News / Transportation Optimization VS. Managed Transportaion

Transportation Optimization VS. Managed Transportaion

11 July 2021 - by - in Industry News

According to Globaltranz, transition optimization partners well with managing transportation. The challenges of managing the supply-chain are often overwhelming and difficult to ensure everything runs smoothly. With so much at stake, it’s essential to have a system in place to help achieve the goals at hand. By allowing technology to set up all the checks and balances, shippers can focus on other things like customer satisfaction and timely deliveries. Understanding transportations optimization is a great place to start when trying to take your business to new heights.

What is Transportation Optimization?

Transportation optimization uses data to carry out all aspects of the shipping process. This helps companies reduce costs, manage time more efficiently, and improve customers satisfaction ratings. This type of optimization is better for all involved, employees, stakeholders, operators, and upper management. You are able to focus on areas that often are neglected like where to trim excessive waste, how to better manage overlaps and large volumes, and track overall performance. Using this technology provides your business with a customizable strategy to meet your unique managed transportation needs.

Difference Between Managed Transportation and Transportation Optimization

Though they are often paired together there are many differences between managed transportation and transportation optimization.

Managed transportation

Managed transportation entails streamlining the entire process. From inbound and outbound logistics to warehouse and delivery these processes share data across network partners. This includes logistics capabilities like:

  • Logistics consulting
  • Analysis needs
  • Costs analysis
  • Calculate savings opportunities
  • Implement training systems.
  • Shipment planning
  • Optimize execution capabilities
  • Manage influx of vendor goods
  • Carrier procurement

Manage processes like:

  • Initial vetting
  • Management with carrier scorecards to make sure freight cost are reduced

 

  • Devout account management that aligns realistic goals in accordance to the value of managed transportation, by using scorecards, quarterly business reviews, and continuous testing to ensure your expectations are exceeded,

The various logistic capabilities not only include the aforementioned management process but they can also be used to optimize shipments in real time, track carrier rates, and route freight. These are benefits to working alongside companies like GlobalTranz who are very successful with this type of operation.

Transportation optimization

Outsourcing is also a huge part of transport optimization that enables the supply chain to productively manage. By contracting out many service and production jobs needed to maintain proper functioning of the supply chain.

According to Supply Chain Dive,

“First is monitored outsourcing, which is the traditional form in which production or service is contracted out to suppliers with infrequent performance evaluations. Using an offshore vendor to manufacture a component for a larger automotive assembly is a typical example. Orchestrated outsourcing is more common in logistics, where businesses require close coordination with a supplier who has a core competency in a particular discipline. A 3PL is a common orchestrated relationship, in which the provider is part of the day-to-day operations with frequent communications.”

Transportation optimization allows 3PLs to An outside perspective makes it possible for 3PLS to work in relationship with freight management
It’s the view from outside that allows 3PLs to orchestrate all aspects of freight management from within the network through transportation optimization.

Another Thing to Consider: Network Versus Execution-Level Optimization

Once an organization has a broad understanding of the meaning of transportation optimization and its relationship to manage transportation, there is another confounding factor. This can occur at a network level and an execution level.
Network level optimization focuses more on higher-level design improvements like landed costs analysis of moving facilities, such as suppliers, manufacturers and distribution centers, assessing aggregate level impact of expenses around deliveries for customer demand changes, e.g., new customers, new product releases, and aggregate level service impacts.
Execution level considers business rules and defined freight profiles to ensure end customer commitments are held while achieving the highest value to transport goods.
As a further example, a broad mix of carriers allows for rapid scalability during times of disruption. A managed transportation solutions provider could enable that with pre-on boarded carrier networks. However, those carrier networks lack value if they cannot be immediately tapped when needed. That is where an execution-level optimization, using technology to seamlessly automate and complete execution processes for each shipment is important. Loads of information can be overwhelming so see transportation terminology to learn more.

Put the Power of Technology and People to Work to Take Advantage of Transportation Optimization

The modern supply chain continues to evolve and become more complex, finding success depends on around-the-clock scalability, insight into specific market granularities, clear data and visibility, and understanding how to stay strategic. Learn more about transportation optimization and how it can help you drive operative advantage while meeting customer expectations and delivery requirements.

How Trifecta Can Help

Dealing with the stress of logistics during regular periods can be headache-inducing enough—factor dealing with logistics during a pandemic and a spike in shipping prices, even worse. The team at Trifecta is here to help streamline your logistics process to save you the hassle. We take care of the entire life cycle of your shipment, so you don’t have to contact multiple carriers to ensure you get your order on time.
We go above and beyond your basic logistic needs. If you have a unique shipment or need something as soon as possible, we can help. We work on your schedule, so we’re there when you need us most.

Contact Us Today

If you’re struggling to find a solution to the increase in shipping prices, our team at Trifecta Transport can make your life easier. Contact us today for a quote on your shipping solutions.