As I explained in a previous post (Getting the Most Out of TMS, April 01, 2011), shippers that elevate their transportation management systems (TMS) from tactical to strategic solutions tend to get the most value out of the technology. But making the transition involves more than a mission statement; it requires a level of expertise that tactical personnel often do not possess.
A common pitfall is that senior managers assume their employees will acquire the expertise they need to become transportation analysts by virtue of the company’s investment in a TMS suite. But tactical folks do not automatically acquire high-level analytical skills because they have TMS tools at their fingertips. They need to be groomed for the role and given ongoing guidance.
Take, for example, analyzing carrier performance. In a non-strategic environment, a staff member’s natural inclination is to select the worst carriers and confront them about their sub-par numbers. A more sophisticated approach is to delve deeper into the problems and come up with constructive solutions that make the transportation network more competitive.
In this example, a useful exercise is to look at how the best carriers are performing on familiar metrics such as on time delivery and load acceptance. Next, deploy an analytical tool to determine why these partners are ahead of the rest. Is the top carrier doing most of its business with a specific facility, for instance, and if this is the case, how is the facility supporting this performance? How does the facility interact with other trucking companies?
With the proper use of TMS analytical tools, it is possible to dive quite deeply into the root causes of indifferent carrier performance. The TMS toolbox supplied by TMC enables analysts to filter down the reporting tool to focus on the carriers that warrant special attention. The user can flip to other analyses – facility performance for instance – and still keep the original filters in place without having to rebuild the reports. This persistent filtering feature is powerful in the hands of a skilled analyst.
But wielding the tool in this way requires expertise that is unlikely to have been acquired by a person who has been largely confined to tactical responsibilities such as booking cargo space.
In our experience, the key to helping staff members learn and hone the strategic skills they need to fully exploit a TMS investment is building prescriptive management routines. The routines should reflect the translation of strategic goals into tactical processes and provide a bridge for staff more accustomed to tactical operations work. Individuals should complete these tasks regularly, and provide outputs that can be used to evaluate their performance.
Such routines not only provide a framework for developing a strategic skills base, they should be an intrinsic part of your TMS strategy. Distribution networks are in a constant state of flux, and need to be continuously monitored by the systematic checks that any robust management routine should encompass. Regular routines also help to ensure that staff members address the areas of greatest risk.
Give individuals a play book and a clear set of instructions. They must get into the habit of carrying out their assigned analyses regularly, finding correlations, and creating action plans that supervisors review and critique. It is then possible to provide solid guidance on how these folks can learn the skills they must acquire in order to develop a strategic view of the company’s distribution network.
A convenient way to test a person’s progress in this direction is to ask him or her to write up a management routine for someone else. Ask the individual to detail the strategy, the associated risks, and mitigation measures. All this information should be included in the “manual” and reviewed.
Also, keep in mind that your customers may well be grappling with the challenges of turning tactical folks into competent transportation strategists. This might help to explain why they are asking you to meet unrealistic performance goals.
TMS analyses can yield countless opportunities for improving the efficiency of your network – providing your employees are up to the analytical task.