Transportation management is a subset of supply chain management with a primary focus on the logistics movement of goods across the supply chain through multi-modal transport types. The transportation system has become the backbone of any economy that makes or breaks the echo system and disrupts public life and economies at the same time. The recent Covid-19 pandemic is an unquestionable example where all transport operations came to either stand still or very limited causing severe damage to the entire supply chain operations. Millions of shipments are either stuck on the way or in delivery yards causing severe cash flow issues and service level issues for the companies.
Key reasons for global transportation management problems
As per Supply Chain Digital, the logistics industry is lagging behind to achieve global targets for sustainability and digital transformation readiness. We believe that the logistics industry needs to have advanced management and technological capabilities to attain success. Consider the below reasons for problems which obvious as we see the global crisis.
- Globalization: The current globalization of the supply chain is changing by how the local companies interact. Contractual terms must be laid out in the context of cultural similarities and differences and everyone in the industry is looking for the latest way to improve visibility in the supply chain.
- Changing customer expectations: customer expectations will be changing throughout the year. The big and major e-commerce players offer faster, less impactful shipping, customers’ demands for faster shipping.
- Market dynamics including carrier’s markets for ocean shipping and a shipper’s market for OTR modes: The changing market dynamics reflect another problem with modern transportation management. Carriers possess the power in the ocean shipping market, but shippers possess the power in the road (OTR) modes. Those trends will continue to force the industry to adapt in the coming year.
- Multimodal shipping: Multimodal shipping continues to add to the complexity of global e-commerce and shipping as more industries mirror retail by going omnichannel.
- Omni-channel experience expectations: Adding final insult to injury, demands for omnichannel experiences from customers through business-to-business partners will complicate matters.
Expected challenges of transportation management
The top transportation management challenges in the industry this year are:
- Poor optimization of resources and processes.
- Low visibility of logistics, inventory and more.
- Heavy freight claims processes.
- High rate of returns in e-commerce.
- Globalization of supply chain and sudden global pandemic COVID-19..
Following are few tips which can help to improve your Transportation Management challenges
- Having self-optimizing systems and leveraging Artificial Intelligence and Machine Learning capabilities along the way.
- Have more sensors and IoT tools to feed data automatically into TMS, which can be used later to get the best insights.
- Have faster, smarter, and simpler systems to automate freight claims management.
- Predictive ordering and e-commerce platforms will ensure customers are happy with their orders.
- Diverse networks will reduce health-related disruptions.
- Improve the business process of end-to-end supply chain operations to improve efficiency in transaction handling.
- Go with the complete solution approach to meet the current and future needs of software and implementer support.