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On premise vs cloud based transportation management solutions

Running a transportation company these days can feel like navigating an obstacle course blindfolded. 

Between ballooning costs, trucker shortages, complex regulations, and outsmarting the competition, you’ve got your work cut out for you. And just thinking about utilizing endless spreadsheets to keep track of everything is enough to give anyone a migraine.

Transportation management systems (TMS) are the behind-the-scenes software putting industry giants ahead of the pack. Think of a TMS as a logistics command center that can expertly juggle all your shipping routes, invoices and carrier relationships with ease.

The big decision is — do you want the flexibility of tailoring a custom in-house system, or the convenience of a ready-to-use cloud based option that can scale as your transportation empire grows?

Sifting through the perfect transportation management solutions is tough, and even the best TMS software comes with a myriad of pros and cons. Before making a sizable investment, weigh the options. Read on to get the recipe for transportation tech success so you can whip up sweet operational efficiency.

On premise TMS

Want complete command of a tailored system? On premise offers infinite customization power. But also prepare to be a lone ranger for handling security, updates and scaling. Choose between freedom and responsibility.

Bend technology to your will

Tired of rigid off-the-shelf transportation solutions that lock you into limiting workflows? On premise allows you to fully customize transportation management on privately owned servers and software with no restrictions. 

Tailor every process, integration and algorithm exactly the way you want for maximum efficiency. When you own the full infrastructure stack, you can optimize operations to achieve strategic business objectives without compromise.

Of course there is another side of the coin. On premise technology typically requires internal expertise. And if that expertise resides with one person who leaves the company, you may have a big problem on your hands.

Fort Knox-level data security — or a cyber minefield?

Worried about cyber thieves stealing precious logistics data? An on premise TMS lets you lock down shipment information in your own private fortress with customized encryption.

Become the sole data gatekeeper by tailoring airtight protocols and firewalls aligned to your risk tolerance, without third-party providers. With cloud systems, security specifics are murky. On premise offers crystal clear protection for your precious data.

But while customizing your own security measures can be great, not everyone has the bandwidth to police encryption protocols and firewall patchworks while simultaneously steering logistics operations. As lone manager of on premise systems, catastrophe awaits if your tech squad flinches. One tiny system crack could expose loads of customer data to ruthless cyber thieves.

Scaling turbulence

Scale too quick and hardware demands pile up like dirty laundry. Crammed servers wheezing under data loads create more tech tasks when you’re already juggling full transportation operations.

Precious time could be diverted to reconfiguring storage, CPUs, and network; stress levels could skyrocket faster than your business as messy upgrades cut productivity.

Cloud based TMS

Feeling overwhelmed by infrastructure demands? A cloud based transport management system lets you hand over tech hassles at a monthly price. 

No expensive on-site servers or IT build outs. The vendor handles all security, updates and storage behind-the-scenes so you avoid meltdowns. 

‍Choosing a cloud based transportation management solution typically means you don’t have to worry about purchasing any servers — all you need is access to the internet and you’re good to go. ‍And with that said, you can access a cloud based TMS at any time, from wherever you have an internet connection.

Infrastructure on autopilot means you can zero in on growing your transportation empire, not maintaining equipment. Cloud base TMS platforms let you set operations to cruise control.

Easy street infrastructure

Tired of hardware headaches zapping focus from coordinating shipping logistics? Cloud TMS lets you kick back, taking the cluttered data centers and moody IT build outs totally off your crowded plate.

New hire processes or route optimization will no longer get derailed by distracting tech crises. The cloud’s got scaling, security patches and storage expansions handled behind the curtains so you steer towards smooth sailing operational success.

Watch out for flexibility limitations, however. While the lack of customization may be helpful to some, cookie-cutter software can make companies with more specific needs feel caged in. Clunky setups from external TMS providers prohibit customizable workflow innovations. Their bland templates might fill basic business needs, but forget satisfying distinctive dreams of operational excellence without complex custom coding.

If you’re hungry for systems perfectly baked to your ingredient list, unless you’re working with highly flexible TMS technology, you may be better off with a home-grown solution.

Controlling cost chaos

No need to leak profits on perpetually humming servers, blazing data links, or endless updates. Cloud TMS bundles everything into one reasonable subscription bill — saving major dough as an all-in wallet wonder compared to on-site systems.

A modern TMS subscription covers snappy logistics software access, background security sweeps, extra data storage when peak season hits, and tech support actually worth dealing with.

On the other hand, trusting important shipment tracking details to an unreliable vendor is like giving matches to a firebug. Should inept IT admins fumble critical system patches, entire operations and customer trust hangs in balance. One breach could mean million-dollar logistics pipelines are exposed to cyber attacks. 

Trusting critical transportation management solutions data to unknown third-party security protocols is an uncertain gamble. Betting entire operations on remote servers safely blocking persistent intruders could leave customer pipelines exposed to attacks.

Consider the pros and cons of transportation management solutions

When deciding between an on premise or cloud based TMS, it’s crucial to consider what your company needs and then weighing all the factors of each option.

Kick things off by envisioning your ideal shipment tracking abilities and efficiency targets. Will current staff resources handle intricate custom configurations or is a straightforward pre-packed cloud system more in tune?

If hungering for ultimate optimization control, brace for big bucks buying specialized servers and software, but consider the endless security, storage and version upgrade chores. With cloud’s faster deployment, you skip the install and maintenance duties — though output flexibility may suffer.

Remember to vet those uptime promises before committing. TMS integrations should seamlessly bridge optimized routing, warehouse operations, order processing and inventory for enhanced coordination.

Regardless of which TMS system you ultimately decide on, accurately projecting your company’s needs and costs is crucial for growth.

Once the foundations allow wide data access, operational excellence awaits. Stay true to core freight goals and the rest falls into place.

Future proof your business

The time is now for forward-thinking transport businesses to deploy a “command center” delivering organization-wide visibility and control with TMS solutions. As shipping complexity and costs continue rising while customer expectations for tracking and efficiency heighten, the best TMS systems provide a pivotal foundation enabling growth into the future.

By outlining current pain points, infrastructure realities and warehouse needs, companies can determine if an on premise or cloud system best aligns. This prevents a disjointed approach of stacking transportation management solutions upon solutions. 

Choose your TMS providers wisely — one providing the security, scalability and nimble optimizations vital for long-term success. Future-proof sustainable profits starting today.


What does a transportation management system do?

A transportation management system (TMS) is software that helps manage logistics operations including planning, execution, tracking, and optimization of shipping movements. Key capabilities include route optimization, load consolidation, carrier management, and shipment visibility.

How much does a TMS system cost?

Transportation management systems range greatly in cost depending on whether they are on-premise solutions requiring customized infrastructure with large upfront investments between $100,000 – $500,000 or cloud-based SaaS subscriptions averaging $1,500 – $5,000 monthly with smaller startup fees.

What does TMS mean in trucking?

In trucking, a Transportation Management System (TMS) is end-to-end logistics software covering shipment planning, execution, freight tracking, electronic logging, document management, analytics, and other tools to consolidate, coordinate and optimize complex transportation operations.

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