Suppliers Products CAD Drawings Product News Certifications
Search By: Category Company Name Brand UNSPSC Commodity
Promote Your Business | MyThomas
Tuesday, September 2, 2014

Automation Use Is Low in Transportation Procurement, Study Finds

Although organizations embrace automation for many business functions, as a way of building data, increasing productivity, and boosting revenue, they resist with other functions. One such area is transportation, where a new study finds 69 percent of respondents use manual or spreadsheet-based systems, or a mix or hybrid of both, and only 25 percent use automation. (The remaining 6 percent outsource or use other techniques.)

The Transportation Procurement Benchmark Study was compiled in May by transportation industry media and research specialist American Shipper (AS), with the Council of Supply Chain Management Professionals and the Retail Industry Leaders Association.

Credit: khunaspix at

Credit: khunaspix at

Last Friday, I wrote about findings that show why some companies outperform others in procurement as it relates to transportation. Here, I present the study’s findings about automation and procurement.

The study finds that in 2013, more companies are actually using spreadsheet and manual systems for procurement than in 2012, when 42 percent were doing so. Not surprisingly, 67 percent of small organizations (sales less than $100 million) and midsize shippers ($100 million-$1 billion) use manual and spreadsheet-based systems, while 36 percent of large shippers (sales over $1 billion) do. When figures for a mix or hybrid of the two are included, the numbers are, respectively, 66 percent and 83 percent.

The numbers are more disproportionate for companies with full automation: 18 percent of large companies use transportation-specific procurement automation, while only 2 percent of small and medium companies do. The figures align at 5 percent each in preference for general-purpose automation systems.

The study finds that impediments to automation include “resistance to change” and “expertise hurdles,” both of which are presumably more formidable for small and midsize companies that lack the resources of large counterparts. In fact, 60 percent of small and midsize companies cite these as bars to automation.

But half of large companies also have financial concerns — notably, automation lacks return on investment, an issue also shared by 31 percent of small and midsize respondents.

Predictably, some large companies, which might be expected to have complex requirements, report that available systems do not meet their needs (27 percent). Small and midsize companies share the same concern, though at a much lower ratio (7 percent).

There is also the school of thought that, summarily, says, “If it ain’t broke, don’t fix it”: 36 percent of large companies and 45 percent of small and midsize companies state the current way of doing things meets their needs.

In fact, 69 percent of respondents don’t plan to add automation, essentially unchanged since 2009. Only 7 percent have automation budgeted in the next 12 months, down from 16 percent in 2012; 6 percent say it is budgeted for the next 12 to 24 months, down from 9 percent last year and 11 percent in 2011; and 18 percent report automation is in a five-year plan. This last represents a 50 percent increase from 2012 and a doubling from 2011. It is, however, about even with the 2010 response (17 percent) and below 2009 (20 percent).

AS notes that “… little truly groundbreaking technology development in the procurement landscape over the past year …” may have dampened enthusiasm for investment in automation. But as most would doubtless attest, “procurement is not always near the top of the investment priority ladder for shippers being asked to automate … their enterprises.”

If investment comes, truckload, less than truckload (LTL), and full ocean container loads (FCL) are the top three choices, followed by parcel/small package, air freight, other ocean transport, rail/intermodal, and LCL ocean. Major gains in preference here are seen in FCL, which 49 percent plan to automate compared with 22 percent in 2012, and air freight, 36 percent versus 3 percent last year. AS says that large companies are more likely to automate truckload, LTL, FCL, and airfreight, which indicates a desire to “homogenize their broad portfolio of models.”

Promoting automation is efficiency (cited by 76 percent) and improving data management (64 percent). Also: managing complexity (56 percent); rate and capacity visibility (55 percent); saving time on procurement (55 percent); and centralizing procurement (54 percent). Improving the value of procurement and lower freight rates were each cited by 44 percent, and scalability would influence 29 percent.

To download the study, go to:


Add Comment Register

Speak Your Mind


Copyright© 2014 Thomas Publishing Company. All Rights Reserved. See Terms and Conditions or Privacy Statement. Website Last Modified September 2, 2014.

Thomas Register® and Thomas Regional® are part of

ThomasNet Is A Registered Trademark Of Thomas Publishing Company.