How to Turn Around Your Driver Referral Program

Found this quote on Wikipedia last week:

“Strong culture is said to exist where staff respond to stimulus because of their alignment to organizational values. In such environments, strong cultures help firms operate like well-oiled machines, engaging in outstanding execution with only minor adjustments to existing procedures as needed.
Conversely, there is weak culture where there is little alignment with organizational values, and control must be exercised through extensive procedures and bureaucracy.
Research shows that organizations that foster strong cultures have clear values that give employees a reason to embrace the culture. A “strong” culture may be especially beneficial to firms operating in the service sector.” Read more here: Organizational Culture

The key word in all of this in my mind is Values, every company has a visible set of values whether they know it or not. They may have formalized those values in a company statement or not –  they exist and they are visible in a multiple of ways (both positive and negative).

This is the essence of culture, you cannot impose values on to people, values develop over time and depend on one’s environment and life experience. Whether we are conscious of it or not, we typically align ourselves with people, friends,  spouses, and work environments that align with those values. When we don’t align ourselves in like values we struggle and typically we end up in divorce, leaving our jobs, leaving a misaligned community etc.

If you employ people or contract services, whether you realize it or not your most successful relationships likely mirror your own values. We like it when our values align it fits our comfort zone, we typically know what to expect and over time these relationship strengthen, we build a team we can depend on and get comfortable with, these relationships endure the test of time.

If your still reading this, then I haven’t bored you to the point you have turned the page then here is my point. I have tried to help many companies get their heads around why their efforts to have their current driving force assist in the recruiting of new drivers to their company, and show them why their efforts haven’t worked to the extent they expected they would like. Here is what most of them don’t realize, it is their culture that is restricting their results, among other things but primarily it comes back to culture.

If your culture is weak, I can guarantee you have poor communication channels, and likely no communications strategy within your business. A good communication strategy would encompass your drivers, contractors, employees, customers, suppliers, enforcement, and the communities you service. Sound like a monumental job, it really isn’t, it is quite easy in reality. It just takes focus and structure. If any of you has worked within a culture where communication is poor, you know that it is the worst situation you can be in, it is check your brain a the door and do no more or less than what you were hired for, it’s boring and unrewarding, it sucks.

Drivers who are asked to assist in recruiting new drivers to this type of company will resist for a number of reasons. Here are a few, first, and I think foremost they don’t have any confidence that you know how to run your business, they think you’re going to over hire and threaten their livelihood. I drove for ten years, I heard it over and over again, believe me this is true and if you have poor communication why wouldn’t they think that way? They’re in the dark about what you might need. You haven’t told them anything that is going to motivate them to help you. So why would they? Certainly not because you offered some “never-never” plan as a monetary incentive. The ones that pay a cent a mile for a year or quarterly installments designed to appear as though there is a windfall coming sometime in the future. I think some of these are designed to motivate drivers to recruit for the company, and to incentivize the driver to stay a little longer at a carrier to realize the future gain, how’s that working for you? My guess it does neither very effectively.

If your culture is strong, an effort to get driver to assist in the recruiting effort looks entirely different. First you have developed an inclusive value statement, you’ve done this by asking everyone in your business to contribute to it’s content, and you have asked them to bless the outcome, you’ve asked them. Does it cover their and your core values, can they work within the confines of it?

Secondly, your people know what is going on within the company because it has a strong communication strategy, it informs them, keeps them abreast of what it happening, it tries to involve community, customers, suppliers and (most importantly) reaches out to the individual employee’s families. You have told them, and they believe you when you say that your customers are busy and are demanding more trucks to service their needs. You need the additional drivers to keep the accounts you have, there is no threat to livelihood of the current drivers, and in fact, it is preservation of the account and their miles that you’re trying to achieve. If you have a brokerage operation, show everyone where that overflow freight is going – you have the data – give it to them. Stop playing your cards so close to your chest!

Finally, get rid of the “never-never” plan as an incentive to help your company hire new drivers; you pay cash, in full, the next pay period after the new recruit turns the first mile period. Your drivers have been schooled as to what type of individual you’re looking for, they have shown the potential candidate the value statement that the company works under. They have stressed whatever information you feel necessary that the potential new hire must understand and agree to be successful at your company. You screened them, you tested them, you accepted them, you put them in the truck, if the individual doesn’t workout how is that the driver’s problem? You owe them, pay them, you do it for your in house recruiters why not your on-road recruiters. Want to make an impact with on road recruiters; this is how to do it.

Courage and Commitment to Change

Commitment throughout the organization is important to the success of improving driver retention. Commitment is paramount among the ownership and management team, as they are setting the example for all others in the company. To consider and then decide to embark on a project to improve driver retention means that ownership and the senior management have looked at the problems of excessive costs associated with poor retention, recognized that significant planning and effort affecting the entire company must be undertaken, and that this effort is warranted by the significant savings and service benefits that will be the result – the long-term gain. Put this way, it is very obvious that the cultural change you are about to undertake is strategic in nature. It is Strategic because we will be investing time, confidence and responsibility in company employees well beyond your driving force. In the process, you will be transforming the company from one that is a victim of all that is harmful about high driver turnover, into one that is a positive, supportive and a service-oriented place to work. A company where people, drivers and owner-operators included, want to work. A transition like this is obviously strategic in nature.

Commitment is one of the most critical ingredients to the success of any effort intended to bring long term improvements to the way business is done. To begin, this commitment must come from the directors of the company and it must be very visible – and active. It must be genuine, and it must be unwavering. After all, people throughout the company will have important roles to play and their commitment must be inspired and supported by the commitment they see in their leaders. In short, company leaders must be seen to walk the walk, and make the same commitment that is being asked of the rest of the company and each department. This is why it’s called leadership folks.

In addition to fostering commitment among the staff, the senior-level commitment must be lasting, since this is a lengthy project that will eventually become the new culture of the business, it must be unanimous among the leaders. This last aspect is sometimes difficult to ensure, but it is important that the leadership team speak and act in unison on the need for the company to make the significant changes necessary to reduce driver turnover. At the senior management level, this means that a personal commitment must be mandatory and delivered by each member of the management team. Like a lot of strategic planning initiatives, it would be a good idea to make positive and supportive engagement a part of the personal performance criteria for managers during this project.

Let’s acknowledge that achieving and maintaining commitment among the leadership team is not something that can be accomplished just by asking for it. There are very natural and predictable obstacles along the way and perhaps the most common is the difficulty we all have with adapting to change. This is natural – we all strive for stability and then along comes a new idea or a new process or a new direction and we naturally question and resist the change. But the management team has targeted real benefits for the company and its employees. We have agreed to undertake reasonable steps to achieve great results, we have agreed to change.

Turn that agreement to change into a commitment to change. We have a commitment to reduce Driver Turnover. We are committed to making our entire workforce a Strategic Advantage for our company. Achieving and maintaining commitment will require you to regularly re-visit our plan and objectives to remind everyone that the change we are undertaking is worth it. We do this to reinforce the commitment among the team. Do this so you do not fall back into old habits. In fact, be on the look-out for any wavering of commitment and the creeping in of those old habits.

So, what other benefits can we expect by recognizing the importance of commitment and then taking specific actions to achieve it? We will create a culture throughout the organization that sees and comes to expect a management team that means and does what it says. Secondly, it will deliver proof to the management team that they can achieve significant results by working supportive fashion –  together.

We are getting ready to draw a line in the sand. You can make it a bell weather moment, the one that drove home the need for us to do something serious to improve Driver Retention? The team must be in unison on this for it to have sustainable impact, so make it a practice to occasionally remind ourselves of what motivated us in the beginning. Use the bell weather moment, the frequent reminders about all the benefits that are ahead – and even reminders to the leadership team about how important their commitment and solidarity is to the rest of the company.

We make this commitment to a new strategy because we know that companies with less turnover are safer companies. We know they pay less in insurance premiums, they have lower CSA scores, these two items alone lead to a more profitable company. We know this to be true and after all isn’t this what we’re here for, profit is not a bad word, but profit while those around you also thrive and flourish is the best situation one could envision, and the neat thing is that this vision is entirely within each and every company’s grasp. All leadership needs to do is muster the courage and commitment to design an effective strategy to achieve the goal and get at it.

So, what is holding you back on this? There is no time like the present. We’re too busy. We’re installing a new software program. We’re looking at an acquisition. We have a vacancy on the senior management team. Have you ever thought that maybe you’re the problem, maybe the individual resistance to change is the face in the mirror? I’ve heard it all, believe me, when it comes to the excuses, the “hey we’ll do it later, after this that or the other thing is out of the way”. Well folks the time to act is now, it is never too late to reinvent your corporate culture and do the right thing. Your entirely too smart to be the only thing standing in your way.

A Better Driver Referral Program

As many of you know, recruiting and retention has become a passion of mine. Having progressed from the Driver’s seat to the C-suite, I have seen first-hand what a united workforce looks like. Conversely (unfortunately), I have also witnessed what can happen when that workforce takes their ‘eyes off the road’. The one area I would like to focus on today is understanding the recruiting and retention process from the Driver’s side.

One significant thing many companies fail to acknowledge is that some drivers sincerely do not believe that you know how to run your own business. I have been behind the wheel for a million miles myself, I can tell you first this hand. Your drivers believe that you will, if given the opportunity, hire them right out of a job. They believe that by your hiring more drivers, their miles will be threatened and their livelihood will be impacted. Don’t believe that? It is the number one reason they do not recruit for you – guaranteed. To protect their paycheck, they will tell other drivers to stay away – ‘money is no good’, ‘no miles’, ‘companies a hard place to work at etc.’

So how do you get around that? As a President, here is what my senior managers and I did – we educated them. Part of my managers daily responsibility was to spend fifteen minutes each morning, and afternoon in our driver’s room, which gave them an opportunity to discuss such matters person to person. I used to tell them that this was the most important thirty minutes of our entire work day. To talk about their family, kids’ sports, community events, whatever. People talk to people, I also wrote a memo to the drivers informing them of our customer’s needs, and that they weren’t prepared to deal with multiple vendors to service their accounts, it cost them too much money. I told them bluntly, if we couldn’t keep up with our customers volumes, they would find trucking companies that would, in other words if they’re not helping our recruiting efforts, they are potentially undermining their livelihood not protecting it.

Implementing a Driver Recruitment program has benefits in terms of the number of good candidates that come your way, as well as the benefit of engaging some of your existing drivers and owner operators in contributing to the company in a meaningful way. Many do want to help, more than you might think, they have chosen to spend their careers with your company, why not.

For our company, once we got the program up and running,we were getting 52% of new drivers through the Driver Recruiter channel. First of all, we asked for volunteers, then we screened them for the role. We looked at whether or not they were good drivers who represented the kind of people we wanted in the company. We looked at their attitude and how they were at talking to other people – were they amiable, honest and positive?

We found that there were different things motivating our driver recruiter volunteers. Some were simply in it for the money, which was fine, as long as they screened well. Others like the recognition, because this was a role with a profile, and the reward was more than just money. We recognized good achievers at our Christmas party, company newsletters and online, presented top recruiters with a plaque etc. And then there were those drivers who simply responded to the call for help. They just wanted to contribute.

A critical part of the program focused on training the drivers for the role. It is important to help build their confidence to prepare them with the skills and tools to succeed. For our program, we gave the drivers training to help them in terms of what kind of candidates they should target, what to emphasize about our company values and objectives, as well as to be completely honest about the demands of our business and customer obligations. We gave them training in conversational sales, we gave them business cards identifying them as Recruiters – and made sure our Value Statement was printed on the back. This was to be a point of discussion with any candidates. And then we put decals on their truck saying “I am a recruiter – talk to me.” This was a popular program with our drivers.

Since this was a valuable service, we were willing to pay for it. Some positions are harder than others to fill so we scaled our compensation to the type of opening being filled. It will be different for you, but in our case, at the time, we paid $2,000 for a flatbed candidate and $1,000 for a van driver.

This could represent a significant boost to income for successful driver recruiters. We had drivers who were responsible for up to 6 new recruits in one year. They pocketed between $6,000 and $12,000 extra that year. And he received solid recognition within and beyond our company.

Pivotal to our program’s success was the payment method we used to compensate our driver and owner operator recruiters. I have seen various programs like deferring payment until after a certain probation period, or so many cents per mile for a determined period of time (or miles) – and even sliding scales over a year or two! For my money, and our results speak for themselves, pay up front once you have hired a candidate. This is most impactful to the drivers – and to any drivers who are not now, but could become recruiters for you. Cash in hand speaks volumes.

Our logic was that once a candidate came our way it is up to us to determine if this would be a good driver for our company.  We put the candidate through our normal hiring/screening process. If we bring that candidate on and it did not work out, that is on us, why should that be on the recruiter, we made the decision to proceed, we made the mistake if the candidate doesn’t work out and we benefit if they success. The driver recruiter did his or her job in bring the opportunity to us. Payment is due, want to support driver recruiting by drivers this is how to do it.

Your drivers will be uplifted by the rewards, recognition and sense of additional purpose that their role will now mean. While delivering benefits to the drivers and to the company, we are also mining just another avenue for building that sense of belonging and community that is the foundation of everything when it comes to Driver Retention.

How to Eat an Elephant – Changing Your Company Culture in 2018

Over the years, I have had countless discussions and meetings with a variety of carriers wrapped around the topic of Driver Retention. I must say that for the most part I have thoroughly enjoyed the work I have done in this field. My most recent effort took place at a carrier I was invited to present to. The profile of the company was 350 trucks, half owner operator and half company owned. This company’s turnover is north of 110%. They need help, but the refreshing part is that they know it, and everything is on the table, nothing is untouchable. What I mean by this is that they know they need, and are welcoming a cultural change. They realize that what they have been doing with respect to their drivers and O/O’s is not working.  They are looking for change, and are willing to do whatever it takes to stop the multitude of issues that come with high turnover.

The president later told me that one of the key things that helped with his decision to approach me was a reference that I had made at a seminar I facilitated about cultural change, which was, if your company has high turnover I will guarantee the culture is sour. If it is not, then you have somehow managed to separate the ‘inside the walls’ workers from the driver population, no easy feat, and a poor way to deal with the issue. Leadership, and the people who work for you, cannot lose high volumes of drivers and feel good about the company, think of the human tragedy, on a regular basis. In this case, multiple times a week, drivers are heading home to their families to tell them they need to find a new employer – cause this place is the ‘wrong fit’, it’s bad  – it’s not necessary – its demoralizing.

Somehow in trucking we have conned ourselves in to becoming immune to it, it needs to get back to taking these failures personal, from the top to the bottom it’s a failure, recognize it, own it, dissect it and fix it. Beyond the human tragedy high turnover has many other nasty side effects, it deteriorates CSA numbers, it elevates insurance costs, it deteriorates reputations in every part of the business, with shippers, suppliers’, the communities it operates in, prospective employees inside and outside the walls, with DOT and FMCSA, etc. If that’s not enough, it will devastate a company’s profitability, and soon enough you won’t have to worry about turnover or culture – your out of business.

If a company with high turnover is looking to develop a sustainable profitable growth strategy for the future and has high turnover, tackling this problem will offer that future. Like many things it tends to wrap itself up in hard work. The good news is that it’s doable, there are many companies that have done it, there is a formula and it is tried and true, if you have the discipline require to make it happen.

I asked the President if he might be interested taking a day for an impromptu strategy session.

Looks like this, with the senior management team, we briefly updated the group on the Theory of Maslow’s Hierarchy of Needs, and building a base to execute a solid plan of execution. We conducted a SWOT test, highlighted priorities by their ROI factor, and then we discussed how they should proceed with the program.

I think the future looks bright for these folks, they made a brave decision, if there is anything I know as fact, it’s that change scares most folks, and if leadership adverse to change or doesn’t fully support it then nothing will happen. I will report back on the progress of this effort in future articles, I’m set up to talk to them once a month, might sound a little dry to some, not to me, I have challenged these folks to reducing their turnover by 50% from 110% to 55% in the next 12 months. With a 340-truck fleet that means 170 fewer drivers and O/O’s that will leave this company in the next twelve months. If that’s not worth the effort I don’t know what is.

Here is a belated Christmas gift for the fleets reading this that have high turnover, convene a senior management meeting around this subject and let all department managers express their opinion on what the issues are they feel contribute to the driver turnover at your company. Document all this information. Next, I want you to task each of them to return to their respective departments and convene another meeting with all of the employees that work in their department. It’s got to be all of them, and here’s the question that they should pose to them. “What in your opinion are the top three things that we do in this department that rub drivers the wrong way and contribute to the turnover that exists in this company”. From there, they simply list them in no particular order and then each person, regardless of position, within the department gets three votes to cast for those items they feel contribute the most to driver turnover. From here each manager will take this information back to the next senior management meeting and present the departments finding to the rest of the team, BTW it is imperative that the information be presented in an unvarnished fashion, no manipulation by the manager.

So is this a fix for the turnover in your company, likely no but it might start the conversation as to what next steps are. What will likely be revealed are somethings that can be fixed quite easily, some might take more effort and maybe some are just intrinsic to the business and can’t be fixed. Turnover in most companies didn’t happen overnight and can’t be fixed overnight either, but can it be brought back to a manageable level, absolutely!

Ask any little kid “How Do You Eat an Elephant” and they will tell you, “One Bite at A Time”

Driver Pay: The Elephant in the Room

Driver Pay: I have been asked to take on this subject on many occasions, and although I have touched on it on and off over the years on numerous occasions, I’ve never really gone at it head on. There is probably a couple of good reasons for this, including but not limited to the fact that this subject is a bit of a rabbit’s hole. It can easily lead many different places once you start heading down this road, and you are likely to disenfranchise yourself with any number of folks, no matter what position you take on these subjects. Having said all that, let’s get at it, as I have said in the past, and it is still true today, at times, there is nothing more illusive than an obvious fact and this is one of those times!

The obvious fact here is that we live in a free-market society whose economy runs on a supply and demand structure. The market will dictate the remuneration you’re paid, determined on the specialty of your trade, or skill in conjunction with the scarcity of workers in your sector. So if one is to put forth the position that drivers are vastly underpaid the argument that there is a driver’s shortage holds no water and must be false, you simply can’t have it both ways. If you don’t believe me, talk to any economist about this situation.

To do the subject justice, it might need more than one article, it will definitely need your input, so please give me your feedback, and I want to hear from you on this – both company drivers, owner operators and executives. I will give you my opinion on the only two paradigms that matter in this subject, first the driver’s then the company’s.

Driver Perspective

When I look at this subject from a driver’s prospective I don’t blame any of you for being completely confused, over the last 3-4 decades you have been heard and been repeatedly told that there is a driver shortage, and it is at a critical stage. Problem is, if this is in fact, then why hasn’t the average driver wage reflected that reality, depending on where you search or who you ask, you keep seeing average annual pay rates between 50K and 65K, what gives? Meanwhile, you just paid your plumber $120 per hour unclog your drains??.

Obviously something is amiss, and has been for quite some time, extreme shortage and 57K annually don’t add up. To be accurate there are companies out there that pay their driver’s markedly more than this, and likely some that pay much less this is the average – the range I found was from 38K to 100K. The typical driver take home is greater for the most part than that of the general average over all sectors no doubt, but again I can see a high frustration level when folks in this profession are continually told of the dire situation that the industry is facing with its overall lack of drivers.

It’s hard to bridge the gap between what we continually hear from industry trade magazines, and the national press, and what we see in the numbers and average pay scales, the two don’t add up. So whats one to do if you’re a driver? A number of things come to mind especially in light of the fact that any number of driver surveys over the past couple decades reveal that money is not always the least satisfying element of the job, nor the top reason for a driver to quit their current carrier.

There are two messages here; One is for the drivers to first, and always be checking the market to ensure that your being paid at or preferably above market rates for your services. If your research reveals that you’re not, I would have the discussion with your employer, and let them explain their perception of the situation. The second message is of course for the employers – you have to make your driver’s pay packages understandable (even customizable), and manage very closely the relationship between their expectations and your expectations. I might suggest an average base pay rate certainly no less than industry average for your sector is a good platform to start with, then a gain-share bonus plan predicated on all the familiar touch points, fuel burn, accident free miles, longevity, production – whatever those KPIs are for your company. These bonuses should provide the driver with the opportunity to get to the top of the range of driver wages in your area. Finally, and the most critical part of the strategy, is they need for these gain-share bonus plans to be obtainable, under promise and over deliver, what a concept right! You get this part right, and the word gets out you may have something, you’d think anyway, reality might be a bit more harsh, because surprise-surprise there is another twist waiting around the corner and it’s called a Human Resources Strategy and Driver Satisfaction.

Do assuming the driver has done their homework, they are now aware of where you stand with your company’s  payment schedule relative to the rest of the market in your area. They can stop looking for greener grass,  and focus on delivering the goods now right?  Not quite. I have discussed Maslow’s hierarchy of needs in previous articles and that we as human beings are driven to needs is a sequential order as is in our nature as human beings. For us to truly enjoy the sense of Physiological (or money) needs we have achieved we now need to move on to the Safety level and then of course up to the belongingness, esteem and finally self-actualization levels. These universal laws drive everyone from the Driver Seat to the C-Suite (no one is immune). If a company decided to lead the industry with their wage package, they will still be challenged to retain their drivers unless they offer an entire package that includes a sense of community and all that goes with it.

Is there a driver shortage? To me the numbers reflected in driver wages would suggest there isn’t, not that I can see anyway? It’s more aptly described as a Driver Churn problem. The churning of drivers in the industry is more a reflection of companies not spending near the amount of focus on their retention efforts than they do on building very efficient recruiting departments, and the vast eco-system of businesses designed to simply get people in seats – as opposed to keeping them in seats – with a true sense of purpose. When I ask most executives their turnover rates very rarely do I get a definitive clear answer, there is usually some hesitation and what looks to me as a very loose estimate of where they are at. This needs to change and until carriers realize that this subject needs to come out of the closet and be a daily focus moving forward we will as an industry continue to confuse driver shortages with driver wages levels.

 

 

 

The Driver Issue: A SWOT Analysis

There has been a seemingly endless array of discussions over the past decade about a driver shortage. This is fact, and whether you agree there has been a shortage or not, the many doom and gloom statements coming from every direction continue to roar on. As many know, I for one can argue both side of this issue, but I lean towards there not being a shortage of drivers (qualified drivers, that’s a different story), but I digress. As an aside I thought I would do my own quick SWOT test on the issue, and here is what I see:

 

STRENGTHS

 

Let us look at the reasons why one might want to enter this industry. I will try and be impartial but this will be somewhat slanted to my own experience, my apologies up front. The solitude for me was an attraction; don’t get me wrong I enjoy interaction with friends and relatives for the most part but I am also a person who is quite content to be left on my own for extended periods of time, I’m quite fine in my own space. This industry will allow you to see almost any part of North America if your interested in seeing new spaces, and places, as I was when I was entering the industry –  this is certainly a plus. If you happen to be entrepreneurial, as I am, then the trucking industry is definitely for you. Further, if you like independence (I know that many will argue that technology has taken much of this away but I still see it as a plus), the person behind the wheel still has to make a thousand decisions on there own each day the are on the job.

 

WEAKNESSES

 

There is likely a variety of issues at play here, not the least of which would be that it takes guts. You have to have a certain level of self-confidence, and courage, to think that you can handle a truck and a fifty-three foot trailer in and around the type of traffic and congestion that is prevalent today. Think about it, it’s not for everybody. Now add to this the elements that come with the job, to some degree an uncertain income level certainly fluctuating income. Lets not kid each other, it’s okay to good at best, it is not excellent, not by a long shot. Very few drivers could divide their pay checks by the total number of hours spent on every element of their work week and say that it is outstanding for what they do. Depending on circumstances, an uncertain workweek, and irregular lifestyle, and you have to enjoy being on your own – a lot. You would also be entering an industry that tends to eat it’s young with excessively high turnover rates. As of the writing of this article no implemented minimum training standards or finishing standards for the entry level folks. Your family life will likely be strained to say the least, and the reduced lifespan of a professional driver all adds up to a less than a rosy picture,

 

OPPORTUNITIES

 

There are any number of initiatives that could be enacted to create a landslide of new entry-level drivers to the industry if the industry has the courage to go after them. First would be to stop eating each other’s dinner when it comes to rates. Drivers need to make more money. Why do drivers, who happen to work for private fleets, make substantially more money than those from the for-hire industry. Think about it, because carriers bid each other down to the bare bones to get the business, if I were a shipper, knowing this, I’d let um go at it too. We need a GOOD solid entry-level minimum training standard, and a good mandatory finishing standard adopted nation-wide that the industry would be forced to comply with. If I had my way violation of the minimum standard put lives at risk and there would be mandatory jail time for violators. Think back to the wheel offs we had twenty years ago, government said mandatory 50K fine per future infraction, industry responded with mandatory certification of all wheel installers. But a school blatantly cuts corners on training and for the most part they got a slide, a slap on the wrist. Does anyone research where the individuals were trained after there is a preventable accident? NO, makes my blood boil!

 

THREATS

 

Biggest threat for me in attracting new drivers and keeping what we have now is our own complacency; Ontario is being watched by the rest of North America because of the work being done on a new entry-level driver training rule. I’m sure this group is watching our industry brothers south of the border as they craft a federal rule. It took a long time to get here; private agendas, and short cuts have prevailed again with the elimination of the mandated 30 hours behind the wheel. To me this is the single biggest threat out there right now, the threat of private interest who may dictate a weak rule for their own financial gain. Scares the crap out of me that we will get a watered-down version of training designed to put pupils in classes and in seats, rather than the top quality entry-level drivers we need, and this industry deserves.

 

Canada and the US are all at critical stages in the industry’s maturity, we will either move the bar up, as is my hope, or we will legislate another round of minutia that will not change a thing –  I’m flipping a coin right now! So there you have it my SWOT test. In conclusion, more money in the driver’s pockets, better training and finishing programs and we’ll be halfway there. Space limits many other observations and this is a good start. Please let me know your thoughts.

Commitment: The Foundation of Retention

OBJECTIVE: The importance of commitment to success in improving driver retention is vital – and it starts at the top. Here we look at what must be done to ensure that leadership is committed and that the entire company knows this.

Commitment throughout the organization will be important to the success of improving Driver Retention. But commitment is especially important among the senior management team as they are setting the example for all others in the company. To consider and then decide to embark on a project to improve Driver Retention means that senior management have looked at the problems of excessive costs associated with poor retention, recognized that significant planning and effort, affecting the entire company, must be undertaken and that this effort is warranted by the significant savings and service benefits that will be the result.

Put this way it is very obvious that the work we are about to undertake is strategic in nature. It is Strategic because we will be investing time, confidence, and responsibility in company employees well beyond the driver team. In the process we will be transforming the company from one that has a victim mentality about high driver turnover into one that is a positive, supportive and service-oriented place to work – a winner. We will become a company where people, drivers included, want to work. A transition like this is obviously strategic in nature.

Commitment is one of the most critical ingredients to the success of any effort intended to bring long-term improvements to the way business is done. This commitment must come from the directors of the Company and it must be very visible – and active. It must be genuine and it must be unwavering. After all, people throughout the company will have important roles to play and their commitment must be inspired and supported by the commitment they see in their leaders. In short, Company leaders must be seen to walk the walk and make the same commitment that is being asked of the rest of the company departments.

In addition to fostering commitment among the staff, the senior-level commitment must be lasting, since this is a lengthy project, and it must be unanimous among the leaders. This last aspect is sometimes difficult to ensure, but it is important that the leadership team speak and act in unison on the need for the company to make the significant changes necessary to reduce Driver Turnover. At the senior management level this means that a personal commitment must be requested and delivered by each member of the management team. Like a lot of strategic planning initiatives, it would be a good idea to make positive and supportive engagement a part of the personal performance criteria for managers during this project.

Let’s acknowledge that achieving and maintaining commitment among the leadership team is not something that can be accomplished just by asking for it. There are very natural and predictable obstacles along the way and perhaps the most common is the difficulty we all have with adapting to change. This is natural – we all strive for stability and then along comes a new idea or a new process or a new direction and we naturally question and resist the change. But the management team has targeted real benefits for our company and our employees. We have agreed to undertake reasonable steps to achieve great results.

We have agreed to change.

Turn that agreement to change into a commitment to change. We have a commitment to reduce Driver Turnover. We are committed to making our drivers a Strategic Advantage for our company. Achieving and maintaining commitment will require us to periodically re-visit our plan and objectives to remind us that the change we are undertaking is worth it. Do this regularly to reinforce the commitment among the team. Do this so we do not fall back into old habits. In fact, be on the lookout for any wavering of commitment and the creeping in of those old habits.

So, what other benefits can we expect by recognizing the importance of commitment and then taking specific actions to achieve it? We will create a culture throughout the organization that sees and comes to expect a management team that means and does what it says. Secondly, it will deliver proof to the management team that they can achieve significant results by working supportively together – and they can use this approach to be successful in other important projects.

We are getting ready to draw a line in the sand. There was probably some bell weather or watershed moment that brought you to realize something must be done about your high Driver Turnover rate. Keep that motivational “trigger” in mind as we go forward – the one that drove home the need for us to do something serious to improve Driver Retention. This is important because the team must be in unison on this project for it to have sustainable impact, so make it a practice to occasionally remind ourselves of what motivated us in the beginning. For our company it was the fact that our safety and accident rate was getting out of control. Before we knew it our insurance costs were going up, our service was declining and we were constantly fighting fires. It had to stop – and improving the stability of our driver workforce was the obvious place to focus. Your motivation might be different. Perhaps you simply cannot find enough drivers to feed the turnover beast. Or maybe you are seeing your profits decline due to excessive costs associated with hiring and general inefficiencies. The ironic thing is that whatever caused you to start on this process you will reap the same rewards – reduced accidents and their costs, lower recruitment needs and those related savings and, finally, a general improvement in efficiency and quality that will drive better profits.

 

Needs and Wants

I heard a phrase the other day, and it set my mind to digging deeper into the thought. The individual I was with was talking about his wife’s shopping addiction. He said that she was a ‘want person’ and not a ‘need person’. Sometime back I actually did some research on the internet on this subject of compulsive shoppers and found that there is actually evidence that suggests that a small amount of endorphins and dopamine is released into the brain when something is obtained or purchased; a feeling of accomplishment that is felt by most of us. Unfortunately, some of us enjoy the feeling so much and it is so short lived that they get hooked on it and become compelled to have the feeling over and over again. It can be very destructive.

Hearing that phrase immediately sent me to a flash back situation. I was at a truck dealership some time ago and while there, I began talking to a driver who was out shopping for a truck. This fellow, just new to the industry as a licensed AZ driver, was determined to become an Owner Operator ASAP. As we chatted, I noticed he was eye balling a year old conventional that was tricked out the wazoo. Beside the beautiful beast was a more conservative aerodynamic truck that was obviously going to be a far cheaper  to operate and had much less ‘bling’.

Having been through the ‘bling’ time of my life when it comes to large cars, I felt compelled to impart my years of wisdom and inform the newbie in no uncertain terms what the best decision would be for him at this point in his career. I went so far as to suggest that the net profit of the more aerodynamic vehicle, with less chrome, would pocket the same net dollars in four years that it would take him to earn in five years in the bling mobile, if he was lucky.

As I have said in the past, I am no sales person. I do not have that skill and I admire those that do. I mention it because this person endured all of the things I could throw at him that were designed to shed light on this decision. I went at him with things like 20% better MPG, ease of maintenance with less bling and less unnecessary repairable gadgets, less capital expenditure, better cash flow and a lighter vehicle that will allow more payload. He looked at me and said: ‘Ya but I have a young son and I’d like to enter into some of the show and shine events with him this summer’. What could I say? I wished him well, that I hoped he would have great success as an Owner Operator and I went on my way. This person knew what they wanted; the fact that it was way more than they needed meant nothing to them.

So what type of person are you: a need or a want person? Let’s look at the famed Psychologist Abraham Maslow’s hierarchy of needs; he designed a five tiered pyramid. You start with food and shelter, then move up to things related to safety and security and then onto belonging, esteem and finally self-actualization.

It is an interesting flow of thoughts here as I overlay this line of thinking onto the current situation of driver turnover. It seems to me that many companies with high turnover struggle to simply supply what a driver of today needs in tier one.

Let’s break it down a little. According to Maslow, the base of his hierarchy pyramid is the need for food and shelter. To me, that means a steady income. With that steady income a driver buys food and shelter for his family. It’s not too complicated, if you don’t give me work or miles, I don’t stay here because you can’t satisfy my basic needs. The next level is safety. Can you provide a safe vehicle for me to drive and a safe work environment for me to work in with lanes, customers, fuel spots terminal etc.? If I don’t feel safe and secure, I’m out of here! Why stay? I have options that won’t put me in harms way, that pays the same as this or better.

If your company does not have the first two driver needs nailed down and nailed down hard, then you are likely a company that has very high turnover. I would guess that it is likely over two hundred percent! You over promise and under deliver, you don’t pay at minimum market rate and your safety record is in question. Also, your trucks are likely being pulled over regularly by DOT because of it.

It is the next few steps that I believe eludes the majority of trucking companies. The next step is Social Needs or Belonging. Does your company make folks feel like they belong to a community? How do you create that sense of community? Do you communicate through newsletters, social media etc. and what do you communicate? Do you try and involve the driver’s family? Do you have functions and opportunities for them to participate in? If you do, I’m going to guess that you feel your turnover is manageable. You feel like this because your turnover rate is at or around the published industry average.

If you’re a company that has mastered the first three steps and are also valuing your people and recognizing them on a regular basis, I’m betting that you’re on the low side of the turnover equation. If you’re past this point and actually assisting your folks to be everything they can be in their careers, lives and relationships, then you’re likely best in class. Your employees and your entire management team have built a company whose strategic advantage in the marketplace is it’s people. Congratulations to you and I’m sure that your dealing with best in class numbers; about 20% and lower would be my guess.

The basic need in driver retention is income and safety; these are the hard things. Transitioning from here to fulfilling the totality of needs, belonging, esteem, and finally self-actualization is where the game is won by best in class companies.