Tackling Driver Turnover - Part 1: Delusion

Question:

How do we deal with the mass delusion that driver turnover is inevitable? When nothing could be further from the truth. Driver turnover is a manageable business challenge like any other. The only thing standing in our way of achieving low driver turnover is the BS we keep telling ourselves in a long misinformation feedback loop. This fallacy keeps us from tackling this problem with the focus needed to achieve the desired outcome.

I'm not sure how this happens, not that I am immune. I was a partner and the President and COO of a company that went from an almost non-existent turnover to one that had 120% in just a couple of years. Some time back, I ran into a quote that seems to fit the situation: "The chains of habit are too light to be felt until they are too heavy to be broken.” I am not sure who owns the quote - a search on the internet is inconclusive. It makes me wonder what situation the author faced when this explanation for their predicament first entered their mind. It's quite likely not trucking, but it does fit perfectly for the current state of things. So, where do you start if your company is the victim of its chains of habit that seem too heavy to be broken? What happens to culture for this to seep into our companies? Let me walk you through what worked for the companies I enjoyed working with. BTW.

It starts with acknowledging that turnover is man-made and not inevitable, as I have already pointed out. Then, from there, the leaders in the company commit to being accountable for the effort and to each other to make the necessary changes to the company culture to infuse a focus on reducing driver turnover. During my workshops, I usually suggest that these folks draft a mission statement they all sign. It is a commitment to each other. Sounds easy, and it is. The problematic part is allowing a peer, in this case, another senior manager, to correct you if they see you acting in a manner contrary to the mission statement that everyone committed to. Unfortunately, people’s egos come into play and are seldom as pliable as they should be.

The next step is the sales pitch; companies need to explain to their employees why a dramatic reduction in the company’s turnover is critical to its future. They also need to discuss why it benefits 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 the start 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 deeper, but not too granularly, let's look at department by department.

Sales: with lower turnover, there are fewer service failures, and you are not regularly training drivers about your customer needs. Fewer service failures mean less time begging for customer forgiveness, which means you can likely pursue a more significant opportunity with your current customer base.

Safety gains by not having to create new driver files all the time. This is a considerable time saver. Safety personnel will have fewer accidents and incidents to track and files to open. Why? Because a stable workforce can be trained to a higher standard. You can’t effectively train a workforce with high turnover; you’re always starting over. Side note: companies with lower turnover have fewer accidents and pay less insurance than carriers with high turnover. There is a direct correlation between lower insurance costs and best-in-class operating margins.

Administration gains with a low turnover environment come from not constantly educating the new workforce about the company’s information flow and paperwork requirements. The company also gains here with its aged accounts receivable. Billing gets out quicker with fewer errors, and the money comes in faster when it becomes repetitive and consistent. Stability in your workforce results in people who know the processes.

Maintenance becomes less of an expense when your workforce stabilizes. A four-year life cycle for a company truck with high turnover could have 4-6-8 different drivers. Compare that to a company with a lower turnover, say under 20%. This company has fewer maintenance issues and an asset that the used truck market covets, so it has a higher residual value.

Operations (I saved the best for last): For a dispatch manager to familiarize themselves with a new fleet of drivers annually must be very distracting and grossly inefficient. How much more time would the dispatcher have in a low turnover environment to concentrate on their KPIs? These might be empty miles, revenue per mile, daily revenue, and unit productivity. Consider a one-percentage-point gain in efficiency here; the numbers are staggering at that amount. Now stretch it to a 3-5% gain.

In the next article, I will discuss the platform for change, including how we ensure consistency in how we act individually when we take on this challenge of what the guidelines are.

All the above constitutes part of the groundwork for tackling driver turnover. Overall, there are seven steps to implement to get things under control. I intend to share the rest in sequence in my next six articles. I hope you find some value in my writing about my experiences. It boils down to transitioning your company from a carrier that delivers freight from point A to point B and then doing it again to a company that 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? I welcome your feedback,

Take Good Care

Regards

Rjh