Transportation management gives companies a competitive edge

The financial success and growth of companies can be directly linked to the value they place on transportation management strategies, tactics, and technologies. Those are the main conclusions of new research from Descartes Systems Group. The software vendor estimates that companies that underestimate the importance of transportation management perform significantly worse financially and in terms of growth.

As shown in Descartes’ sixth annual Global Transportation Management Benchmark Survey, 74% of companies who view transportation management as a competitive weapon achieve above-average financial results. As a result, senior management at 40% of the companies with poorer financial performance does not view this type of management as strategic. Respondents who view transportation management as important are almost twice as likely to have annual growth rates above 15% as those who do not.

“The supply chain disruptions of the past two years have made clear the importance of transportation management strategies, tactics, and technologies to companies,” says Chris Jones, EVP of Industry and Services at Descartes. According to the study, there is a strong correlation between financial performance and the leadership’s perception of the importance of transportation management to the organization. It changes how top performers think, act, and invest in transportation management.

Driver shortage

According to the survey, the driver shortage and carrier capacity have become increasingly important issues over the past three years, and are the top concerns for industry respondents. Top performers and companies that view transportation management as a competitive weapon tend to develop more advanced operational and technological strategies and investment plans. Furthermore, the study shows that these companies are significantly better at measuring and sharing transportation management information within their supply chains. They also find it much easier to secure additional investments with this type of management.

Improving transportation value

The key to responding to market trends is still investing in technology. In order to improve the value of transportation, those investments are closely linked to automating transportation processes. Visibility, carrier sourcing, and order management are seen as the most important capabilities for effective transportation management in the next two years.

Read more about how to increase the profitability of your logistics business

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