What it Takes to Reach TSM Maturity
It takes time for a business to grow and mature in today’s market. However, this isn’t a passive process. Supply chain leaders must take the initiative to make changes as the company scales.
Whether it’s updating business rules, implementing new technology, or optimizing current operations - there are multiple ways to propel a company forward on its journey toward transportation spend management maturity. Continue reading to gain a deeper understanding of what it takes to reach TSM maturity.
Trax is a global leader in transportation management, with the ultimate goal to empower supply chains to take control of transportation costs. By enabling end-to-end visibility, the Trax solution improves efficiency, value, and maturity.
Supply Chain Maturity Models
Over the past five years, researchers have proposed different models to conceptualize supply chain maturity. Essentially, they classify a business into different stages that are characterized by core dimensions. In a comparative study Hansali et al. (2022) identified 13 common areas that served as the basis for different maturity models, which are listed below:
- Performance Measurement
- Storage and Distribution
Knowing that there isn’t one single measure of TSM maturity, it’s important to look at how different models assess a company’s current state. For example, a recent model developed by Caiado et al. (2021) focuses on manufacturing enterprises whereas Szłapka and Stachowiak’s (2018) model applies to logistics companies.
Something that makes it even harder to define supply chain maturity is that the various models also differ in the number of stages. There can be anywhere from three to six maturity levels depending on who developed the model.
How can leaders understand their supply chain maturity level when there are so many conflicting models?
Focusing on Transportation Spend Management Maturity
Trax simplifies the SCM model by looking specifically at transportation spend management. Whether Trax is working with an automotive company or a retail partner, the definition of transportation spend management remains the same:
“Trax’s Transportation Spend Management Maturity Model is a framework that provides a roadmap for large, global enterprises to shift from a lack of visibility and control to a fully optimized and accurate data-based transportation supply chain—for all modes and geographies.”
There are four stages in this maturity model: Reactive, proactive, optimizing, and leading. Many companies start out with reactive transportation spend management solutions, such as invoice processing and payment automation. These solutions are used to optimize freight auditing and correct errors as they come up. However, taking this a step further, companies moving to a proactive technique combine multiple data sources for holistic reporting and continuously improve their data management to identify errors early on.
Part of the TSM maturity model is based on the concept of continuous improvement. Even as a company moves on to optimizing its transportation management solutions, it still implements reactive and proactive techniques as needed. Finally, in order to achieve the leading stage of TSM maturity, Trax emphasizes predictive analytics and complex automation.
How to Get There: Trax Product Suite
It’s clear that the tools a company implements for transportation management play a key role in achieving TSM maturity. The Trax product suite includes a variety of solutions tailored for each stage of a client’s transportation spend management maturity.
Reactive Transportation Management
The first step toward TSM maturity involves employing reactive solutions, such as a freight audit and payment system (FAP). The Trax freight audit focuses on data compliance, invoice auditing, settlement, and program management.
To ensure data compliance, Trax products allow users to cleanse and normalize data from multiple sources and achieve complete visibility. The invoice auditing software covers auditing for liability, duplicates, tax accuracy, and more.
Proactive Spend Management
As a company approaches more proactive TSM techniques, there are specific Trax products that are well suited to smooth the transition from reactive to proactive and promote further growth. Two of the main products addressing these points are Rate Manager and Data Compliance Manager.
Rate Manager allows companies to improve visibility into all rates, optimize the submission approval workflow, and link rates with invoice data. For those companies looking to take this a step further, Rate Manager also allows for cost modeling and simulation.
Data Compliance Manager centralizes all of a company’s data and incorporates automation systems to reduce unnecessary time spent on tasks.
Optimizing Supply Chain Management
When optimizing a company’s supply chain, an easy area of impact is sustainability. In today’s market, managing carbon emissions is a top priority and the Trax Carbon Emissions Manager helps achieve this goal. The carbon emissions tracker provides real, detailed carbon emission data for all shipments, across all modes and in all geographies.
In addition, the Trax Claims Manager tool is important for maximizing performance. In essence, the claims management service takes over the responsibility of working with carriers on behalf of the shipper. The goal is to file, investigate, resolve, and recover funds from customer claims due to carrier performance.
Leading and Advising
For those companies striving for TSM maturity, Trax also offers extensive advisory services. These premium solutions include contract optimization, network optimization, accessorial optimization, service optimization, and transportation strategy. Depending on a company’s current state in the TSM maturity model, different services are applied and collectively maximize savings and improve ROI.
As companies progress through the stages of TSM maturity, different products and services are emphasized. The key is to understand the starting point and the ultimate goal.
The Trax Difference
The tools and technology behind transportation spend management are crucial in moving a company toward maturity. Don’t fall behind the competition by getting stuck in the early stages of transportation spend management. No matter what phase a company is in, Trax meets a company where it’s at and quickly propels it toward TSM maturity.
Contact Trax to access the tools and services necessary to become a proactive, optimized, and leading enterprise.
Trax is the global leader in Transportation Spend Management solutions. We partner with the most global and complex brands to drive meaningful optimizations and savings through industry-leading technology solutions and world-class advisory services. With the largest global footprint spanning North America, Latin America, Asia, and Europe, we enable our clients to have greater control over their transportation performance and spend. Our focus is on your success.