2017 will be the year of renewed focus and interest in adopting newer transportation management systems (TMSs) to boost productivity and find the biggest cost savings among shipping transportation providers. This is the result of renewed, surging demand from consumers and greater confidence in the stability of the U.S. economy. Consequently, seven key trends will dominate the industry throughout the remainder of the year and propel TMS solutions to center stage.
7 Trends Propelling TMS Solutions to Center Stage
1. Transportation Management Systems Will Become Centralized in the Cloud.
The use of a dedicated TMS has been essential to staying competitive over the past few years, but 2017 will be the year that companies around the country and globe will look to centralize their TMS operations in the cloud. Approximately 15 percent of companies utilize cloud-based TMS systems, reports Dream Orbit. However, global use of the TMS is expected to have a compounded annual growth rate (CAGR) of seven percent between 2017 and 2021. Thus, companies using legacy-only systems will soon be unable to compete in a global shipping market.
2. Globalization Will Encourage Adoption of Newer, More Advanced Systems.
Industries around the world are coming together to find better ways of doing business. U.S. import and exports grew nearly $2 trillion over the past 25 years, and transportation accounts for approximately 14 percent of jobs in the U.S., asserts PLS Logistics. While statistics are not clearly defined, a large portion of these jobs are devoted to the shipment of goods, so the industry is being driven by globalization. Essentially, growing globalization means more people and products will be needed in the U.S., so adoption rates of TMS systems will grow to meet this demand.
3. Safety and Automation Will Be Standard.
Safety is a top priority for shippers. An issue could result in swift backlash, financial setbacks and even the assessment of criminal penalties. However, automated systems can help to increase safety by eliminating the opportunity for human error from the equation. In other words, shipments can be organized to prevent falls or injuries on the job. Of course, there will still be opportunities for safety violations, but automated systems, such as robotics, have the potential to virtually eliminate all the human touchpoints from the picking, packaging and shipping process.
4. Sustainability Will Become Key to Better Public and Private Images.
Sustainability will be another driving force of TMS adoption in 2017. Customers and business-to-business partners are willing to pay more for services that come from well-known, eco-conscious companies. While this might seem counterproductive, it means your company could charge more per shipment if sustainable, efficient practices are in place. Fortunately, a dedicated TMS can handle this need. In fact, the use of TMS-as-a-Service (TMSaaS) systems are starting to replace older TMS solutions. Thus, companies can access information from any location and take advantage of the latest information from all supply chain network partners, which helps the industry isolate and correct unsustainable practices.
5. Analytics Will Take Center Stage of Dedicated TMSs.
Analytics have the potential to dramatically reduce the burden on shippers in 2017, reports Willian B. Cassidy of JOC.com. Analytics is not a new player in the transportation game either. Siemens has been using the technology for more than 15 years! It can help new and upcoming shippers find ways to consolidate shipments and reduce overhead. Meanwhile, analytics systems are being built into new TMS solutions, including TMSaaS products. This will further reduce the burden on shippers by giving them more tools and resources at a more cost-effective price point, translating in more competitive rates.
6. Apps Will Be Essential to Success in 2017.
The role of mobile technology cannot be overstated. Per Bridget McCrea of Supply Chain 24/7, TMS solutions will get a makeover in 2017 through mobile optimization. New vendors will demand increased access and ease-of-access to information about supply chain partners. Meanwhile, the number of smartphone users is growing, which includes drivers. Supply chain entities can use this to their advantage by creating Google Play store of iTunes-enabled apps that workers can download and use. In some cases, a small subsidy payment may be appropriate for workers bringing their own devices, but that will be up to each company individually.
7. Autonomous Trucks Will Drive Investments Forward.
The final push toward investing in transportation throughout 2017 will be the increasing interest and versatility of autonomous trucks. These self-driving trucks have the capacity to meet the demand where truckers are unavailable, due to either reduced workforces or hours-of-service limitations. Essentially, this will lead back to automation with TMS solutions, which will propagate the trends in this post.
Transportation management is going to be an exciting area of the shipping industry to watch in 2017. If your company has not yet implemented cloud-based TMS systems, you are behind the learning curve. Start thinking about how you can get started by embracing these top seven trends in transportation management now.