Logistics technology: SaaS taking on a larger role in TMS sector
Outside of a select few, most companies that want to use Transportation Management Systems in their supply chains will be seeking out some form of Software-as-a-Service, or "cloud" computing, when adopting new software platforms.
Sean Murphy, Associate Editor -- Logistics Management, 11/18/2009
If you are a shipper, carrier or logistics manager interested in Transportation Management Systems(TMS), chances are you'll need to make use of Software as a Service (SaaS) systems, casually referred to as "cloud" computing.That was the message of the True SaaS Executive Roundtable discussion, held at the Boston Marriott Hotel in Newton yesterday. Executives from LeanLogistics, the sponsor of the event, put on a presentation discussing the concept behind SaaS, which essentially involves outsourcing computer software applications to remote locations.
Matt Ahearn, Chief Operating Officer at LeanLogistics, described SaaS as having six key attributes, sometimes using LeanLogistics products to illustrate:
Single-Use, Multi-Tenant: Possibly one of the more important attributes is the idea of a single piece of software or single application, which is simultaneously used by many other people. This can add up to hundreds, or even thousands of users working with a single program.
As an example, LeanLogistics has about 65 corporate clients right now, with 30,000 users and more than 6,000 carriers, all using a small number of hosted, SaaS applications. Chris Timmer, senior vice president of sales and marketing for LeanLogistics, said this idea, of multiple users working with a single application, is a fundamental attribute to SaaS.
"Unless you have that, you don't have SaaS," he said.
Built-in Shipper/Partner Network: This network creates visibility, not just within the SaaS application, but throughout the supply chain.
Pay-As-You-Go Pricing: Ahearn said the system was subscription-based, meaning users only paid for it while they were using it, as opposed to installed software, which is often paid for up front, with a flat fee, regardless of how much the software is used.
Continuous Innovation: By continually developing the application, Ahearn said SaaS software is upgraded automatically, and implemented immediately, with no lag time, in a "plug and play" fashion.
Support Services: Ahearn said his company offers strategic support, holding quarterly meetings with clients to make sure the SaaS product is continuing to meet their needs.
Modular Applications: Most people don't want to pay for what they don't need, and the best SaaS applications only offer what clients want, and nothing they don't.
There were about 14 logistics managers and other executives in attendance, and Timmer told them that SaaS-based TMS is routinely being used now to reduce inventory and transportation costs.
After the presentation, Timmer told SCMR that the era of installed, in-house TMS is not dead. One major fault of SaaS-based TMS, he said, was a lack of customization by the client.
"There's always going to be customers that really want to customize," he said.
But in the end, he added, most companies feel the benefits of SaaS far outweigh that one problem.
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