Data’s Role in Driving More Responsive, Automated and Cost-Effective Shipping

The logistics landscape has become more complex in recent years. Rates and capacity availability have been seesawing, and at the same time, companies are navigating ongoing disruptions.

As shippers are planning and executing the transportation of their goods—either inbound or outbound—situations can change rapidly. During Sourcing Journal’s “Smarter Shipping: Cutting Costs with Visibility” webinar, moderated by logistics editor Glenn Taylor, speakers from supply chain technology firm Manhattan Associates and consultancy Kearney discussed how technology and data can best be used to quickly pivot and proactively address issues that arise.  

“What we’re really seeing is just an acceleration…in terms of the ups and downs and lefts and rights that shippers are forced to deal with on a regular basis,” said Josh Brogan, partner, strategic operations practice at Kearney.

Delivering this needed data, transportation management systems bring the entire shipping process together on one platform, starting with managing purchase and customer orders. This unified system lets shippers plan transportation across modes and then coordinate with carriers, including gathering feedback on where there is capacity available. While orders are being shipped, Adrienne Wallace, director of solution consulting for TMS solutions at Manhattan Associates, explained that a TMS gives “up-to-the-minute updates” and proof of delivery. This system also has the capability for invoicing and can track carrier performance. Some TMS platforms can additionally run scenario modeling to anticipate what impact certain choices and changes would have.

If a shipment is facing delays, a company might have to switch from the planned mode or carrier to have the best delivery outcome. Many TMS platforms support automated rerouting, allowing changes to be made without human intervention. “When things do change as rapidly as they do, having the options to make those changes to different modes, having that visibility to what’s available, is crucial, and TMS’s can provide that quick look,” said Wallace.

TMS platforms also allow for collaboration and communication between parties in the shipping process, and companies can tack on additional tracking technologies for further visibility, with TMS as the “control tower.” Having insights—whether from a TMS alone or a system of platforms—unlocks improved efficiencies. For instance, an order could be added to an existing shipment to consolidate and save costs.

Technology is also giving more insight into pricing. Contracts remain popular to lock in capacity and costs, but companies still use the spot market to fill in gaps. TMS solutions allow companies to compare spot rate quotes to their existing contracts in real time and see how their contact pricing compares to the average.

As Brogan noted, while a shipper’s main goal used to be delivering goods on time in full (OTIF), now it is more about “right-sizing spend.” In addition to saving money, Kristin Kay, senior design lead at Manhattan Associates, has seen companies use TMS to earn revenue, such as via a brand-owned private fleet or brokering transportation to other companies on their existing carrier contracts.

Along with considering the economic cost of shipping, companies are also weighing logistics’ environmental costs. Per Brogan, cost-cutting measures typically coincide with environmental, social and corporate governance improvements. For instance, fuel efficiency saves both money and carbon footprint, while automation efforts help reduce manual movement of goods, thereby shrinking the potential for worker injuries.

With ESG scrutiny and reporting requirements rising, Kay noted that TMS can support sustainable decision-making—such as picking lower impact carriers. These systems can also calculate the emissions footprint of different modes, carriers and routes to provide data for disclosures.  

In addition to operational benefits, TMS also has an impact on the customer experience. As Kay explained, consumers want accurate delivery timelines. Having insights into where delays might arise allows companies to shift gears, such as leveraging air freight. By connecting a TMS to warehousing and inventory data, retailers can choose to fulfill from a different distribution center or a store to get product to the customer in the promised timeframe. “You need to be able to have enough data to make these decisions between customer service and your bottom line,” said Kay.

Technology is only as beneficial as the ecosystem around the platform. For one, data fed into software must be accurate and complete to enable automation and allow companies to use the full range of solutions in a TMS. Brogan explained that those who will get the most out of data technology and automation will be the ones with “their data house in order.”

“AI is not a magic bullet, TMS is not a magic bullet in and of itself,” he said. “They’re great solutions that are going to drive the future of how we manage logistics. But getting the fundamentals right is not going to be something that we can get around.”

Along with TMS adoption, companies should also be looking at how they can improve their processes, according to Wallace. “Trying to implement a TMS around a broken process is not going to make that process better; it’s not going to improve it in any way,” she said.

Watch the webinar on demand to learn:

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