Greg Mechler is this month’s guest columnist. Greg is an expert in the development of transportation leaders. Greg is the President of Human Advantage, Inc. He has consulted in the trucking industry for over 30 years. He is especially focused on the selection of talent and development of people in the industry.
You can learn more about Greg and his company here.
HAVE YOU SOLVED THE DRIVER RETENTION PROBLEM YET??
A report published in 2015 from market research firm Gallup finds there’s still plenty of truth in that old cliché – “people leave managers not companies”. The survey of 7,200 adults found that about half had left a job at some point “to get away from their manager”.
APPROACHES
Perhaps you have already tried many approaches to reducing driver turnover, from incentives, benefits and perks, to the many solutions from OEM’s, technology vendors, seat makers, and more, all claiming if you only install or use their product, drivers will be attracted to your company and stay longer.
Yet companies in the truckload industry struggle to retain drivers year after year and turnover rates continue to hover around 100% or more.
You may have tried a lot of highly touted solutions but have you tried significantly upgrading the driver management position?
The Gallup study suggests that the person who manages the driver is a major variable in the retention/turnover challenge. There are many other studies that reflect the same result – people leave managers, not companies. Is this true for your company??
THE DRIVER MANAGER
For the purpose of this article we will use the title “Driver Manager” (DM) to refer to any position directly responsible for day-to-day operational performance.
You may have different titles depending on your size, your service segment (van, flat, tank, local, dedicated, and more) and your operations department structure. Some titles we have seen are fleet manager, driver manager, driver coordinator, driver supervisor, dispatcher – the list is endless.
The DM is the person responsible for the day-to-day dispatch, coordination, and performance of the driver workforce?”
This is the person drivers perceive as their boss. This is the person that can positively influence drivers to stay or conversely, cause them to go elsewhere.
In this article and future articles we will explore ways to strengthen this important position in your company.
ROLE CLARITY, ACCOUNTABILITY, LEADERSHIP
The title does not really matter but role clarity, accountability, and leadership does. Whether it is formalized or not this front line leadership role is influencing driver performance for better or worse.
If the DM does not have role clarity, accountability, and leadership capability, he or she cannot do their job properly.
Usually the DM has an assigned fleet of drivers with responsibility for optimizing the performance of the fleet. In our view they are really running a profit center.
Each truck and driver enhances profitability or detracts from it. Even though the DM is able to have substantial impact on performance, in our experience many carriers choose to treat this role as a low level, almost clerical role, rather than the leadership position that it is.
These companies fail to hire top caliber leaders, keep the compensation low, do not hold people accountable for results, and they do not train and develop people for greater responsibility. As a result the DM is not able build strong productive relationships with drivers and they are not able to influence performance outcomes.
RESULTS
Our contention is that a strong DM must have both accountability and authority for managing a fleet of drivers.
The DM should be accountable for the overall performance of the fleet (usually 30 to 40 trucks and drivers), especially in terms of fleet profitability (operating margin), productivity (miles/truck/week), and driver turnover rate and retention %.
To be an effective performer, the DM must manage key result factors such as preventable turnover rate, miles/truck/week; revenue/truck/week; DOT compliance; on-time %; and more.
In order to do this and have real accountability, DMs must have sufficient authority to make decisions related to driver performance such as load selection, discipline, and goal setting. Then they are able to build real working relationships with their drivers and have a positive influence on retention.
When there is real accountability for fleet performance including driver retention, results improve and make a direct positive impact on profitability and growth.
Effective DMs directly impact the financial performance of the company. Therefore it is necessary to fully understand and appreciate the role and what it takes to develop a successful DM. In our research on the DM role we have found 5 groups of competencies and 6 leadership dimensions that must be utilized to achieve success.
COMPETENCIES
- Basic skills and knowledge – business acumen, industry knowledge, computer skills, etc.
- Daily work flow – load tracking, load assignment, problem response, etc.
- Administrative and organizational – keeping records and information current
- Relationship development – communication, empathy, advocacy, etc.
- Leadership and management – setting goals, coaching, recognition, performance management, etc.
LEADERSHIP DISCIPLINES
- Perspective – the way of viewing the business, relationships, and results
- Preparation – doing the work necessary to make good decisions and get results
- Way with People – being the kind of person who others can respect and relate with
- Courage to be decisive – uses sound judgment to make effective decisions
- Teamwork and team play – working with others to accomplish extraordinary results
- Results with excellence – achieving lasting results not just short term solutions
There are specific steps carriers can take to create and staff this essential leadership role. When done well this process creates a pool of leadership talent that is ready to go when needed as the organization grows. The steps include:
- Making a commitment to an upgraded DM role
- Clearly defining the role, responsibilities and accountability
- Hiring the right people who can perform well in this role
- Developing and training the right people with a development process that starts at the time of hire and continues throughout the career life cycle
The payoff – increasingly excellent business results, lower driver turnover and better driver performance, and the creation of a deep pool of leadership talent that can handle new opportunities in the future.
In future articles we will outline the essential competencies and leadership disciplines in more detail along with recommendations for implementing this strategy.
By John Sheehy. President, NSRMCA.
Have you ever wondered what the difference is between lowest price and best value? On the surface, it would seem in most cases the lowest price is the “best value”. I can think of many instances where the lowest price is not always the best value. For example, there was a test I read about recently where two tires were compared. One tire was significantly lower in price than the other tire. One would think that the lower priced tire was the best value, except that during operational tests the more expensive tire proved to offer better fuel economy. The improved fuel economy when extrapolated over the life of the tire showed the more expensive tire had a significantly lower total cost of ownership than the cheaper tire. Can a process like this really be a successful way to evaluate a contract?
During the very well attended Las Vegas Regional meeting, the 5 contracting officers tag teamed a very informative presentation revolving around best value in postal contracting. Preparing a transportation proposal today is much more involved than just presenting your best price. Price is certainly a very important factor but the ability to show lowest cost or best value looks to be what the contracting officers are challenged to evaluate today. I believe this is great news for an industry that has been driven to very low to zero operational margins over the past 10 years.
As a supplier, you are now challenged to present a case that you are the best value to the USPS. This still may be lowest price, but the other factors that will come into play. An example will be Environmental Sustainability. In a proposal, the supplier will need to present their plan to be environmentally sustainable. This may mean the ability to use alternative energy, which was another topic discussed in depth at the meeting. Or it may mean the supplier needs to present a plan on how their company plans to be more fuel efficient or how tires or other items are recycled. Sustainability is not just the use of alternative fuels it can be way more involved than that. Past performance will be documented and evaluated to make sure the supplier can provide the service standards required in the solicitation.
Another item that will have a bearing on a successful offer will be the capabilities and the financial strength of the business. The USPS wants suppliers that have organizations that promote good business practices, are able to evolve and make changes and can survive financial challenges as needed during an ever changing business environment.
These are great strides being made in the industry, but like all other evolutions there can be some pitfalls. Eval- uations if not completely quantified can be very subjec- tive. One need not go far to find great examples of the difference between subjective and objective. In sports a good example of objective would be a football game where the winner is the team with the highest score, while a figure skating event is subjective to the judges scores. I would contend the new bidding process is more like the figure skating event, and could lead to some unintended consequences down the road.
Working in this new environment will certainly have its own set of challenges. Learning how to make a very objective proposal will be key to your future success. This will mean a supplier will need to track more data, know how to present that data and run the business very professionally. Understanding of the operational requirements of a proposal; knowing what is most important to the contracting officer for a specific proposal. What things have the most value in a proposal; does sustain- ability have more value than lowest price for example. Will you be able to show the contracting officer that over the term of a contract that a higher initial price has a lower overall cost similar to the tire example above? These are the challenges facing all of us.
I am very encouraged by the direction the industry is heading. It will not be without its challenges, but we are on a new and exciting path. Working cooperatively is moving the industry forward. Thank you to all who attended a very successful Western/Central regional meeting.
|
The CSA Safety Measurement System (SMS) Website has been updated with the February 26, 2016 snapshot.
Section 5223 (c) of the Fixing America’s Surface Transportation Act (FAST Act) of 2015 requires the Federal Motor Carrier Safety Administration (FMCSA) to keep property carriers’ absolute measures available to the public.
These measures are generated directly from safety data and not based on relative comparison to other motor carriers.
The FAST Act prohibits the display of a property carrier’s relative percentile, so on December 4, 2015, FMCSA removed the information prohibited from display, and also removed the absolute measures to allow time to modify the SMS Website to be compliant.
At this time, those modifications are complete and the SMS Website is fully compliant with the FAST Act.
All information on passenger carriers continues to remain available.
If you are a motor carrier and do not have login credentials, please click here for more information on how to obtain your PIN. |
Source: Hours-Of-Service Audit – Article – TruckingInfo.com
By Dennis McGee – Dennis McGee and Associates
An explanation of the term “Absolute Measure” means in the new BASiC status;
The numbers circled in red are the percentiles which we were used to seeing. These percentages will no longer be seen to the public
The number circled in Yellow are the absolute measure numbers. These are the numbers the public will see.
The Yellow triangle indicated that the motor carrier was in an Alert Status in that BASIC. The Yellow triangle will no longer be seen to the public.
The motor carrier will have access to this information by using their assigned “pin” and logging into their FMCSA data.
The absolute measures were always posted, but not much attention was paid to them by the public. The absolute measure ONLY relates to each individual motor carrier, and not comparing the motor carrier with other motor carriers in their “group”.
Trucking company “A” may have an absolute measure of 1.09 and trucking company “B” may have the same absolute measure of 1.09. Depending upon each of the motor carrier’s inspection history, the absolute measure of 1.09 may not mean the same for “A” & “B”.
Therefore, the absolute measure viewing by the public does not inform the public of the motor carrier’s Alert Status or percentages relating to other motor carriers in its group. This meets the FAST Act mandate.
Originally published in Public Works Magazine
Finding the right telematics partner is like hiring contractors with their own tools and equipment. Here’s how to establish a mutually beneficial relationship.
By Joel Beal
Thirty years ago, specifying onboard vehicle technology was easy. There were four suppliers, dispatch and routing systems were the same, and only a handful of commercial applications existed. You picked the one that best fit your needs and made it work.
With the explosion in technology and suppliers since then, the job’s much harder. Today, choosing the right product requires significant time and energy. If your agency can’t afford to expend the resources necessary to learn about how to pilot a system, stop reading right now.
If it can, however, you can take the guesswork out of procurement with the following process. You may have to tweak it a bit for your particular situation, but you’ll avoid wasting taxpayer money.
Step 1: What do you need today?
Your job is to make the most logical choice given your agency’s current needs, future plans, and budget. Create a written plan with specific steps to map your path to successful purchase and implementation.
f you’re starting from scratch, consider things like:
- What worries you? Are you getting complaints from internal customers, the public, elected officials?
- Are vehicles and operators dispatched and routed, ideally, every day?
- Are there areas of the operation where you no longer have insight?
- If your fleet includes commercial motor vehicles (CMV), which Federal Motor Carrier Safety Administration Compliance, Safety, and Accountability (CSA) program scores are particularly high?
- Are some internal customers more expensive to service than others, but you don’t know why?
- What are operators doing wrong? What are they doing right that they’re not being rewarded for?
- If you already have vehicle-tracking technology, ask the same questions, plus:
- Which expectations did it meet?
- Which ones didn’t it meet, and why?
- Which areas of operations did it improve?
- What areas didn’t it improve, and why?
Then determine the needs to which you can attach a return on investment. For example, if you’re a large DOT with multiple maintenance yards, you may suspect that one or two yards have too many vehicles and/or particular equipment. Tracking usage across the agency will help you identify and sell excess equipment.
Step 2: What do you need five years from now?
You can’t afford everything right now, so create a wish list for a second implementation phase.
Let’s say you want a tracking system and automated dispatch. Choose the one for which you have the greatest need now and put the other on a list to roll out next year.
If you make the right purchase for your initial needs, you’ll be able to expand capability fairly easily via an additional service, software module, or hardware peripheral.
Step 3: Writing the request for proposal
Your job is to find the company that meets most of your important requirements and employs people you trust at a price you can justify.
The request for proposal (RFP) is the road map for getting there. You’re introducing yourself to potential partners; how they respond indicates how well they listen — a key to any successful long-term relationship.
You now know current and future needs. Write them down as simply and straightforward as possible in a grid format that enables the respondent to answer:
Yes, No, In the Future, and With Conditions.
Provide enough detail to guide potential suppliers but not so much that you stifle creativity.
The RFP should also include:
- A description of your agency and fleet demographics
- Expected implementation date
- How to submit questions
- How to respond (mail, website, etc.) and the deadline
- Request three references
- Ask for an executive summary
- Request a quote that captures upfront and ongoing costs in terms of both hardware and software.
Step 4: Separate the wheat from the chaff
With your RFP in place, it’s time to engage possible suppliers. Start with a long list of those that may possibly meet your needs.
Ask them to explain how they’ll meet each current and future requirement. Using your grid, grade their responses on a scale of one (can’t do it) to 10 (this is exactly what we want).
Remove companies that can’t meet basic requirements. Rank the rest numerically based on their cumulative response.
Call in this short list of companies for an interview. Do they understand your agency? Are they empathetic to its mission and needs? How will they support your system? What’s their implementation and training plan?
Listening carefully to the answers will tell you how compatible your potential partner may or may not be.
Your short list of suppliers may be shorter after the interviews. Evaluate and verify their answers by asking references the same questions you asked during the RFP process.
You may decide it’s best to do an onsite evaluation by installing and using the technology for a specific period of time. You’ll ask the same questions as during the RFP process and when talking to other users, but you’ll see the answers. You’ll evaluate ease of installation, ease of use, applicability to your operation, competence of training, and reliability of support.
Step 5: The weakest link in the chain
In my experience, technology doesn’t fail because a fleet chose the wrong solution. It fails due to inadequate implementation, which must be planned, measured, and managed.
By now, it should be obvious who your internal technology champion is. Put him (or her) in charge of implementation. Because they’ll get resistance from coworkers, give them the authority and time to get the job done right.
Using the RFP as a guideline, develop a schedule with important milestones and deadlines. Assign who will perform each task. Define their role and give it to them in writing.
Meet weekly, looking back on accomplishments and looking forward to the week ahead. Establish a checklist to audit system performance going forward/annually.
Joel Beal is managing partner for JBA Telematics in Arlington, Texas. Please visit www.jbatelematics.com. E-mail joelbeal@jbatelematics.com.
This article is taken from “How to Find, Install, and Use the Right Vehicle Technology for Your Fleet: Your Blueprint to a Successful Telematics Implementation.” Get a free copy of the $195 special report by e-mailing joelbeal@jbatelematics.com.
