Transportation Market Meets Managed Services

Transportation management systems software, which shippers use to plot the best routes and optimize loads, is making the shift to managed services. Consider the following developments and their implications for MSPs.

Noteworthy moves include:

  • JDA Software Group Inc. plans to debut TMS Management Services, targeting “companies that want to tackle their transportation and logistics challenges but lack the IT and capital resources to do so.”
  • TMW Systems, a TMS software developer based in Nashville, Tenn., rolled out TMW Managed Services, an application hosting/systems management offering. The company aims to “lower the capital cost of major software implementations.”
The TMS market is a subset of the broader supply chain automation field, but the story here echoes the broader trend in managed services. In a tough market, vendors are hoping that the lower entry costs of managed services -- as opposed to traditional on-premise implementation -- will win over customers.

TMS vendors also appear to be trying to jump start a market that has yet to hit its stride. According to a Gartner Inc. Magic Quadrant Report, TMS software is growing at a 20 percent annual clip but has reached a relatively small slice of the market.

“Today, the TMS market is underpenetrated, with only approximately 20 percent of the addressable market having implemented such a system,” the April report stated.

It will be interesting to see whether the managed services model gets more shippers to buy TMS. There could be a lesson there for MSP in making complex applications more accessible.

Contributing blogger John Moore covers Master MSPs, Web hosts and emerging opportunities. Follow MSPmentor via RSS; Facebook; Identi.ca; and Twitter. And sign up for our Enewsletter; Webcasts and Resource Center.
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