Your solution should create and enforce global logistics controls company-wide. A flexible, rules-based approach enables enterprises to transform optimized plans into consistently-executed activities, whatever the supply chain involved, and refine them in real-time as experience dictates. Logistics or transportation managers create rules based on these optimized plans, giving employees and business partners a common platform for making day-to-day shipping decisions. One-off shipping situations are managed, minimizing costly departures from plan. A central data repository dramatically reduces the labor-intensiveness of managing shipments. Complete, standardized data shared across the supply chain reduce errors and the cost of doing business.
Your solution should provide the information required for effective business intelligence. The Best-in-Class companies cited in the Aberdeen report are 30 percent more likely than other companies to be able to access global supply chain data in real time. What's more, they use it in analytics that support smart marketing decisions.
By creating a central repository of rules, shipping transactions, and carrier information, an ideal logistics management solution makes it possible to see the total transportation spend picture clearly and to drill down into categories such as spend by carrier or carrier type. In addition, the right solution has tools and reporting capabilities that extract the most relevant information from a morass of data and present it to stakeholders in a way that doesn't overwhelm them.
These capabilities enable organizations to perform visibility data analysis such as tracking the landed cost of shipment, performing trade lane analysis and examining performance trends and root cause analysis. The Aberdeen report bears this out. Best-in-Class companies were, for example, 44 percent more likely than "industry average" companies and twice as likely as "laggards" to calculate the landed cost of a shipment as it progressed toward its destination.
The Case for Automating Logistics
Companies lacking real-time visibility into their global logistical operations and the ability to access and analyze relevant data may come close but will never quite achieve supply chain excellence.
Putting a TMS in place and attempting to wade through reams of data is not enough. Many organizations have already made substantial efforts in this direction but are coming up short because they lack the tools to transform information into control. In the end, Aberdeen's Best-in-Class companies will emerge as the clear winners.
These enterprises have bridged the divide between creating optimized plans and putting them to work in their daily operations. They have adopted technology to help them enforce rules, streamline business processes, and gather the actionable business intelligence that makes the final mile of the supply chain smooth sailing.
(1) Rick is a composite of the many skilled supply chain professionals with whom I've had the privilege of working.
(2) Aberdeen Group, "A View from Above: Global Supply Chain Visibility in a World Gone Flat," September 2007.
About the Author: David Fox is the founder, president and chief executive officer of Agistix (www.agistix.com) and has served as chairman of the board since the company’s founding in 2003.