So, whose fault is it?

A couple of weeks ago I was talking about the airline industry and some things I think we can learn from them. Reader Wayne commented that drivers are often their own worst enemy - the bad apples make the whole industry look bad.

Of course, he's right. There are definitely drivers out there that make the entire industry look bad.

But I started thinking about this and it seems like it might be a chicken-and-egg situation.

Do drivers act unacceptably because they're inherently ignorant and insensitive? Or do they get put in situations that push them towards that behavior?

All of us have had jobs at one time or another where we didn't perform at our best. And most of us have had jobs where the environment was generally crappy and we ended up doing things we wouldn't otherwise do. Maybe it's cutting corners on quality. Maybe it's stealing office supplies. Maybe it's fudging a timesheet. If the environment we're working in is bad enough, most of us will start equally bad things as a result.

In other words, we rise or sink to the level of our surroundings.

So, the question then is - how many "bad apple" drivers are like that anyway, and how many are otherwise good people stuck working for companies that treat them poorly? In the latter case, it's not really the driver's fault at all, is it?

In those cases, I think we should be screaming just as loudly at the companies that treat drivers poorly. They're the ones that are making us all look bad.

What do you think?

Thoughts on the Markel Let's Talk Series

I had the opportunity over the last month to participate in Markel's Let's Talk series of seminars. These are one-day seminars run in various cities, with a group of speakers discussing hot issues of the day. This particular series focused on profitability and included experts talking about legal issues, insurance, rate modeling, and other things. I was on board for the Toronto, Calgary, and Edmonton events, speaking about the value of investing in people and why training (as part of broader HR initiatives) is such a good investment.

I really enjoyed being a part of this event and having the chance to meet some very cool people from across the country.

What I found most interesting, however, was the number of companies that are already doing these things and seeing a tremendous benefit from it.

Tim Courtney, the Markel representative on the panel told a story of one customer who invested $3000 in mirror adjustment training to help with backing collisions. That investment led to $40,000 PER YEAR savings in backing collisions. That ROI is amazing.

Barry Bembridge, GM at Paul's Hauling, explained how they invest in their drivers in a variety of ways. The payoff for them is "almost zero" turnover - that's outstanding as well.

Bill Williams, Director of Operations at Orlick's Transport, had a great story about how they work with their customers to optimize the shipping process, streamlining the process for both the customer and Orlick's. The payoff for the customer is lower shipping costs, the payoff for Orlick's is more efficient operations and a deeper relationship with the customer. Also, since Orlick's drivers are the ones pointing out the places where shippers can optimize, they also feel a deeper commitment to the customer and Orlick's - they become invested in making the business better rather than just delivering the freight.

The funny part about all this is that there are still companies who don't think investing in their people is good business. There are still fleets that will spend a fortune on magazine recruiting ads to replace drivers, but not spend a dime figuring out why drivers are leaving in the first place. There are still fleets that will spend money on new trucks, but won't invest in making sure their drivers can run them safely.

Building a business is more than getting the freight delivered at a fair price. As the old saying goes - success is when preparation meets opportunity. Companies like Paul's Hauling and Orlick's are making sure that they (and their drivers) are well prepared for every opportunity that comes up.

Kudos to Markel for putting on this series and giving us a chance to hear some of these great stories.

What Trucking Can Learn From The Airline Industry

What’s the difference between a professional driver and a commercial airline pilot?

Pilots carry human cargo and there’s probably a greater risk of fatality if they crash, but pilots never fly alone and they don’t have the share the sky with endless numbers of idiots that are constantly crowding them and running them off the road. I'd bet that a commercial pilot doing a Toronto-London or New York-London route is pretty similar to a driver doing Toronto-Montreal.

In fact, a top level driver – the kind you’d trust to haul explosives or do oversize flatdeck - probably has qualifications similar to a top level commercial pilot.

The difference is marketing.

The airline industry has done a great job of formalizing different levels of qualification so a pilot can say “I have X designation” instead of just “I have X years on the road”. Trucking could benefit from that as well. Imagine if drivers could have a list of credential letters after their names the way pilots and other professionals do. What would people think then?

As a related question: Why do pilots wear those uniforms?

They could fly the plane just as well in jeans and a t-shirt, but every commercial pilot wears the uniform. I think this is great marketing as well, because it gives the general public much more confidence in the qualifications of the pilot. There’s a sense that, regardless of the pilot’s age, they’ve accomplished something if they’re wearing the uniform.

What would happen if trucking adopted a similar approach? If every driver wore a uniform that said “I’m an experienced, skilled professional”, what would happen to the public’s perception? I'm not just talking about the 'construction blues', here. I'm talking fancy shoulder pads and gold embroidery like the pilots have.

It would send a whole different message to the non-trucking public, wouldn't it.

Understanding Driver Turnover - All Exits Are Not Equal

I hear a lot of people talking about driver turnover and how much it impacts their business. Driver turnover is certainly a challenge, but I don't think it's a black and white issue. I don't think that all driver turnover is bad - in fact, I think some driver is a GOOD thing.

If you take all your drivers and plot them on a graph that maps their quality, you'll end up with something resembling a bell curve:

• A big bunch of pretty-good ones in the middle
• A smaller group at the top
• A matching small group at the bottom.

The drivers in that top group are the stars - the 20% of your fleet that makes you 80% of your profits. The big bunch in the middle probably break even for the most part, but the group at the bottom cause you problems. They're the 20% that account for 80% of your headaches, disruption, and unplanned costs.

Good exits
If we consider turnover in the context of that graph, we get a different picture. Drivers in the bottom 20% don't really cause a problem when they quit. In fact, they're probably doing you a favour, since the odds are good that their replacement will be better quality than they are.

Bad exits
Drivers in the top 20% cause HUGE problems when they quit. If a top-20% driver quits, you lose a great source of profit and have a monumental challenge trying to find someone of equal quality as a replacement.

Finding balance
I think we need to consider driver turnover in that context, and plan retention activities accordingly. Do everything in your power to keep those top-20% drivers happy. Do what you can for the big bunch in the middle. For the ones in the middle, either move them up or move them out.

The first step for each of those is developing a clear picture of who's who. We'll look at that next time, but for now think about how much it would HELP you if all your bottom-20% quit.

Controlling the Cost of Driver Turnover

With the Recruiting & Retention Conference happening in Calgary shortly, I've been thinking about the ongoing challenge of driver retention. Driver turnover in trucking tends to be pretty high and it's a big drain on resources. Turnover is expensive and disruptive. When you've got margins as thin as what we typically see in trucking, you can't have that kind of expense and disruption for very long without seriously impeding business growth. That expense needs to be contained, and there are really two things we can do to contain it - we can reduce the amount of turnover, or we can reduce the 'per exit' cost. We spend a lot of time talking about how we can cut the number of people that quit, but we can get just as far ahead by lowering the cost (and impact) of each exit as well.

I'll be talking more about that at the Calgary R & R show, so if you can sneak away for a day or two, come on out!

The Trucking Industry - It's NOT About Trucks

I always find it interesting how much attention is paid to trucks in this industry. We certainly need trucks in order to move freight, but it seems like there's a piece missing from the equation most of the time. As much as we need a solid vehicle to move the freight reliably, the truck is really just a tool that allows a driver to perform a service. It's the driver that makes that service happen. If you have a driver and no truck, you can always go rent or lease a truck. However, if you have the truck but don't have the driver (or don't have a GOOD driver), that's a much tougher problem to solve.

Assets and Liabilities
Looking at it from a financial standpoint, trucks are assets that will always depreciate. You can slow that depreciation by taking good care of the truck, but no matter what you do the truck will be worth less tomorrow than it is today. Apologies to my partners that sell trucks, but that's a business reality we can't change. On the other hand, drivers are assets that don't lose value over time. In fact, if you take care of your drivers, they actually get MORE valuable over time. Put another way:

Trucks depreciate...people appreciate

For a lot of you, this is the time to plan and budget for next year, and there's a lot of talk happening right now about what the industry is going to be like in '08. Many are concerned about sluggishness in the US economy, continuing challenges in Ontario, etc. However, the fleets that are doing well, in almost every case, are the ones that continue to invest in their people.

After all, trucks and technology will never give you a competitive advantage - any fleet can have those. What DOES give you competitive advantage is your policies and processes, and the outcomes they create for you. Investing in the people side of the business will ALWAYS pay off handsomely.

Yes, I'm an Idiot

Yesterday I posted a note about my presentation from the Council of Driver Trainers Annual Conference and included a link to the presentation itself. Well, it turns out that the link I posted didn't work, since I posted the file in PPT format instead of PDF.

This is what happens when I try to do this stuff myself. :-(

The link has been fixed and the presentation (now in PDF format) is available here.

Feel free to mock me.

The Presentation People Are Asking Me For...

I've had a bunch of people ask me for copies of the presentation I delivered at the Council of Driver Trainers Annual Conference last weekend, so I decided to post it in a public location instead of emailing to everyone individually.

For those that missed it, the topic was "Before You Buy - Is Your Company Ready?". The presentation gave an overview of what eLearning really is, why it's worth considering, how to tell if your company is ready to tackle it, and the steps to follow to make sure it's a success. Since the audience was mostly Safety & Compliance staff, much of the content focused on how to 'sell' eLearning to upper management and get approval for it. There were a lot of good questions that came up and we ended up having a good discussion about the topic.

The presentation has been posted in our document downloads area. It's free, but you do have to provide your email address and contact info to get at it. I don't want to make it easy for my competitors to steal all my ideas!

Enjoy!

An Industry In Crisis

There's a crisis in this industry - there aren't enough workers, and it's going to get worse before it gets better. The industry itself has a bad reputation - outsiders hardly have any respect for it at all.

As a result, young people aren't entering it the way they should be. Parents and guidance counsellors, at best, don't encourage kids to consider this industry. At worst, they actively DIScourage them from considering it. Schools are seeing their enrollments decline - in some cases as much 75% from previous levels. Enrollment problems today mean hiring problems tomorrow, and many companies are taking notice. They're doing small things to minimize the problem - like keeping older workers around longer - but it's only a temporary solution. Everyone knows there's a big problem coming soon unless something major is done.

The story above is the kind of horror story we hear about all the time - a looming driver shortage, not enough being done about, people running scared. However, this particular horror story isn't about the trucking industry at all. The story above is actually about the IT industry, and the current work shortage there. It came from a larger article that Fortune magazine published a few months ago, and the problem is getting to be fairly severe for the IT and high-tech industries.

There are lots of other industries facing challenges similar to what we deal with in trucking. They've had differing levels of success in tackling these challenges, but there are lots of creative and interesting ideas out there.

What are we doing here?
I'm going to use this blog to explore some of those ideas and see how we can 'borrow' them for the trucking industry. We're also going to look more broadly at the challenge of maintaining and improving driver quality, both through the recruiting and ramp-up processes, and through ongoing driver management activities. And since a blog is no fun without discussion, I encourage you to post your comments and feedback on the various postings - let's get a good discussion going here and see what we can do with it!

What are THEY doing?
As for the IT industry, they're doing a lot of things that will sound familiar - career fairs, public awareness campaigns, general "brand building" for the industry as a whole. In trucking we're already doing some of those things, but we could certainly do more to build the industry's brand. We'll look at some ways to do that over the next little while as well.