CASE STUDY 1
DJ Transport, WI
Advising This Motor Carrier How to Turn Around It’s Turnover and Retrain It’s Recruiters
Executive Summary
We developed an extraordinarily unique methodology to expand their driver force by using a concept we created called “backward planning” that predicts their needs and then identifies the number of conversations a recruiter must have to hire one qualified driver.
This allows the company a way of forecasting their truck needs and having enough drivers to fill them. They were able to reduce the number of open trucks by 60% in the first 4 months of working with us and reduced their turnover by 20%.
Challenges:
The owner of this 130-truck motor carrier contacted us from an article we wrote in Transport Tropics (September 6, 2019, https://www.ttnews.com/articles/perspective-rethinking-driver-recruiting) and asked us for help. They consistently are having 20-30 trucks empty without drivers and were expecting another 15 trucks delivered that they ordered 10 months ago. Their turnover was making the problem worse.
Solution Provided
We examined the recruiting team and hiring methodology during our first all-day visit and learned the three fundamental reasons why they were frustrated with their poor recruiting results
First, they had no formal process for prospecting for drivers.
Second, based on their need for their customers approval of new hires, it took way too long to get drivers to orientation.
Third, the recruiters have no formal training and, as a result, their weak recruiting, sales and interviewing skills made their efforts inefficient or ineffective.
We developed a very unique recruiting regime called “backward planning” and retrained the recruiters to handle phone calls with greater skill, ask better questions, and get drivers to appreciate the competitive advantage of this company over others.
This program gave the recruiting team and the executive management group absolute knowledge based on solid data what the recruiters needed to do to hire a qualified driver
Results
Within four months we were able to reduce the number of open trucks with new drivers by 60% and reduce turnover by 20% based on the new recruiting methodology and improved interpersonal skills and interactions with existing drivers.
ROI
The investment in our advisory services already has resulted in a reduced monthly advertising spend of $4000 and by year end will begin to reduce it another $2,000 by changing ad vendors, eliminating unproductive ad placement and creating better quality messaging.
Future Plans
We will continue to train the recruiters to improve their effectiveness to reduce the number of conversations they need to get one qualified hire. We will focus on helping drivers make more money, make it easier to get help on the road for needed support and get home more often.
Norris, you have helped me make changes in our company operations and people performance that I have been trying to accomplish for years. With your ideas, training and guidance my recruiting team has learned a process to has led to hiring 4-5 new drivers almost every week. This is “nuts”. I never thought we would ever turn around our turnover and get the recruiters really hopping
J. F, President, DJ Transport, Inc. Milwaukee Area
CASE STUDY 2
KLI Trucking, DuPage County, IL
Executive Summary
Chicago suburban 25-year-old family owned trucking company was exposed to three uninsured casualty losses which jeopardized its ability to continue operations without bankruptcy.
We quarterbacked and built the turnaround team, successfully managed the closure of all three claims/lawsuits without unbearable financial exposure. Fifteen years later, I am still helping grow the company into very significant EBITDA (6%) annually after the tremendous losses suffered in the 2008-2011 economic downturn.
Challenges
In 2003, a family-owned, [$6MM Revenue] asset-based transportation company was confronted with three (3) uninsured casualty losses with potential exposure exceeding $500,000. This exposure threatened the future of the 23-year-old company, jeopardizing its ability to continue operations without succumbing to bankruptcy.
Solution Provided
The company asked me to assess the situation and identify an alternative to bankruptcy. We hired a law firm specializing in claim and financial management, advised the company executives on a plan to manage the claims to closure at minimal cost, a transformation plan to save the company and developed their recovery strategy, reorganized the corporate structure with the assistance of their lenders and built the turnaround team to manage future risk mitigation.
Results
With the strategies and oversight we provided, the trucking company was able to survive the lawsuits with nominal financial loss and avoid a bankrupt status. Throughout the last fifteen years, with my continuous support, the company survived the tremendous losses the industry suffered in the 2008 – 2011 economic downturn and has been able to grow into very significant EBITDA (6%) annually.
ROI
With the threat of bankruptcy behind them, the company was able to continue to operate and with my experience in working with trucking companies we were able to restructure operations, hire a professional employer organization to manage our human resources, reduce our workers compensation costs and acquire health insurance at substantial savings. We replaced our aging fleet of trucks with a long-term lease of new equipment eliminating all maintenance, mechanic, parts, labor and inventory and downtime costs. We acquired a new transportation management system and changed our driver pool to include more owner operators. The net result was a significantly improved bottom line approximating 6-8% EBITDA annually.
Future Plans
The current plan is to firm up the operations, increase revenue and then build an exit strategy for the two owners. The company has little concentration of customers but strong customer relationships and high levels of service. It is an attractive prospect for other local carriers of larger size.
Norris has worked with us quarterbacking a total reorganization of our 25-year-old business. We were on the brink of going out of business and his insights, execution and support have made us stronger than ever.
DM, President, Western Suburbs, Chicago