MANAGERS at O&S Trucking Inc have elevated driver selection and training to a higher level. The effort is paying impressive dividends.
The Springfield, Missouri, refrigerated truckload carrier reports that it has been able to reduce driver turnover to about 45%, and it is on track to reach its goal of limiting turnover to 20% or less. Further, the carrier has achieved some of its best retention success in what it calls its Finishing School for truck drivers with limited over-the-road experience.
“Our retention rate from our Finishing School is in excess of 94% for those who graduate from the program,” says Jim O'Neal, president of O&S Trucking. “We think that is outstanding, and it is helping us drop our overall driver turnover rate to the 20% target. It's important to remember that the turnover rate for the trucking industry as a whole ranges from 110% to 125%.
“We think we've found a better way to build stability in our driver force, but that doesn't change the fact that the driver shortage is still a serious issue. There is no magic wand to fix the driver supply problem. We have to build a corporate culture that shows drivers that we care about them. Other factors include pay and at-home time.”
Industry focus
O'Neal's effort to build a better driver force isn't focused on just his company. As the 2007-2008 chairman of the Truckload Carriers Association, O'Neal is actively promoting the “GetTrucking.com” campaign launched by TCA. The program includes billboards along interstate highways and is designed to help attract new truck drivers.
The focus on truck drivers is nothing new for O'Neal. That has been one of his passions throughout his 26 years in the trucking business. His first trucking related venture was Ozarks Truck Brokerage, which he started with Keith Stever in 1981.
By 1983, they had established an independent contractor fleet and changed the company name to O&S Trucking. The carrier was one of many to benefit from trucking deregulation in the 1980s, and it grew steadily with a cargo mix that included refrigerated and dry freight.
O'Neal and Stever ended their partnership on friendly terms in 1987, with O'Neal remaining at the helm of O&S Trucking. By the 1990s, company-owned tractors were part of the operation, and the cargo mix gradually shifted until dry freight predominated in the first years of the 21st Century. Refrigerated cargo dropped to a low of about 25% of the total mix.
“The worst thing we did was start to rely on a single dry freight customer that accounted for an overwhelming majority of our business,” O'Neal says. “We paid dearly for that when this customer of 20 years suddenly announced in 2003 that it was putting the shipments out for bid. We kept about 70% of the business the first year, but the volume fell off after that. We knew we had to make some radical changes.”
The management team determined that refrigerated transportation offered O&S Trucking the best opportunity to diversify its customer base. They wasted no time in refocusing the operation, and the Temperature Controlled Division was up and running by mid 2003.
“When we looked around southwest Missouri, we saw that there were a substantial number of potential customers that needed refrigerated transportation,” O'Neal says. “Dry freight remains a part of our business, but we want refrigerated hauling to account for at least three-quarters of the operation.
“For us, refrigerated freight is generating better revenue than dry freight. We're seeing what is essentially a cargo recession for dry freight right now. The industry has recorded eight straight months of freight declines largely due to the cool down in the housing market and the slowing of the automobile industry.
“Refrigerated freight has continued strong because people still eat no matter how the economy is doing. Refrigerated rates have held up so far, partly because they had been woefully under priced. This industry takes aerospace risks for grocery store margins. Refrigerated rates are still too low, but we believe the long-term outlook is very positive. There is no question that we did the right thing when we decided to put greater emphasis on refrigerated operations.”
The transition got a key boost with the acquisition in early 2003 of two smaller refrigerated fleets: Mo-Cal Express Inc and Belcor Inc. That was followed by the decision in 2004 to merge with Stever Trucking, which was established by O'Neal's former partner.
“With the Stever acquisition, O&S Trucking essentially came full circle,” O'Neal says. “That acquisition also significantly increased the size of our refrigerated fleet, and it gave us a strong portion of refrigerated business.
“We're very confident that our refrigerated activity will continue to grow — both short-term and longterm. We've already seen an economic pick-up in the second quarter, and we anticipate further improvement in the third and fourth quarters. Over the next 10 years, US freight shipments are projected to grow 40% to 150%. Truck tonnage will grow by an estimated 31%.”
The irregular-route carrier already has plenty of refrigerated freight to keep its fleet busy. The carrier runs 350 tractors and 750 trailers. Of the trailers, 350 are refrigerated, and that number will grow to 400 this summer. Almost all of the equipment is based at the headquarters terminal in Springfield.
“Refrigerated freight levels are high enough that we could easily justify more tractors and trailers,” O'Neal says. “We can't add capacity fast enough, because there aren't enough affordable drivers. This is a problem that will be with us for a long time.
“ATA estimates that the shortage of longhaul truck drivers in the United States will reach 111,000 by 2014. The driver force also is aging. For instance, the average age of the 350 O&S Trucking drivers is well over 50. There are some in the industry who are calling for an open border with Mexico as a way of obtaining a plentiful supply of low-cost truck drivers. I question whether the quality would be there, though.”
O&S Trucking has taken a different approach. The company is targeting a broad spectrum of truck driver candidates drawn from a variety of sources. The carrier initiated an innovative career development program that already has shown an ability to attract new drivers from fresh sources.
Career choice
“We're offering a career choice, not just a job,” O'Neal says. “Some of the people we've hired have made a major career change. For instance, our driver team includes a French chef and at least one attorney. We're attracting more women.”
Sundy J Muse-Morton, O&S Trucking recruiting and marketing director, adds that the driver shortage is no excuse for hiring applicants who don't meet the carrier's quality expectations. “We've set high standards, and we don't deviate from them,” she says. “We want to hire the best people, and our driver team works with us to achieve that goal. Between 45% and 50% of our driver candidates are recruited by O&S drivers.”
To be considered by O&S Trucking, a truck driver must be at least 23 years old and have a clean driving record. The carrier prefers applicants with a minimum of 12 months of over-the-road truck driving experience, but the company does make exceptions for candidates who exhibit the right characteristics.
O&S Trucking managers begin looking for those characteristics, as well as overall driving proficiency, during a rigorous road test. “We record each road test on video, and we review the video with the applicant,” says Mike Tettamble Jr, O&S Trucking safety vice-president. “Our objective is to identify potentially unsafe behavior before we put a driver behind the wheel of one of our tractors.”
Two tracks
While all driver applicants go through the same initial qualification process, the company offers two different training tracks. One is designed for those with little or no real driving experience, while the other targets truck drivers who have been operating over-the-road for some time already.
Termed a Finishing School, the new driver program at O&S Trucking is a recent addition to the carrier's driver recruiting effort. “We set up the program in 2005, because we wanted to begin recruiting more truck driving school graduates, and many of those individuals need more seasoning and more experience before being sent out on their own,” O'Neal says.
The program isn't just for graduates of truck driving schools, though. The one thing each applicant must have to qualify for the Finishing School is a valid commercial driver license. Applicants also must be able to show that they possess the appropriate decision-making skills and driving ability.
Those selected for the program receive one-on-one instruction for approximately eight weeks at a cost of around $6,000 per student. Trainees also receive a livable wage while participating in the program. Nine trainers — all of them NATMI (North American Transportation Management Institute)-certified — provide instruction.
The Finishing School is driving-intensive, and the students are the ones behind the wheel. The trainers ride in the passenger seat. Over the eight weeks, the student will be with up to three different trainers. The program starts with city driving and progresses through over-the-road operation, and the trainees are tested and evaluated at regular intervals.
Driver orientation
In addition to the Finishing School process, trainees also go through the same initial orientation that is required for all newly hired drivers at O&S Trucking. The orientation takes about two and a half days and goes well beyond the basic Department of Transportation requirements.
All newly hired drivers go through the Smith System defensive driving and the Value Driven Driving programs. “The Value Driven Driving program was recommended by our insurance provider, Great West Casualty,” Tettamble says. “We've been using the program for about three years. It focuses on decision making by drivers. It looks at their values and priorities. It examines what motivates a driver to be safe. The program discusses good and bad driving techniques, and it helps reawaken core values (like honesty and integrity) that drivers already hold.”
The Value Driven Driving program is part of an overall effort at O&S Trucking to enhance the image of the professional truck driver. “Most truck drivers want to be safe drivers,” Tettamble says. “We do all we can to help them achieve that objective everyday.”
The effort includes monthly safety meetings and a safety incentive program with cash bonuses. Retraining is a key part of the safety effort. “Anytime there is an accident or a DOT roadside inspection violation, we consider the retraining option,” Tettamble says. “We want to see if the driver is willing to take responsibility and work out problems through retraining. We have a good team of driver trainers (both men and women) who handle the retraining.”
O&S Trucking also has worked hard to raise the level of professionalism with its driver team. This includes establishing a career development program with three levels — apprentice (less than 12 months driving experience), senior driver (one year of truck driving), and master driver (at least three years of truck driving). From the one-year mark on, drivers receive a company letterman-style jacket (wool with leather) with patches indicating level and any special achievements.
A fourth level — Presidential — is by invitation of the company president. Drivers selected for this honor are the best of the best at O&S Trucking. Selection is based on driving skills, safety record, attitude, and customer service. Each year, they are invited to the Presidential Fleet Retreat for a discussion of industry issues.
Quality tractors
Beyond the training and incentive programs, O&S Trucking provides its drivers with well-maintained tractors and trailers sporting some of the latest technology. The newest tractors are Freightliner Columbia conventionals with 70-inch sleepers and Qualcomm satellite tracking and communications. New driver features, including turn-by-turn directions, are being rolled out in the Qualcomm system.
Tractors are specified with 500-horsepower Detroit Diesel engines and Eaton transmissions. “We've begun spec'ing Eaton's AutoShift and UltraShift automated transmissions,” says John Gervais, O&S Trucking maintenance director. “These transmissions make the job easier for drivers who are new to trucking. They take away the shifting guesswork. They also help improve fuel economy.”
Driver comfort features include the ThermoKing TriPak and Carrier Transicold ComfortPro auxiliary power units.
Good equipment, good training, and driver-oriented management give O&S Trucking a motivated and loyal driving team. All of this has played a big role in the carrier's successful transition back to refrigerated hauling.
