Does the market need yet another transportation management system (TMS)?
That’s the question that popped into my head when 3Gtms (a Talking Logistics sponsor) entered the market more than five years ago. Last week, I attended Innovate 2018, the company’s first user conference, and as I stood on stage to deliver my keynote presentation in front of 140+ attendees, the answer was clear: Yes.
The reality is that new innovations in technology, coupled with new transportation challenges that shippers and logistics service providers (LSPs) continuously face, create new opportunities for startups to enter the market. Five years, 90+ clients, and 90 employees later, 3Gtms has achieved a critical mass of success and penetration, particularly in the third-party logistics (3PL) space. Last week’s user conference, which was well attended and featured a couple of client presentations (Crowley Logistics and Dynamic Logistix), was another milestone for the company.
New TMS Capabilities
Last year, 3Gtms rolled out five product releases containing 140 new features and enhancements, including:
- Vendor Portal for Inbound Transportation
- 3G Mobile for Status, Check Call and Doc Upload
- Carrier Web Services for Rating, Tendering, and Documents
- Enhanced User Experience
- Improved Product Scalability and Maintainability
This year the company is focusing on expanding and improving its Advanced Planning & Rating, Brokerage, and International capabilities (e.g., multi-currency, multi-UOM rating improvements, and date/time zone management).
One of the new capabilities highlighted at the conference was Continuous Pool Optimization. As described in the press release, continuous pool optimization “gives users the ability to plan shipments into a predetermined consolidating point or dynamically determine the optimal consolidation facility. This maximizes achievable freight savings while adhering to pickup and delivery constraints; improves customer service; and may eliminate the need for warehouses or distribution centers.”
I discussed Continuous Pool Optimization with Mitch Weseley, CEO and founder of 3Gtms, in a recent episode of Talking Logistics. During our conversation, and at the conference, Mitch also talked about the importance of flexibility — that is, the importance of being creative and having the ability to consider many options to find the best solution to a transportation problem. Below I share some highlights from the video episode.
Focus on Customer Satisfaction
Overall, this first-ever 3Gtms user conference provided a great learning and networking opportunity for all of the attendees. I had the opportunity to speak privately with several customers and their overall experience to date with 3Gtms has been very positive. In his presentation, Bob Weist, Vice President, North America Transportation at Crowley, said, “Our partnership with 3Gtms is the only IT software project I’ve been a part of where the software worked as designed on initial implementation.” Another client, when I asked him how the implementation has been going so far, said, “It’s been going well, it’s been fun.” I joked back that “TMS implementation” and “fun” are not terms you often hear together in the same sentence!
3Gtms is not trying to be all things to everybody. Its focus and strength at the moment is on domestic, land-based transportation, with most clients being logistics service providers in North America, but with a growing list of shipper and overseas clients too. One of the ways the company looks to differentiate itself from the competition is by achieving high customer satisfaction and retention rates. Based on what I saw and heard at the conference, the company is executing well on that objective.
Talking Logistics Episode Highlights: Continuous Pool Optimization – Putting Creativity to Work in Transportation
Transportation Management: Always the Same, Always Changing
Mitch began our discussion by pointing out one of the enduring facts about the transportation management industry, and the systems that support it — that the basic tasks have never changed. People create loads based on the lowest cost to ship orders to customers within their acceptable delivery windows, execute those loads, and settle the payments based on agreed upon rates, charges and compliance. However, the marketplace from which the orders are coming (notably the rapid increase in e-commerce shipments), the technology available to plan and execute the loads, and the opportunities to optimize the processes and communications are always evolving. Rapid innovation in technology is supporting innovation in these processes, such as in continuous pool optimization.
Mitch noted that the need for continuous pool optimization is related to the age-old problem that between the time a load is first created and the time it is delivered, a lot can, and usually does, change. What were initially optimized loads and routes can quickly become less than optimal, resulting in potential cost and service degradation. Continuous pool optimization allows you to account for these constant changes by enabling incremental optimization of the load plan as new orders and opportunities present themselves.
The Benefits of Continuous Pool Optimization
Mitch gave several examples of how continuous pool optimization can reduce costs and improve service. He cited a case, for example, where a company normally shipped loads to a pool point in Sparks, NV for distribution to west coast locations. However, certain orders might be large enough where it is more cost-effective to ship directly to Los Angles or San Francisco, avoiding the pool point. Or, an order might include inventory available at another west coast pool point so that it is more efficient to route through that pool point instead.
As Mitch puts it, “Our job is to help people be more creative in solving their transportation issues. By giving them more options to explore ‘what if’ scenarios, we can arrive at better solutions at lower costs and improve service to their customers.”
Simplicity is the Enemy, Flexibility is Our Friend
Mitch provided an interesting observation that the biggest obstacle to achieving the true potential of optimization is the need for a change in mindset. He notes that for years the accepted principle for solving the complex issues involved in transportation management was to simplify, simplify, simplify. That made sense when planning and execution were done manually or with earlier systems that might have taken many hours to run optimization routines in batch mode. Simplifying, such as grouping like factors or loads together, or asking all carriers to bid based on the same tariffs, made the job easier and faster. What it doesn’t do is provide the optimal result because it limits the opportunities to be creative and optimize.
Fortunately, today’s advanced optimization technology enables shippers and third-party logistics providers (3PLs) to embrace complexity and explore a broader set of routing and delivery options, such as continuous pool optimization, to lower costs and improve service. Shippers and 3PLs must shift their mindset from ‘simplify’ to ‘innovate’ to leverage the greater opportunities the new technology offers.
For more details about continuous pool optimization and additional insights and advice about transportation management systems, watch my conversation with Mitch. Then post a question or comment and keep the conversation going!