With the truck driver shortage expected to swell to a net-negative 175,000 truck drivers by 2024, trucking companies have a lot at stake ensuring they are meeting goals, otherwise there simply might not be enough manpower to get our nation’s freight to where it needs to go. Also consider that the average replacement cost for a truck driver is around $12,000 and it isn’t hard to see that transportation companies must do more.
According to HireRight’s 2018 Transportation Spotlight report, a over 60% of respondents responded saying they planned to invest in more robust retention programs. Another 51% said they intended on making larger investments in training and development. With 52% of truck drivers leaving fleets for better money and 27% for better benefits, motor carriers have to think hard about innovative ways to attract and retain the right people.
Data to the Rescue
Could it be that the best-run motor carriers rely on data? We live in the age where computing and data is plentiful. Data-driven programs are differentiating factors when trying to recruit top truck driving talent. We have reached a time when the simple once-a-year safety bonus program simply isn’t cutting it.
The fleet of the future will use monthly or quarterly scorecards based on comprehensive data streams across a variety of factors, from truck driver performance to safety, fuel efficiency, and other important criteria related to quality truck driver retention efforts. Motor carriers need a step-by-step guide to help them create a data-driven incentive and retention effort that drives real results.
The fact is this: some truck drivers need incentives, but all truck drivers need rewards. A truck driver incentive program that is well thought out can provide a serious return on investment while also increasing overall fleet safety and improving recruiting and retention efforts. But what steps should a fleet take to ensure they get it right?
- Design an effective program.
- Select the right metrics.
- Incentivize and reward truck drivers.
Different Motivational Factors
It is important to remember there is a difference between incentivizing and rewarding. An incentive is something that motivates or encourages someone to do something better, while a reward is something given in recognition for a job well done.
It is no secret that designing effective truck driver incentive programs is not easy. They are unique and challenging and not always easy to get right. Although a good incentive program’s ultimate goal should be to keep truck drivers safe, successful, and feeling like a part of the family, they are not without their fair share of unintended consequences.
As one example of how an incentive program can work against you, if you try to incentivize your truck drivers based on how many miles they have driven or how many loads they have delivered, it could lead to risky or unsafe driving behavior. It is important to consider the successful factors that make up an effective truck driver incentive program.
Attributes of a World Class Incentive Program
First, you want to make sure you have buy-in from the top. If you do not have executive buy-in for your plan, it will be hard to get buy-in from the people down the chain. You also need to have HR, Ops, Safety, and other departments in on the new routine.
Next, make sure you establish clear objectives and goals for your incentive program. They must be actionable and in line with your safety culture and desired outcomes. Successful truck driver incentive programs are effective at boosting truck driver performance, motivate, improve safety, and ultimately help retain people.
As you are considering your incentive program – or deploying it – consider surveying your truck drivers to see how they feel about the program. As long as it is simple and easy to understand, there is no reason why your people should have any problem with it.
As with almost anything else, communication is key. You must have both an internal and external communication standard in place to explain what you’re doing. From brochures to webinars, internal documents, and more, it is critical your program itself also has a voice. Communication is so important because you’ve got to be able to keep your truck drivers informed about how well they are doing in the program. If they have no idea of their performance, how can they change?
Finally, programs like this motivate truck drivers to compete with each other and be better. Fostering an atmosphere of friendly continued improvement is never a bad thing. But before you can get the most out of your people, you must ensure you are tracking the right data.
Utilizing data just for the sake of data won’t get you very far. It is critical that a motor carrier select the right metrics and targets to drive the results. Metrics are the backbone of any data-driven incentive program. Fleet managers can use performance metrics to compare periods of time or truck drivers. They also provide a great way for fleets to reinforce the overall message.
Generally, the most effective fleet metrics are those tied to safety/operational goals and are intended to impact truck driver behavior and performance. It is important to start small. You don’t want to choose a basket of metrics and end up overwhelming your truck drivers and managers. Focus on actionable KPIs first.
Actionable metrics should be ready-to-use and represent a best practices model that integrates pertinent data, such as CSA or BASIC information. Integrating different data sets enhances the success of your overall program. Truck drivers need to understand not just their performance metrics, but how those metrics impact their actions behind the wheel, and vice versa.
Motor carriers who want to zero in on the best performance indicators need only look at the top-three safety-driven factors:
- Safe driving
- Overall efficiency
- Improved driving
As you build up your program, you will need to consider target selection. Targets should refer to measurable performance milestones. Set targets that are timely, objective, and easy to understand.
You also don’t want to make program targets so difficult that they seem impossible to achieve. You want your operators to be able to meet these milestones and be rewarded for doing so. Do your best to get rid of the “all or nothing” mentality. Use several tiers of targets to achieve the reach you are looking for.
Finally, make sure you revisit your metrics and targets. There is no point to holding on to a program structure that doesn’t work simply for the sake of doing so. You can only expect to get results out of a results-oriented program, driven by solid metrics, achievable targets, and relevant data.
Keeping Disqualifications in Mind
Not everyone will succeed in a truck driver incentive program. Just as important as how robust your incentive program is on the front end is how you will handle those that do not meet the goals. Motor carriers should customize their programs to respond to unbiased disqualifications.
For fleets that have adopted a video-based safety system, events recorded can be used to measure whether a truck driver is meeting the goals or not. Trucking companies can set thresholds for their own disqualifications. Examples of some disqualifying events include:
- Extreme speed
- Collision with a fixed object
- Unfastened seatbelt
- Driving the wrong way
- Failure to yield
The fact is, there are far more examples of incidents that could inform a potential disqualification, from driving with two hands off the wheel to failure to stop at a stop light. Once measurements are set into the disqualifications, fleet managers can decide who makes the grade and who doesn’t. A truck driver with two or less seatbelt violations might still be able to participate in the program, while a truck driver who collided with a fixed object might not.
Meet with a Reward
When truck drivers meet or exceed their targets, the most effective way to keep them doing so is to reward them. Incentives without rewards are far less effective. You must consider the size, type, and frequency of the reward.
While money is always the easiest reward, things like events for best-performers, safest truck drivers, trophies and company shout-outs also work wonders to keep your people happy and performing to the best of their abilities.
For motor carriers who have multiple sites, challenges can be organized to see which sites are consistently meeting the goal. When progressive, positive recognition is provided in answer to strong performance, truck drivers stay motivated. Ensure you are not rewarding too frequently or to infrequently. While finding the right balance may not be easy, it is important.
When combined with the standard quarterly and yearly safety bonuses, an effective truck driver incentive program can go a long way to increasing your fleet’s overall safety, keeping your truck drivers happy, and creating a positive engagement culture. Moves like these do only good for the company’s bottom line. So, what are you waiting for? It’s time to get started on your data-driven incentive plan.