The primary objective for implementing a TMS remains the same — to meet customer service level requirements at the lowest cost.  Achieving this objective, however, is more challenging than ever.  Transportation costs are increasing, due to rising fuel prices and other factors; order-to-delivery cycle times are shrinking, as customers place smaller, more frequent orders and demand faster lead times; globalization is introducing new complexities and constraints; and exceptions, such as order changes and transit delays, are now the norm.

Simply put, demand for TMS is growing because companies, particularly those still managing their transportation operations with spreadsheets and faxes, are realizing that cost increases and service level failures are inevitable unless they gain greater visibility and control of their transportation operations.

The TMS market has grown faster than predicted the past two years, fueled by continued demand for Global Trade Management solutions, a reinvigorated market for Fleet Management solutions, increased sales to Logistics Service Providers (LSPs), and strong activity in Europe and in the small and midsize business (SMB) segment.  

Strategic Issues
TMS is migrating away from being a stand-alone, monolithic application used by only a handful of transportation users, to a platform where users across the value chain can execute role-specific, transportation-related business processes.  Vendors who recognize this trend will position themselves for long-term success.

• How can vendors differentiate themselves beyond features and functions?
• Why is “on demand” deployment and pricing gaining traction?
• Will LSPs continue to drive growth in the market?
• What new functionality are users looking for in a TMS?