Editor’s note: This post originally ran on Connect. Since it’s a relevant topic for the carrier community, we decided to share it with you here on The Road.
The changing competitive landscape in trucking is focusing more attention on the role of drivers in the management of supply chains.
Companies continuously strive to optimize their freight operations by, for example, improving supply chain visibility, choosing simple or multi-stop delivery configurations, instituting pooling arrangements, and developing complementary crossdock facilities.
The truck driver element of supply chains is now coming under more scrutiny for a number of reasons.
Influence on Favored Shipper Status
A leading cause for this scrutiny is competitive pressure to achieve favored shipper status. Carriers can bestow this status on shippers they prefer to do business with. Researchers at Iowa State University studied this phenomenon using data provided by C.H. Robinson and TMC. The research shows that there is a strong link between transportation rates paid and dwell times over two hours. Dwell time is one of the main qualities that make up favored shipper status. For more on the Iowa State study, download the white paper Do “Favored Shippers” Really Receive Better Pricing and Service?
Feedback from drivers is key to carrier assessments of shippers as trading partners. As a result, shippers that strive to make the driver’s job as trouble-free as possible are more likely to score highly on the “favored” index. This can be done by, for example, streamlining loading/unloading operations or providing drop trailer yards, thereby minimizing dwell times.
Network Efficiency and Planning Programs
Driver feedback can also be a valuable input to network efficiency and planning programs. An experienced driver who is also informed about the loads he or she hauls can flag opportunities to improve operational performance. An example is where inter-plant moves are unnecessary and a source of excessive cost that can be eliminated with better planning. Or, a shipper having to send a trailer only 40% full because the less than truckload (LTL) transit times are too long. In this case, requiring the destination sites to ship on the same day if they do not order full loads creates opportunities for load consolidations and reduces the number of trucks on the road.
Electronic Logging Devices
A new source of driver data that could be extremely valuable for supply chain managers is electronic logging devices (ELDs) on trucks. Federal regulators recently set a December 2017 deadline for adopting the technology.
These devices are also the subject of some controversy, since they can be used to monitor driver hours of service. Tighter regulations governing the length of time drivers are permitted to work have a huge bearing on the availability of truck capacity. Some carriers see the technology as an unwanted restriction, while others support the introduction of the units. Regardless of which parties win the argument, electronic logging is another issue that shines a light on driver activities.
The perennial problem of driver shortages has the same effect. A number of solutions have been proposed, but a less obvious one is reducing the need for drivers by eliminating miles from freight networks. Giving drivers fewer miles to cover is by no means a panacea, but smarter supply chain planning improves the utilization of this vital resource.
Of course, the ultimate solution in this sense is autonomous trucks. It will be some time before driverless rigs ply the nation’s highways, but in the meantime, more advanced in-cab technology improves driver productivity as well as driver safety for drivers and passenger vehicles. These advancements continue to move the industry closer to fully automated vehicles.
Truck drivers generally are much more connected to logistics operations than they were, say, 20 years ago. Now, their contribution to the management of supply chains—both domestic and international—is more visible than ever.