Drivers

ALK Conference Keynote Addresses Driver Retention

May 20, 2014

By Chris Wolski

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Richie Henderson, J.B. Hunt Transport's senior vice president of administration and technology, gives the May 20 keynote.
Richie Henderson, J.B. Hunt Transport's senior vice president of administration and technology, gives the May 20 keynote.

In his keynote address during the opening day of the ALK Technology Conference in Princeton, N.J., Tuesday, Richie Henderson set the theme for the rest of the day.

“Everything begins and ends with the customer and employee experience,” he told the packed house. “The customer experience is the new differentiator [when it comes to our industry].

And with this customer-centric focus, the pressing problems of the trucking industry have come to the forefront. At the top of the list is the driver shortage, which Henderson, who is senior vice president of administration and technology for J.B. Hunt Transport, says will hit critical levels — a deficit of at least 239,000 — within a decade. What’s primarily fueling the shortage are stagnant driver wages. The new hours of service rules and infrastructure issues aren’t helping matters.

Raising wages will only be a temporary fix, however. “Ultimately how drivers are treated, the equipment they have to use, how much time home they have, and how they’re treated by the customer is more crucial,” Henderson said.

Retaining qualified drivers makes good economic sense. Henderson noted that it costs $5,000 to $10,000 to replace a single driver. “And this is inflationary to the U.S. economy. The cost will be passed on to the consumer,” he said.

Capacity is another issue forcing drivers out of the market. For instance, the DOT's Compliance, Safety, Accountability enforcement regime disqualified about 3% of drivers. When new hours of service rules came online last year, it had a negative impact on between 3% and 5% of drivers. Speed controls are also limiting capacity. With the lack of drivers and other constraints, Henderson said, freight prices will rise between 4% and 6%.

Compounding the capacity issues is what Henderson termed the “Omni Channel.” Essentially, this is a consumer-driven phenomenon where there is a demand for a seamless buying experience in which an order will be fulfilled within about 24 hours. It is here that technology can play a part, with better routing and scheduling.

“We all better get good at data analytics,” Henderson said. In fact, he predicted that successful trucking companies will be those with the best analytics. Piggy-backing on this is “Big Data” (another theme of the first day of the conference).

Finally, the improving economy will put added pressure on recruiting and retaining drivers and strain capacity further.

In closing, Henderson shared J.B. Hunt’s goal — and a recipe that could be used by the rest of the industry — to retain good drivers: “Enriching employee lives and build a sustainable culture based on the service experience.”

Comments

  1. 1. John Mullen [ May 21, 2014 @ 05:18AM ]

    Cudos to Mr. Henderson for having the testicular fortitude to address the coming driver shortage at the Tech Conf.. He did well in pointing out that raising pay (per mile for less than actual miles), sign on bonuses etc. fail to correct the problem. Bringing out the cost of driver replacement, which fails to address the retention issue , should be worthy of consideration to managment. The overburden of regulation is a mockery of the effort to improve safety and compliance in the industry. The C&C problem on highways, congestion and construction, adds to the no pay delays which now with the benefit ? of electronic loging, goes against the limit of hours.
    Time to say and do that which is not politically correct. Eliminate mileage pay, pay by the hour. Minimize driver the time of tours of travel, relay loads to return drivers to their home terminal. Ask state DOTs to move through truck traffic to the left or HOV lanes in metro areas. Demand that FMCSA address safety complaints and not leave the driver to take on the carriers corporate law firm. In the failed system and an Administration in search of "shovel ready jobs" these points - and others are worthy of consideration. Even the blind pig will find an acorn occasionally.

  2. 2. Amish Trucker [ May 21, 2014 @ 05:33AM ]

    I keep hearing this "coming" shortage. Folks the shortage is here right now. I have recently attended an insurance-related seminar and the TCA Safety & Security Meeting and there is a general consensus the driver shortage has already arrived. There is more equipment sitting empty. There are fewer applicants responding to job postings. Why doesn't the industry want to admit the shortage has arrived? Is Mr. Henderson not aware agents for his company are offering carriers well over $3-$5 per round trip mile to cover loads from major distribution centers? Would we see these rates if there was no shortage? Perhaps the big guys who make the press don't want the little guys to know they are already raising rates due to the driver shortage. Their ability to undercut due to economies of scale is wiped out by their inability to attract qualified drivers to cover the freight. Oddly enough the issues Mr. Henderson referenced as reasons drivers are leaving, have been fully supported by ATA and big trucking. Did they think these changes to "level the playing field" would drive only the little guys out of business? What good is gobbling up the excess freight, when you can't get it delivered?

  3. 3. Phil [ May 21, 2014 @ 07:57AM ]

    Well, JB Hunt should have thought of that before they lobbied govt. to change driving hours and "environmental" regulations. I had to dispose of 2 trucks already because all of the sudden they were destroying the environment due to "magical gases" that came out of the exhaust. The pay is crap, the life style is crap, you have no life, your stuck far from home and family. Nobody wants to get involved with that kind of life anymore. So be proud you guys destroyed the trucking bizz with all the changes including low balling on freight rates. Grab all those loads you got from us by undercutting the rate, twist it really nice and see if you can shove it up a very specific part of your anatomy. Cry me a river now!!!!

  4. 4. ET [ May 21, 2014 @ 12:48PM ]

    driver wages = abusive driver times waiting @ both shipper and receiver and break down times.
    The new hours of service rules = forcing drivers to spend more times on the confined space of the truck and wasted times away from home and family.
    Another BIG issue is driver facing HARASSED from the DOT cops!

  5. 5. Marlin Bruce [ May 22, 2014 @ 08:31PM ]

    It is a little late to worry abut it now, but a lot of the older guys, like myself (59) are leaving the industry for the above mentioned reasons and taking very impressive safety records with them. Myself over 3 mil, accident and ticket (except DOT) free. I wouldn't return for all the money in the world, but I will check back in a coupla years to see how the mega-regulated newbies are faring.

  6. 6. Matt [ May 24, 2014 @ 12:04AM ]

    This keynote address is timely, however , it is a message that should have been a key address many years ago. Having said that, it is welcome and it has some excellent suggestions for implementing improvement in the industry. I do not subscribe to the number 5 comment by Marlin Bruce. I understand his frustration, given that we both have many years and miles under our belt and have seen this industry in good times and bad times. We assume that it is lost to the new drivers who will not pick up the mantle of being considered professional truck drivers. Bruce it is no time to fluff off, and hope that things improve. Instead try being positive, lend a hand in teaching or training such as I have been doing. Give these new ones the tools necessary to be good representatives of the industry. This in my opinion is more important than all other things that need reform. If a so called retiring professional trucker, will not lend support to an industry that probably at one time served him or her well, then maybe they were never the professional they claim to be. It stands to reason that complainers are really sharing insight about what is truly inside them. There is a proverb that say's "Can a Leopard change it's spots, or can a Zebra change it's stripes". This attitude of walking away, and closing your eyes, at the same time yelling out negative comments, will cause one to trip over their own tongue. It takes a professional to mold a professional. If implemented changes come down the pike, like we all should hope and pray for, then the well trained, and knowledge based professional drivers will carry those benefits and build upon it.
    Matt Chase

  7. 7. haller [ May 24, 2014 @ 08:29AM ]

    Management will always pay the worker as little as possibly and when they run out of workers from America they will get workers from a foreign country and pay them even less. This is the way I see the truck driver pay problem, 70 hours per week @ $24.00 per hour equals $1680.00 plus full benefits. A 50 cent raise every year and the driver pool managed as if it was a UNION...

  8. 8. John Mullen [ May 24, 2014 @ 08:41PM ]

    To Matt,
    To ask the experienced professionals to train newbies and urge them to accept existing conditions or lead them to believe they can change them is to become the Judas Goat for the carriers. The carriers are aware of the changes necessary to attract and retain drivers but take a united stand in maintaining the exemption to labor law that they hold and the benefits derived through the demise of the ICC.
    50 years in the industry in a wide variety of roles. Over 5 million miles safe driving. Been before House Small Buss Comm and Senate Anti Trust Comm on behalf of Ind Truckers Nuff said - shame on you Matt !!

 

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