"Knowledge must come through action." --Sophocles
Mention the name "Wal-Mart" in mixed company and you'll usually get a lot of grumpy, mean looks. Frankly, most folks don't like the giant retailer one bit and for a variety of reasons -- low-paid labor without benefits, heavy reliance on "Made in China" goods, or how they've driven mom and pop stores out of business. Go ahead, pick a problem, and I guarantee you someone is trying to pin it on Wal-Mart.
This isn't to say they are a saintly corporation, now -- far from it. And many of the grievances leveled against the company are true (though maybe not to the extent we see and read about in the mainstream media). But one HUGE thing that gets overlooked by almost everyone is how Wal-Mart is changing the game: Not so much in retailing and logistics anymore -- they're past masters in those areas -- but in their role as motivator for innovation in trucking, specifically in terms of boosting tractor trailer fuel economy while lowering pollution. They are also putting a richly deserved emphasis on the role their drivers play not only in terms of company and vehicle performance but in the community at large.
I got to see this first hand in Dallas a few weeks back when Peterbilt Motors and its sister company Kenworth unveiled prototype hybrid Class 8 tractors -- built in an exclusive partnership with Eaton -- that are being delivered to Wal-Mart for field trials. These are tractors that will one day be able to operate like Toyota's Prius -- humming along on electricity in stop and go urban operations -- while also being able to power HVAC systems for the night without having to idle the diesel engine. And Wal-Mart's been the goad in getting this project off the ground -- without their commitment to buying and testing these trucks, neither Peterbilt nor Kenworth would be doing this. It's just too expensive to gamble on market acceptance these days.
I talked to Tracy Rosser, the former VP-corporate traffic for Wal-Mart, about the company's innovation strategy earlier this year. He's since moved on to a new position, but his insight shows how innovation at this level can still have some big economic payoffs for fleets.
“Our fleet strategy mirrors our corporate and logistics strategies - we need to improve operational efficiency so we can keep costs down to remain competitive in the global market,” he explained to me. "We‘re trying to control more of our freight and get more density in our lanes so we can maximize driver and asset productivity, thus keeping control of our costs."
Rosser pointed to the major efficiency gains Wal-Mart achieved for its private fleet of 7,000 tractors - trucks that haul goods from the company‘s 39 distribution centers to its 1,075 stores in the U.S. The company originally wanted to improve fleet efficiency by 25% within three years, largely measured by gains in fuel economy. But by getting suggestions from its drivers, switching to new tractor specs, and making operational to its trucking operations pattern, Rosser said those targets were met within just one year.
"In 2006, we added APUs (auxiliary power units) to our vehicles to reduce idling, made aerodynamic improvements to our tractors, switched to more fuel-efficient tires, and had our drivers adopt more fuel efficient practices largely suggested by them, such as progressive shifting," he told me. "We also now turn 96.5% of our trucks at the shipping docks in under two hours. Those changes helped us boost average fleet fuel economy to 7.1 mpg for all except two months last year -- that‘s how we achieved our efficiency targets."
Rosser noted that Wal-Mart doesn‘t plan to stop there. "By 2015, we plan to achieve 100% fuel efficiency gains for our fleet," he said. "That will come not only from further improvements to the trucks and operating patterns, but from changes in our packaging as well, which will affect shipment weights."
But it's not just about the numbers either -- that's the other interesting thing about Wal-Mart's trucking presence. For instance, the company has been a huge supporter of Trucker Buddy for almost a decade now, getting its drivers matched up with elementary schools across the country. Sure, a nice PR ploy, some would say. I would note that you'd get more positive exposure -- and keep your drivers focused on driving -- by making a big donation to say the Ronald McDonald House every year. But Wal-Mart realizes that drivers get a lot out of the Trucker Buddy connection, finding it's a win-win for the company, driver, and community alike on a lot of unexpected levels.
"We‘ve been involved now with Trucker Buddy for 10 years and we initially just got involved with it as just another opportunity to connect our people with the communities they live in," Tim Harris, Wal-Mart‘s regional transportation manager, grocery-western division, told me a few weeks back. "But we‘re finding that our drivers just get so much out of it. Not only is it inspiring to them, it‘s changing the image of truck drivers overall in their communities."
Harris said not only are children responding positively to the pen-pal-style relationship Trucker Buddy helps form between drivers and schools, but so are the parents.
"I‘ve gotten letters from countless parents telling me how much of an impact this program had on their child. That makes a difference in terms of how drivers are viewed in their communities and in the public at large," he said to me. "The Trucker Buddy program has impacted one million kids so far and we‘re happy to keep supporting it any way we can."
It also tells you something that company is willing to sent key executives out into the field to show it's support of such programs, both to the public and to its own drivers. That's how far Wal-Mart is willing to go to change the game in trucking, at least.