What is a true Transportation Management System?

The options for a Transportation Management System (TMS) are almost endless and ever-growing. If you’re looking to get one or make a switch, before getting lost in all the features, let’s take a look at the core functions to consider for selecting the right system.

Visibility

A good TMS provides you with the visibility you need both internally and externally. When it comes to internal visibility within your organization, some capabilities to look for are the ability to add an unlimited number of users without increasing costs, system alerts to bring attention to critical items, and online routing guides with preferred providers. You’ll also want to make sure it can integrate with your existing supply chain software. The visibility externally should capture all the modes and regions your company needs.

Operational Planning

One of the most important features of a TMS is the ability to select the most cost-effective mode and carrier based on their needs for the shipment (in terms of timing, service levels, and other factors). This includes managing your contracts and rates. Look for a TMS that captures both inbound and outbound freight, so that planning for both can be done in one place.

Execution

The features of a TMS for executing shipments should streamline the process for your company while still offering all the options you need. Too many features can drive up the cost and make it more difficult to use, while too few features could leave your company supplementing with spreadsheets. Some core functions to evaluate are freight sourcing and bid optimization capabilities, carrier communication, documentation, and tracking abilities. You’ll also want to consider things that could make freight management easier for your company such as the ability to manage by exception or utilize a managed services offering.

Payment/ Settlement

A well built TMS has the ability to audit and pay your bills, plus make it easy to track your spending. If this ability is included, be sure to learn about the company's background in this area since this is a key part of your relationship with suppliers.

Analytics/ Optimization

Another important function of a TMS is access to analytics, dashboards and other supply chain metrics, such as carrier performance monitoring.

There may be other competencies your organization needs, but this is a good place to focus and compare.

If you'd like to see the features of our Constellation TMS software, we invite you to schedule a demo.