Definition

Transportation Management System (TMS)

A Transportation Management System (TMS) is a subset of Supply Chain Management (SCM) software focused on transport logistics. TMS systems facilitate interactions between an Order Management System (OMS) and the Warehouse or Distribution Center (DC). 

 

Common TMS software modules include:

•         Route planning and optimization

•         Load optimization

•         Execution

•         Freight audit and payment

•         Yard management

•         Advanced shipping

•         Order visibility

•         Carrier management.

 

A TMS product serves as the logistics hub in a collaborative network of shippers, carriers and customers.  

The business value of a fully deployed TMS should achieve the following goals:

•         Reduce costs through better route planning, load optimization, carrier mix and mode selection.

•         Improved accountability with visibility into the transportation chain

•         Greater flexibility to make changes in delivery plans

•         Completion of key supply chain execution requirements.

Related glossary terms: smart label, demand planning
This was last updated in October 2010
Posted by: Margaret Rouse

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