It used to be that your TMS handled one task, while your WMS took care of another. Now, the walls are a-tumbling down.
Supply chain software has historically been split into discrete chunks, which meant users had to turn to a transportation management system (TMS) to solve one problem, a warehouse management system (WMS) for another, and an enterprise resource planning (ERP) program for an overview of it all.
These distinctions worked fine for years as the tradition-bound trucking, warehousing, and material handling industries caught up to the technology wave sweeping corporate America. But as the digital marketplace re-orders supply chain operations, it's evident that the siloed model is no longer up to the task.
TMS vendors have responded by tearing down the fences that used to separate trucking software from other logistics solutions. Today's TMS programs share overlapping databases with ERP, WMS, and warehouse execution systems as well as with fulfillment planning, order management, business intelligence, data analytics, and other specialized applications. Linking these isolated data fields can trim waste and create new profit, whether the user is a shipper, third-party logistics service provider (3PL), broker, truckload carrier, or other supply chain player.
The merger between TMS and its software siblings has been made possible by recent advances in two particular fields—cloud-based computing that allows for shared interoperable databases, and mobile application development that supports native apps built to take advantage of the unique capabilities of devices like tablets and smartphones.
OMNICHANNEL DISTRIBUTION CHANGES THE GAME
One of the main forces driving the change in transportation management systems is omnichannel retailing, which is pushing users to demand higher performance from their transportation management systems and increasing the execution pressure on fulfillment operations, said Fab Brasca, vice president for global solution strategy and intelligent fulfillment at Scottsdale, Ariz.-based developer JDA Software Group Inc.
In response, developers are moving away from treating those diverse software applications as independent silos of information because the isolated data can lead to bottlenecks and latency in decision-making—an unforgiveable sin at a time when companies need to be able to respond swiftly to any disruption in the supply chain.
"A customer could say, 'I've already got WMS, TMS, and order management software. Isn't my supply chain efficient enough?' And we answer that it may have been efficient enough when all you were doing was pushing inventory to your stores. But with this change to omnichannel, it's not just about store fulfillment and online fulfillment, but about overall consumer fulfillment," Brasca said.
Companies increasingly operate in a marketplace where complex global problems affect not just transportation but also omnichannel distribution, retail, and manufacturing operations. To tackle those challenges, software must feature interoperability between transportation and warehousing, both in sharing transactional flows and in merging the two worlds with optimization logic.
A "warehouse-aware" TMS application can help users to eliminate common bottlenecks—for instance, by allowing them to revise dock schedules to better coordinate inbound and outbound traffic, said Brasca.
Another advantage a networked TMS offers over standard transportation management systems is the ability to host a link to mobile computing platforms, giving users more visibility into shipments in transit than is allowed by current technology, such as daily updates generated through electronic data interchange (EDI). In comparison, a TMS linked to a location-enabled smartphone could use signals from a global positioning system (GPS) receiver to provide real-time updates that give users better connectivity with carriers and let them find quick solutions to capacity constraints.
Adding mobile capabilities to a TMS can do much more than simply allow users to do a better job of tracking deliveries and monitoring schedules. For example, it is easier to track a load if the TMS can accommodate "geofences," which, when incorporated into software programs, enable users to receive alerts when a truck crosses predefined geographic boundaries as measured by an app on the driver's smartphone.
"With an automated location-enabled device, you could be notified if the truck is ahead of schedule or behind," said Bill Ashburn, chief marketing officer at HighJump Software Inc. "You would know he's arrived, because he broke the geofence and he's no longer moving. So now you know he's at the DC."
That location-enabled TMS extension could also allow a company to automatically track information relating to fuel taxes, driving logs, and hours of service, sparing drivers the task of keeping detailed records and reporting them to the dispatcher once a day.
The transition from daily updates to real-time connectivity will produce big results, but it may take time to reach all levels of the shipping industry.
"Transportation is a very generational business," Ashburn said. "The millennials come in and they're more savvy with technology. The generation (before) them is wowed by real-time data."
Mobile TMS apps can do far more than generate truck schedules, Ashburn said. A driver with a TMS app on his smartphone could take photos of damaged cargo, record vehicle inspections at checkpoints, or scan images of documents such as a bill of lading. In some cases, a mobile-enabled TMS could even generate additional profit for users. "Now, you can see if there's a vehicle here and a load available over there. Let's connect the dots and reduce deadhead miles," Ashburn said. "If you don't have it, you're at an extreme competitive disadvantage."
Shippers and their customers are raising their expectations for real-time TMS performance as they become aware of these abilities, said Chris Parker, chief operating officer of InMotion Global Inc., a TMS provider in Brandon, Fla.
"Today's logistics professionals are much more sophisticated than they were 10 years ago," Parker said in a press release. "They are used to one-stop online services, with access from any location and on any device."
TMS use has more than tripled since 2005, according to a July 2015 survey conducted for the company. The same survey showed 54 percent of logistics professionals use some sort of TMS software today, compared with just 15 percent 10 years ago.
Logistics companies are flocking to transportation management systems to address the issues that keep fleets from operating at maximum efficiency, particularly those related to drivers' schedules and delays that all-too-commonly occur at the junction between the warehouse and the truck.
Those pain points are among the top causes of wasted driving hours and lost freight-carrying capacity, according to a recent white paper from J.B. Hunt Transport Inc., a multimodal transportation logistics company based in Lowell, Ark.
Delays in transportation can cost freight carriers dearly because of the Department of Transportation's strict limits on truck drivers' hours of service, the report says.
Current regulations limit commercial motor vehicle drivers to an "on duty" day of 840 consecutive minutes (or 14 hours), which quickly shrinks to 660 minutes (or 11 hours) after subtracting mandated safety inspections and a required 30-minute break within the first eight hours.
Because the hours-of-service countdown logs all minutes consecutively, drivers can't simply stop the clock during traffic jams or warehouse delays. J.B. Hunt goes on to list a range of additional time-wasters, such as waiting around for freight to be loaded or unloaded, detention and dwell time caused by inflexible pickup and delivery times, and unscheduled variation in shipment schedules.
The common thread to most of these time-wasters is that they occur at the point where the truck meets the distribution center. That means a TMS app with access to warehouse data could help users avoid logjams by identifying time-consuming activities and devising a more efficient route.
By smoothing out those bumps in the road, a connected TMS application could add valuable minutes to every driver's day and boost the number of shipments passing through each warehouse.
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