As we explained in last week’s post, transferring control of inbound freight movements to a third-party transportation management system (TMS) delivers some important benefits, providing you lay a solid foundation first.
This second post in the two-part series looks at the next two phases of such a roll out: implementation and post-implementation.
When the system goes live the emphasis shifts from planning to participation. The buzz of activity reaches its peak during this phase.
First, there is a change management job to do. Suppliers’ enthusiasm for the project varies according to the effort they need to put into it and what they perceive as the return. There is often push back from vendor organizations when they realize that the program requires them to change the way they operate in the inbound space. The shipper and TMS service provider need to work together to reset vendor expectations and make sure that the right parties are involved in the roll out.
Customer service account teams need to be primed for the transition. These representatives should understand the rationale behind the change and what it entails, and be able to answer queries about the new practices that are being put in place.
Be ready to schedule more training sessions for suppliers that missed the first phase of the roll out. The sessions may also be needed because some individuals did not learn enough during the initial round of trainings.
The final, post-implementation phase is less hectic, but there is still plenty of work to do.
Now is the time to measure supplier compliance; are they utilizing the system in the way that was intended and mapped out during the training sessions.
It is up to the third-party provider to brief their customer on the level of compliance. Then the customer can take action to address non-compliance issues within individual supplier organizations.
Sometimes the reasons for not using the system properly have more to do with the level of shipment activity than the competence of the supplier. As you monitor the performance of the new TMS-based inbound transportation system, it might become evident that the paybacks are less obvious for low-volume suppliers. Keep in mind, however, that the higher the shipment volumes flowing through the system the more efficient it is likely to be.
Set up routine reporting procedures to catch anomalies like these.
Although the main training effort is over, there will be an ongoing need for classes. New vendors joining the program require training. Also, the organizations that successfully completed the implementation will need continuous instruction to update and reinforce their knowledge of the system.
Clearly, the third-party provider needs to have the expertise and operational scope required to implement the three-phase program described in this two-part series. In addition, shippers should keep in mind that the provider must be capable of playing a middle-man role. Unlike other TMS applications, in third-party inbound solutions the provider operates between the supplier base and the shipper’s client.
Implementing an inbound TMS solution is demanding – but the paybacks are substantial.
As we mentioned in the first post, standardized documentation, improved supply chain visibility, and greater control over preferred routes, are three specific benefits.
But there is a fourth benefit that offers even more potential: the availability of much better data on inbound operations that can be analyzed by the TMS to identify further opportunities for network efficiency gains.