TMS –three letters that should not be unknown to anyone who is a professional in the logistics and transport industry. What does this abbreviation stand for and why is it essential to run a successful company in this line of business? Let’s answer these and other questions.
Modern business is based on knowledge. It is no different in the logistics and transport industry. What is the status of my supply chain? Are the transports running without any issues and within the requested time frame? Are all links in the chain operating at peak efficiency? Is there any interference somewhere? If so, what kind? All this information is necessary to ensure the harmonious functioning of a company’s supply chain. It is a mass of data that needs not only to be acquired, but also constantly updated and properly analyzed.
Logistics never stops. Therefore, a solution is needed that will allow you to have continuous insight into this information in real time to be able to react to any events requiring intervention on an ongoing basis. And here IT specialists came to the aid of professionals from the logistics industry to jointly create TMS.
What does the abbreviation TMS mean?
TMS is an abbreviation of the English name Transport Management System. It can be described TMS as a repository of data on carriers and shippers, combined with a transactional and communication system,
To put it a bit simpler and more descriptively, it can be said that TMS is a computer program or a digital tool that allows you to manage various transport processes in one place.
TMS collects and stores information on completed, ongoing and planned transport tasks and the status of logistics resources. It means that in one place users of such systems can plan, predict and organize transports, as well as manage the network of carriers and –in real time –track the current status of loads on the route. The TMS system also allows for settling payments, conducting data analysis and generating reports. TMS also enables greater automation of processes, for example booking transports or tenders.
It is possible to utilize WMS (Warehouse Management System) as complementary software to TMS. The WMS system helps to control stock levels, organize the work of the warehouse and/or distribution center and manage order fulfillment. If the company uses both of these systems (because it deals with the organization and operation of transport and warehouse operation at the same time), TMS and WMS programs can be integrated with each other as part of the ERP (Enterprise Resource Planning) tool, allowing all operations to be carried out using one platform.
Streamlining everyday work and reducing costs
Why are TMS systems so important for the smooth functioning of companies in the logistics and transport industry? The answer is quite obvious and basically suggests itself. The use of TMS solutions ensures better efficiency of the forwarder’s daily work. hat used to require a larger workforce and took more time, can now be efficiently handled by a smaller team. The processing time for each order has significantly reduced, because all information regarding a given transport event, carrier, etc. is in one place. This means that more orders can be processed at the same time. Along with reducing the risk of errors, this leads to optimization of operating costs.
Does my company really need a TMS?
Perhaps the answer “it depends” is not what you expect, but yes, in this case, we really need to answer the question of whether your company should invest in TMS software in this way. It depends. It depends on the number of loads you handle during e.g. a week. If there are few of them, for example a dozen or so, then handling using spreadsheets and e-mail communication could be sufficient.
With the increase in the number of handled loads, sooner or later there will certainly be a need to implement a TMS program, because more loads automatically mean more carriers in the network, more types of handled transports and a more complex supply chain. Initially, it can be a ready-made software, provided by an external developer, offering basic TMS functionalities. This type of transport management system can be a solution distributed in the cloud, which significantly reduces the cost of its implementation.
However, at a later stage, it may be necessary to switch to a dedicated TMS system, created especially for your company. Such software should be constantly developed and updated by your own (or external, but constantly collaborating) team of developers to meet all the specific requirements of the company and users.
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