TMS Overview - bvl-digital.de

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Gartner Supply Chain

Technology Team

TMS Overview

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INTERNAL or RESTRICTED

Introduction



Prioritizing Supply Chain Technologies

“I want the best supply

chain functionality and

capability”



Enterprise Application Software Market



What You Need to Know — Market Insights

The key drivers in this technology market are:

• Digitalization

• Advent of multienterprise business process enablement

• Commoditization of public cloud computing

• Development of single data model offerings

• New vendors in the market

• In-memory computing becoming a foundational standard

• Supply chain convergence

• Automation and enhanced decision making (adding “embedded intelligence” such as AA, AI/ML)

• Digital supply chain twin



Functionality Is Important to Our Clients …

When selecting new supply chain applications what are the top four criteria that determine which SCM application you choose?

n = 107



Gartner Branded Documents: Magic QuadrantA report offering visual snapshots, in-depth analyses and actionable advice, which provide insight into a market’s direction, maturity and participants

Planning SOR

Planning SOD

Strategic Sourcing

Procurement

Manufacturing Transportation

Warehousing

Logistics Providers



Gartner Branded Documents: Hype CycleOverview of the relative maturity of technologies and innovations in a specific area, offering a simple way to understand and communicate the complex issues related to maturing technologies and their related benefits

Planning Source & ProcureManufacturing Industry Execution SC Strategy

Manufacturing Operation



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Business Network

Magic Quadrant

Multienterprise

Hype Cycle

Ecosystem

Hype Cycle

Recognizing new terminology & capabilities

➢ Multienterprise

➢ Business network

➢ Ecosystem



TMS

10 CONFIDENTIAL AND PROPRIETARY I © 2015 Gartner, Inc. and/or its affiliates. All rights reserved.

Logistics & Transportation Landscape

Analytics/

Visibility

Warehouse

Management

Yard

Management

Mobility

Interfaces

Applications

Transactions

Data

Fleet

Management

11 © 2017 Gartner, Inc. and/or its affiliates. All rights reserved.

Logistics & Transportation Decision Flow


TMS Means Different Things to Different Roles/Companies

MQ

Non-vessel operating common carrier (NVOCC)


Gartner Model for Holistic Multimodal Transportation Suites


TMS Components

Analytics/

Visibility

Execution

Settlement

Mobility

Interfaces

Applications

Transactions

Data

Planning

Procurement

Logistics Networks

Suppliers Customers

CarriersOther

Shippers


TMS Stratification ModelN

etw

ork

/Pro

cess

Co

mp

lexit

y

Process Sophistication

Fragmented

CentralizedPlanning/Local

Execution

Multidirectional

Global Shared Service

MultienterpriseCollaboration

LOCAL REGIONAL GLOBAL

2

1

3

4

5


Level 1 Transportation Complexity

Level 1 Transportation operations are typically rudimentary environments where transportation is

managed locally and in its own functional silo. The process are manual and there is very limited

visibility to the transportation execution.

Level 1 TMS solutions offer limited transportation capabilities, normally as minimal additions to the

order management and fulfillment capabilities of ERP applications. Level 1 TMS applications are

rudimentary, mostly manual TMS capabilities, such as simple mode and carrier selection at order entry

time. Many ERP solutions provide a place to select a carrier for a specific order from a fixed routing

guide, a list or as specified by the customer. Some also offer minimal mode selection based on high-

level rules, such as delivery promise date, which helps determine if an order goes parcel/next day or

less than truckload. Normally, these solutions support a fraction of an enterprise's transportation

activities; the remainder are typically supported manually. At this level no extended capability is

needed and the solution is very regionally focused and typically only needs to provide a solution for the

over-the-road shipments, FTL and LTL.

Level 1 Complexity



Level 2 Transportation operations are typically fairly straight forward with mainly still manual processes

and some capability in the ERP to provide some insight into transportation spend.

Level 2 Transportation operations use more of the core TMS capabilities but do not get into extended

TMS capabilities. This level introduces more transportation-specific functionality, focusing primarily on

the execution aspects of over-the-road transportation — tendering shipments to carriers — and, in

some cases, providing limited and rudimentary planning capabilities. Level 2 TMS provides more

dynamic selection of modes and carriers while focusing on improving the shipment-tendering process.

However, Level 2 TMS typically supports a minimal number of modes (for example, truckload and less

than truckload), and most are regionally specific (for example, the U.S.). The basic systems provide

some electronic data interchange (EDI) tendering. More robust solutions add carrier portals, whereby

email messages or web forms are used to electronically tender to non-EDI-capable carriers.

Level 2 Complexity



Level 3 TMS solutions expand the functionality by adding better operational planning, visibility (track

and trace), some freight rating and carrier contract management, audit and pay, and some freight

analytics. These solutions are closer to providing a closed-loop TMS (plan-execute-monitor-settle),

with somewhat more sophisticated planning engines, and more options for consolidating shipments

and selecting the best carrier. At this level, we see improved operational planning for a single direction

(for example, outbound or inbound), more modes (for example, parcel, less than truckload, truckload,

air, intermodal, rail and ocean), minimal support to identify backhauls and round trips, more robust

load consolidation, and better carrier selection.

Level 3 Complexity



At Level 4, emphasis shifts from core TMS where manual work processes are automated to focusing

on improving or enhancing processes by adding value-added decision support capabilities such as

freight procurement, transportation modeling and 3D Load Building.

This level introduces increasingly sophisticated transportation planning features focused on improving

mode selection, load consolidation, routing and carrier selection, allowing for the simultaneous

consideration of inbound, intra-enterprise and outbound shipments in a single planning and execution

environment. Level 4 TMS has more robust options and greater levels of inherent model sophistication

and flexibility. These systems are aimed at constructing transportation plans that exploit more

opportunities to combine loads, build round trips, build continuous moves or exploit advanced

concepts (such as pool and floating pool-point distribution) to further reduce costs while meeting

service objectives. These systems are often used to centralize transportation planning with the most

advanced shippers, creating a shared-service organization spanning functional areas, business units

and geographies. These types of Level 4 solutions also expand the footprint by adding capabilities

such as freight procurement, bid optimization, forecasting, tactical freight capacity planning and more

robust performance management.

Level 4 Complexity



The previous levels focus on domestic/regional transportation, whereas the emphasis at this level

shifts to global transportation/logistics operations. Level 5 operations are usually the most complex

and sophisticated. This is because these organizations need to support multileg shipments that

typically span multiple countries, multiple modes of transportation, multiple parties involved in a

shipment and shipments with long cycle times.

Level 5 TMSs are designed to handle the complexities and special needs of a global transportation

operation. At a minimum, these systems must be globalized to support multiple languages, currencies,

geographies (road networks) and other international features, such as date formats and postal codes.

More important is the need to support global transportation requirements, such as multileg shipments,

international documentation and additional modes, such as ocean and international air shipments.

Level 5 Complexity



TMS Vendors


TMS Vendor TypeVendor Type Description CompaniesApplication

megasuite vendors

These vendors offer broad portfolios of applications across most

application categories (for example, back-office financials, supply chain

management [SCM], logistics, CRM and product life cycle management

[PLM]).

Oracle, SAP

SCM suite vendors These vendors offer a portfolio of applications focused primarily on

SCM, including aspects of logistics, but not other functional areas such

as financials or human capital management. While these vendors might

offer a variety of SCM solutions, they do not necessarily offer an

integrated platform (although some do).

JDA Software, Manhattan

Associates, BluJay Solutions

Specialist TMS

vendors

These vendors are independent software vendors (ISVs) that focus

primarily or exclusively on holistic TMS, although they might offer some

additional capabilities.

3T Logistics, inet, Kuebix,

MercuryGate International,

3GTMS, CloudLogistics,

Logility

TMS services

vendors

These vendors offer not only the TMS technology but also provide the

services to run the day-to-day transportation management while the

shipper maintains and controls key relationships with their carriers and

customers. Some specialist vendors also offer this service but are still

primarily Technology vendors.

C.H. Robinson (TMC),

Transplace

SMB Vendors These vendors are specialist TMS vendors that focus on specific

regions or are generally much smaller players in terms of company size

and number of customers and industries served

Generix, DDS Logistics,

OTMS, PrimeLog, Unifaun


Track Record

Optimization

Go-to-Market

Breadth/Depth

Innovation

2019 Magic Quadrant

From "Magic Quadrant for Transportation Management Systems," 9 March 2018 (G00304405)

https://www.gartner.com/document/3629838?toggle=1&refval=182522666&ref=solrAll&qid=f94c28545d63db2507f5be42c44e271d


Notable Mentions

▪ Generix Group

▪ InMotion Global

▪ ProcessWeaver

▪ TRANSPOREON

▪ TMSFirst

▪ Transwide (Alpega)

▪ Unifaun

▪ vTradEx


Four Vendors Dominatethe TMS market

TMS Has a Diversified Vendor Landscape (US)

Next category is a small group of TMS vendors that has revenues of $20M or

more and growth of 15% or more

We have dozens of smaller TMS players that have a limited amount of enterprise

customers, but many more (in some cases 1000s) of SMB customers


Gartner Also Follows TMS Vendors in the SMB MarketVendor Headquarters Region

3GTMS Shelton, CT US

3T Logistics Leicester, U.K. Europe

Acuitive Solutions Charlotte, NC US

AdvantageTMS Pleasanton, CA US

AEB Gesell Stuttgart, Germany Europe

Agistix San Mateo, CA US

BestTransport Worthington, OH US

BluJay Solutions Manchester, U.K. US

Broussard Logistics Houston, Texas US

Cirrus TMS Palm Harbor, FL US

CloudLogistics Fort Lauderdale, FL US

CTSi Global Memphis, TN US

DDS Logistics Boulogne-Billancourt, France Europe

Deltion (CarrierNet) Staines, U.K. Europe

Descartes Waterloo, Canada Canada

Dovetail Epsom Downs, South Africa South Africa

Enroute (Pitney Bowes) Stamford, CT US

Evos SmartTools Bend, Oregon US

FlexTMS (Echo Global Logistics) Chicago, IL US

FirstTMS Houston, TX US

FreightGate Fountain Valley, CA US

FreightPop Lake Forest, CA US

Freightview (TMC) Overland Park, KS US

Generix Group Lesquin, France Europe

HighJump Eden Prairie, MN US

Inconso Bad Nauheim, Germany Europe

Infor New York, NY US

InMotion Global (AscendTMS) Brandon, FL US

InterLog Group Chanteau, France Europe

JDA Scottsdale, Arizona US

Kuebix Maynard, MA US

Log-Net Tinton Falls, NJ US

Logicor Mesa, AZ US

Logility Atlanta, Georgia US

Made4Net Hackensack, NJ US

Vendor Headquarters Region

Mercurygate Cary, NC US

Microsoft Dynamics Redmond, WA US

NCR Retalix Duluth, GA US

Next Generation Logistics Inverness, IL US

NuLogX Mississauga ON, Canada Canada

nVision Global McDonough, GA US

Odyssey Logistics Danbury, CT US

OneNetwork Dallas, TX US

Oracle Shanghai, China US

oTMS Shanghai, China APAC

Precision Software Lisle, IL US

PrimeLog (Pagero) Gothenburg, Sweden Europe (Scandinavia)

Princeton TMX Fort Wayne, IN US

RAMCO Systems Chennai, India APAC

Ratelinx Madison, Wisconsin US

Redwood SCS Chicago, IL US

Revenova Chicago, IL US

Saas Transportation Destin, FL US

ShipHawk Santa Barbara, CA US

ShippersEdge Burnsville, MN US

Siemens Postal, Parcel and Airport Dallas, TX US

Slick Software Solutions Antwerp, Belgium Europe

Softeon Reston, VA US

Tecsys New York, NY US

TMSFirst Houston, TX US

Transporeon Ulm and Kempten, Germany Europe

Transportation Warehouse Opt. Franklin, TN US

Transwide (Alpega) Zaventem, Belgium Europe

Transworks Fort Wayne, IN US

UltrashipTMS Fairlawn, NJ US

Unifaun Gothenburg, Sweden Europe (Scandinavia)

URoute Warren, MI US

vTradEx Shanghai, China APAC

WiseTech Global Alexandria, Australia APAC


TMS Selection Criteria

© 2018 Gartner, Inc.

• Best of Breed vs Industry Focus

• Breadth and Depth of TMS support

• Geographical expertise

• Similar Company Profile

• Maturity

• Experience (nr of implementations)

Functionality

Agility

Cost

Area of Expertise Culture

Vendor Vision

Customer References

Usability

• In-memory

• Cloud

• Collaboration Support

• Customer centric

• Customer councils

• Standard Software Features

• Planning Capabilities

• Advanced Capabilities, Network

• Innovation

• Product Roadmap

• Partnerships

• Value-Based Justification

• Pre-templated solutions

• Level of cost and effort

• Easy interface

• Data exploration

• Data visualization



ROI


▪ Average TMS Productivity: 5%-15%

▪ Areas of productivity of a TMS

▪ Route and mode optimization

▪ Rate Negotiations and compliance

▪ Carrier assignment optimization

▪ Electronic communications/Visibility

▪ Continuous moves and dedicated fleets

▪ More efficient/automated operations

TMS ROI


Expected Savings

Avg. Savings between 5-15% of Freight Spend

Largest group of TMS customers see a 5-10% savings


Savings Buckets (high to low)

Optimization 5%-25%

➢ Lower Cost Mode selections

➢ Better rate selection

➢ Better load optimization

➢ Continuous moves and dedicated fleets

Procurement Savings 3%-10%

Increased usage of preferred carriers 4%-8%

More efficient, automated operations 1%-5%

Freight Audit Savings 1%-5%

Better Analytics 1%-5%


Other Benefits

Customer Satisfaction

Warehouse efficiencies

Yard efficiencies

New Delivery capabilities

Inventory Reductions

Cash flow improvements

Access to a greater number of carriers

Better transportation compliance



Cost


TMS Costs


Cost of a TMS

License cost is typically between 1%-1.5% of Freight Under Management (FUM)

Cloud solutions include licenses, maintenance, support and infrastructure

For On Premise solution you need to add another 20%-25% per year for maintenance costs plus the cost of the infrastructure (servers, software licenses)

The implementation cost is heavily dependent of the complexity of the solution and the vendor and can go from 1/3 of the license cost to 3X the license cost.


Recent Factors Impacting ROI

Globalization of transportation

Omni-Channel

Cloud Platforms

Lower Barriers to Entry

❑ Subscription based pricing

❑ Free or Low cost solutions

❑ Savings sharing options

❑ Faster and less costly implementations

❑ Realization of productivity occurs sooner


Visibility


Visibility — Context

Lack of real-time end-to-end supply chain visibility

Inability to understand and leverage signals from the digital ecosystem

Lack of exception management and an intelligent response framework

Inability to continuously learn, sense and respond

Visibility is about building the foundation, providing E2E data driven insights as basis for E2E smart decision making at various levels of granularity and time horizons combined with intelligence & automation


Operational Visibility Vendor GuideFocus on operational visibility covering supply chain operations with the primary focus to fulfill orders, manage inventories (outside the enterprise) and move or deliver products



Research


Recommended Gartner Research▪ Magic Quadrant for Transportation Management Systems

▪ By Bart De Muynck, Brock Johns, Oscar Sanchez Duran (ID G00355727)

▪ Critical Capabilities for Transportation Management Systems


▪ Gartner’s Model for Holistic Multimodal Transportation Management Systems: Core Capabilities

▪ By Oscar Sanchez Duran, Brock Johns, Bart De Muynck (ID G00353665)

▪ Gartner’s Model for Holistic Multimodal Transportation Management Systems: Extended Capabilities


▪ Key Considerations for Supply Chain Leaders Evaluating Transportation Management Systems


▪ How to Select the TMS, Provider and Solution Best Suited for Your Strategic Capabilities


▪ How to Calculate the ROI for a Transportation Management System Project

▪ By Brock Johns, Bart De Muynck, Oscar Sanchez Duran (ID G00390024)

▪ Maximize Business Success in the Deployment Phase of a Transportation Management System Implementation

▪ By Oscar Sanchez Duran (ID G00377339)

▪ Toolkit: RACI Matrix for TMS Implementation


For more information, stop by Gartner Research Zone.

https://www.gartner.com/document/3905867



https://www.gartner.com/document/code/386368






© 2018 Gartner, Inc. and/or its affiliates. All rights reserved. Gartner is a registered trademark of Gartner, Inc. and its affiliates. This presentation, including all supporting materials,

is proprietary to Gartner, Inc. and/or its affiliates and is for the sole internal use of the intended recipients. Because this presentation may contain information that is confidential,

proprietary or otherwise legally protected, it may not be further copied, distributed or publicly displayed without the express written permission of Gartner, Inc. or its affiliates.

Gartner delivers the technology-related insight necessary for our clients to make the right decisions, every day.

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