Challenges such as manufacturing and labor shortages and rising costs have affected the transportation industry in the last few years. However, increased supply chain visibility technology is allowing shippers and manufacturers to better communicate during the shipping process. Shippers and carriers are using transportation management systems powered with AI to manage their operations.
Supply Chain Intelligence is a Must
The transportation industry is complex with a lot of fluctuation. Enhanced supply chain intelligence is a requirement for transportation companies to be able to survive. Companies use Transportation Management Systems (TMS) and Artificial Intelligence (AI) to obtain updated information and full visibility in order to have a competitive advantage over other companies.
The Power of AI
Artificial Intelligence is a powerful tool that is shaping the logistics industry. With the use of historical data and trends, businesses are able to be more accurate and efficient in how they manage their operations and can better adapt to supply chain demands. Shippers are using AI to find the most efficient routes, loading, and schedules. A TMS gives shippers access to thousands of lanes and visibility to new carriers they did not have access to before.
AI algorithms are able to optimize loads based on driver availability, weather events, traffic, and past performance to reduce empty miles. There is a large opportunity for the transportation industry to use AI and machine learning to figure out how to move the same amount of goods with less empty miles. The following are ways that AI is changing the way we ship:
Predictive Analytics: AI algorithms can analyze a large amount of data and make predictions about demand, inventory levels, and delivery so that organizations can optimize their operations while reducing waste.
Sustainability: Because AI can improve truck routes and idle time, fuel consumption and emissions decrease. Using real time weather conditions and traffic helps AI to optimize delivery routes and reduce travel time.
Automation: AI is able to automate certain tasks like identifying the delivery routes for customer orders. AI is also predicted to make big changes within warehouses by automating the storing, organizing, and sorting of packages. This saves time and reduces the risk of errors.
Risk Management: AI can make informed calculations based on the data it gathers. The analysis that AI gives can help to identify and mitigate risks. These include inclement weather, traffic, and potential supply chain disruptions.
Customer Relationships: AI is able to improve customer service with chatbots that are available around the clock to answer questions and track orders. This makes customers feel better about their experience.
Last Mile Delivery: The last mile of delivery has always been a challenge for carriers; however delivery drones will reshape that last step in the process. Delivery drones have already been tested and used by some logistics companies, and the demand is expected to continue to rise over the next few years as drones offer more direct routes and are able to bypass traffic congestion.
TMS Gives Control Over the Shipping Process
A TMS is a transportation management system that automates shipping processes as well as gives insights into ways a shipper can save time and money. Examples of these insights include transportation planning, business intelligence, and freight payment. A TMS consolidates and optimizes to find the right combination for the lowest cost to move freight within the desired timeframe. Advanced load planning algorithms offer freight savings.
A TMS gives shippers access to thousands of lanes and visibility to new carriers they did not have access to before. TMS is also improving the shipping process in the following ways:
Optimization: A TMS uses parameters to optimize scheduling, even when there are multi-leg shipments. Industry knowledge and data helps shippers and carriers give optimal service. Without a system, reports and analysis need to be generated manually, which is time consuming.
Rate Management: Rates change often in the transportation industry. The rating portion of a TMS enables contract carrier pricing to be stored and chooses carriers based on cost.
Bidding: Carriers can use a TMS to bid on shipments virtually, making it easier and more effective.
Freight Distribution: Freight distribution can be controlled and automated based on parameters such as cost, rank, and lane allocation. Automated freight tendering simplifies communication between the shipper and carrier.
Visibility: Large companies may have several different shipments in transit at once, which can be challenging to keep track of. One of the most valuable features of a TMS is the ability to trace shipments throughout the shipping process so decisions can be made in real-time. A TMS allows shippers to track freight and sends alerts when shipments are going to be delayed.
Reporting: The insights that are provided by this type of system make it easy to respond to questions, figure out costs, and make informed decisions. Information is available at the business unit, shipment, and SKU levels.
Billing: This system allows shippers to have virtual payment options with the ability to reject or approve accessorial fees, rather than wait for an invoice.
Export Compliance: Shipping, particularly internationally, involves documentation. A TMS can help keep all information in order and ensure export compliance regulations are met. This means that nothing will be overlooked.
Verizeal Uses the Latest Technology to Optimize Your Supply Chain
There are a variety of data solutions that are able to co-exist with a company’s current software suite but offer the ability to use data more efficiently. By integrating data across multiple sources and utilizing the newest technology, a company will be able to evaluate its business on a more informed level. The use of AI and TMS are transforming the logistics industry, and the possibilities for these applications keeps growing. If your business is not taking advantage of these technologies, Verizeal’s collaborative logistics platform will enable your business to drive profitability while improving operations.