These days, the phrase “logistics automation” often brings to mind the warehouse, where moving from manual to technology-enabled material handling processes can streamline operations and help get orders out the door in less time. But companies can reap big rewards from automation projects that happen in the back office as well, particularly when it comes to managing their freight transportation functions.
Transportation management software and technology platforms are often employed to do the trick, helping companies move from manual, spreadsheet-based processes to digital ones that free up employees’ time and reduce errors. Transportation management systems (TMS), as they are known, can also create seamless connections with other back-office functions, such as accounting, to drive further efficiencies and reduce costs. Here are two examples of recent TMS projects that are doing just that.
GOODBYE, EMAILS AND SPREADSHEETS
Fibox, a Finland-based manufacturer of enclosure products for industrial and infrastructure applications, was having trouble managing its various shipment modes and was looking to move from a manual system to an automated one that would give it greater control over its transportation management functions while also reducing costs and improving productivity. Among the problems, managers were having trouble getting materials from overseas, were experiencing challenges with some suppliers, and needed a way to track raw materials that were imported via ocean carriers. They also wanted to get a better handle on their less-than-truckload (LTL), truckload (TL), air, and parcel shipments to customers worldwide. Given the scale of its operations—Fibox has nine manufacturing sites around the world, more than 700 employees, and a global network of distributors—coordinating the transportation piece of its business is paramount to making everything run smoothly.
Fibox had been aggregating data from carrier websites and using email and spreadsheets to book and track freight, but was looking to automate that process with a TMS. The company partnered with third-party logistics service provider (3PL) Nexterus to solve the problem.
The 3PL began by implementing a TMS from supply chain tech firm BrillDog, which develops supply chain software solutions for small to mid-sized businesses. Immediate benefits included optimizing Fibox’s carrier mix and repurposing staff to more value-adding tasks, according to Ryan Polakoff, president of the privately owned, fourth generation-run 3PL.
“[Implementing the TMS] allowed [Fibox] to get rid of an obsolete, archaic function,” Polakoff explains, adding that labor savings were among the biggest benefits because the automated system freed supply chain staff from all the phone calls, emails, and spreadsheet management that had taken up much of their time. “We’ve helped them in that classic sense of ‘Do what you do best and outsource the rest.’ Now they can focus on enclosures.”
Fibox soon moved on to using additional Nexterus services, including its freight audit and payment solutions and its customer care support team, a 24/7 service that provides clients with a dedicated account manager as their point of contact to resolve freight and transportation problems. Polakoff says Nexterus now operates as an extension of Fibox’s supply chain team, providing them with ancillary support for quoting transportation rates, managing logistics, creating reports, and managing their freight audit and payment processes. The 3PL handles more than 200 shipments per month for Fibox across all modes.
And the savings are adding up. Polakoff says Fibox has cut 8% to 12% of its annual transportation spend as a result of their partnership.
A SEAMLESS SOLUTION
Shipping and logistics company American Group is working faster and smarter since integrating Tai Software’s TMS, a domestic freight management system for TL and LTL shipments, into its daily operations in 2021. American Group was having trouble with its previous TMS, particularly when it came to syncing the system’s data with its back-end accounting software. That process wasn’t working well and was opening the door to errors and inaccuracies.
Company CEO Michael Schember says Tai was able to solve that problem almost immediately.
Tai’s integration with HubTran—which provides cloud-based automation software for the transportation industry’s back office, including invoicing, electronic payment, and document management—made the difference by eliminating the need to sync transportation and accounting data. Essentially, American Group now has access to seamless and automated invoice processing via HubTran, which reduces the time and effort required for manual data entry and document management while mitigating the risk of improper inputs, according to representatives from both Tai and American Group.
“We were looking for an integrated accounting solution because a previous provider’s synchronization to Intuit QuickBooks proved to be unreliable at the time. Tai had that solved right out of the box. Since we don’t have to sync, it doesn’t cause errors, and we have better security around our AP [accounts payable] and AR [accounts receivable] functionality,” Schember said in a statement describing the project. “Tai’s platform is helping our teams get better at their tasks so we can focus on winning more business and taking better care of our customers.”
The proof is in the results. Today, American Group is saving five hours per week, per rep; is realizing 50% efficiency increases through automated invoicing and billing; and is 70% faster at finding load coverage, according to both companies.
“If freight brokers aren’t implementing automation into their operations, they’re setting themselves up for disappointment,” Tai CEO Walter Mitchell said in the statement. “American Group needed a fast solution that could help them start growing their brokerage. Offering our streamlined platform and integration network to some of the best [logistics technology] in the industry has provided unprecedented efficiencies to allow their representatives to find more business.”
