We all do things that waste time. Some of us will do low-value tasks that we really should be delegating (or just not do at all), but we feel that no one will be able to do it as well as we do. Others will look at a huge project and procrastinate because it appears to be too big and complex, likely doing unimportant tasks to put off that large task that scares us. Still others are perfectionists who continue with a task long after the return on the additional effort is negative. Alternatively, a perfectionist may put off tasks because they are uncertain that they can perform at the unrealistic level that they set for themselves. Finally, there are some of us who get a feeling of importance by never saying no to requests. It feels good to be the go-to person that everyone thinks can do the impossible. However, by never saying no we make everything a priority, and, in the end, nothing gets done. Let’s face it, time and task management are not something that any of us will ever get perfect. What we all need to do is determine what is “good enough” and then use that as a starting point towards continually improving.
There are several ways that one can use to improve our time and task management skills. None of them are one-size fits all. You may find that some are better at one stage in your career, but they may need to be changed or modified as you change roles and responsibilities. You may have other ways of managing that work better for you. The important thing is to create a system that works for you and continue to improve it over time. Holding on to things that don’t work is another time cost that we put on ourselves!
Organize Work Around Energy Levels
Find your most productive hours and schedule high value and high energy tasks during those times. As an example, if you are a morning person then do your most critical work when you start your day. After lunch, your energy level may drop a bit so use that time to do more administrative tasks.
You should also know your energy levels by day. Most people find Tuesdays and Wednesdays as their most productive days, so scheduling their most difficult and important tasks on those days will lead to getting more done.
Start the Day with Critical Work
Mark Twain once said “If it’s your job to eat a frog, it’s best to do it first thing in the morning. And if it’s your job to eat two frogs, it’s best to eat the biggest one first.” He was talking about determining what is your most important or hardest task and dealing with it first. Getting it done will bring you momentum for the rest of the day. Think about it – if you have already achieved your most important goal for the day then tackling the rest of them will seem easy by comparison and that positive mindset will carry with you throughout the day. Elon Musk suggests that you “don’t waste time on stuff that doesn’t actually make things better.” Sometimes we deal with the squeaky wheel or the easiest tasks first and never get to what was important. Resist that urge and leave those simple tasks for that time in the day that you know you are at your lowest energy.
Knowing how to prioritize is a must – if everything is a priority then it moves towards nothing being a priority. One way to determine priorities is to use the Eisenhower Matrix. The goal is to focus on accomplishing the important and urgent before moving on to the other tasks.
Do it now
· Pressing clients
· Deadline driven projects
Decide when to do it
· Long-term planning
· Calling back a client
· Replying to a specific email
Who can do it now?
· Booking a trip
· Scheduling interviews
· Social media
· Working on a dead report
Start by writing down all your tasks – at this point don’t worry about the order, just get down everything that you need to do.
Identify what’s urgent and what’s important and note which of them applies to each task. Tasks can have one, both or none of these identifications. If the task has none of them then find a way to purge it.
Assess value. Look at the important tasks and identify the high value items. Determine which tasks have priority over others and how many people are impacted by your work.
Now estimate the amount of time is required for each task and order them from the most effort to the least.
Insert the tasks into the Eisenhower Matrix to gain a full overview of your work tasks
Some tasks will be urgent, but not important. These are tasks that are good candidates to get delegated to others. You don’t need to do everything yourself and moving these tasks to others can free up time to get the important and urgent tasks done. Remember that holding on to these tasks can have a large opportunity cost – they are time that could be spent doing something that is yields a greater return on your time investment. When delegating, keep these things in mind:
Find the right person – they should have all the necessary skills and be capable of doing the job.
Provide clear instructions – write down the steps and be as specific as possible.
Define success – be specific about the expected outcome and the timelines.
Clarity – have that person explain the tasks back to you. Clarify what they are unclear about, rewriting the instructions if necessary.
Expect that the person will not do it exactly the way you did it – in fact they may find a better way. Don’t let your pride get in the way of delegating things that you should not be doing yourself.
Automate Repetitive Tasks
Find the things that you do multiple times a day or week and see if you can use technology to help you work smarter. Examples include setting reminders so that you don’t forget anything; creating canned responses for emails that you keep writing repeatedly; or creating spreadsheet templates for reports that you do on a weekly or monthly basis. Find those common elements and figure out ways to stop reinventing the wheel each time you do them. Saving a few seconds here and a few seconds there will eventually free up 30 to 60 minutes a day that can be spent on your important and urgent tasks.
Next week we will look at eliminating distractions, how to say “no” more often and gaining more time through batching similar tasks.
November 2, 2018|Kristen Bouchard|in category StrategyComments Off on Getting from Idea to Action Quicker: The GTD Method
Getting Things Done (GTD) is a time management method created by David Allen. This method is based on the idea of moving planned tasks and projects out of the mind by recording them externally and then breaking them down into actionable items. This allows one to focus their attention on acting on tasks instead of recalling them. For a great explanation, David was interviewed on this edition of The Dealer Playbook podcast. For a short version of what GTD is, David does a 90 second explanation here. For a quick infographic on what GTD is, click here.
Most of us are too busy to work on our values, mission and ultimate purpose. Why? Even though our minds are great at creating things, it is terrible at tracking it. (For a great example see this video from Successful by Design) There is a very good chance that you are tracking tons of things in your head right now. That stuff drains your energy and clogs your creativity because you are relying on yourself to remember it. This stuff makes it hard to stay afloat on a day to day basis, forget about being able to think bigger. In this TED talk, David talks about getting in control and creating space:
So, what’s the solution? You have likely been told it’s start at the top and work down. That’s what’s got you struggling. Start by mastering the bottom (by mastering getting things done efficiently) and then when you are no longer drowning you can think about your mission, purpose and values.
Getting Things Done is a collection of processes and habits that aim for:
A clean and updated calendar of time-critical actions;
A clear, current and comprehensive list of next actions you can take anywhere, anytime, without the need for further thought or clarification;
A full list of outcomes (big and small) that you’re committed to achieving in the next 12 months; and
A complete system to organize and keep track of all the “stuff” in your life.
By implementing GTD you will:
Never let anything important slip by again;
Always have pre-prepared options of actionable and productive things to get on with;
Have total oversight of everything you’ve committed to in the near future; and
Have a totally clear head with no need to mentally track of remember anything.
In short, it’s a way to get your life under control. Through getting things out of your head and into a trusted system you will trust yourself more. You will know when to say “no” and still feel confident about handling anything that is thrown at you. By making space in your head that the “stuff” used to inhabit, you will have the time and energy to start working on the bigger things. David talks about “The Art of Stress-Free Productivity” in this video here.
Capture – Collect what has your attention. Use an in-basket, notepad or voice recorder to capture 100% of everything that has your attention. Little, big, personal and professional – all your to-do’s, projects, things to handle or finish.
Clarify – Process what it means. Take everything that you capture and ask: Is it actionable? If no, then trash it, incubate it or file it as a reference. If yes, then decide the very next action required. If it will take you less than 2 minutes, do it now. If not, delegate it if you can; or put it on a list to do when you can.
Organize – Put it where it belongs. Put action reminders on the right lists. For example, create lists for the appropriate categories – calls to make, errands to run, emails to send, etc.
Reflect – Review frequently. Look over your lists as often as necessary to determine what to do next. Do a weekly review to clean up, update your lists and clear your mind.
Engage – Simply do. Use your system to take appropriate actions with confidence.
Plan complex projects to get from multistep outcomes to actions.
Here’s a short video where David walks Dutch TV host Linda Geerdlink though getting started with GTD.
Let’s look at these in more detail.
This includes all your outstanding stuff. Gather every out of place and unfinished thing in your head, your e-mail, your briefcase and wherever else it is stored and put it into a few external inboxes. An inbox can be a basket, a notebook, a spreadsheet or any other way of getting it all into a small number of places. You want to get it external to yourself because otherwise it will stay on your mind, eating energy and killing creativity.
Stuff is anything (an action, commitment, project or object) that:
You want, should, could, ought or need to act on, now or later; or
Anything that is even slightly unfinished or out of place.
Allen refers to this stuff as open loops. By not having been closed yet, they cause stress because they are things that we could forget. They are constantly telling your brain to “think about me”. That stress is what is killing your energy and your creativity.
By collecting you empty these external inboxes so that you can move to the clarifying and organizing stages. It’s sort of like doing spring cleaning. Once it has been collected you will have an overview of everything that is unfinished or out of place in your life and it allows you to do the next steps quickly and effectively. Once you have the system set up, collecting on a weekly basis will become shorter and easier. While collecting, do not process as you go – you will be much more efficient if you batch all collecting first before trying to process it (the only exception is for items that can be completed in two minutes or less). If the item is impractical to move (say you need to sell your old car, boat, etc.), use a physical or digital note as a placeholder so that it gets into the system. Tooodledo.com offers a great infographic on how to do a brain dump here.
Clarifying is the process of determining what stuff is, what’s the desired outcome and what is the next action. You need to answer all these things. If you don’t know what something is, how can you tell if it is important? The desired outcome lets you know when the thing has been completed. The next action follows determining the outcome as this is the next step required to move towards that outcome. By not answering these three questions the item will sit in the system and you will not act on it until you are forced to. Allen says that “you often have to think about stuff more than you realize, but not as much as you’re afraid you might.”
When determining the next action, be complete enough that someone else could do it without needing further clarification or thought. If the next action is “call garage to schedule an oil change”, include the phone number. If you don’t know it, then the real next action is “find phone number for Joe’s Garage”.
A few rules for working through your inbox:
Always start with the top item on the pile.
Handle only one item at a time.
Never put anything back into an inbox.
Not sure how to get your inbox to zero? David offers some advice from his blog in response to a help request from a user here.
This is the process of:
Doing, delegating or deferring next actions;
Tidying up useful but non-actionable stuff into its proper place; and
Trashing what is left.
There are a few tools that you will need for organizing:
A calendar for time-critical meetings, events and actions;
A way to take notes for lists of actions, outcomes, plans and ideas;
A filing system to store information you may need to reference but can’t act on; and
A trash can or paper shredder depending on how sensitive the document is.
Allen prefers physical systems but the choice between physical and digital is yours. Just make sure that the setup is relatively easy and works for you. Want to know what apps David uses to keep his lists? He discusses them in this short clip here. David offers some other ideas on what tool to use here.
In the note taking tool create four new notes with the following headings:
Waiting For – a list of all things that you are waiting for from others;
Next Actions – a list of every doable next action to progress to an outcome;
Outcomes – a list of every multi-step outcome that you’re committed to realizing in the next 12 months; and
Someday – outcomes or actions you may like to undertake one day under different circumstances.
In your filing system create two new sections or folders inside of it:
Plans – visualizations, milestones and next steps for complex outcomes; and
Ticklers – stuff you will “mail to self” for later re-processing.
Within the ticklers, set up 43 folders:
1-12 are labeled with the name of each month; and
The remaining are labeled 1 through 31.
How does this work? Say you received an email for and event that you want to attend that opens registrations in February. There is no actionable item for right now, but there will be, so file that invitation in the February folder for later re-processing. The remaining folders are for items in the current month. The items will go into the folder representing the day that they are due.
Once an item has been clarified, you now have five choices:
Do – if the next action takes 2 minutes or less, do it now;
Delegate – if the next action can be done by someone else, delegate it;
Defer – commit to acting on a next action at a specific or general time in the future;
Tidy – find a proper place for everything and put everything in its proper place; and
Trash – dispose of anything that is no longer important or needed.
The best approach is to keep things simple. Have one proper place for everything and put everything in their proper place. Try to only use one list and fewer folders wherever possible. Sort things alphabetically – avoid the urge to categorize by sequence and priority. Reducing complexity will just add thinking that will result in things not getting done and undermining the system.
The one place where many is better is in your next actions list. Allen recommends splitting next actions across several lists by context, such as place (where you must be), person (who you must be with) or tools (what you must have on hand). These contexts will help you to remember to be in the right place, with the right people and at the right time. They will also allow you to batch similar actions together.
At a minimum, do a weekly review where you look for items from the previous week that have not yet reached their desired outcome, have been deferred for various reasons or just have not been actioned on yet. Re-run steps 1 to 3. Review, update and refresh every one of your folders and use your freed-up headspace to get creative, think big or maybe start a project from your someday list. For each item answer the following questions to determine what to do with it:
Where am I on this?
Is it still relevant?
Is it still in the right place?
What’s the next action?
Once your system is up and running, this is where you will expend most of your time and energy. At this point all that is left is the doing and because it has been organized, the doing is much simpler. Everything has been funnelled to your calendar and your master list of next actions.
So how do you decide what to do next? First, rule out things that you can’t or shouldn’t do based on:
Context – what can’t you do based on where you are or what tools you have available?
Time available – What can’t you do based on the time until your next appointment?
Energy – What shouldn’t you do based on your mental or physical state?
Out of what is left, trust your gut and do what feels most important right now. Even if you procrastinate, as long as you are working from your list you will be making progress on something. However, as you get more proficient, there will be less and less reason to avoid doing anything. David discusses procrastination here.
Something to keep in mind is to never respond instantly to work as it shows up, no matter how “urgent” it is. Spend a couple of minutes running the request through steps 1, 2 and 3 of GTD. Review any next actions you have identified within the context of all your next actions. Only engage with the new request if it still is the most important and urgent thing on your plate. David offers more tips on how to deal with interruptions in this 4-minute video here.
Sometimes just a moment of thought and effort that’s needed to identify a project’s next action, but its usually better to have a plan. A good place to start is:
Define the purpose and principles – why are you doing this and what are the constraints?
Visualize outcomes – what does success look like?
Brainstorm – what are all the ideas that you can think of and eliminate the bad ones.
Organize – what ideas will you use, which are the most important and what order to do them in.
Identify next actions – what is the very next physical action you can take to progress the project?
The goal of GTD is to get things done, so don’t make planning an end in itself. It must draw out next actions! Jacob Bronowski puts it as “the world can only be grasped by action, not by contemplation.” If you are spending half of your time building and maintaining your system, you just aren’t doing it right. Trust your instincts, simplify your system and get things done!
This post is the third in a series of five focused on narrowing or eliminating the gap between ‘Knowing’ vs. ‘Doing’. In our personal lives, we all know what we ‘should’ be doing, but our daily habits and tactics don’t always line up. Similarly, in business, a business without an achievable strategy, a business will ultimately deteriorate to the point where it’s simply a series of fires being put out. The Knowing Vs. Doing series is a lead-up to our TPP Seminar on December in Indianapolis focused on preparing trucking enterprises for success in 2019. Take the Knowing Vs Doing Survey here.
In last week’s post, we reviewed the S.W.O.T. process. This mechanism, regardless of industry or size, is a crucial step in developing a short and long term strategy for success. Specifically, discussing and owning your company’s current weaknesses and failings is the type of introspection that should occur regularly, with feedback from all roles in the business – from the C-Suite to the Driver’s seat. Further, I’ve always felt that successful businesses, and their leaders, should always be a bit paranoid – in both good times, as well as bad. After you’ve gone through the S.W.O.T. process, and you’ve determined the major objectives for the business (see Part 1 of this series), it’s time to put the plan into action. In general, all well-executed plans have the following key components:
The goal is well defined. Each team member understands what IS to be achieved, and the impact on the business – whether from a financial, as well as from a corporate culture point of view. Each member of the team assigned to the objective should be able to clearly communicate verbally the objective, and the key benefits to the business.
A timeline is established.Execution does not happen without a deadline. Put that on the wall in every room of your business. Conversely, if you want to remain on the treadmill of mediocrity, don’t set deadlines.
Make your people accountable. This part may seem like a no-brainer, however, being a fan of business, I’ve read about (and witnessed) many well-known businesses that got too comfortable. This comfort was rooted in a lack of accountability – from the Board room, all the way down to the front lines (e.g. Kodak, Sears, Toys R Us). Making specific people and teams accountable will ensure continued momentum. This step is also an important vetting process for future business leaders. The ones who step up, and want to reap the rewards (and the potential penalties) are the type of people you build your business around
Incent, Incent, Incent, Succeed. Within TPP, many of the top performing companies use variable compensation to light the fire for success. Outside of asking your people to become shareholders, there are very few other tangible ways to ensure that your people have Skin in The Game, other than variable compensation. Proper variable compensation plans need to aligned with, and constantly readjusted to make sure they tie to the goals, deadlines and the overall financial impact of the individual actions and decisions made by people and teams. While contemplating these programs, ensure that the compensation program methodology is easily understood, and the objectives, variables and measurement are within the control of the individual and teams being rewarded.
Review and Adjust Regularly. No explanation needed here.
In all industries, leveraging existing frameworks for the above process can vastly improve the speed of developing and executing on a strategy. In TPP, we have a significant amount of discussions on the items above. Further, many high performing companies have implemented third-party programs such as the Four Disciplines of Execution. Using 4DX or another third-party program narrows the focus, and clearly defines the steps needed to rapidly move forward. Next week, we’ll move from the Macro to the Micro, and discuss the importance of time and task management to executing on your plan.
For your Sunday viewing pleasure, here’s a short video about the 4DX program to get you thinking about your action.
No General leads his or her army into war without knowing both the terrain he or she will face and what the strengths and weaknesses of the enemy they will face. In the current market environment, achieving profitability should not be difficult, even with pressing weaknesses. However, just like seasons change, the market will swing the other way. The smart companies know this, and are reinvesting their profits into building networks and advantages, to put themselves ahead of the their competitors when tide goes out. Knowing what your business needs to do next comes naturally to some business leaders, but for most, setting a course for the future requires equal parts Collaboration, Introspection and Honesty. An excellent way to get you started on this path is with a SWOT analysis.
SWOT stands for Strengths, Weaknesses, Opportunities and Threats. Strengths and Weaknesses are internal business factors while Opportunities and Threats are external factors and variables. There are several different templates out there that can be found with a quick Google search and each organization will have their preferences. However, the physical form is not as important as actually doing the exercise.
This analysis is not just for use at the enterprise level. It is equally powerful when done at the division, department or even product line/customer account level. You are probably already doing a similar analysis on all your top accounts but possibly not in as formal a framework. By using this method in conjunction with being closely integrated with your large account you should be able to foresee any threats to that client and be prepared to fend off any attempts by other carriers to take over some or all of the business.
Look at factors such as:
• What are the organization’s advantages?
• What do you do better than others?
• What unique resources can you offer (ideally ones that a customer will pay for)?
• What does the marketplace see as your strengths?
• What is your unique selling proposition?
When looking at your strengths, also look at where you are in relation to your competition. If all your competitors are achieving 98% on-time deliveries then you achieving that is not a strength, it’s a market necessity (a table stake). Also take the viewpoint of the customer as they are the ones making the buying decision!
• What could you improve on?
• What should you avoid or eliminate?
• What does the marketplace see as your weaknesses?
• What does your competition do better than you do?
• What causes you to lose sales?
• Are their perceived weaknesses that you could easily overcome?
Be honest in this step as downplaying weaknesses will not allow you to move forward and address them.
• What are emerging trends?
• What changes in technology are coming in the near, medium and long terms that you are posed to exploit?
• What competitors are family owned and are showing signs of cash flow issues?
• What new developments are your current customers working on?
• What new businesses are coming to your marketplace?
One approach to take is to look at your strengths and ask if they open any opportunities. At the same time ask yourself if the elimination of any weaknesses could also create an opportunity.
• What obstacles do you face?
• What are your competitors doing?
• What technological game changers are coming that you are not ready to exploit?
• What is your financial position – any cash flow or debt problems?
• Are quality standards or specifications for your product or service changing?
• Are there any weaknesses that could seriously threaten your business?
• Are there any Political, Economic, Socio-Cultural or Technological (PEST) factors to consider?
Once you have made an exhaustive list for each category, it is now time to pare down the list and prioritize each item. Where possible ensure that all statements are precise and verifiable – for example you want “a cost advantage of $0.05 per mile on the Chicago to Des Moines lane” instead of “competitive pricing”. Finally make sure that any options generated are carried through to later stages in the strategy formation process. Make certain that you follow through and create a strategy once the analysis has been done.
An important task is to measure the gap between where you are and where you want to be. This helps you create goals that can be measured and verified. It’s much better to say “achieve a 5% increase in miles per gallon” than it is to say “improve fuel efficiency”. Understanding what these gaps are will guide both you and your staff towards implementing an effective strategy to get to where you want to be.
Finally, be prepared to revisit this analysis on a periodic basis – possibly yearly for the entire enterprise, more often at the product or customer level. Look at what has changed. Did you improve or eliminate any of your weaknesses? Did your competitor find a way to close the gap on your price advantage? Did something new that has the potential to be a game changer come on the market recently? This should not be a static document and it should be one of the first things you turn to when a new threat or opportunity comes on the horizon. By understanding what is happening on the playing field means that you can make the proactive moves of a market leader instead of reacting like a follower.
This post is the first in a series of five focused on narrowing or eliminating the gap between ‘Knowing’ vs. ‘Doing’. In our personal lives, we all know what we ‘should’ be doing, but our daily habits and tactics don’t always line up. Similarly, in business, a business without an achievable strategy, a business will ultimately deteriorate to the point where it’s simply a series of fires being put out. The Knowing Vs. Doing series is a lead-up to our TPP Seminar on December in Indianapolis focused on preparing trucking enterprises for success in 2019. Take the Knowing Vs Doing Survey here.
Most senior managers are very aware of the things they need to do to reach greater levels of profitability and growth. However, many don’t have the time to come up for air to determine which actions they should take, and in what order to build momentum. Everyone wants to reengineer their freight network, implement a shipper scorecard, fix their billing process, eliminate redundant tasks, implement new maintenance practices and measured etc. This list can be endless. I would suspect that they vast majority of those reading this post are shaking their heads, saying ‘yep, yep…”.
Now, let’s stop for a moment and remind ourselves of the following quote:
“Well done” is always better than “Well said”.”
There will be a small percentage of readers who can state, with confidence, that they have a well-defined strategic plan, and have assembled a series of tactics to achieve this plan. For everyone else, it’s time to set step back, catch your breath and prioritize.
My two favorite methods/systems of prioritization are extremely simple, and are/were used by two very successful individuals – Warren Buffett and President Dwight D Eisenhower.
The Buffett Method of Prioritizing Strategies and Goals
You can read about the Buffett method here. In a quick summary here’s how it works:
Write down up to 25 goals – big and small, that you have for your business. This needs to be done by both principals and senior managers.
Combine all the goals you listed with those of the rest of your team
Circle the top 5 goals that are achievable in the next 12-24 months. This is your ‘List A’. The remaining goals are your ‘List B’.
Although it’s not technically part of the Buffett method, when it comes to execution, size and scale matters. For Large carriers (e.g. over 500 trucks), 5 important goals is a ‘doable’ thing in 12-24 months. However, for smaller carriers, I would pare the five down to 2 – max. For mid-sized carriers (100 – 500), 3-4 should work.
Now that you have List A and List B. What’s next? Simple develop a strategy and a project plan to achieve each item on List A and adjust where necessary. Make sure every person on your team knows what is on List A, meet weekly to discuss. List A needs to become engrained in the fabric of your team.
What happens to List B? Easy, store each of those goals away and don’t consider them until you’ve completed / achieved List A. They are not given any more time!
The key difference between the Buffett Method for personal vs business is collaboration. In order to build long-term business value, the decisions on which goals make List A must be done in conjunction with those in c-suite right through to the driver’s seat. You want buy-in, and a thorough understanding of what is achievable, and what’s not. For larger companies, this typically would involve departmental goals, and strategies, for smaller companies, company wide goals and strategies.
The Eisenhower Method: Prioritizing Daily Tactics, Tasks and Habits
Everyone has the person on the team that fills their day up with ‘busy work’ that provides little or no value to the business. People always ask me what is the number one cost-saving opportunity for trucking companies. Regardless of the industry, it will always be removing those people from your businesses. The longer you wait, and the more you grow, you are tacitly telling your team this behavior is acceptable, and suddenly you have a business full of ineffective people. Cut them from the team. It will improve culture, set a new course for that role in the business, and add to your bottom line.
Each if us also has daily habits and tasks we all do that are either redundant (not needed or done by someone else), or those that are not moving the business forward. Doing an audit of your daily and weekly habits and tasks is an important one that should be done by everyone in your business. Once you have that cumulative list, it’s time to prioritize. The Eisenhower Matrix is a phenomenal way for people in all roles, and at all levels of responsibility, to do a gut-check on their daily activities. How does it work?
President Eisenhower would regularly create a matrix to properly categorize and prioritize his daily activities. This eventually turned into a mental model that his team used to decide which things they should bring to him, and which things should be immediately delegated, or perhaps eliminated. Here are sections within each matrix, and how to consider those daily tasks and habits:
1.Urgent and important (tasks you will do immediately).
2.Important, but not urgent (tasks you will schedule to do later).
3.Urgent, but not important (tasks you will delegate to someone else).
4.Neither urgent nor important (tasks that you will eliminate).
Although setting priorities can sound boring, it can be the main difference between success and failure. Hopefully the above two methods provide you with some food for thought. Are you expecting too much from your team, from yourself? Do you need to be part of that email chain? Are you going to keep allowing people to use their time ineffectively and inefficiently? Does your team know their collective priorities other than the daily ‘busy work’? Take some time, give this some thought. Take action.
I spent some time this week talking with Jarit Cornelius, the Vice President of Asset Maintenance and Compliance at Sharp Transport. One of the topics was my recent articles on site selection and building a new facility. Jarit is very involved with the Technology & Maintenance Council and currently is the Vice Chairman of the S.5 Study Group (Fleet Maintenance Management). He mentioned that the TMC has developed Recommended Practices for New Facility Development. This was a result of many consultations among various industry experts and real-world experience.
Some of the relevant Recommended Practices (RP) when looking at a new facility include:
RP 510A – New Facility Development offers a great overview of what steps are needed to design a shop either from scratch or renovating an existing one. It offers guidelines on things like layout, energy efficiency, how to calculate or estimate the number of services required and much more.
RP 518A – Fuel Station Planning offers similar guidance for developing on site fueling stations.
RP 512A – Mechanic Staffing Determination – provides a formula to calculate the number of mechanics required to adequately staff a heavy-vehicle maintenance shop
RP 513 – Estimating Number of Service Bays – gives an analytical methodology for estimating the number of service bays required in a facility
RP 515 – Maintenance Shop Design Considerations – a listing of critical elements that should be considered in the design
RP 517 – Managing Environmental Compliance – guidance on compliance education/training, self audits and record keeping.
These have undergone many updates and amendments over the years as the study group constantly looks at new and upcoming technologies and how to integrate them into individual shops.
Other Recommended Practices offer guidance from the following study groups:
1 – Electrical
2 – Tire & Wheel
3 – Engine
4 – Cab & Controls
6 – Chassis and Brake Systems
7 – Trailers, Bodies and Material Handling
8 – Cost Control Methods
11 – Sustainability and Environmental Technologies
September 22, 2018|Kristen Bouchard|in category StrategyComments Off on Finding the Ideal Facility – Part 2 – The Building
Now, let’s turn our attention to the building itself. The first thing you need to do is determine what activities will go on in it. Obviously, you will need some office space for your operations and admin staff. You might need some warehouse or cross-docking space. A shop area is probably on your list as well. Here’s a few things that you may not have been thinking about:
Space for your drivers while they are waiting for maintenance on their trucks or while they are waiting to be dispatched.
Do you need to provide showers or other amenities for the drivers?
What about file storage space for those documents that have a retention period?
Will there be lockers, or a change room required for any of the staff, such as mechanics?
Lunch room and any meeting/conference spaces
Washrooms – both placement and the number of them
Parts and equipment storage
An IT room with adequate power and cooling
Adequate clearance in any shop or warehouse areas to allow for their safe use
Develop your list of things that you must have but at this point, try to keep things general. Many design engineers will tell you that good layouts develop from the general to the specific, not the other way around. Don’t go in with a set idea of where things will be as they will act as constraints on where other things can be put. Knowing what areas should be adjacent to each other is good but getting too many specific items such as “the tire machine should be here, and the parts room should be there” will likely result in a suboptimal design. Next, determine what activities will occur in the facility, both now and in the future. As an example, if you think your warehouse activities will grow over the next few years, you may want to place it at the back of the facility so that future expansion is a possibility.
Determine what areas are the priorities. Many designs focus on the front end where the main entry and the offices are. However, other areas may have more of an impact on your revenue stream, such as the cross-dock area or the shop. Sometimes it is better to start with the rear of the facility and work your way to the front. One question that needs to be asked before focusing on any individual department or area is “How does it impact the movement of people and/or product throughout the entire building?” A way to look at this is the product to be handled will determine the warehouse and equipment needs. Equipment locations determine workflows. Eventually you will need to put the pieces together on paper and determine what area needs to be adjacent to each other.
Some other considerations at this stage include the following:
Try to anticipate any future needs by designing spaces to be potentially converted or expanded.
Anticipate any future loading docks, truck space and car parking and leave enough space for them
Include enough structural capacity to handle any additional rooftop equipment, such as additional HVAC units.
Avoid block or poured cement walls as much as possible to allow for future expansion. Ideally a curtain wall construction is used so that the outer cladding can be removed, and a new section added with a minimum of disruption.
Try to specify the use of energy efficient items such as LED lighting and proper insulation. These will cost a bit more in the construction phase, but they tend to have a lower overall cost of operation. LED lights also tend to last longer than other options, reducing the amount of building maintenance required.
Try to avoid dark colors on the outside of the building and roof as these will result in additional cooling capacity. A more neutral color will also be less restrictive if the building needs to be remarketed in the future.
Consider what products may be stored in the facility and include enough fire protection based on the anticipated fire hazard.
Allow for adequate circulation paths in both the warehouse and the shop areas. In the warehouse this includes walkways as well as paths wide enough for forklift trucks to safely operate. In the shop this includes walkways for staff to circulate, safely move required parts to their service bays and allowing for the required number of egress points.
If possible, separate shipping and receiving areas to avoid congestion both inside and in the yard.
Ensure that the floor slab is capable of handling not only today’s uses but allow for potentially heavier loads in the future.
Use pallet racking that is sufficiently rated for the products being stored. Racking should also be considered to maximize the warehouse’s capacity and utilization as well as to maintain proper laneways for both people and materials handling equipment.
Try to anticipate any future computer or telephone locations. Cable drops are much easier and less costly to install before the wall cladding is installed. If the exact locations are not known, consider running cables that are coiled and secured in the drop ceilings with enough extra length to allow them to be installed relatively quickly.
Allow for natural lighting in the design for as many workspaces as possible.
Take into consideration any fumes or smells that may infiltrate into the office areas. In some cases, the mandatory fire breaks may be enough but additional ventilation or air barriers may be required if the shop or warehouse must be adjacent to the office space.
Looking specifically at the office area, consider having the structure capable of supporting either a mezzanine or the ability to add an additional floor above it if expanding to that end of the building is not feasible.
Shop bays should be designed with enough space at the sides to allow for both the storage of tools and equipment as well as the safe passage of employees.
Where possible design shop bays in a drive through configuration. This will not only minimize the need to shunt vehicles around but also reduces the need to back vehicles out which can result in a visibility issue.
Allow space for shared equipment, such as tire machines, bearing presses, etc. so that mechanics can access them without having to move vehicles that are being worked on.
Consider the use of either a lift or a pit for doing fluid or tire changes to minimize the reliance on jacks or jack stands and to provide a more efficient workspace.
Ensure enough airlines and/or fluid delivery lines are placed in each bay as retrofitting these is costlier than installing them during the original construction.
Orient the overhead doors to allow for ventilation during warm weather but at the same time try to avoid orienting them directly into the prevailing winds. This allows the doors to be left open when the weather allows it while minimizing any snow or rain infiltration into the bays.
This is not intended to be a complete list but gives you an idea of some of the unique things for our industry that should be taken into consideration. Make certain to look at any other items that make you different and ensure that those needs are put into the design.
As much as possible use an architect and/or engineering firm that has experience with truck terminals and repair shops. They will understand some of the ways that industry works and what questions they need to ask of you. At the end of the day it is more important to spend a couple of extra days planning up front instead of having to bring in a construction company to retrofit something a short time later. Getting it right the first time is always less expensive in the long run.
September 22, 2018|Kristen Bouchard|in category StrategyComments Off on Finding Incentives to Locate Your Facility in a Specific Jurisdiction – A Resource Guide
Last week we discussed looking at the differences between jurisdictions in terms of taxes and any incentives that are available to you. We received many requests for more information.
Note – the following is provided for information use only and is not to be considered as tax planning advice. We also make no guarantees as to how up to date the information is or to its accuracy. Please consult a professional familiar with the jurisdiction(s) under consideration. Also, the following tools are offered as examples and no endorsement of the provider is being made nor should it be implied. The author has no financial interests in any of the organizations presented.
A good place to start to look at different states’ overall tax climate is the Tax Foundation’s State Business Tax Climate Index (click here). Their index is designed to show how ell states structure their tax systems and provides a roadmap for improvement. All states levy a property tax, but their analysis provides a way to look at the overall tax burden. Some states do this by foregoing one of the major taxes – either corporate income taxes, individual income taxes or the sales tax – at the state level. It is possible for a state to levy all the major taxes id they do so with a low rate over a broad base. The worst performing states tend to have nonneutral taxes with comparatively high rates. A four-year comparison chart allows the user to see what the trends are for each state while a separate table shows the state rankings for each major tax type, so you can see how the ranking was reached. An interactive web tool (click here) is also available to look at adjacent states at a glance. Clicking on a state will bring up the ranking for that state as well as the overall ranks of the neighboring states. A further click through allows you to learn more about a single state’s tax structure and average rates.
Financial advisors SmartAsset provide both an income tax calculator (click here) and a property tax calculator (click here). The property tax calculator estimates the property taxes for a given zip code location and assessed value. While this is for residential properties, it will give you an idea of how that county and state compare to the national average. This is not a direct proxy for commercial property taxes, but it will give an idea of if that municipality is a relatively high or low tax jurisdiction.
Locations Economists Biggins, Lacy, Shapiro & Company, offer both an interactive map as well as a pdf version of state economic development incentives (click here). Topics such as available tax credits, special zoning, grants, job training, tax exemptions and more are provided on a state-by-state basis.
Online journal Area Development provides several resources for a company considering a new facility, from site selection, facility planning among others. They provide individual state resource pages that offer information on financial incentives, business taxes and economic development contacts.
Software provider BS&A offers an online search tool to find existing property and any other local taxes (click here). Simply pick the state, county and municipality and then run a public record check on the address under consideration.
A comprehensive listing of contact information for both state and district economic development agencies can be found on the U.S. Economic Development Agency web site (click here). Simply click on the state to get links to each available level of economic development agencies.
Finally, check both the website of the municipality that you are considering as well as it’s local chamber of commerce. Many will provide how they calculate and assess property taxes, but some will not. If no guidance is provided they will have contact information that you can use to phone the appropriate department directly. The local chamber can also provide information on local programs and incentives that may be available to you.
September 16, 2018|Kristen Bouchard|in category StrategyComments Off on Finding the Ideal Facility – Part 1 – Picking the Location
When trying to create the perfect facility there are many different things to consider – site location, site layout, building layout, lighting, security, etc. There also is no such thing as a “universally perfect” facility. Each company will have a slightly different priority list and even within the same company you will find differences at each different location. As an example, a facility in Miami will have different priorities compared to one in Minneapolis. The Miami location will need to worry about hurricane proofing while Minneapolis must worry about things like snow load.
In general, we have several common items that need to be considered:
Site location and size
Building construction type and layout
Parking for employee vehicles, tractors and trailers
This week we will focus on the site location and size.
When considering the ideal site, the following should come into your planning process:
Size of the lot.
Shape of the lot
Proximity to an Interstate
Proximity to your customer base
Commuting distance for your employees
Regarding size, you will need to calculate how much space that the fleet to be domiciled at that location requires, including space to maneuver vehicles without causing any damages. Assume 80 feet for a tractor trailer combination. That means you need a minimum of 133 feet (80 feet + 53 feet), and more likely 150 feet between rows of trailers to allow for enough space to pull trailers in and out of the rows. Additionally, you will need about 10 feet in width for every trailer. As an example, if you have 90 trailers and the lot is 350 feet wide, you will need to have enough room for 3 rows of 30 trailers (allowing enough space for a laneway at both ends). You will then need approximately 450 feet in length to fit the 90 trailers. This is before we find space to park the tractors, put up the building, etc.
Tractor parking is a little more of an art as highway tractors can be anywhere from 20 to 29 feet long depending on the wheelbase. Day cabs will run about 5-6 feet shorter. For tractor parking in a tight yard, consider using angle parking as it will shorten the width needed compared to straight on.
There are a few other major considerations with a site:
Being close to your customers as well as an Interstate (or other major highway) means that you will be minimizing unpaid miles – this is a cost that needs to be considered when choosing a site as it is effectively a fixed overhead charge that will eat into your profit on almost every trip.
The physical shape and landscape of the property. Ideally the lot will be either square or rectangular. This will reduce the amount of wasted space that reduces parking capacity.
What is the natural drainage of the lot? Will it need significant ground preparation and a catch basin system?
Are there any waterways or aquifers in the area? Those could result in restrictions put on your ability to refuel in the yard as well as the storage of items like used oil or anti freeze. You may need to construct a berm for any spill containment.
Zoning – ideally any site you select will already have the proper zoning from the municipality. Having to apply for a variance or zoning change will result in additional time and expenses as well as injecting some uncertainty into the project. The municipality may reject your application, especially if it is a jurisdiction that has already shown hostility to our industry with things like parking restrictions or traffic bylaws that require trucks to reroute.
What is the planned use for surrounding properties? Will those uses have a potential impact on your planned operation?
If you think that you may need to expand in the future, gain an option on an adjacent lot. Otherwise you could find yourself land locked in the future.
What is the tax structure in that municipality? Pay attention not only to the rate but how the value will be calculated. It is not uncommon for nearby jurisdictions to have vastly different property taxes on similar sized and priced lots.
What services are currently available for the property and what will be the buyer’s responsibility to provision? Pay attention to things like natural gas and fibre optic availability as the cost to have these brought to your property can be high. Without some form of reliable high-speed internet, you could find your staff unable to work effectively. What sort of electrical service can you get, and will it be enough to power your planned operations?
Were there any previous uses that may require environmental remediation? Remediation can be very costly. Take this into account if buying a property that has already been used as a terminal.
What sort of soil does the lot have? The soil composition may impact the footings required for your desired building. How stable it is may impact the amount of earthworks are needed before you can use the property. The soil can also impact any environmental concerns (example – a fuel tank leak in sandy soil may go down several feet until it hits bedrock or clay. It may then run for hundreds of feet underground. If you need to do a remediation this could easily cost hundreds of thousands of dollars).
Surrounding neighbours – will your drivers be coming and going at all hours or will they mostly be operating during daytime hours?
What sort of surface the yard has have an impact here. If you have a dirt or gravel parking area you may run into a dust issue, resulting in the need for periodic applications of some sort of dust abatement product.
There needs to be adequate parking for both your staff and any visitors.
The building that houses the terminal should have enough room for future expansion without causing onsite traffic flow problems.
Are there any location specific needs, such as where to pile snow in northern states? If you have a facility in places like Buffalo you will either need to leave aside space to pile snow, have some sort of melting system or have someone in place to truck it away.
In northern states, there may be a need for plugs to operate block heaters in the winter months.
This list in not exhaustive and may differ depending on the location you are searching in. The take away is you need to do your homework before you start looking. Spend the time up front to know what you are realistically looking for will allow you to have a list that you can use to compare different options against each other. If you are not sure of what you need, enlist the help of an expert. Many commercial real estate brokers will have people on staff that can give you the necessary guidance.
A final point – not all real estate brokers are equal. Don’t just go with the person who helped you buy or sell your house. A residential specialist is unlikely to have the skill sets or supporting services to help you through the maze of regulations that you will face in the commercial/industrial marketplace. Go with a commercial real estate agent from the start as they will be knowledgeable about things like zoning or acceptable uses as well as knowing the questions to ask and have the resources to let you get things right the first time.
Next week we will look at how to design your ideal terminal building.
August 26, 2018|Kristen Bouchard|in category StrategyComments Off on Don’t Fall Asleep at the Wheel – Keeping Your Business Plan Up to Date
We all create annual business plans, and then attempt to get our proforma budgets in line. But how many of us revisit those plans on a regular basis? Are we monitoring the environment for changes that could impact us – a change in minimum wage, a new entrant into the marketplace, or a disruptive technology that catches us napping. Not planning for developments from competitors or governments can put your plan, or possibly even your business, at risk.
Reality check – there just isn’t enough time in the day to monitor every environmental risk that could impact us. That’s why we belong to industry associations, subscribe to newsletters, and follow blogs. These act as our early warning systems for new things coming on the horizon. There is no way that any of us can keep up with all the changing regulations that the various levels of government impose on us. Some are in response to emergency situations and get pushed on us with little notice. Others (such as the ELD mandate) are publicized years in advance, and have lengthy implementation periods before enforcement begins.
So, lets look at some things that we can control ourselves. Let’s start with your target market – have you really spelled out what it is? What is your preferred network? Your hot lanes? How will these affect your retention efforts? Have you spent enough time doing your research so that you know what your customers really want and value? And even if you did that once, have you revisited those assumptions to make sure that they are still valid? If you have the target market right, have you crafted your marketing and sales efforts to appeal to the needs of your current and potential customers. With 10-25% unseated percentages, and 250% over-capacity. It’s easy to fall into the trap of forgetting that the economic tables will eventually turn, and you’d be wise to heed one of Warren Buffett’s famous warnings – ‘only when the tide goes out do you discover who has been swimming naked’. Now is the time to make those technological investments, get lean, build that competitive advantage.
Next, what sort of branding have you done? Have you positioned yourself as a premium provider, or are you competing purely on price, effectively telling the market that you are a commodity? Playing the low-price game will eventually put you out of business. Similarly, have you focused on a market niche or are you trying to be everything for everyone? If you want to be a premium player, then you need to focus on parts of the market where you provide real value and can command a higher price. Think of the mistake that Cadillac made in the early 1980’s with the Cimarron. At that time Cadillac was known for large luxury vehicles like the Fleetwood Brougham or the Eldorado. The Cimarron was essentially a rebadged Chevrolet Cavalier with leather seats and a Cadillac logo on it, poor performance and a significantly more expensive price tag than its sister vehicles. By trying to compete against some of the smaller luxury import models Cadillac rushed the Cimarron to market with a vehicle that didn’t meet the needs of those buyers. They misread both the threat and what buyers wanted – they even had a four speed as the base transmission, not exactly something that your average Cadillac buyer wanted at that time.
A more recent example was Build-A-Bear’s “pay your age” fiasco. For those of you that aren’t familiar with Build-A-Bear, they take buying a stuffed animal to a higher level. The child gets to pick out what one they want, gets to custom fill it and then picks from hundreds of outfits and accessories to customize their new friend. And guess what, they were able to charge a premium because of the customer experience. Pay your age has probably put that premium image at risk. Why? Partially because they failed (massively) to deliver – by 11AM most malls had forced the stores to shut down because of the large lineups. But also, because now they have put the thought into the minds of parents and grandparents that $1 to $10 is all that they really should cost! In one poorly thought out and even more poorly executed swoop some major damage was done to their brand image.
Your reputation is something that could take a hit, especially with social media sites where some people have no concerns about sharing negative opinions. Unfortunately, you really must wow someone to get them to put up something positive about your business, but all it takes is one little slip up (and it probably seemed like something insignificant to your employee) to have someone start a rant against your company. We all need to be monitoring social media constantly and be prepared to give some honest and real answers when someone posts criticism or something that is plain old nasty. It’s going to hurt but if you respond in a thoughtful and respectful way you will be on track towards regaining people’s trust.
The last risk we will look at is having too much of your sales tied up in one place – whether it is one customer or with one salesperson. Too much concentration, regardless if it is internal or external, is not good. Relying too much on one customer puts you at too much risk of something like a management or ownership change causing a serious reduction in your volumes. Even worse is if they go into bankruptcy leaving you not only with lower volume but also with the potential of your receivables from them only being worth pennies on the dollar. A similar risk occurs if you rely too heavily on one salesperson. She manages your top five accounts and is very hands-on with them. Now what if she moves to one of your competitors? If she has such a great relationship with those customers, will you be able to overcome that to keep them? Depending on your state, courts may be reluctant to enforce non-compete clauses for much more than 6-12 months (if at all). You had better have a backup plan for either of these scenarios.
These examples only scratch the surface of the risks that your company could face and that you really should have a plan “B” for. Depending on your local market, there may be others that are more important, but these will give you a start. Don’t try to cover off every possible risk – the idea is not to make this the full-time job for a team. Devise realistic probabilities of any of these risks happening and what the potential cost would be. Determine what a realistic number of threats that you should (or can) mitigate against and start from there. However, ensure that these probabilities are reviewed on a regular basis so that new threats are being considered and any old ones reviewed to see if they are still relevant. It’s sort of like insurance, you hope you never need it, but you will feel significantly better if you already have a plan should any of those threats become real.