What Are the Interactions Between WMS and TMS?

by Vector | Nov 2, 2021 8:12:24 AM

In the thick of the post-pandemic supply chain crisis, certain things became clear. Other things became less clear. For example, it's abundantly clear how interconnected everything seems to be. The global supply chain itself is certainly interlinked. But the public at large is also learning how much our lives depend on a strong, functioning supply chain.

In other words, the constant stream of reports regarding supply chain disruptions leaves us feeling confused. It isn't clear how long the supply chain crisis will last. Will the entire industry ever catch up with demand? Today, we'll attempt to dispel the fog of confusion from the world when it comes to the interactions between a WMS and a TMS.

We're talking about warehouse management systems (WMS) and transportation management systems (TMS). These are both software stalwarts of the transportation and logistics industry lexicon. Indeed, we'll get clear on what makes your WMS and TMS software such rock stars. But we're really more interested in looking at how a WMS and TMS interact—and what happens when they don't!

Ultimately, the question we want to look at here is this. How would better WMS and TMS interactions help clean up the supply chain crisis?

Put another way, the ideal interaction and collaboration between your WMS and TMS is like a hat I'm pretty sure I ordered from Instagram. It hasn't arrived yet. But this hat is awesome. Allow me to explain why.

Where's That Awesome Hat I Ordered From Instagram?

Honestly, where in the world is that hat?!

You may be asking yourself, "Who cares? It's just a hat, buddy!"

Or perhaps you're saying, "You get what you deserve for buying something off Instagram!"

Or maybe you're thinking, "Are you sure you even bought it? That purchase probably happened at the end of an endless scrolling binge. That's when you have zero willpower, and brain cells, remaining. So are sure you even clicked the Buy button?"

To that I say, "yes, I'm pretty certain I clicked the Buy button." That might explain why my hat hasn't arrived. But it wouldn't explain why this hat is so awesome.

How awesome? All right, picture this.

Take a Chicago Bears hat (or whatever you like—they've got options). Then, combine it with a Carhartt brand hat.

Yeah. I know, right? Boom.

Can you even think of a better hat? Especially for the fall and football season? It's sporty! It's outdoorsy! Can you call that outsportsy?

Most importantly, you haven't seen your friend wearing one. Talk about a win-win-win! Am I right!?

Fair enough if that's not your cup of tea. After all, there's no accounting for taste. But this missing Bears-Carhartt hat is indicative of the entire supply chain crisis on many levels.

My missing Bears-Carhartt hat is also a metaphor for how we can optimize the interactions and collaboration between a TMS and a WMS. Allow me to explain!

A Brief Overview of a TMS

Here's a quick rundown of a transportation management system. First of all, a TMS is widely regarded as an essential software tool across the logistics industry. A TMS performs many amazing feats. For example, a TMS allows you to find and match available loads of freight with empty capacity.

To clarify, that load of freight can be as large as hundreds of ocean containers. That load can also be as small as one amazing Bears-Carhartt hat.

In addition, capacity can mean any and every mode of transportation. Huge ocean vessel. Intermodal and rail. Truck and trailer. FTL. LTL. 3PL. Parcel. Regardless, there's a TMS for everything. In short, TMS software helps you streamline the entire load process.

TMS software helps organize and optimize everything. Routing. Load matching. Delivery confirmation. Payments. Conflict resolution. Paperwork and load documentation management.

Over the years, TMS software has continually evolved toward more efficiency and optimization. But the most important evolutionary step for TMS was document digitization. I'll explain why I say that in a moment. But first, let's jump over to the WMS side.

A Brief Overview of a WMS

Warehouse management systems have been around forever. A WMS basically helps warehouse managers control and coordinate their operations. This is a software tool that helps optimize and streamline the throughput, storage, and organization of a warehouse.

A WMS helps manage the process involved in the flow of goods and order fulfillment. That includes everything from unloading to loading. It also includes staging, storage, and inventory management.

In addition, a WMS with AI and machine learning can help identify seasonal items (like the perfect fall hat). This helps managers rotate inventory for more optimized cycle times.

Beyond that, a WMS can integrate with facilities management, personnel management, and robots (which fall somewhere in between).

Clearly, a WMS and TMS are vital standalone pieces of software. But how do these systems interact and integrate with each other?

What Are the Interactions of a WMS and TMS?

As all smartphone users know, there's always a new update to install. Software is constantly evolving. There are new needs, updates, iterations, and improvements. WMS and TMS are no different.

In my opinion, the biggest evolution in logistics software is the way multiple systems can now communicate. The interaction between a WMS and TMS is essentially data sharing. As we know, logistics software exists as a tool to identify and relieve pain points. Like, for instance, avoiding potential stock-outs of certain hats?

When it comes to visibility tools, what we're really talking about is end-to-end order tracking. So let's discuss that next.

End-to-End Order Tracking

How reassuring it would be to know the precise location of my hat right now?!  And for that matter, all the way on its journey!?

We could start from the click of the Buy button. There it is, in a warehouse. Then in a box. Then on a pallet. Up on a fork truck, and into a container. Onto a truck. Up a hoist and onto a ship. Now rolling across the high seas.

Then bobbing in San Pedro Bay offshore of the Port of Long Beach for a few weeks. Still there? Eventually off the ship. But then sitting at the Port for awhile. Did they forget about it?

Oh, it's finally moving onto a truck. And now it's hitting a few cross-docks. How worldly this hat is! Hey, it's stopping here and there with other parcels. Until finally—deliverance to my fall-themed front step!

You get the point. The interaction between the warehouse and transportation aspects of any given supply chain helps you and your organization prepare in advance for needs like volume spikes or capacity shortages. Without visibility tools, we're in the dark.

Breaking Down Data Silos

The interaction between WMS and TMS lies in data integration. Put another way, for greater supply chain visibility, we need to break down information silos. We need to integrate data, get it to teams, and pool this information.

One example of this is the interaction between WMS and TMS systems that has produced yard management systems (YMS). The YMS is the point of change between warehouse and truck. And navigating any given yard can be choppy and filled with bottlenecks. The interaction and data exchange of a YMS helps warehouse managers optimally stage personnel and prepare capacity for inbound freight.

But these systems are not alone. Beyond WMS, TMS, and YMS, there's also data management systems (DMS), third-party logistics (3PL) software, telematics software, countless internet of things (IoT) devices, and endless barcodes and QR codes to pool and integrate.

Talk about information overload!

But it's even worse when each system exists in its own world. Thus, we need more and better information—but less of it.

Visibility, Digitization, Control Towers, and the Single Pane of Glass

We've arrived at a new stage in the modern world, in my opinion. We have too many options and too much information constantly bombarding us. Yes, that's the churn behind big data, machine learning, and AI on the back end. But on the front end, it's little ol' frazzled me. I can't even remember if I actually bought the hat we're talking about. And you expect me to learn seven new systems this year?!

What I'm saying is this. We need that pool of data, but it all needs to be distilled down to something we can taste, with a sip.

So that brings us to user interfaces, control towers, and what Mitel.com calls the single pane of glass promise simplicity. The single pane of glass is "a term used throughout the IT and management fields relating to a management tool that unifies data or interfaces across several different sources and presents them in a single view."

Business communication, data analysis tools, easy-to-use interfaces. Visibility, collaboration, and customer service tools. One "cheat sheet" view that doesn't require you to switch between applications. And to my earlier point, the driving force behind everything is document digitization.

For more on digitization, check out Vector. The bottom line is simple. Big data can't do its thing if we don't eliminate paper from the supply chain.

Collaboration Will Define the Next Decade

Think about the single pane of glass another way. Picture an NFL coach walking the sideline carrying his entire laminated playbook like a Denny's menu. There's a lot of cooks and recipes working in the background to make it real, but you know what play you're calling at a glance. The same is true regardless of whether we're talking about interactions between a WMS, TMS, YMS, DMS, the NFL, the Bears, or Carhartt.

The coming decade will be won by whoever makes—and delivers—the best collaborations. I'd click Buy on that!

This post was written by Brian Deines. Brian believes that every day is a referendum on a brand’s relevance, and he’s excited to bring that kind of thinking to the world of modern manufacturing and logistics. He deploys a full-stack of business development, sales, and marketing tools built through years of work in the logistics, packaging, and tier-1 part supply industries serving a customer base comprised of Fortune 1000 OEMs.

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