The freight market is like a pendulum, as FreightWaves CEO Craig Fuller described last month. Just wait and the market will eventually swing, for better or for worse.
Looser market conditions in recent months have tested carriers’ resolve as increased capacity has given carriers more pricing power. Under these conditions, contracts are particularly important for freight forwarders to ensure consistent freight and cash flow.
“The best and most agile companies can negotiate lucrative contracts with carriers that ensure they keep moving,” said Frank Kenney, Cleo’s director of market strategy.
The technological infrastructure of a logistics company is important for this negotiation. Technology is critical to how efficiently it can navigate business processes, customize services, and respond to and resolve problems.
A flexible and robust infrastructure puts businesses in a better position to attract and retain customers, allowing them to remain flexible in times of economic contraction while riding the wave of opportunity when conditions become more favourable.
Building a strong infrastructure
According to Kenney, a former analyst and “market evangelist,” there are a few core components crucial for the efficiency and market stability of any company:
- Process automation: “Brings consistency, reliability and predictability to all critical processes, such as B. accepting and declining offers, status updates and invoicing.”
- Exception Management: “Retains automation in the process, but allows for additional value creation opportunities or risk mitigation measures in the event of exceptions to established processes.”
- Problem identification and resolution: “The reality is that problems happen to every single company in the world. How quickly these problems can be identified and resolved separates the strong from the less strong. It’s not like the problem happened. The problem was fixed that quickly.”
Integration platforms foster an environment where all three ingredients come together, making them a vital resource for organizations as they build out their infrastructure. They are powerful tools to shape and connect the moving parts of an organization’s technology ecosystem for its onboarding, automation, governance and operational efficiency needs.
With integration platforms, users sit in the command center of their mission-critical operations—including day-to-day processes and data intelligence. They are able to design how their enterprise systems, services and applications interact with each other and how they interact with trading partner technologies.
To break this down further, Kenney points to the two types of integration platforms: internal and external.
An internal integration platform allows a company to synchronize data across its critical technologies such as TMS, enterprise resource planning system and analytics technology.
“These companies don’t focus on the complexities of working with an outside partner who has their own governance, security and control infrastructure and systems,” Kenney said. “Negotiating that is a delicate but critical part of a [business to business] Relationship.”
The logistics industry is driven by B2B partnerships, be it with customers, carriers or suppliers. Every single company interacts with numerous trading partners on a daily basis. This means that most companies require external integrations that offer more complex interactions than the internal integration platforms.
These third-party technology integration platforms focus on B2B, but don’t offer the level of oversight that some companies strive for.
“Often the only companies that offer this are managed services that take your documents and send them through their engine, processes and governance mechanisms,” Kenney said. “These three systems are hidden from the user, compromising visibility, control and problem-solving efforts.”
Cleo Integration Cloud (CIC) is a hybrid of internal and external integration system types that provides users with a self-service platform to connect their internal ecosystem of back office and cloud-based enterprise systems to trading partners via any-to-any transformation engine.
“What if one [system] could handle the internal data that sync requests, [application programming interface] Beast integration needs and the ability to handle complex B2B collaborations?” Kenney asked. “This is the world Cleo lives in, a mix of self and managed services and the ability for internal and external process integration.”
Cleo serves 4,000 customers worldwide, of which more than 500 represent industry-leading transportation and logistics providers. These customers use CIC to unify required B2B integration capabilities including data orchestration, API integration, electronic data exchange integration, transparency, governance and more.
To learn more about Cleo Integration Cloud, click here.