Tackling Driver Turnover Part 1 – Delusion
How do we deal with the mass delusion that driver turnover is inevitable? Nothing could be further from the truth. Driver turnover is a manageable business challenge like any other. The only thing standing in the way of achieving low driver turnover is the nonsense that we keep telling ourselves in a long misinformation feedback loop. This feedback loop manages to keep us from tackling this problem with the focus that is needed to achieve the desired outcome.
I was a partner, President and COO of a company that went from a turnover that was almost non-existent to one that had 120% in a matter of just a couple years. Some time back I ran into a quote that seems to fit the situation in our industry, it reads “The chains of habit are too light to be felt until they are too heavy to be broken.” I wonder what situation the author was facing when this explanation for their predicament first entered their mind. Quite likely not trucking but it does fit perfectly for the current state of things in trucking. If your company is the victim of its chains of habit that seem too heavy to be broken where do you start? Let me walk you through what has worked for myself and the good folks with whom I had the pleasure of working.
The plan starts with the acknowledgment that turnover is man-made and not inevitable. From there, the leaders in the company must commit to be accountable to the effort and to each other to make the changes necessary to transform the company culture to infuse a focus on a reduction to driver turnover. During my workshops, I suggest that these folks draft a mission statement that they all sign as a commitment to each other. Sounds easy and it is. The problematic part is allowing a peer, to correct you if they see you acting in a manner that is contrary to the mission statement that everyone committed to. Unfortunately, people’s egos come in to play, and they are seldom as receptive to this feedback as they should be.
The next step is what I call the sales pitch in which companies need to explain to their employees why a dramatic reduction in the companies’ turnover is critical to its future. They also need to discuss why it is beneficial to the individual’s future at the company. Lower turnover means things such as a safer trucking company, a more profitable company, and a more fun culture to work in to name just a few of the good things that come from low turnover. In my experience, people get so entrenched in the daily whirlwind of their routines that they get blinders on and don’t see what a little change in how they do things could be of great benefit. To dive a little deeper let’s look department by department.
The sales department benefits from lower turnover through fewer service failures and not having to regularly training drivers as to your customer needs. Fewer service failures means less time begging forgiveness from customers meaning you can likely pursue a more significant opportunity with your current customer base.
The safety department gains by not having to create new driver files all the time, a considerable time saver. Safety personnel will also benefit from fewer accident and incidents to track and files to open. Why? Because a stable workforce can be trained to a higher standard. When you are always starting over, you can’t train a workforce with any effect. Side note — companies with lower turnover have fewer accidents and pay less insurance than a carrier with high turnover. There is a direct correlation to lower insurance cost and best in class operating margins.
Administration gains by not having to educate the workforce as to the company’s information flow and paperwork all the time with a low turnover environment. The company also gains here with its aged accounts receivable, and billing gets out quicker with fewer errors, allowing the money to come in faster.
Maintenance becomes less of an expense when your workforce stabilizes. A four-year life cycle in a company truck with high turnover could have 4-6-8 different drivers in them. Compare that to a company with lower turnover, say under 20%, this company will not only have fewer maintenance issues and an asset that the used truck market covets, it also has a higher residual value.
Lastly, Operations, for a dispatcher to be acclimating the majority of its drivers on an annual basis has to be very distracting and grossly inefficient. How much more time would the individual have in a low turnover environment to concentrate on whatever their KPI’s are. Might be empty miles, revenue per mile, or revenue per day. Consider a one-percentage-point gain in efficiency – the numbers are staggering at that amount. Now stretch it to a 3-5% gain.
Next month I will discuss the platform for change. How do we ensure there is consistency in how we act individually when we take this challenge on and what are the guidelines?
All of the above constitutes part of what I call the groundwork for tackling driver turnover. Overall, there are seven steps to implement to get things under control. I intend on sharing the rest in sequence in my next six articles. I hope you find some value in turning your issues around. It boils down to transitioning your company from a carrier who delivers freight from point A to point B to a company which differentiates itself from its competition with the quality and dedication of its employees.
Given the two options, where would you like to spend your career?
Interested in learning where your company rates on their overall driver retention effort? Go to https://www.surveymonkey.com/r/KF2HG7S and follow the instructions. From there we can set up a call to see if what we have developed at TCA as a Driver Retention Project Plan is right for your company.