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Microsoft Dynamics TMS: The Ultimate Guide

Optimize your logistics with Microsoft Dynamics TMS, powered by Avantiico’s enhancements like dynamic routing and load planning. Streamline operations, reduce costs, and improve delivery accuracy for a more efficient supply chain.

Picture of Monty Montgomery

Monty Montgomery

Introduction

Managing transportation logistics isn’t without challenges, from high costs and inefficient routes to complex carrier relationships. But with a transportation management system such as Microsoft Dynamics TMS, you can ease these pain points and simplify your logistical processes.  

Discover how transportation management in Dynamics 365 can optimize your route planning, enhance load efficiency, and streamline carrier management, and learn how Avantiico is elevating the Dynamics TMS with advanced features like dynamic route planning and load optimization. 

What Is a TMS?

A transportation management system (TMS) is a software solution designed to help businesses plan, execute, and optimize the physical movement of goods. It provides visibility into day-to-day transportation operations, ensures compliance with transportation regulations, and ultimately streamlines the shipping process. Other core functions include route optimization, carrier selection, freight auditing, and real-time shipment tracking. 

What Does a TMS Do?

A TMS is used to manage transportation operations from start to finish, typically offering automation features to simplify the logistics process. Here are its key use cases: 

  • Route Planning: Identifies the most efficient routes to save time and fuel. 
  • Freight Auditing: Verifies freight bills for accuracy and identifies discrepancies. 
  • Payment Processing: Automates payments to carriers and manages invoices. 
  • Load Optimization: Ensures vehicles are loaded to maximize space and reduce trips. 

For example, a TMS can automatically select the best carrier based on cost and delivery time, schedule shipments, and generate necessary documentation. By doing so, it enhances efficiency, reduces errors, and improves customer satisfaction by ensuring timely deliveries. 

What Is Microsoft Dynamics TMS?

Microsoft Dynamics 365 Transportation Management System (TMS) is a native module within the Dynamics 365 Supply Chain Management suite, designed to streamline and optimize transportation logistics across the supply chain. It provides businesses with tools to manage both inbound and outbound transportation activities efficiently. 

By leveraging Dynamics 365 TMS, companies can enhance operational efficiency, reduce transportation costs, and improve overall supply chain performance — all within the integrated Dynamics 365 environment.

Key Features of Microsoft Dynamics TMS

Microsoft Dynamics TMS offers a comprehensive suite of features designed to streamline transportation management and enhance supply chain efficiency. Key features include: 

  • Transportation Planning: Helps in planning and optimizing transportation routes, consolidating shipments, and scheduling deliveries. 
  • Carrier Management: Manages relationships with carriers, including contract management, performance tracking, and rate agreements. 
  • Load Planning: Optimizes the loading of goods into transportation vehicles to maximize efficiency and reduce costs. 
  • Execution: Facilitates the execution of transportation activities, including shipment tracking and management. 
  • Cost Management: Tracks transportation costs, including freight, handling, and other related expenses. 
  • Manual Freight Invoice Reconciliation: Ensures that the charges billed by carriers match the agreed-upon rates and the actual transportation services provided. 

How Does Microsoft Dynamics TMS Optimize Transportation Management?

Microsoft Dynamics TMS optimizes transportation management by providing tools that streamline logistics operations, reduce costs, and improve efficiency. The system helps businesses: 

  • Plan and Optimize Routes: Identify the fastest or most cost-effective routes for shipments. 
  • Manage Carrier Relationships: Track carrier performance, manage contracts, and negotiate rates. 
  • Monitor Shipments: Track shipments in real-time, ensuring timely deliveries and addressing any issues promptly. 

Transportation Planning with Microsoft Dynamics TMS

Microsoft Dynamics TMS empowers businesses to streamline transportation planning by optimizing routes, managing orders and shipments, and adapting to real-time changes – and with Avantiico’s enhancements to dynamic route planning and advanced load sequencing, companies like yours can further improve efficiency and reduce costs.  

What Is Dynamic Route Planning?

Dynamic route planning is a real-time navigation method that adjusts travel routes based on changing conditions like traffic, weather, and customer order and delivery priorities. Unlike static route planning, which uses fixed routes, dynamic route planning continuously updates to find the most efficient path. 

For example, if there’s an accident on your usual route to work, dynamic route planning will reroute you to avoid delays, ensuring you reach your destination faster. This technology is commonly used in GPS systems and fleet management to optimize travel time and fuel efficiency.

Microsoft Dynamics TMS Does Not Offer Dynamic Routing

However, Avantiico’s solution builds upon the basic tools of Dynamics 365 TMS so that dispatchers can add or remove stops from a route on-the-fly. Customers with different call days are automatically included on the routes for the days they take deliveries, and if delivery appointments are required, the system schedules those appointments automatically for customer confirmation. 

Shipments can also be picked in ascending or descending load sequence, eliminating the need for dock staging and reducing handling costs. 

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Orders vs. Shipments: How Microsoft Dynamics TMS Plans Transportation

Microsoft Dynamics TMS can plan transportation based on either orders or shipments. Planning based on orders is useful for managing individual customer requests, while planning based on shipments is ideal for consolidating multiple orders into a single load. The choice between the two approaches depends on the specific logistics requirements of the business. 

How to Set Up Transportation Planning in Microsoft Dynamics TMS

If you’re already using the Dynamics 365 TMS, you can configure transportation planning by following these steps:

1. Navigate to the Transportation management module. 

2. Set up global settings, including integration and default parameters. 

3. Define transportation modes and methods.

4. Create and configure shipping carriers and their services.

5. Set up route plans and guides to optimize delivery routes.

6. Use the Load building workbench to propose and manage loads.

Load Management in Microsoft Dynamics TMS

Effective load management is critical to maximizing transportation efficiency and minimizing costs. Microsoft Dynamics TMS, enhanced by Avantiico’s dynamic load planning and containerization tools, ensures trucks are loaded optimally based on weight, volume, and stop sequencing. 

What Is Load Planning?

Load planning is the process of efficiently organizing and managing the placement of goods within a vehicle or container to maximize space utilization and ensure safe transport. It involves determining the best way to stack and arrange items to prevent damage and optimize delivery routes. 

For example, in a warehouse, load planning ensures that heavier items are placed at the bottom and lighter, fragile items on top, reducing the risk of breakage. This practice is crucial in logistics and supply chain management to enhance operational efficiency and reduce transportation costs.

Load Planning in Microsoft Dynamics TMS

Load planning in Microsoft Dynamics TMS involves optimizing the loading of goods into transportation vehicles to maximize efficiency and reduce costs. Core features include load building, load templates, rating, and routing.

However, it does not include advanced containerization tools or automated solutions for eliminating manual staging of shipments on docks. It could also benefit from dynamic adjustments to split routes across multiple vehicles when necessary.

How Avantiico Eliminates Manual Staging with Dynamic Load Planning

Avantiico’s enhancements further improve this process by incorporating advanced containerization tools and rules-based logic for truck loading based on height, uniform loading, and sequencing by stop. These improvements eliminate the need for manual staging of shipments on docks, ensuring efficient space utilization and reducing double handling. Avantiico’s dynamic load planning can also split routes across multiple vehicles when necessary, boosting your overall operational efficiency.

How to Use Load Templates in Microsoft Dynamics TMS

Load templates in Microsoft Dynamics TMS help define weight, volume, and equipment restrictions for shipments. To use load templates: 

1. Navigate to the Load building workbench. 

2. Select or create a load template with specified height, weight, and volume limits. 

3. Apply the load template to shipments to ensure compliance with transportation requirements. 

Hub Consolidation: Streamlining Multi-Warehouse Logistics

Hub consolidation in Microsoft Dynamics TMS optimizes logistics by consolidating shipments from different warehouses or vendors into a single hub before delivery. Avantiico’s enhancements include customer-specific rate linking, which provides additional details for rates and accessorial charges, improving the efficiency of multi-warehouse logistics. This is far more cost effective than handling separate shipments. 

For example, a single shipment of 10,000 lbs. to a customer is less costly than four shipments of 2,500 lbs. each. Combining goods from multiple sources into a single shipment allows for lower transportation costs. 

Avantiico’s Hub Consolidation Solution for Microsoft TMS

Avantiico’s solution enhances the Dynamics 365 Transportation Management Hub feature by linking it to the customer and providing additional customer details for rates and accessorial charges. This allows for efficient consolidation of large loads from different warehouses bound for the same customer, reducing overall transportation costs and improving delivery efficiency.  

Last Mile Delivery with Microsoft Dynamics TMS

The last mile is often the most complex and costly part of the delivery process, which a dependable TMS can solve for. Microsoft Dynamics TMS simplifies the final mile with route optimization, dock appointment scheduling, and dynamic route guides, so that your deliveries arrive on time and customers are left satisfied. 

What is Last Mile Delivery?

Last mile delivery refers to the final step in the delivery process, where goods are transported from a transportation hub to the end customer. Microsoft Dynamics TMS enhances last mile delivery by optimizing routes, managing carrier appointments, and ensuring timely deliveries. 

Optimizing Last Mile Delivery with Route Guides

Route guides in Microsoft Dynamics TMS improve last mile efficiency by combining route segments and defining criteria for matching loads to specific routes. This dynamic routing ensures that deliveries are made efficiently and on time. 

Dock Appointment Scheduling for Last Mile Efficiency

Microsoft Dynamics TMS manages carrier appointments for pickup and delivery through dock appointment scheduling. This feature helps coordinate carrier schedules, reducing wait times and improving overall delivery efficiency. 

Freight Management and Reconciliation

Accurate freight management and reconciliation are key to maintaining financial control and ensuring carrier compliance. Thankfully, Microsoft Dynamics TMS offers both manual and automated reconciliation processes, along with tools for setting up rate masters and rating metadata. 

What is Freight Reconciliation?

Freight reconciliation ensures that carrier charges align with agreed-upon rates and that the transportation services were delivered as expected. This process is crucial for businesses to maintain accurate billing and effective financial management.

How Microsoft Dynamics TMS Handles Freight Reconciliation

Microsoft Dynamics TMS handles freight reconciliation through manual processes, which can be costly, time-consuming, and error-prone. Manual reconciliation involves matching invoice lines with freight bill lines, selecting reconciliation reasons for any discrepancies, and submitting the invoice for approval.  

Automating Freight Reconciliation in Microsoft TMS

Avantiico incorporates automatic freight reconciliation into Microsoft Dynamics TMS, using predefined rules to match invoices and freight bills, which streamlines the process and reducing manual effort. This approach not only identifies mismatches, but tells you why they’re mismatched, so that you can reconcile with a carrier and reclaim those discrepancies or identify which charges are valid.  

Another key advantage of this enhancement is the ability to set hierarchical tolerances for discrepancies. As a user, you can define acceptable thresholds for various factors such as rate, delivery date, carrier name, and more. 

For example, small differences in freight costs or minor delivery delays can be set to auto-approve, while bigger issues are flagged for review. This way, you only deal with what truly matters, cutting down on unnecessary alerts and helping you focus on resolving major problems. 

Reclaim Discrepancies with Automated Freight Reconcilation

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Setting Up Rate Masters and Rating Metadata

Rate masters and rating metadata in Microsoft Dynamics TMS determine shipping carrier rates. To set up rate masters: 

1. Define rating metadata with lookup criteria. 

2. Associate rate masters with rating metadata. 

3. Configure rate bases and assignments to calculate rates based on criteria like distance and weight. 

Microsoft Dynamics TMS for Shippers and Logistics Service Providers

Microsoft Dynamics TMS can benefit shippers and LSPs in a number of ways, from efficient order management and route optimization to fleet tracking, carrier management, and more. 

Key Benefits for Shippers

Microsoft Dynamics TMS provides shippers with a range of benefits that enhance their logistics operations and improve overall efficiency. By leveraging the system’s advanced features, shippers can achieve better control over their transportation processes, reduce costs, and ensure timely deliveries. Key benefits include: 

  • Order Grouping: Consolidate multiple orders into a single shipment. 
  • Route Optimization: Plan efficient delivery routes. 
  • Fleet Management: Manage and track company-owned transportation fleets. 

Advanced Tools for Logistics Service Providers (LSPs)

Logistics Service Providers (LSPs) can leverage Microsoft Dynamics TMS to enhance their service offerings and improve operational efficiency. The system provides advanced tools that support complex transportation requirements, enabling LSPs to manage multi-stage transportation, billing, and carrier relationships effectively. These tools help LSPs deliver better service to their clients and optimize their logistics operations. 

  • Multi-Stage Transportation Support: Manage complex transportation routes with multiple stops. 
  • Billing: Handle billing and invoicing for transportation services. 
  • Carrier Management: Track carrier performance and manage contracts. 

Setting Up and Managing Carriers in Microsoft Dynamics TMS

Logistics Service Providers (LSPs) can leverage Microsoft Dynamics TMS to enhance their service offerings and improve operational efficiency. The system provides advanced tools that support complex transportation requirements, enabling LSPs to manage multi-stage transportation, billing, and carrier relationships effectively. These tools help LSPs deliver better service to their clients and optimize their logistics operations. 

How to Set Up Shipping Carriers

1. Navigate to the Carriers setup page. 

2. Create a new shipping carrier and enter the required details. 

3. Define the carrier’s services, transportation modes, and rating profiles. 

Advanced Features of Microsoft Dynamics TMS

Microsoft Dynamics TMS gives you access to powerful tools that streamline transportation management and provide deeper insights into your logistics operations. With features like seamless analytics integration, handling complex transportation constraints, and managing dynamic pricing and product substitutions, you can achieve greater efficiency and responsiveness in your supply chain. These capabilities are designed to help you stay ahead in a competitive market while optimizing your operations. 

Integration with Power BI for Real-Time Insights

By integrating Microsoft Dynamics TMS with Power BI, you gain real-time analytics and insights to make smarter decisions in transportation management. Power BI lets you visualize your transportation data, track key performance indicators, and generate detailed reports — all in one place.  

With this integration, you can easily identify trends, monitor carrier performance, and optimize routes based on data-driven insights. The result? Improved operational efficiency and lower transportation costs, all while staying in control of your logistics. 

Handling Constraints in Transportation Management

TMS features within D365 allow you to manage transportation constraints for items, shipments, and carriers, ensuring compliance with specific requirements. Whether you’re dealing with hazardous materials, temperature-sensitive goods, or carrier-specific limitations, the system allows you to set up filter codes for item groups, ensuring products are stored and transported under the right conditions.  

You can also configure constraints for specific customers or vendors, giving you the flexibility to meet all logistics needs. By effectively managing these constraints, you can ensure the safe and compliant transportation of goods, keeping your operations running smoothly. 

Sales Commodity Pricing for Dynamic Order Management

Many distribution companies operate with market or commodity pricing rules that are updated on a set interval, such as weekly. While standard Microsoft TMS does offer sales commodity pricing, it’s limited when it comes to handling market-price commodities, buyer add-ons, and planned cuts. 

Improving Commodity Pricing in Dynamics 365 TMS

Avantiico’s Commodity Pricing enhancement fills these gaps by creating a commodity pricing agreement for products, allowing orders to be entered without prices. This avoids the need to use outdated prices just to complete sales orders and eliminates the need to manually adjust pricing. The enhancement also supports buyer add-ons and planned cuts, ensuring that customers receive proportional allocations of short-supply products. 

Customer-Based Product Substitution Roles

Out of the box, Microsoft Dynamics substitution rules are product-specific, and don’t consider customer requirements. To solve for this, Avantiico’s substitution enhancement defines customer-specific rules for product substitutions, ensuring that substitutions follow all other customer-specific rules such as batch numbers and FEFO. 

When products are in short supply, customers may agree to substitutions. Avantiico’s Substitution enhancement defines customer-specific rules for what can be substituted and when. Substitutions can be prioritized based on availability or explicitly defined by sales order line. This flexibility ensures that loads can be completed and delivered on schedule, even if the original products are unavailable. 

Why Choose Microsoft Dynamics TMS Over Other Solutions?

Microsoft Dynamics TMS, combined with Avantiico’s enhancements, offers certain advantages over other TMS solutions, such as Oracle NetSuite TMS and SAP Transportation Management. Here’s how it compares to other major TMS platforms: 

Microsoft Dynamics TMS vs. Oracle NetSuite TMS

Microsoft Dynamics TMS provides seamless integration with other Microsoft tools like Office 365 and Azure, enhancing productivity and user adoption if you’re already using D365. In contrast, Oracle NetSuite TMS is known for its customization capabilities but may require more technical expertise for complex configurations. 

Microsoft Dynamics TMS vs. SAP Transportation Management

SAP Transportation Management offers robust features for large enterprises, but can be complex and costly to implement. Microsoft Dynamics TMS, on the other hand, provides a more user-friendly interface and better integration with Microsoft’s D365 ecosystem, making it a more accessible option for mid-sized businesses. 

Conclusion: Is Microsoft Dynamics TMS Right for Your Business?

Microsoft Dynamics TMS can transform your logistics operations by providing comprehensive tools for transportation planning, load management, and freight reconciliation.  

As part of the Dynamics 365 ecosystem, it ensures seamless operation and enhanced efficiency, while Avantiico’s enhancements — such as dynamic route planning, automated freight reconciliation, and advanced load optimization — further elevate its capabilities.  

Together, these features make it an excellent choice if you’re looking to optimize your supply chain logistics, reduce costs, and improve the accuracy of your deliveries. 

Enhance Your Microsoft TMS with Avantiico

Ready to take your Microsoft TMS to the next level? Our Dynamics 365-native solutions address key transportation challenges for your business, offering dynamic route planning, load planning and optimization, and more.  

Reach out to us with the form below to learn how Avantiico can transform your TMS and drive efficiency across your supply chain. 

FAQs

What is Microsoft Dynamics TMS, and how does it work?

Microsoft Dynamics TMS (Transportation Management System) is a software solution that helps businesses plan, execute, and optimize the movement of goods. It integrates with Dynamics 365 to streamline transportation logistics, offering features like route optimization, carrier management, and real-time shipment tracking. By automating and centralizing these processes, it reduces costs, improves efficiency, and ensures timely deliveries. 

How does Microsoft Dynamics TMS improve transportation efficiency?

Microsoft Dynamics TMS improves efficiency by optimizing routes, managing carrier relationships, and automating load planning. It uses real-time data to adapt to changes, such as dynamic route adjustments and load sequencing, ensuring trucks are used effectively. This reduces fuel costs, minimizes delays, and maximizes delivery accuracy, ultimately enhancing customer satisfaction. 

What are the key features of Microsoft Dynamics TMS?

Key features include transportation planning, carrier management, load optimization, freight reconciliation, and real-time shipment tracking. It also supports dynamic route planning, hub consolidation, and last-mile delivery optimization. These tools help businesses reduce costs, improve operational efficiency, and maintain compliance with transportation regulations. 

How does Microsoft Dynamics TMS compare to other TMS solutions?

Microsoft Dynamics TMS stands out due to its native integration with Dynamics 365, making it a seamless part of the Microsoft ecosystem. Unlike SAP or Oracle, it offers a user-friendly interface and is more cost-effective for mid-sized businesses. Compared to Shipwell, it provides deeper integration with supply chain management tools, offering a more unified logistics solution. 

Can Microsoft Dynamics TMS handle last-mile delivery challenges?

Microsoft Dynamics TMS has basic features that can help with last mile delivery optimization, but add-ons are needed to access advanced dynamic route planning, load planning, freight reconciliation, sales commodity pricing, and customer-based substitutions. Avantiico’s add-on, which works natively within Microsoft’s TMS (Dynamics SCM & Warehouse Management), offers these features in a seamless integration. Contact us today to meet with a consultant and learn more.

What are Avantiico’s enhancements to Microsoft Dynamics TMS, and how do they add value?

Avantiico enhances Microsoft Dynamics TMS with advanced features like dynamic route planning, load optimization, and hub consolidation. These tools allow for real-time route adjustments, efficient load sequencing, and streamlined multi-warehouse logistics. Additionally, Avantiico’s solutions include commodity pricing enhancements and customer-specific product substitution rules, which help businesses adapt to market changes and product shortages. These enhancements significantly improve operational efficiency, reduce costs, and ensure smoother logistics operations. 

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