Time to Look for a New Home – Have You Outgrown Your Terminal?

It’s Friday night and the yard is packed.  The sound of 40 reefers trying to keep frozen loads cool has caused you to get yet another neighbor complaining about the noise.  You have 3 trucks at truck stops on the other side of the city because of the perpetual traffic jam on the Interstate and they don’t have the hours to get back home.  Your shop is replacing yet another corner on a trailer that was hit by someone trying to back into too small of a space.  The dock is full to the point that you will need to load an empty trailer just to get at the freight that has to leave first thing tomorrow.  And now Jimmy is coming into the office all steamed up because his truck is blocked in and there is no way he’s going to make his delivery window tonight.  Oh, and the night dispatcher is running late because of more construction on the Interstate, and the surface streets are full of people trying to bypass the mess.  As you get yet another cup of coffee to stay awake you start to wonder if maybe it’s time to look for a new yard.

Now don’t get me wrong, growth is a good thing (as long as it is profitable of course).  Unfortunately, it sometimes means that the terminal that you have already paid off has become too small.  Maybe it’s a block building that can’t be easily expanded.  Even if it is curtain wall construction, perhaps the perimeter wall is already too close to the fence.  Maybe you are just land locked and the person with the empty lot around the corner wants too much for it.

Alternatively, you may have recently fired one of your large customers because they are forever asking you to “sharpen the pencil”, playing you off against Fly-By-Night Trucking and Logistics, and treating your services like a commodity to the point that they are causing a negative return.  Or perhaps one of your bigger customers has closed the doors on the distribution center across the city and now most of their work is on the other side of the state.

Regardless of why your business has changed, there will come a time when you think about moving to a new location.  Before you pick up the phone and call a real estate agent you need to create a list of must haves, nice to haves and any show stoppers.  Examples could include:

  • Easy highway access to reduce deadhead and travel time
  • Close to your major customers
  • Access to public transit or a relatively short commute so that is not a constraint to hiring staff
  • Close to where you drivers live so that does not give them a reason to leave
  • Traffic conditions so that you don’t lose on HOS to get that cheaper piece of land

Sometimes you will have to do trade-offs.  If you are a reefer carrier and one of your major customers is Tip Top Poultry in Marietta, GA then you will not want to put a terminal down in Forest Park, near the Atlanta Airport.  It may cost you more upfront to be in the north end but the payback of drivers not losing an hour or two each trip running through (or around) Atlanta could be huge.

You might want to start by looking for an existing facility.  The best option is a terminal that someone else is selling.  Truck terminals are an unusual beast – the building may not need to be large but there has to be a lot of open land available for parking and maneuvering equipment. You will likely have to do some renovations to make it fit your needs but at a minimum you should not run into any zoning issues.  If you are not certain what your longer-term needs will be, sharing a yard with another carrier through renting their unneeded space could be an option.  However, keep in mind that if that company experiences growth you may be asked to move again.

If you want to build a new facility, keep zoning at the top of your mind.  There are a lot of municipalities that are outright hostile to our industry.  Part of the problem is terminal buildings tend to be small relative to the size of the lot (generally less than 20%).  That will result in a lower property tax bill compared to a warehouse that covers 75% of the lot.  Check the local bylaws in case they require a minimum percentage of building footprint to the size of the lot.

Avoid irregular shaped lots if possible.  A rectangular lot will maximize the amount of trailer and equipment parking.  A pie shaped lot will end up with areas that are only good for parking storage trailers or older equipment that has not yet been sold.

Another consideration is what neighbors you will have.  If you have drivers who will sleep in their trucks overnight in the yard you will not want to be next door to something like a stamping plant or a meat processing facility that will cause noise or odor issues for your employees.  At the same time, you don’t want many houses nearby as they will probably make noise complaints to the municipality.  I once had an inherited facility in a mixed residential/industrial area.  I could count on at least one phone call a week complaining about the backup alarms waking them up at 2 in the morning when my night linehaul drivers backed into the docks. You may be forced to put in fences or berms to abate the noise, adding to your overheads and detracting from your ROI.

Another consideration is the existing grade and soil composition of the land.  You are going to have to do some grading to put down the appropriate aggregate and then compact it.  You will want to avoid having to build up areas so that water is not going to pool or require additional drainage.  Also, how stable is the soil – is it heavy compacted clay or is it sand? The site preparation work could be your largest expense so you will want to find properties that naturally minimalize it.

Finally, what sort of utilities are already servicing the land you are looking at?  Is it a fully serviced lot or will you be required to bring in the utilities at your own expense?  What utilities are available?  For example, what sort of internet connections are in the area?  If you are using cloud-based technologies, will you have enough bandwidth available?  If you’re planning for the future, fiber should be a priority. What sort of right of way is available if you need to service the property yourself?  For example, does a specific utility have the exclusive rights to the poles in the area?  You could end up needing to trench or drill conduit to bring in electricity, telephone or fibre optics lines even though there may be poles on the property already. Is water and sewage available or will you need to drill a well or use a septic tank?

As you can see there are a lot of things to take into account before you even think about hiring an architect to design the building.  There’s a lot that could go wrong in this process.  Make sure you are using a real estate agent who understands industrial/commercial or have a consultant who can walk you through the process.  There’s a lot of work before you even get a shovel in the ground.  There will always be something that pops up during the process but avoiding as many of them before the purchase can keep the project on its timeline and keep it within budget.

Be a Disrupter (Before Someone Else Eats Your Lunch!)

Among the many newsletters I receive each day there was one that caught my eye this morning.  Freightwaves posted an article on Amazon, and how their ambitions on the supply chain should have logistics companies worried.  E-commerce has been steadily gaining market share from traditional brick and mortar retailers, now accounting for 9.5% of the entire US retail market.  Another article I read last night talked about how grocery stores are facing tighter margins, and reduced earnings because of things like Amazon buying Whole Foods and selling more groceries online as well as the rise of online services that make it easy for any small restaurant to allow for internet or app based ordering and pooled deliveries.  Millennials are just not buying cars the way other generations did, but they are more comfortable with the idea of ordering what they want from their phone.  Some traditional retailers are turning to offering delivery to meet this trend.  Some retailers will innovate, but others will follow in the fate of retailers like Sears, Toys R Us and Circuit City into massive store closures or bankruptcy.

Let’s face it, most of us are busy enough trying to meet our short to medium term business objectives.  Who has time to find the next big technology or trend in our industry? Besides, being the leader can be a risky thing.  It’s never fun to put your career on the line for a relatively untested idea. What if you guess wrong?  Why not let those small start-ups live on the bleeding edge while you sit back and wait to see what ideas gain traction?

We need to make sure that there is a culture of Intrapreneurship in our organizations.  We all have red tape and redundant processes that are “the way we have always done things”.   Our managers and staff need to be empowered to question those processes, and be encouraged to come up with alternatives that we support and allow to be experimented with.  I don’t mean letting them just try anything – customers can not be negatively impacted.  At the same time, front line managers must be given some leeway to green light ideas that can be quickly executed.  Nothing stifles creativity more than having a drawn-out process where all changes need to work their way up to senior management and then back down again.  Give your functional managers the ability to approve experiments within a reasonable boundary so that these trials can happen quickly.  Some projects will have impacts across the organization or be capital intensive enough that senior management needs to be involved but look at ways that the process can be shortened.  Smaller companies with a flatter structure will be acting on these sorts of ideas more quickly and start taking your customers away as a result.

Intrapreneurship needs to be something that we build into the recruiting process.  Offering the ability to create new businesses can give you a significant advantage when it comes to hiring the best and the brightest.  This is a strategy that companies like 3M and Google have used for years.  Offering the freedom to have ideas supported (and later rewarded) can provide a way to attract better new hires than just throwing more money at them.

One thing to keep in mind is most of these ideas and improvements will not be big, especially not at first.  How many start ups get to huge valuations within the first year?  Almost none of them!  And many that do become successful probably would not get approved in the typical corporate review process.  Think of many of the great baseball teams – how many of them rely solely on the home run to win pennants?  If that was the way to do it, then this year’s New York Yankees should be miles ahead in the AL East with their new incarnation of the Murderer’s Row.  Unfortunately for them, they are sitting 4.5 games back of the Red Sox.  You are going to get better results relying on small ball to get runs and then when a home run does come around it is just a bonus.  And don’t to try to force things.  In Thursday’s game between the Yankees and the Royals, veteran KC player Alex Gordon ignored the stop signal at third, tried to create a run and got gunned down at home for the final out of the game.  The same thing can happen to your business when it only tries for the next “big” thing.  The reality is that none of us know what that will be (and if you really do know what it is, why aren’t you already doing it?) Encourage those smaller improvements – streamline your billing process, find a way to do routing better.  Those smaller things will add to the bottom line and give you the resources to fund the big ones when they appear.  Besides, having several smaller bets means that failure on any one of them will not threaten your business but going all in on a potentially big one could.  At the end of the day, innovation is like portfolio theory.  By diversifying your holdings, you reduce the overall risk profile.  Most disrupters stated as a small idea that ended up growing beyond what it’s creator hoped for.  So, encourage that innovation within your company and pay attention to what’s going on around you.  That way you remain nimble enough that if someone else does start to eye your lunch you can create and implement solutions that allow you to remain differentiated from the rest of the market.  It’s not going to be easy to give up some of that control, but it will be significantly less painful to give it up on a small initiative than it would be to have to bring in something big because that’s the way the market has gone while you stood pat.

Are You Looking for a Professional Driver?

I have been speaking and consulting about retention, almost exclusively, over the past number of years. What I have found, and it is my experience, that high turnover in any trucking company can be brought under control.  That’s a fact, been there – done that, bought the tee shirt. Any half insightful management team that can muster a measured amount of committed effort, can show impressive decline in lost drivers in a matter of three to twelve months. With ongoing programs, it can be maintained indefinitely.

Recently I have been asking my trucking executive audiences how many of them would prefer to hire professional drivers.  To put this in context I classify drivers in three categories.  First, the lost and forlorn, they’re just driving until they find their real calling (and BTW, they rarely do). Second, there is the truck stop cowboy, these folks are in love with the image of being a truck driver more than being proficient at what they’re doing. The 3rd is a professional, always looking clean and sharp, concerned with doing things properly and being accountable and responsible for all their actions. After I ask what type of Driver and Owner Operator they would like to hire, what I see is a room full of hands that have shot in to the air for, of course, the professional.

So, here’s the nest question to the group, so you all want professionals in your company, okay that makes sense, so what do you do to foster that desire, this is when I get the glazed over look. Most companies currently have professionals in their infrastructure that they support. You may have a CPA that you assist in making sure is current with all accounting rules and probably pay for their annual CPA dues. You may have a head of HR that you support who needs to be kept abreast of all the new labor rules. How about your Safety Manager? The company likely sends this individual to regular safety council meetings and has paid for them to get their CDS designation. This is to name just a few positions.

So, you want professional drivers and Owner Operators at your company, what do you do within your fleet to support this claim? How do you make information available so that your people have a source of knowledge that will allow them to excel at their trade, such as: how to be a successful Owner Operator; new proposed rule-makings; advanced defensive driving; new equipment innovation; and conversational sales, to name a few examples? If your answer is nothing, then you should stop claiming to want professionals at your company because you do not have an infrastructure that supports that claim. If you want professionals, treat them like professionals.  As Don Cherry would say “It’s not nuclear surgery”.

And it is so easy. There are so many great resources for educating oneself these days on how to be successful. This is not to say that there wasn’t some good information back when I drove but back then it was in book form and after I put in my long days’ work it was time to hit the sack. Reading a couple chapters and absorbing anything of value from a general business self-help book was not in the cards. And when I got home it was down time – get recharged and then head back out.

Today there is a great wealth of information specifically on being successful as a driver or Owner Operator and it is available in the most convenient forms – whether streamed from internet, YouTube, listening to satellite radio and online courses. Much of it can be listened to while the driver watches the miles go by.

For those drivers out there thinking of purchasing a truck and possibly becoming an owner operator or even starting a small trucking company, here are some of the materials that I would suggest that you get a hold of and listen to as a way of formulating a plan to move forward.

I would listen to Trucking Business and Beyond by Kevin Rutherford on Sirius XM Radio’s channel The Road Dog. I would also check out the training he offers here .  Kevin is an old friend of mine, and has a sea of knowledge on how to become a master Owner Operator. I took Kevin’s Certified Master Contractor course some years ago and it was excellent – well worth the money. I would check out ATBS’s Knowledge Hub program as it is an excellent resource of valuable information, a great website ..  In addition, there are many good industry publications whose editorial has valuable information that is there for the reading. On any variety of business topics and life in general I happen to love Udemy . The volume of quality educational content is staggering and very economical. If there isn’t something there that peaks your interest, maybe it’s time you consider retirement.

The list of good information that is there for the listening can go on and on. Much of it is free and the rest is very economical. I remember being at a seminar where the speaker was then Miami Dolphin coach Jimmy Johnson. During the Q&A period he was asked this question. Coach Johnson, how do you mold the crop of young boys you get each year into men who are professional football players? The coach’s short answer was “talk to people that look up to you the way you want them to behave and they will become that. Talk to them the way they are, and they will stay that way.” You want professionals? It’s simple, treat them that way.

Take Good care and Safe Trucking,


Where Do Leaders Go For Advice?

Effective leadership in business, politics, a family, or in any situation or organization is a critical success factor. I have seen, and been involved in many situations at many trucking companies, non-profit organizations, and community efforts that would not be suffering but for one missing element, effective leadership. Someone with dedication, vision, and a strong moral compass who walks the walk can fix almost any issue in any circumstance; I know this to be true!
Leadership used to be tied to that person being a role model but that idea is suffering badly in the public eye. I have been fortunate in my lifetime, along with many of you I’m sure, to be exposed either through teachings or first hand witness to many great leaders that were in the public purview. Folks like Tommy Douglas, father of the Canadian Health Care System, Winston Churchill and his heroic stand during World War 2, JFK and the unfolding of the civil rights movement, Terry Fox, Mike Hanson and the list goes on and on! These were and are great role models, and these were folks that knew the price of leadership whether they sought it out on purpose or it came to them as a result of a heroic effort, they rose to the occasion for all to see and stood proud.
Of course today’s scrutiny is much more of a micro lens than the macro lens of just a few decades ago, but even so when these folks were elevated to their pedestals by “we the public” it seemed that all we did was shine a light on what was already there. Their style and class was not contrived or manufactured, what we saw was nothing more that what already existed and it was class and it gave us all something to aspire to. The world seemed a better place because of the folks that were our role models of the day.
I’m confident that these same types of role models exist today and these same types of folks are walking in our midst as I write this piece. That Micro examination of today’s media though shows every freckle, wart, and hiccup that ever existed in ones past, and regardless of ones character you will be vetted in the public eye to that situation or circumstance. Let’s face it, who needs that type of scrutiny. Even if you were prepared to endure the focus on yourself, all of those around you will suffer the same level of scrutiny and should they have a skeleton in their closet, condemnation by association will be swift.
Where big business and the mainstream media direct their spotlight and whom they place on a pedestal these days is of course the youth of North America, the trendsetters, and the consumers. Look at what’s happened in just the past 3-5 decades, during that period our elders who were once upon a time invaluable advisors to our youth, have been transformed from role models, knowledge givers and resources of a life of experience they were willing to share, into a burden on society. The very infrastructure that they built for us to live in now is turning on them and blames them for the high cost of supporting them in their advanced years and the cost associated with health care and other social infrastructure. 
I am no conspiracy theorist but I believe what’s happened is that the mainstream media’s focus has lead us down a path that is directly pointed at the youthful consumer, and the advertising dollars that come with selling products and services,. In doing so, they have discounted our elders in today’s society. The focus today is on youth and future possibilities not accomplishments of the past and calling on that wisdom to offer opinion on today’s reality. 
Direction is given and taken from advertisers trying to solicit young consumers by portraying them as the chosen generation, the folks who will evermore carve our trek into the future, new is better, old is bad. It was just a few short decades ago that seeking advice from one’s elders was common practice, and always looked upon as a prudent thing to do. How often do you hear of that today, typically the elders among us are uninitiated in the world of technology, and are made to feel left out of the loop and disconnected from the rest of the world, discounted in their value as people! I think young leaders in our industry would be wise to consult and listen to the successful people before them who made our industry so successful.
Nothing takes the place of experience and common sense; it was explained to me this way by an acquaintance that has a PhD in education, he says that young people have what is referred to as liquid knowledge. Which is the knowledge that comes from studying a particular subject or learning as they move through a situation? Mature people have liquid knowledge and have crystal knowledge, which is the additional knowledge that comes from having worked through a particular subject or situation once or many times. It is additional knowledge that comes from experience, trial and error, getting better and better at something, minimizing the scares, bin there done that, know the drill!
So whom do you call on when you need advice whether you’re a Driver, Owner Operator, company Owner or a Department Manager ? We all from time to time should have an experienced confidant to bounce things off of and to act as a sounding board. Those industry topics that keep bubbling to the top, despite some slight changes in appearance, are the same ones that those elders encountered 3-4 decades ago. According to the TCA, they are, HOS and the shortage of qualified drivers, fuel issues; congestion; government regulations; tolls and highway funding; tort reform and legal issues; truck driver training; environmental issues; and on-board truck technology. See anything new? I don’t, and remember “A wise man learns from the mistakes of others while fools learn from their own mistakes.

Getting Strategic about Social Media

With all the choices we have for social media – Twitter, Facebook, Instagram, Youtube, LinkedIn, etc. – how do you ensure that you are getting a good ROI, while reaching your target audience with a message that resonates with and influences them?

To start, do you have a social media strategy?  Likely you have a website and marketing materials that present a consistent brand image (and if they do not then that needs to be dealt with before you even get into social media).  That branding will guide you through your social media strategy.  The strategy needs to make sure that the content you provide aligns with your overall business and marketing goals.  Make sure that you create specific KPIs that measure against the business goals.  If you can’t connect a social media activity back to one of those metrics, then you probably shouldn’t be doing it (see this recent Forbes article).  For a short video of how to create a social media strategy, click here to see this video created by the Moz Academy.  For a more detailed discussion on social media measurement, please see this Social Media Examiner interview with Dave Fleet of Edelman

As part of the strategy, determine which audiences you want to reach (see this MavSocial article for some tips).  The recruiting of drivers will likely use a different platform than trying to generate leads for your sales force.  Determine what you want to do and then be on the online platforms that your target is spending time on.  As an example, to reach drivers you will probably want a Facebook presence but if you are trying to generate leads for your truckload van division LinkedIn may be a better place to focus on.

Keep in mind the age of your target.  This is also going to influence which platforms to use.  If you are focusing on Facebook to help drive your recruiting efforts you may not be reaching enough younger candidates as they don’t spend as much time on Facebook as they do on something like Instagram.  One additional note – if you are looking to engage millennials, take the time to talk with a few twentysomethings (or at a minimum use a consultant who is familiar with them) to determine which social media outlets they are using and expect to have to change those platforms on a regular basis (for more information see this MIT article here).   The Moz Academy has another short video on identifying social channels here.  Leading Results offers 3 platforms that have been shown to be effective for business-to-business marketing – click here.

Be prepared that how you perceive your image and how the public sees it may be two different things.  You need to go out and ask people how you are positioned.  Do not just sit around a table and think that you know how people see you unless you are actively having those conversations with your target audience.  Otherwise at best you may be putting out content that does not engage your audience and you get ignored.  However, you may be putting up things that alienate your audience and you end up harming your image.  If you want people to understand or position you in a different way, it is very hard to do if you only look at your business’ perspective.  Often you will get it wrong or it just won’t work.

Along this theme is the necessity to be yourself online.  One of the goals of social media involvement is to build trust with your audience.  If your posts just sound like generic pitches that have no context then it will not come across as authentic.  Develop a narrative that explains why you are different and where you want to go.  Consider things like what charities your business sponsors as a way of showing who you are.  Whatever you do, make sure that it ties back to your goals.  As an example, if you are targeting businesses in a large city like New York, Los Angeles or Chicago, then posting that you support the local 4H club (even though it is a worthy cause that means a lot to the business) probably is not going to mean a lot to your audience on that specific platform.  Also, mix up your messaging.  If you overuse a similar message, then it will appear scripted and will detract from your trust building.  This Post Planner article by Ben Sailer can help you write better posts.

Remember that at first it is better to spend a lot of time on one or two platforms than spreading yourself out across many them.  Gaining an effective digital presence takes time.  Spend your time on platforms that are relevant to your strategy and spend time on them daily, especially as you are building your presence.  Having consistent and engaging content is the key here.  The use of some automated tools can be helpful but do not rely on them as your audience will quickly pick up on the fact that you really are not there.  In an ideal situation you will be adding content in the times that your audience is using these platforms.  Ensure that you have some sort of coverage to monitor and engage with comments and messages in real time or close to it.  Your window to engage with those users may be as short as a few minutes.  This is especially true of negative comments that people post.  Every second that you are not engaging and interacting with that user, other people are seeing that negative message that you are not responding to.  Negative comments are just an opportunity to have a conversation that ultimately should strengthen your brand.  Keep your responses respectful and remember that if one person felt strongly enough to make a complaint, there are likely many others who feel the same way but might be just keeping it to themselves and just not considering your business to fulfill their needs.  See this The Financial Brand article for some Dos and Don’t on responding to negative comments on social media.

Finally, social media is NOT the place where people go to be sold to.  Much of your time should be spent having conversations, showing what you are about and what your values are.  Just putting out sales pitches will cause your audience to lose attention to you.  It’s much better to be an influencer that puts you at the top of your audience’s mind space.  The key is to have a respectful and supportive two-way relationship with a genuine value exchange – very much like doing value proposition sales.  It’s all about building online relationships that can lead to face-to-face conversations that will get you to your goals (see this MIT Sloan Review article here).  It’s not going to happen overnight, and it will take a sustained effort so make sure that you do the upfront planning and align it with a strategy to ensure that your stakeholders get the maximum return on the time and money you invest in social media.

Turn Mistakes into Compound Interest for your Business

We all strive for the golden ring of Six Sigma, and making as few errors as possible.  Making mistakes has become taboo as we compete in the global marketplace against German and Japanese firms that emphasize efficiency, consistency and reliability.  But what if that quest is stifling entrepreneurialism and innovation?   What if creating an atmosphere where employees are afraid of making mistakes is costing us on the bottom line?

Let’s face it, all of us have made mistakes throughout our careers.  Most them were small and easily corrected, but some may have been huge and had immense repercussions.  At the end of the day we are all humans and imperfect beings.  What’s more important is asking the question – did we learn from the experiences to ensure that we didn’t make the same mistake twice? How capable are we of introspection? The old saying “Fool me once, shame on you. Fool me twice – shame on me” comes to mind here.  For many of us it was our reaction to our mistakes (or the mistakes of others) that proved our worth and moved us forward.  The legendary UCLA basketball coach John Wooden once said “If you are not making mistakes then you’re not doing anything.”  So, if learning from those errors helped you in your career, don’t you owe your employees some leeway to make mistakes as well?

Yes, there are certain positions, tasks, or customers that you have no room for error – making a calculation error on the budget or overcharging your largest customer on fuel surcharge are examples of mission-critical errors.  However, each business has areas where perfection isn’t necessary and doesn’t pose a real threat.  We have previously discussed Kanban systems of continuous improvement.  Implicit in the concept of improvement is the possibility of being wrong occasionally.  Amy Rees Anderson in a 2013 Forbes article put it this way – “mistakes are not failures, they are simply the process of eliminating ways that won’t work, in order to come closer to the ways that will.”

Making a mistake means that the employee went outside of their comfort zone and entered a state of learning, which is where new discoveries are made, and lessons are learned.  However, many of us are reluctant to allow employees to make mistakes and the root cause tends to be a lack of trust.  That comes from two sources.

The first one is our own belief in being better at running all facets of our business than anyone else.  Why else do we all carry our phones with us on vacation and constantly monitoring and checking our e-mail?  It’s rooted in the belief that we are better at making decisions than everyone else.  It’s that attitude that’s holding leaders back from becoming greater leaders.  We can’t run successful businesses if we insist on doing everything ourselves.  Let’s face it, there are only 24 hours in a day and eventually we must sleep.  Short bursts of being a hero are possible, but it can’t be sustained over the long run.  Eventually we get tired and need to be recharged.

I was recently talking with a regional VP of a major bank who had just come back from a vacation.  She told me that for the first time ever she did not bring her phone with her on a trip.  A week before leaving she gave her people notice that she was only available by email up until a certain date and that any emails received while she was away would just be deleted.  Her reasoning was she had a team below her that she had empowered to make decisions and she trusted them to do so.  I spoke with her three days after she had come back, and she still felt rested!  How many of us have come back from a vacation only to feel like we had not even gone away?

The second reason for not trusting people to make mistakes stems from how we hire people.  Sometimes we just take the first reasonable candidate to fill the short term need instead of putting an emphasis on trustworthiness during the interview process and setting the expectations from the start.  Yes, it is painful to have to use existing staff to backfill vacancies but if you are just taking the first warm body that seems capable for the job, is it any wonder that we don’t trust them to make decisions, much less make mistakes?

We can all start by setting a culture where a degree of risk taking is acceptable.  Obviously, a VP is going to have more leeway than a customer service representative.  Given that constraint we need to make certain that we allow some room for experimentation so that a culture of continuous improvement can take place.  So how do we do that?

First, encourage people to own their mistakes and learn from them.  That means not lowering the boom on them whenever an error happens.  Do that and they will never develop the habit of looking objectively at the mistake, recognizing what they did wrong and understanding why that choice was the wrong thing to do.  Let them hold themselves accountable for their mistakes and acknowledge them.  If they are more worried about getting ripped into because of a mistake, then they will just hide them and never learn from them.  This will also result in you only knowing about mistakes when they become large and potentially costly instead of when they are small and easily fixed.

Second, make sure that the person who makes the mistake either fixes them or at least is involved in the correction.  I once heard someone say that lessons aren’t lessons unless they hurt a little bit.  Keep in mind that for most people the self-induced shame of having messed up is probably enough, you probably aren’t going to help things by piling it on, especially if it is a relatively small issue.

Finally, work with that person to develop safeguards to ensure that the same mistake will not get repeated.  Do a root cause analysis with that person so that they get an insight into what went sideways and why.  Most of your employees are more than smart enough to determine the root cause, they just might need some help with the framework.  By going through that process, they will gain insights that they can use in the future to start catching errors before they happen.  And guess what, an employee that can do that means better decision making in the future and just maybe you can join that bank VP in taking a vacation where you come back rested or even just go home at night and not feel that you need to constantly monitor things.  By being able to let people take on those new responsibilities you are going to free your own time up to take on items that will either grow your business or just contribute more to the bottom line.  Making mistakes – who thought that it would be a win-win proposition?

100 and Counting!

100 weeks ago, we started publishing our weekly email newsletter. At that time, there we just under 100 recipients on our distribution list. Today, there are close to 3200 people that receive the inGauge Data + Action newsletter each Sunday. I’m well aware that this level of growth wouldn’t get too many professional marketers excited, but frankly I don’t care. It’s been entirely organic, and I can see first-hand that people are reading it (and hopefully getting value our of it). Our focus is to improve 1% each and every day.

When you start something, it’s easy to get caught up in the hype of trying to make something ‘viral’, instead of staying committed to consistency and the core purpose of whatever you are bringing to the table. Preaching the value of benchmarking and sharing ideas hasn’t been easy. In fact, four years ago (yesterday), we had our first development planning session to discuss the core features of inGauge – essentially trying to predict what our future clients would value.  Today, we are proud of the fact that 158 companies and their subsidiaries are actively using inGauge to move their businesses forward, and modify the ‘status quo’. With that being said, we are not even close to reaching our goal as a service, an Association, and as a group of forward-thinking Trucking organizations committed to continuous improvement. This last sentence captures what inGauge and TPP is all about – working as a group to advance the status, profitability and sophistication of the North American Trucking Industry. In today’s post, in light of the above milestone, I thought I would share a snapshot of both our short and long-term vision of inGauge for the TCA Profitability Program.

Short-Term Vision and Strategy

I’ve always been my biggest critic. I think this trait has been helpful in building a service that provides real value. Odds are that when a member communicates a ‘missing piece’ or any other type of service ‘deficit’, I’ve already identified it, and perhaps ruminated (and lost sleep) over it. The biggest problem in building a valuable benchmarking or comparison tool is ensuring that participants are speaking a common language. Language has nuance. If you’ve used Google Translate, you have seen this first-hand. Each trucking operation has slight difference in ‘dialect’. Although many of the variables are the same, you all address those variables in slightly different ways. Conversely, these slight differences affect how, and what you account for with respect to your financial and operational data internally. The biggest obstacle to continued growth of benchmarking in Trucking is the creation of a common language that removes (to the greatest extent possible) that nuance, which can obviously pollute the comparative data. I’m pleased that we have made significant progress on this specific topic. Recently, with the help of Best Practice Group members and valued partners, we published the first TPP Chart of Accounts. The TPP Chart of Accounts, available to every company free of charge, by clicking here, is result of sixteen years of contemplation, discussion, and iteration from Best Practice Group members. The TPP Chart of Accounts, fill a massive void (based on my first-hand daily experience) in the trucking industry. We haven’t necessarily created a new language, we’ve improved an existing one – and removed much of the nuance.

It would be foolish to think that companies will simply do a complete (and quick) ‘renovation’ of their internal reporting processes and models. As such, having an easy to use interim step is (and will always be) important. This missing link needs to be able to translate existing data, that may not be in the form that is required (has that nuance). In July of 2017, we started building a data mapping tool to address this critical requirement. Prior to that, we expected inGauge and BPG members to perform that interim step themselves. Many have, and continue to do a great job in this regard, but it has been a big barrier to entry for companies looking to get started. We are now (as of late Friday evening), on our 79th version of this data mapping tool. This tool allows companies to swiftly categorize, allocate (in six different ways) and report their financial and operational data in a standardized fashion. This tool, I am proud to say, is saving members a significant amount of time each month, and providing inGauge with better data – which as a by-product, improves the credibility of the results and the elevates the status of our platform in the industry.

However, we’re not done (not even close). The current version of our mapping tool is simply a ‘proof of concept’. We have already started building what we are now calling the inGauge Data Engine (please send me your feedback for a better name). This cloud-based tool will not only provide the critical mapping functions, it will also provide an enhanced developer environment, to allow you to more rapidly connect your databases (securely) to inGauge. Further, using machine learning, it will perform the initial steps in the data mapping process for you, automatically. Finally, and most-importantly, it will allow you to connect data, build dashboards, KPIs and visualizations for your own internal purposes, as opposed to external benchmarking.

In short, our short-term vision and strategy is making it increasingly easier for existing and new members to extract the most value out of the exercise of benchmarking, while at the same time reduce the resources required to transform the data into that common language required.

Long-Term Visions and Strategy

The biggest value of the Best Practice Groups is that the program provides companies with the ‘How’ (simply stated). Each group is comprised of people that want to get better, and desire external feedback on their strategies and activities. No one leaves a group meeting without at least one actionable task, project or thought to take back, and implement within their respective organizations. However, the onus is on that individual attendee to ensure that they deliver that idea, next step or strategic change when they arrive back to their business. Understandably, people can get caught in the whirlwind as soon as they arrive back at their facilities. Although it’s understandable, it still represents a massive gap – one that needs to be filled.

In early 2017, we introduced inGauge Actions, a simple project management tool to help capture and translate some of those great ideas that flow out of group discussions and presentations. We are pleased that some companies have used this tool, but we also understand that this feature is simply (again) a proof of concept. On that note, part of our long-term vision for inGauge is three-fold:

  • Increase the number of inGauge users, within each participating company with access to inGauge. Additional ‘subusers’ are free – and very strongly encouraged.
  • Automatically capture, and assemble pre-built projects within inGauge Actions that companies can utilize to move their businesses forward. These projects will be both group-specific.
  • Provide a auto-suggestion feature, to scan the library of good ideas (based on the group-specific presentations and discussions) and automatically recommend, based on performance on one or multiple KPIs. For example, if your Driver Turnover results are subpar, inGauge will automatically scan the pre-built projects that can help you to improve your results, and link those team members (based on their defined roles) to the project.

The above is an ambitious pursuit. Any time you attempt to link the qualitative with the quantitative, you will encounter many obstacles on the path. However, once we have our short-term vision and strategy completed, it will clear the deck to allow us to attempt this ambitious strategy. Stay tuned and feedback welcomed!

Onward and upward!

Thanks to all the BPG and inGauge members who have made all of the above possible. Your support is greatly (and graciously) appreciated!

An Empowered Team: Compound Interest for Your Business

“Empowerment is not giving your people the ability to make decisions. Empowerment is the giving your people the ability to mistakes” – Steve Hitchcock, COO Duncan and Son Lines

The above quote (one of hundreds of golden nuggets I heard at this year’s TCA Convention) got me thinking deeply about empowerment – true empowerment, which also requires a necessary absence of micro-management from senior leaders and managers.

I use the concept of compound interest as a frequent analogy for many business processes and functions, which I think is totally appropriate, since it is (as Albert Einstein once declared) the 8th Wonder of the World. The concept of compound interest doesn’t just apply to money, it can be easily applied to human capital, and technological capital. For human capital, if you have the right ingredients – people with a decent set of technical skills, and better-than-average amount of character and purpose, the gains your staff can make (if you give them the right tools) can catapult your business to the next level of profitability and efficiency.

The above can happen if you have two necessary table stakes. First, you need the right people (I know easier said than done in this low-unemployment environment). Second, you need to employ the correct approach to managing those people. Specifically, you need to have a strong culture and set of shared values that leads a current or future associate to respect the business and want to add value to it – day after day.

If you ask a leader with a micro-management problem, in my experience, they will undoubtedly admit to this ‘addiction’. Normally, this business-limiting issue affects the entrepreneurs who built the business from the ground up. He or she has invested their blood, sweat, and many tears over the years to get to where they are today. It’s natural that they are emotionally torn when it comes to trusting someone else with an important business function. However, for those that are true micro-managers (many say they are, but they aren’t), they don’t realize the opportunity cost of looking over their team’s shoulders day after day – they are not receiving any interest payments on their human capital. To visualize this, think of a hamster on a wheel. Lots of busy work, but no progress.

I started this post off with a quote about empowerment. I had not heard it defined like that before. Empowerment is not, at it’s basic level, about giving an associate the ability to say no to a customer, authorize additional compensation for a great driver, or perhaps decide to stop doing a process you’ve been doing for eons. No, true empowerment is allowing them to make those decisions, without fear of reprisal if the decision(s) didn’t work out to the company’s advantage. Further, true empowerment requires a lack of unnecessary oversight (see micromanagement).

My challenge for you this week. The next time one of your trusted associates brings a business-critical decision to your desk, simply reply “I’m good with whatever you decide”. Conversely, when a team member (who has been trained properly) discloses that a previously made decision didn’t turn out the way it should have, simply reply “Good, we can learn, and get better”. On the last one, watch this great video from Jocko Willink for inspiration.

It’s time to start earning higher rates of interest on your human capital.

Adding by Subtraction: Say What??

Every business leader with a pulse is intrigued by new products, services and strategies which promise a ROI. Regardless of the size and scope of these new equipment offerings, devices or services, it will undoubtedly require resources – both direct investment, plus a diversion of existing human resources to implement, maintain and leverage. In some cases, it may require more people, and added physical infrastructure. The point is, everything comes with a price, both direct and indirect.

To stay on point with the title and purpose of this article, we will focus only on the labor (human) part of the equation. When I first published the article “The 9 Traits of High-Performing Trucking Companies (and their Leaders)”, we received multiple emails and calls about #1, which was “Adding by Subtraction”. In the article, I reinforced a common tactic among the best leaders was to clear the deck of unneeded and redundant tasks, products and services to make way for the new – like how a forest revitalizes itself with fires (but maybe not as dramatic). Understanding that time (human time) must be freed up to make way for the new service is the first step. Likewise, the best leaders know that implementation is only part of the equation, ongoing maintenance/monitoring and continuing education are all factors which need to be considered.

To relate this concept back to trucking, although I don’t have empirical data – just anecdotes, many have relayed their estimation that most trucking companies are only utilizing 10-15% of the capability of their TMS platform. This same utilization factor seems to fit with almost all common software services (e.g. Excel, Powerpoint, G Suite etc). Further, if scientists are right, we have approximately the same utilization factor for our brain, but that’s another story. The whole point of a suitable TMS platform is to allow companies to do more with lessnot the same with more. So instead of just budgeting for the install and implementation of the TMS, you should also budget for the indirect and direct expense of educating your team (to various degrees, relative to their ultimate reliance on the TMS) on all parts/modules, and time to stay up-to-date on new features, integrations etc. At this point, many readers will have stopped, and are asking: “Ok, but after implementation, I don’t have anything left over in the budget to train my team”. My first response is that will change in coming years. The upfront cost of a properly spec’d TMS will drop in the coming years due to the increased popularity of cloud-based or ‘hosted’ solutions – which will drive down much of the upfront hardware and customization expense. Also, the new breed of TMS services will have a rich library of user-driven knowledge (just like Google / Microsoft etc.), and updated company driven knowledge for users to consume. My second response is that the more you invest in the knowledge base of your key personnel, the better. Not only will you benefit from better TMS utilization, you will also empower those people – thereby reducing turnover.

Getting back to adding by subtraction, to free up time (reminder that the whole point is to do more with same or less), your team must stop doing the things that a system or service will do for them. Further, they must simply stop doing things that are redundant or irrelevant. This is one of the most difficult things in business: 1) Deciding which tasks, functions and processes are no longer needed, 2) Getting people to stop doing them (the hardest of them all). Humans don’t like change in general. This is further exacerbated when your company has become stale, and the concept of change and flexibility has been removed from your mission and strategic plan. Businesses can get in a rut, just like humans.

In summary bullet-point form, here is how your company can get out of a rut, and start adding by subtraction:

  • Survey your team – ask them to provide a list of three tasks or functions – daily, weekly or monthly, that are either redundant, or the value is consistently questionable.
  • Meet with your team (using a defined agenda and time limit). In the meeting, list all the identified tasks and functions from the survey.
  • For each, list all departments, and other processes and customers that are dependent on these tasks and functions.
  • Prioritize this list, moving those tasks and functions that can be immediately stopped or reduced.
  • For the remaining tasks and functions, identify whether you can automate, either with an existing or new service.
  • Finally, quantify the number of labor hours you will have saved by eliminating or reducing these tasks and functions. This is the amount of time you can re-purpose for a new service or product – which should, in turn, result in more automation.
  • Rinse and repeat.

You’ve just Added by Subtraction, if you are confused, simply watch this video from my mentor Mr. Michael Scott.

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”