Supply Chain Management Blogs by SAP
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Supply chain complexity and competition, especially in the transportation sector, are exacerbated by increasing globalization, changing consumer preferences, the need for efficient and cost-effective transportation solutions, shortages of skilled personnel, capacity pressures, and regulatory challenges such as environmental impact and sustainability. Companies therefore need new technology solutions to address these challenges and identify and mitigate risks to make the transportation process as efficient as possible.

Logistics as a differentiator

In today's competitive marketplace, logistics can be a key differentiator for companies. To stay ahead of the competition, companies need an effective logistics strategy that focuses on delivering products and services quickly, reliably, and cost-efficiently.

In recent years, a game-changing technology has emerged in the logistics industry: Transportation Management Solutions (TMS). These solutions help companies make the transportation process from order placement to delivery more transparent, reduce costs, increase efficiency, and optimize transportation activities to make them more sustainable, environmentally friendly, and resilient.

According to a recent study, the global transportation management systems (TMS) market will be worth $10.45 billion in 2022 and will register a compound annual growth rate (CAGR) of 14.8% between 2023 and 2030.

This year, SAP was again recognized by Gartner as a Leader in the Magic Quadrant™ for Transportation Management Systems. SAP continues to invest in new technologies that help companies build the supply chain of the future.

Trends in transportation management

Thanks to modern technologies such as the Internet of Things (IoT), Big Data analytics, artificial intelligence (AI) and automated processes, companies can better plan, manage and monitor transportation orders. These technologies provide real-time visibility, automated processes, and advanced analytics that can reduce costs, improve efficiency, and increase customer satisfaction. As a result, companies that leverage these technologies have a competitive advantage over those that do not.

And in today's world, customers expect to be able to track their shipments at every stage of transportation, from manufacturing to shipping to delivery. Real-time shipment tracking and visibility is therefore becoming increasingly important. The Transportation Management (TM) solution enables end-to-end, real-time tracking and visibility throughout the supply chain. As a module within the ERP system that can be connected to it or used as a standalone cloud-based platform, it offers the advantage of easier access to data for all stakeholders - anytime, anywhere. In addition, a cloud-based system enables faster implementation and training, lower total cost of ownership, better scalability, greater flexibility, and benefits from automatic updates.

But alongside technology, sustainability is no longer just a "nice-to-have," but a must. After all, logistics and transportation remain among the biggest CO2 emitters. Companies are under increasing pressure to reduce emissions and use more sustainable means of transportation, such as electric vehicles, in order to improve the environmental footprint and resource efficiency throughout the logistics chain - transportation, intralogistics, and logistics real estate. With a TM solution, companies can optimize their transportation networks to minimize emissions and reduce costs. By integrating AI into the TM solution and applying machine learning to historical data and trends, transit times can be better predicted, capacity can be more predictable, and risky shipments can be better identified (e.g., time- or temperature-sensitive products).

Collaboration across company boundaries

More collaboration and data exchange between players along the supply chain will not only create more transparency in the future, but also more efficiency. With the help of the cloud-based Business Network, companies can easily and efficiently network, tender orders, check invoices or work together on predefined milestones, freight tenders and joint load consolidation and route optimization, which not only leads to a reduction in CO2 emissions, but also helps to save time and money.

Supply chain affects the entire enterprise. And digital supply chain solutions connect the entire process - design, planning, manufacturing, logistics, maintenance, and service - to the rest of the business and all contextual data and connect the company to its partner network. Only then can you move from ordinary automation to extraordinary, business-changing transformation.

To learn more about the research findings that are important for supply chain executives evaluating the TMS market, simply download the latest Gartner Magic Quadrant Report.