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Transportation Management Systems: Trends and ROI

Transportation Management Systems: Trends and ROI. NITL Conference November 11, 2004 Jane Biddle. The Headlines…. Issues and Opportunities Creating Sense of Urgency!. Behind the Headlines…. 30,000 Intermediaries Around the Globe: Point systems have evolved over time

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Transportation Management Systems: Trends and ROI

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  1. Transportation Management Systems: Trends and ROI NITL Conference November 11, 2004 Jane Biddle

  2. The Headlines… Issues and Opportunities Creating Sense of Urgency!

  3. Behind the Headlines… • 30,000 Intermediaries Around the Globe: • Point systems have evolved over time • Reliant on paper, faxes, phone calls • Many ‘opportunities for failure’ • Change Being Driven From Top Down: • Corporate leadership strategies • Increased focus on supply chain execution • Internet-based & more affordable solutions Challenge: Leverage TMS Trends and Technology To Accelerate Supply Chain Performance.

  4. A Vision for TMS Leadership Customer HQ Contract Manufacturer Command and Control Alert Notifications Alert Notifications Order Status Order Status Customer DC Supplier Customs Status Order Status Order Status Order Status Shipment Status RemoteFacility Shipment Status Stock Levels Stock Levels Shipment Status Retail

  5. Agenda • A Vision for TMS Leadership • Application Landscape • Enabling Corporate Strategy • Value Proposition

  6. Cost of U.S. Trade Security Improvements $83B (ARC) Landscape – Industry Perspective Total Worldwide Trade $12.6T(WTO/2002) Logistics Visibility & Control $500M by 2008, 29% CAGR (ARC 2004) Transportation Management Systems $1.2B by 2008 (ARC 2004) Cost of U.S. Compliance Systems Financial Settlement Supply Chain Management $6.7B by 2008 – CAGR 5% (AMR 2004) $15B (Stephens/2003) $2.6T+ $640B (@Global Trade) Customs Clearance Cost $150B (Stephens/2003) Total Worldwide Logistics Costs $1.5T (Cass/2002)

  7. Application Landscape: High Level Strategic Planning Tactical ERP Execution Plan Make Source Deliver .

  8. Application Landscape: Detailed Supply Chain Planning TMS/GTM Supply Chain Network Import/Export Domestic International Contract Price Book/Tender Network Design Forecasting Demand Planning ATP Planning Optimization CPFR Total Landed Cost Demand Mgmt Order Mgmt Fulfillment DC Delivery ERP RFQ/Quote Vendor Mgt Purchasing CSI/Customs Door Delivery Customer Service CRM BPM & Finance SRM Supply Chain Inventory Sourcing Catalog HTS Export Track & Trace Production Planning Inventory Control Good Mfg Practices Quality Reporting Trade Content Regulations Contract Mgmt Truck/Rail Air/Ocean CAD Formulation CAM Plant Maint Financial Settlement WIP Op Inst SCADA Labor Mgmt PLM MES Business Rules Event Mgmt

  9. TMS: Platform or Application? • Option #1: Platform (Are Shippers Ready?) • Business unit optimization –> SC optimization • Departmental optimization –> Enterprise optimization • Standardization - data, processes, metrics • Option #2: Application (Are Vendors Ready?) • ERP/SCM vendors moving ‘out and down’ • TMS players moving ‘up and across’ • 3PLs, Forwarders adopting Technology • Convergence Is On The Horizon-

  10. Leverage IT Investments "If you have built castles in the air, your work need not be lost. That is where they should be. Now put the foundation under them." - Henry David Thoreau

  11. Packaged Applications ERP SAPSSAPeopleSoftOracle 4PLs SCP UPSFedExDHL ManugisticsI2CAPS (SSA) Domestic TMS Global Visibility BridgePointLogNetGT Nexus G-LogRedPrairieDescartes Compliance WMS VasteraNextLinxOpenHarbor Manhattan HighJump (3M)Optum/Metasys

  12. Checklist Considerations • Corporate Compatibility vs. Best of Breed • Single Data Model AND Local Configurability • Multi-Multi-Multi • Product Road Map • Purchase vs. On Demand • Technology Integration Strategy: • Trade data and compliance reporting • Supply chain inventory and assets • Settlement and financial systems • Role of 3PL Information Systems

  13. Agenda • A Vision for TMS Leadership • Application Landscape • Enabling Corporate Strategy • Value Proposition

  14. Corporate Leadership Strategies • Lean Enterprise/Supply Chain • Customer Driven Supply Network • Competitive Advantage • Price • Quality • Service Even The Best Strategy Will Not Succeed Without The Ability to Execute!

  15. Enable Corporate Strategy • Be an Agent for Change: • Go where the action is - gain insight and support • Recruit Colleagues and ‘The Brass’ • Political Campaign of your Career? • Develop Business Case: • Tangible: ‘Top Line’ and ‘Bottom Line’ • Intangible: Opportunity to ‘Break Through’ • Risk of Status Quo • Name It – Brand It – Launch It • Establish Metrics & Reward Success

  16. Your Reality – Déjà Vu? “Perhaps in time the so-called Dark Ages will be thought of as including our own.” Georg Christoph Lictenberg (1742 - 1799) Circa 1990mrp -> ERP Circa 2004tms -> TMS

  17. HTS Denied Parties Commercial Invoice Purchase Order Match & Pay Import Documentation Bills of Lading Break Down The Barriers • New Workflows • Information Standards • Centralized Planning Purchasing Sourcing Finance Regulatory Export Customs Import Compliance Traffic Departments Sales Service • Collaborative Execution • Measurement Performance • Extending Integration

  18. Set Standards for Integration ERP ERP Play a Leadership Role!

  19. Think Globally, Act Locally Establish Metrics Enterprise Supply Chain Partners Centralize Planning Inbound/Outbound All Regions All Modes Global Tiger Team: Education Tiger Teams: Operations Systems Reporting Tiger Teams: Operations Systems Reporting

  20. Agenda • A Vision for TMS Leadership • Application Landscape • Enabling Corporate Strategy • Value Proposition

  21. AMR Value Proposition “Companies that have connected their partners through collaborative execution practices have seen the following benefits: • Increase in the fill rate by 10% • Cost reduction of 5% (of revenue) • Reduced planning & execution cycle time by 15% • Reduction in inventory by 50% in a year • Inventory obsolescence reduction by 80%” “Connecting Collaborative Planning to Execution for Results”AMR Vinay Asgekar, July 30, 2003

  22. Start With ’Quick Wins’ • Automate Ordering/Pricing Processes • Provide On-Line Visibility • Eliminate Paper Handling • Integrate TMS with ERP/Finance • Link TMS to Compliance Systems • Others?

  23. Establish Key Metrics • Transportation • Carrier Performance • Asset Utilization • Inbound/Outbound • Compliance • Document Management • Reporting • Audits • Customer Satisfaction • Order Accuracy • Order/Invoice Cycle Time • Performance • Inventory • Days of Supply • Carrying Costs • Warehousing Costs • Collaboration • Global Visibility • EDI Connections

  24. Technology Expectations • Tomorrow – • Full Transparency • Increased Reliability • Improved Flexibility • Global Dashboards • Competitive Advantage • Today - • Visibility • Cost Savings • Operational Efficiencies • Reduced Risk of Non-Compliance • Improved Customer Satisfaction

  25. Jane Biddle Chatham, New Jersey 973-701-2557 www.biddleassociates.com jane@biddleassociates.com

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