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Transportation Software
Transportation Software
Transportation Software is a broad term. Large shippers and
carriers began developing transportation software in the 1960's
when mainframe computers became more widely available and
affordable. Large LTL carriers such as Roadway Express and Red
Ball were pioneers in the field. It is a little known fact that
the freight industry created E.D.I. (electronic data
interchange) during this time frame. Early transportation
software was custom built and run on company mainframes at the
large carriers and shippers. As with so many other fields,
transportation software for small or medium sized companies did
not begin to materialize until after the introduction of the
I.B.M. personal computer in 1980. Transportation software can be
as simple as software used to calculate point-to-point mileage
or complex enough to manage virtually all shipping functions of
a carrier, broker or shipper.
Modern transportation software has standardized into basic
functional groups based on the needs of shippers and
carriers/brokers. Much of the available transportation software
is sold with these functions as modules that can be purchased
separately. Which modules are purchased is usually driven by the
size of the company looking for the transportation software.
Transportation software as applied to shippers can be part of
the much larger field of supply chain management or more
narrowly focused on supply chain execution. Supply chain
management can be defined as the application of information
technology to economic order quantity theory. It encompasses
virtually every function within a company that deals in tangible
products and is usually best preceded by ERP. Enterprise
Resource Planning is the company getting its data house in
order. It can then think in a more focused way about supply
chain management and execution.
Transportation software as it applies to shippers is most often
associated with supply chain execution. The main functional
groups here are the preparation of goods for shipment and the
effective management of transportation vendors. The preparation
of goods for shipment is a function of warehouse management
software. The warehouse must stock the products that will later
be shipped, pick the products that have been ordered and package
or unitize those products for shipment.
Management of transportation vendors is an important function of
supply chain execution software. Shippers usually need a number
of vendors to cover their territory or find it beneficial to
have vendors competing for business. Vendor management software
uses objective measures to point out the best vendor for any
given shipment based on price and service accomplishment. The
best supply chain execution software allows for effective
communication with vendors throughout the shipping process.
Transportation software as it applies to trucking or broker
companies has standardized into three basic functional groups;
dispatch operations, equipment management and accounting. Much
of the available trucking software is sold with these functions
as modules that can be purchased separately. Which modules are
purchased is usually driven by the size of the carrier or broker
looking for the trucking software. Very small carriers and
brokers can manage dispatch and or equipment on paper.
Accounting functions at this level are well served by software
packages such as QuickBooks or Peachtree. Carriers that grow
beyond 10 so trucks and brokers with 20+ loads per month or can
usually begin to see the
value of having one or more of the
transportation software modules.
Transportation software designed for the accounting functions is
the least likely of three to be offered as a stand-alone product
since it depends upon the others for data. Payroll functions can
be derived from dispatch operations data such as which driver
went where. Invoicing and receivables are also derived from
dispatch operations data as in which customer sent what where.
Equipment expenses are derived from equipment management
functions. Transportation software designed to integrate with
the over the counter accounting packages such as QuickBooks can
ease the transition for many small carriers and brokers.
Equipment management functions of transportation software
revolve around fuel and maintenance costs. Fuel, tires, periodic
maintenance, and repairs are all important costs to be managed
by every trucking company. This type of software can get very
complex but is essential to larger carriers and can be a good
value to smaller companies. The availability of fuel cost data
on the internet has given carriers a new tool to manage those
costs as in where and when and how much fuel to buy.
Transportation brokers do not have these concerns.
Transportation software designed for dispatch operations is the
most likely of the functional groups to be offered as a
stand-alone product. It is also arguably the most important of
the three functional groups. It is the most important because it
can have the greatest impact on customer service. Freight
brokers in particular should recognize that this software can
give them a competitive advantage. Equipment management and
accounting functions are internal; dispatch operations touch
every customer the carrier or broker has in one way or another.
Dispatch operations is all about keeping the right drivers with
the right equipment in place to services the customers' needs
and take advantage of opportunities that arise. Managing those
resources is important but the best dispatch software also gives
dispatchers and managers tools to monitor work in progress and
communicate effectively with customers.
The internet has given rise to two interesting new developments
in the field of transportation software; software as a service
and networking as a new functional group. Software as a service
is delivered via the internet by subscription and has the
following advantages:
No large upfront investment as in traditional buying of
software. No new hardware costs. Your existing network, internet
connection and browser such as Microsoft Internet Explorer are
all that are needed. Pay as you go. This type of software is
often available month to month without a contract. Maintenance
and upgrades handled at the web server with little or no bother
to the user.
Networking as a functional group is a new development made
possible by the internet. Dispatch software can now be extended
onto the customers' desktops. Carriers, brokers and shippers can
collaborate to give and get the data that they need to get the
job done. Customer service is greatly enhanced with true real
time communications and the customer as a larger part of the
process. TDNweb.com is an example of this new breed of
transportation software.
About the author:
Van Wooten is the vision behind Transport Data Networks (TDN) an
innovative online application that is revolutionizing the
transportation software industry.
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