Although managed services solutions are gaining ground, we find that many shippers are still unsure about how to go about sourcing this class of transportation management system (TMS). Managed services solutions offer TMS technology combined with personnel—seasoned transportation experts adept at getting the most out of a TMS. Finding a provider that has both the technical capabilities and expertise – as well as aligns with your organizational culture and strategy – can seem like a daunting undertaking.
When the time is right for your business to issue a request for proposal (RFP), there are several key considerations that can determine the difference between achieving your goals and spinning your wheels. Here are a few important factors to help ensure you choose the provider that best fits your organizational strategy:
Outline your goals and objectives. Communicate the purpose of the RFP and your strategic objectives. In addition to clarifying your goals, this initial step ensures that you as the buyer, the service providers, and other key stakeholders, are all on the same page.
Consider the people. Gain a thorough understanding of the expertise offered by the TMS professionals who are an integral part of your managed services package. Think about how the support they offer can free up your staff members to engage on value-rich, strategic work.
Find the right cultural fit. The managed services provider you choose becomes an extension of your staff, so make sure they are a good fit for your organization.
Assess technology scalability, features, and analytics. It is important that the provider grows with your business in key areas such as geographic reach, technical sophistication, and strategic as well as tactical know how.
Mitigate risk. The last thing you want is a TMS that is prone to interruptions, so check out the provider’s risk management capabilities; are they accountable to customers for system changes, for example?
Understand the deployment and ongoing process improvement strategy. Successful managed services start with a detailed analysis of the shipper’s needs, and an installation process that configures the system to those needs. Ensure that the provider is able to do this, and has continuous improvement processes in place.
Develop a definitive savings plan. Reap early rewards with a savings plan based on core elements such as a roadmap to sustained savings.
Pursue true visibility. Visibility to relevant information such as costs, fees, and performance stats of both your network and the provider’s ability to support your goals ensures you have a true understanding of trends and opportunities. This level of transparency between you and the provider is important to achieve the agreed ROI.
Retain the control you need. While the provider team can shoulder much of the tactical burden, the shipper should be able to retain the right amount of strategic control over its transportation network. The RFP should include provisions for striking this balance through collaboration and flexibility in solution design.
Look for hidden fees. Avoid spending unnecessary dollars by asking about charges that might not be immediately obvious, such as upfront implementation costs associated with onboarding, and ongoing costs for training.
This guide should help you to establish a solid foundation for your managed services investment, but it shouldn’t stop there. Having created a short list of potential providers, it is important to stay proactive throughout the sales cycle and look beyond the standard RFP responses. For example, visit providers’ premises, meet with their leadership and operations teams, and request a detailed demonstration of their technology to make sure that what you are buying is what you are really looking for.
This can be an arduous process, but the rewards are substantial: a TMS that not only meets your needs, but provides the kind of best-in-class service that raises your competitive game.