3 Logistics Trends Point to Cloud TMS Adoption by SMBs in 2016

The Collaborator has been reviewing respected sources of industry analysis to gain perspective on the trends being predicted to materialize in supply chain logistics for 2016. What follows are highlights from the trends reports we’ve read and some analysis of what the trends portend for mid-sized to large-volume shippers in the US.

Trend 1) Supply Chain Convergence – According to Gartner, “ By 2016, 20 percent of SCM organizations will adopt a supply chain execution convergence application strategy.” Thirty-five percent of businesses recently surveyed by Gartner identified the inability to synchronize end-to-end business processes as an issue, which will increase demand for SCM application convergence. Gartner identifies “application portfolio fragmentation” or the inefficient practice of cobbling together disparate stand-alone tech solutions as a driving factor behind the push for convergence.

Gartner suggests the growing emphasis on wringing efficiencies from the supply chain will drive the adoption of more complete, single-source solutions. However, the majority of mid-sized shippers and even some of the larger-volume shippers are simply not able to allocate the high capital cost of global end-to-end solutions like those from Oracle or TMW. Furthermore, for all but the largest, those platforms are overkill. This reveals the advantages to most shippers inherent in leveraging a best-in-class cloud solution that can offer a wide array of SCM functions (like transportation management, freight/route optimization, yard management and private fleet management) from a single provider and with simple, subscription based pricing.

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Taken as a composite, it is clear that 2016 will be a year in which mid-sized businesses and large shippers alike continue to invest in logistics IT solutions in the cloud.

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Trend 2) Collaborative relationships – Over at the Cargomatic Blog, they discuss the predictions of greater collaborative capabilities enabled by Internet, wireless and social technologies and how such collaboration will influence SCM. These predictions of yesterday are the emerging realities of today’s cloud-based logistics IT solutions and they’re delivering in spades when it comes to enabling more efficient effective means for locating unused capacity. The collaborative capability is also a boon to private fleet operators who are better able to optimize revenue streams on backhauls. Moreover, the easy communication afforded by these solutions allows for better upstream/downstream visibility from dock door to dock door with integrated yard management features. For years supply chain experts have been predicting greater collaboration between logistics providers. However, recent advancements in information and mobile technologies like on-board telematics, ELDs, etc., have set the stage for truly integrated supply chain partnerships.

Trend 3) The Role of BI and Data – Logistics IT solutions are adept at collecting all manner of data relevant to transportation management. The latest cloud TMS solutions now include robust data analytics capabilities transforming the raw data into easy to interpret visualizations for better planning and performance metrics.   Downstream data analysis reduces forecasting errors and as data analysis becomes more sophisticated, these capabilities will be critical to achieving and maintaining competitive advantage in a highly competitive market.

Taken as a composite, it is clear that 2016 will be a year in which mid-sized businesses and large shippers alike continue to invest in logistics IT solutions in the cloud.

 

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