08.03.23 By Bridgenext Think Tank
This blog explores the process and benefits of migrating an on-premise transportation management system (TMS) to the cloud. Learn how a cloud-based TMS will help you manage the peak shipping season better and faster.
According to Adobe Analytics, the 2021 holiday season has already brought in over $109.8 billion in sales. At the peak of Cyber Monday, consumers spent $12 million every minute.
It is safe to say that peak season lives up to its name.
The Transportation and Logistics (T&L) market in the United States is a significant and dynamic industry. It encompasses various modes of transportation, including trucking, rail, air cargo, maritime shipping, and pipelines. The rise of e-commerce has had a profound impact, driving increased demand for last-mile delivery services and specialized logistics solutions. Technological advancements, such as automation, data analytics, and digital platforms, are enhancing efficiency and transforming operations. The competitive landscape is diverse, with large multinational corporations, regional players, and specialized providers. Also, the T&L market in the US is constantly evolving, influenced by economic factors, and changing consumer preferences.
According to a report by Grand View Research, the global logistics market size was valued at USD 6.1 trillion in 2020 and is expected to grow at a compound annual growth rate (CAGR) of 7.5% from 2021 to 2028.
A Transportation Management System (TMS) is a vital tool for Transportation & Logistics companies, enabling efficient management of transportation for multiple clients, better carrier negotiations, and real-time visibility for clients. By leveraging a TMS, 3PLs can provide cost-effective and reliable transportation solutions, ensuring competitiveness in the market. The TMS enhances operational efficiency, reduces costs, improves customer service, ensures compliance, supports data-driven decision-making, fosters carrier collaboration, and offers scalability and flexibility. It streamlines operations and optimizes transportation processes, leading to increased productivity and improved overall supply chain performance in T&L.
The global market for Freight Management Systems is estimated at $10.8 Billion, and the US is estimated at $3.8 Billion in 2022. – Research & Markets
The T&L industry experiences seasonal shifts in market conditions that impact rates and capacity. It typically observes four seasons. The Quiet Season falls in between January to March. It sees a slow recovery after the holidays and increasing freight volume as spring approaches. The Produce Season spans from April to July and brings a surge in freight volume due to the active produce market, resulting in higher rates and increased competition for carriers. The Peak Season occurs from August to October. Heightened shipping activities characterize it as companies prepare for holidays and back-to-school season, leading to peak freight volume and rates. Finally, the Holiday Season in November and December experiences a rush in shipping as shippers aim to complete orders before closures, making it the busiest time for last-minute shipments.
The seasonality in T&L impacts and demands changes in technology. Let us understand how.
In software systems, workload patterns refer to the characteristics and variations of the tasks and requests the system handles. These patterns help us understand the nature of the workload and the design of software architecture and infrastructure, leading to effective handling of demands. Understanding the workload patterns helps software architects and system administrators design scalable and resilient systems that can handle varying demand levels efficiently. Here are some of the most common workload patterns:
The T&L industry falls under the periodic workload pattern due to the seasonality in the business. To keep the business running at optimal performance, T&L companies must ensure the provision of infrastructure and relevant resources at the peak level. To do so, organizations spend more CAPEX, and the extra capacity remains idle during non-peak seasons, leading to cost over heads and maintenance.
Handling periodic workloads in on-premise systems significantly impact resource planning, scalability, infrastructure provisioning, performance optimization, redundancy, high availability, cost considerations, and flexibility. These workloads require careful resource planning to ensure sufficient capacity during peak periods, which may involve scaling hardware resources and optimizing system configurations. Provisioning the right resources is crucial to handle workload spikes effectively and maintain optimal performance. Redundancy and high availability measures are essential to minimize downtime and ensure continuous operation. However, cost considerations should be weighed since resource allocation may lead to underutilization during off-peak periods, increasing operational costs. The flexibility and adaptability of on-premise systems are vital in accommodating changing workload patterns, allowing for dynamic resource scaling and efficient resource allocation. Assessing the trade-offs and considering hybrid cloud or cloud-based solutions for added scalability and cost optimization is essential.
The evolution of cloud computing has revolutionized the way organizations handle their IT infrastructure and operations. Initially, cloud technology offered on-demand access to computing resources, storage, and applications, enabling businesses to reduce capital expenses and pay for services as needed. Over time, cloud platforms evolved to provide greater flexibility, scalability, and security, allowing organizations to easily scale their operations to meet changing demands. By leveraging cloud services, organizations can quickly deploy and scale resources, whether it’s expanding server capacity, handling higher website traffic, or accommodating spikes in data storage. Cloud computing also fosters collaboration, enhances data accessibility, and facilitates remote work, enabling organizations to adapt rapidly to market shifts and improve overall efficiency.
The global market for Digital Transformation Spending in Logistics, estimated at US$52.3 Billion in the year 2022, is projected to reach a revised size of US$108.8 Billion by 2030, growing at a CAGR of 9.6%. – Research & Markets
Here’s how migrating to the cloud can simplify managing periodic workloads compared to on-premise systems:
Migrating on-premises applications to the cloud empowers organizations to efficiently manage periodic workloads, improve performance, and stay competitive in a rapidly evolving digital landscape.
The worldwide end-user spending on public cloud services is forecasted to grow 20.7% to $591.8 billion in 2023, up from $490.3 billion in 2022, higher than the 18.8% growth forecast for 2022. – Gartner Inc
Let us look at the steps involved in migrating an on-premise system to the cloud.
Cloud migration strategy refers to organizational plan and approach while transitioning their applications, data, and infrastructure from on-premise systems to cloud environments. While specific strategies may vary depending on the organization’s goals and requirements, a typical cloud migration strategy involves the following key steps:
It’s important to note that the cloud migration strategy aligns with the organization’s unique needs and includes additional steps based on specific requirements. It should also have a robust change management and communication plan to ensure smooth adoption and minimal disruption to business operations.
At Emtec Digital, we help organizations achieve digital maturity by migrating on-premise applications to a combination of public, private, and hybrid clouds. Our experts help fulfill desired business goals by deploying technical services using the following step-by-step process:
Our experts will hold your hand for a seamless migration and integration of your TMS, from technology consultation to transition and post-migration support. Leveraging a winning process, we will help you overcome all your technical inhibitions and instill confidence to adopt upcoming technology.
Want to leverage the power of a cloud-based TMS to meet peak demands?
References
blog.adobe.com/en/publish/2021/11/30/adobe-consumers-spent-10-8-billion-on-cyber-monday-109-8-billion-so-far-this-holiday-season
www.researchandmarkets.com/report/freight-management-system
www.gartner.com/en/newsroom/press-releases/2022-10-31-gartner-forecasts-worldwide-public-cloud-end-user-spending-to-reach-nearly-600-billion-in-2023