Effect of transportation management system on logistics

Transport management systems have a significant role in moving commodities. The transportation management system ensures that the commodities are delivered to the final consumer appropriately. Therefore, they need to be efficient for logistics to be successful. The advanced technology has introduced software packages, have improved logistics process in transport management (Button & Hensher, 2005). This software are saving operation costs for companies and improving accuracy in specific duties. The software depends on the task it has been programmed to perform. For example, there is software responsible for shipment.

Transport management system has made logistics activities faster. Companies are able to get solutions for most appropriate means of transport for their commodities. This enables the commodities to reach destinations faster. Shipment of goods is planned realistically and in real time. This assures the company that customers’ needs will be met and satisfied. Transportation is not only used for delivering goods to customers but also supplying a company with materials it requires in logistics. Transport management system links all separate activities to complete logistics chain (Field, 2006).

The transportation management system has facilitated healthy competition among companies. This is because companies have improved their quality of services and goods. It has made the products more popular and marketable. Companies have to compete in capturing large market shares for their products. At the same time, costs of operations have reduced and companies are in a position to produce more units. This has resulted to an increase of profit margins. If the transport management system would be ineffective, logistics would not be fully beneficial in business (Mangan & Butcher, 2008).

Types of software involved in logistics assist in providing support in shipping, ground transportation and freight forwarding among others. Companies choose this software depending on the mode of transport used. If the company is using freight, it will acquire software for freight management. This software enables the logistic management to plan and make proper arrangements for transportation. Technology has enabled businesses and companies to monitor cargo as it is being transported. In case of any problems, they take the necessary measures to ensure the commodities reach destination as planned (Mangan & Butcher, 2008).

Transportation management system has improved the relationship between business partners. They can do business effectively with the current advanced transport management system. A business can collaborate with a logistics firm to provide transportation to the business’ commodities. For example, an exporting firm might need FEDEX for air transportation. This means the exporting business will collaborate with FEDEX for them to transport their commodities overseas. There are several other reasons of collaboration brought by transport management system (Button & Hensher, 2005).

Transport management system is a link between the order management system and the distribution center or warehouse. This is because the orders are delivered from the inventory in the warehouse. Therefore, TMS bridges the gap between these two systems. TMS is used to plan routes of transportation and optimization. A company makes a schedule of its transportation operations using TMS software. This enables it to plan appropriately and in accordance to the needs of transportation. It prevents imbalance of delivery trips or using the wrong means of transport (Field, 2006).

Other uses of the TMS are load optimization and yard management. Logistics is able to determine the amount of load to be transported and who often. It ensures there is no overload or under loading. This applies in both taking inventory as well as making deliveries. The TMS assists the management to know the amount of inventory and determine how to restock the warehouse. TMS also assists in determining the distance of transportation. For instance, it monitors the mileage of trucks or other means of transport. Yard management has brought the issue of security during transportation operations (Mangan & Butcher, 2008).

Transport management has to audit the transportation payments and other records. This has been made effective by the TMS. It is possible for the auditor to verify accounts in transportation with the help of TMS. T is possible to spot errors or adjustments required. After planning the transport operations, the next step is executing them. The TMS assists managers in execution of transport operations. It is important for company management to consider using transport management system. It has many benefits and it is contributing significantly in improving business performance (Button & Hensher, 2005).

TMS products serve as logistics hub in the network of carriers, customers and shippers. A business, which has fully invested in TMS, should enjoy enhanced accountability and transparency of the transportation chain. The management finds it easy to make changes where necessary since the system is flexible. A business efficiently meets the requirements of completing the supply chain. One of the important achievement TMS has brought to business entities is decreasing costs of transportation management. The TMS system improves as the technology advance. It requires companies to update their systems as the technology changes This will ensure continued efficiency in logistics (Heizer & Render, 2001).

References

Button, K. J., & Hensher, D. A. (2005). Handbook of transport strategy, policy and institutions. Amsterdam: Elsevier.

Field, A. M., (2006). “One platform, many uses”. Journal of Commerce, New York

Heizer, J. H., & Render, B. (2001). Operations management. Upper Saddle River, N.J: Prentice Hall.

Mangan, J., Lalwani, C., & Butcher, T. (2008). Global logistics and supply chain management. Chichester, England: John Wiley & Sons.