The Business of Independent Service Provider Contracting

Why is it important to understand and monitor your weekly Driver Productivity Report that is emailed to you weekly from eTruckBiz?

Well, it could mean the difference between surviving in the ISP environment or not. 

I want to take you through the report, and show you why it is of utmost importance and why it matters to you.

First and foremost, it provides a way for you, on a weekly basis, to measure and monitor the performance of each driver to the goals or expectations you have in place for them. You should use it to give your drivers feedback and follow up on their performance.

Here is a video, then a breakdown of the report, by column, of the information generated for you to help your business:

1. ILS - This is the service level provided by driver and it allows you to compare and see how each driver is doing.  Also allows you to use this to diagnose those drivers that have the biggest opportunity to improve your total team’s results.  By addressing the lowest few performers, it will impact your team the most.  A constant theme we have is try to improve your bottom 10%, this is one way of showing who they are and hopefully monitoring how they improve. 
2. Stops per On-Duty Hour and Stops per On-Road Hour — Both are extremely important, but we feel the most important number here is the on-road SPH number.  You should monitor the driver’s results vs. the goals you have set for them from your observation rides (in our classes we have the time to teach the method of how to properly set a SPH goal for a driver from observation rides).  Once the goal is set, it allows you to manage your employees’ on road performance.  Also, if poor driver on-road performance becomes an issue, having this data and information is invaluable for holding an employee accountable.  You have actual performance numbers vs. the set goals.
3. Total Number of Stops — Helps monitor a particular driver’s workload.  This column also allows you to look at your whole operation for the amount of stops and how you are managing them.  This is especially important in an ISP environment where you can vary your on road staffing to maximize labor efficiency and control your costs.  
4. Packages — Helps you monitor the impact of volume on routes (i.e. increases in certain routes…bulk effects etc.). 
5. Packages Per Stop — Gives you a factor to compare your drivers vs. each other as well as helps evaluate workloads and trends. This measurement is also very important in determining the profitability of a particular work area.
6. Miles — You should have an expectation of miles you expect on a route.  Since vehicle costs impact your bottom line, how do you monitor the miles an employee drives?  We have seen repeatedly that when a drivers stops are lower, their miles go up.  As they have more “free” time, they may drive out of their area to non-work related issues.  This costs you money.  If you pay your driver a daily rate, and you then don’t really care how long they take, or how many miles they drive, you better think about this again.  Remember your drivers and your vehicle’s are your most expensive costs, do you want to give them almost a blank” check each day and not know what they do?   Your challenge is to monitor your miles and hours worked each day in order to balance the workload to the point where each driver is as efficient as they can be, every day. In our eTruckBiz university courses, we teach a dispatch method called “loop dispatching”. This is how to make your drivers as efficient as they can be, every day. This is the key to winning the P&D productivity battle, which, ultimately translates into a profitable business.
7. Miles Per Stop — This is another measure used for looking at all of the issues stated previously.  As well, it helps you detect if you have a driver who starts to run their route less efficiently than they should be. If their miles per stop start to trend up, they may be routing themselves differently.  That will cost you money. 
8. On-Duty Hours — I think this speaks for itself, but you need to monitor what your drivers are reporting here for accuracy. 
9. On Road Hours — We think this is most important metric to manage, especially for those in an ISP world.  FXG will not pay outside of a range we have seen in contract negotiations.  Meaning that if any operation is not within a certain level of efficiency on road, they (FXG) will not pay to meet those costs. In other words, they are not going to pay you the extra money needed to run an inefficient operation. This is why managing your on road operations is critical to your business success.  FXG engineered routes in the IC world, but this goes away once you are an ISP. So as growth happens, Contractors must manage their operations efficiently or the business will suffer, or die.

10.   Time Difference (between) On Duty/On Road — This is On Duty Hours minus On Road Hours, or in building hours (AM and PM combined).  We encourage all managers to establish what they feel and observe is an expected goal for their employees’ time spent in the building (am sort etc.), both the AM and PM. Monitoring this metric allows you to monitor their goal vs what they actually have done.  We have historically seen that if this is not managed, it can lead to erosion of on road productivity as drivers will not be maximizing their time on road as much as possible.  Which can also help contribute to DOT hours of service violations.

Not only should you be monitoring a driver’s performance against the goals you have set, but you can also compare their results to the “National Averages” that are in bold at the bottom of each column. They are from all over the country and have been statistically verified to be a valid and representative sample.  EVERYBODY in each mileage range has many of the same challenges as everyone else in that same range.

We know that everybody’s route is “the hardest one out there”. But, if a driver is in a similar mileage range, the averages are a pretty good measurement of what could be expected of them.

Regardless of that, it is only there to serve as a bench mark for you to compare and draw any conclusion you wish.  Nothing should substitute for actual observation ride and subsequent goal setting as a way to manage and judge performance.

So in the end, it is essential that you monitor this report as it comes to you weekly. Otherwise, you’ll struggle to run an efficient, profitable operation.