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3 Ways Shippers Can Make Better Decisions

Posted on April 8, 2015

Written by broussard_press

In an age where professionals are constantly bombarded by changing technology and information, the ability to capture, review, and act on that information is critical. There is certainly no exception for managers whose responsibility include logistics, shipping, or supply chain in any organization. Constantly looking for ways to learn and adapt is an important survival tactic.

With that in mind, it always helps if you can improve your decision-making skills, either by acquiring better information, choosing better vendors or becoming more efficient. Here are 3 ways shippers can make better decisions:

#1 – Audit Freight Invoices.

It may sound either boring or simplistic, but auditing your freight invoices – both pre- and post-payment – is a critical step in making better decisions. Before accounting pays the freight bill, simply making sure the correct rate is applied is absolutely essential. There are so many variables that go into the proper freight rate, such as freight classification, fuel surcharges, and negotiated rates. Making sure this piece is correct can save the expense of finding these problems later. It reduces the number of checks you are cutting and re-issuing to correct for problems, but it can also help you identify the vendors or carriers that are consistently creating billing errors so you can shift business away from them to the vendors that are performing at a higher level in this area. In addition, it can be used as negotiating leverage when faced with your next increase.

A post-audit can be just as important. Even the most attentive accounting departments can make mistakes. Hiring an outsourced auditor to perform a post-audit on freight bills can be a cost effective decision. The law states that you only have 6 months to claim overcharges from freight carriers, so this is a time sensitive endeavor. Once again, however, it can not only yield savings in the way of overpayment, it can indicate to you either processes in your own organization that need to be revisited or recurring issues with one of your vendors that need to be corrected.

#2 – Get a Transportation Management System, or TMS.

A TMS is a powerful tool. We have discussed in this blog how focusing on your core business is so important in today’s environment. For shippers, there is no better way to do that than adopting a TMS system (hyperlink to TMS blog post). One big payoff is automating manual processes. One example of this is creating BOLs electronically, allowing shippers to store, send and track information in a much more dynamic way. A TMS also makes the arduous task of searching for and evaluating freight rates much simpler. There are few ways to better improve decision making then automating manual processes and putting the information you need to make a decision at your fingertips.

#3 – Get Customized Reports.

A third way shippers can get better at making decisions can be a by-product of the first two. By automating processes – and implementing the technology and tools to allow you to do so – you get better at organizing data and harnessing technology. There is no more complex, multi-variable task in an organization than managing a supply chain. 21st century supply chain managers must have a grasp of all those variables and be able to run reports, manipulate data and organize information to their advantage. Chasing today’s crisis or solving this week’s problem is not good enough anymore. Planning and anticipating challenges much further down the road is vital. By utilizing a system that allows you to input all those variables, reviewing customized reports that highlight exceptions becomes second nature, and the ability to perform system-wide searches for particular vendors, products, and unique variables can help supply chain managers elevate their skills to efficient and exceptional.

Sound decision-making in today’s business environment is an underrated skill. It takes two things: the right information, and a bias for action. Not every manager is a good decision-maker. It is certainly difficult to develop a bias for action.

We can, however, always be striving to get an edge by obtaining better information.