SaaS TMS Offers Operational and Cost Advantages over Traditional Hosted Solutions

September 4th, 2013 - by andrewh

by Bill Wolfe, Director, Global Technology

According to a recent report by ARC Advisory Group, the TMS (Transportation Management System) market has “bounced back” after the global recession, growing faster than the rate of inflation in 2010, with significant growth forecasted through 2015.

While hosted TMS solutions have been deployed in the market for over 20 years, SaaS (Software as a Service) or cloud-based TMS solutions are rapidly outpacing hosted solutions, with a 6x annual growth over premise systems.  That’s because a SaaS TMS offers significant application and cost advantages over traditional hosted solutions:

Network Connecting:  Most SaaS TMS provide a pre-established and extensive network of carriers, suppliers and trading partners.  As shippers look for new capacity in a carrier-limited market, greater access to carrier resources provides a competitive advantage in contracting additional capacity or optimizing relationships with existing partners.  With a SaaS TMS, only one connection is necessary to interface with multiple logistic partners, carriers and vendors.

Continuous Improvements:  SaaS TMS enhancements are seamless and executed on a continuous basis.  As new functionality becomes available, upgrades are automatically accessible to all users at once with very little, if any, effort required by the user. With a traditional TMS, upgrades are normally at the discretion of the user; therefore, their hosted TMS can become outdated and support may no longer be available if upgrades do not occur over a certain period of time.  Also, when upgrades are executed, a much larger effort is required from the user compared to a seamless SaaS TMS upgrade.

Lower Cost:  As no hardware needs to be purchased, implemented, or maintained with a SaaS solution, shippers spend very little in internal IT costs when utilizing a SaaS TMS.  Additionally, as many logistics partners connect directly to the SaaS TMS, users do not need to maintain EDI connections as they are already established and supported through the cloud-based system.

Fast Deployment:  With little IT footprint and no hardware requirements, SaaS TMS implementations can be completed within a few weeks.  Additionally, as the SaaS TMS can be configured and utilized through a web-browser, all of the implementation steps (such as customization, administration, testing, training, etc.) can be fully controlled and implemented by the project team without the need for IT development work.

Customization:  Many SaaS TMS solutions now offer similar levels of customization as traditional TMS.  Users can turn offer certain functions and customize applications to meet their requirements.

Time to Value:  Rapid deployment generates quicker ROI in about 12 to 24 weeks.  Cost savings from optimization, automation and control, and reporting is about 10% of the shipper’s total logistic costs.

For a no-obligation demonstration of CLX’s SaaS TMS from IBM, call (215) 461-3800.

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