One of the most effective measures for reducing costs and exposing supply chain inefficiencies is the use of Transportation Management Systems (TMS). The TMS technology and processes should be the foundation of a supply chain’s success. These platforms are typically designed, modeled and implemented on long-term savings rather than immediate cost avoidance. This inherent characteristic adds stability, reliability and transportation process cost controls. Key components of a successful TMS solution include connectivity, optimization, transparency and collaboration to be established among its operations. A successful TMS solution is one that accounts for all of the supply chain stakeholders and helps them in decision making, based on specific constraints or desired outcomes. These decisions need to be supported by leading technologies, experienced professionals and an extensive global network.
Shippers agree that 3PLs provide new and innovative ways to improve the effectiveness of logistics, and that, they are sufficiently agile and flexible to accommodate future business needs and challenges. Despite the ongoing churn in shipper-3PL relationships, in general, shippers are increasing their use of outsourced logistics services. Also, shippers and 3PLs are now about equally satisfied (70% and 69%, respectively) with the openness, transparency and good communication within their operative network.
The results need to be focused on cost reductions and service improvement. Reduced transportation expenditures are by far the largest benefit of a TMS application. However, benefits such as service level improvements, increased market share due to customer service process improvements and inventory reduction processes should not be overlooked.
No one in business has a crystal ball, but true adaptability comes from those who have thought through their options much ahead of time. The 6 ‘Rights’ of Logistics - "The Right goods in the Right quantities in the Right condition delivered to the Right place at the Right time, at the Right Cost".
Signs indicate that the “IT Gap” — the difference between the percentage of 3PL users indicating that IT capabilities are necessary elements of 3PL expertise (98% in the current study) and the percentage of the same users who agree that they are satisfied with 3PL IT capabilities (55%) — is stabilizing to some degree. Yet, our research also finds that 3PL IT capabilities are becoming increasingly important to shippers, and that the shipper satisfaction ratings are also becoming increasingly significant.
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