“The cat has too much spirit to have no heart.” –Ernest Menaul

For years, I’d always thought dogs were a trucker’s best friend – a view borne out by the many different canines I’ve met over the years riding shotgun with drivers. Yet this year at the Mid America Trucking Show, I got an eye-opener of sorts as I stumbled upon quite a few trucks that were homes away from home for plenty of cats.

(Pee Wee, perched high in the cab for a great view of the road.)

Shaun Flowers, a driver for Roady Trucking of Marysville, Kansas, introduced me to his feline highway companion, sporting the handle “Pee Wee” and resting comfortably on the dashboard. “He’s been with me for three years and goes everywhere I go,” Shaun told me. “Best thing is, I don’t have to stop and take him for a walk.”

(Pee Wee is ALWAYS ready for a close up.)

But it’s more than that, of course. Cats are very different from dogs psychologically as well as physically, content to seek out affection from humans when they need it, then quick to saunter off for a nap or ritual fur cleaning without so much as a backward glance. I know this for a fact, having spent the last 12 years in the company Woody, our resident grey tabby feline.

(The indefatigable Woodrow Wilson Kilcarr the First.)

This isn’t to denigrate the stalwart canine companion in any way, shape or form, I stress! In all honesty, I was a dog person my whole life, growing up with a wide variety of breeds, from cocker spaniels and a Collie-German Shepard mix to outright mutts. (We had three dogs at one point – meaning I probably qualify as a “Redneck” according to some of the rules laid down by the great Jeff Foxworthy). I spent countless hours in their fine company and at some point still plan to bring a Chocolate Labrador into my home

Yet cats – especially those that like to display their social skills – are more than great companions at home and on the road. They provide to us humans comfort, unquestioning friendship, and probably best of all a calming influence. After many a long day, I can tell you, there’s nothing like sitting down with a cup of hot chocolate and Sir Woody by my side, his rhythmic purrs leaching away the stress in large chunks.

(A whole gaggle of cats finds this trucker’s dashboard a fine place to keep warm.)

That soothing presence is a great boon to me, as well as to truckers plying the long highways day after countless day.

“Too many new drivers are involved in road accidents and are not properly prepared for driving alone. It is time for a new approach to learning to drive.” –Ruth Kelly, secretary of state for transport, United Kingdom

Though roadway deaths and serious injuries dropped by 33% in the United Kingdom (England, Wales, and Scotland … oh, all right, we’ll throw Northern Ireland in there too for now, much as I’d rather not) since the mid 1990s, the casualty rate for young drivers has not changed – and that’s promulgating a new effort spearheaded by Ruth Kelly, the U.K.’s transport secretary, to totally revamp driver training processes.

“The aim … is to create safer drivers for life by strengthening the current learning and testing procedures and creating a culture of extended and advanced learning,” she said in a statement to the press kicking off this new program. And it’s a program we in the U.S. should take a close look at ourselves, suffering as we do from some 43,000 highway deaths every year.

The problem in the U.K. is simple and brutal: One in five people get into an accident within six months of passing their driver’s test, with another 70% reporting near-misses in the same period. Newly qualified drivers and their passengers also account for one in five of all car deaths in Britain as well.

Note some of these statistics: Two million people take a car driving test every year in the U.K. but only 750,000 end up qualifying for a license. That means the pass rate is 44%, meaning the average learner takes more than two tests before passing. Three quarters of those 750,000, by the way, are under the age of 25, according to the U.K.’s department of transport.

“We must make sure that novice drivers are safe drivers when they have passed their test,” Kelly added. “We must also create an expectation of lifelong learning, so that people continue advanced learning after their test. That is why I am publishing proposals that offer new drivers more opportunities to learn both before and after the test, including at school.”

Her plan is to create a foundation course in safe road use for under 17 years olds to be piloted in schools and colleges in Scotland from this Autumn – leading to a qualification program available across Great Britain by 2009.

For the first time, Kelly said, there will be a syllabus to ensure more effective and comprehensive training is offered to learner drivers. This will set out more clearly the necessary steps to driving safely – beginning with the basics of car control, progressing to skills such as driving in difficult weather or at night and culminating in ensuring driver awareness is enhanced, to help novice drivers predict the intentions of other road users.

Here are some of the key points of her proposal:

* A more focused and thorough learning process before the driving test that focuses not just on vehicle control but also the wider skills needed to be a safe driver, from driving in difficult conditions (for example at night or in poor weather) to learning to predict and respond to other road users’ intentions;

* A new training syllabus to ensure learners understand what is required of them to become a responsible driver, enable them to undertake structured and efficient learning and accurately assess when they are ready to pass their driving test;

* An improved driving test which requires the driver to demonstrate independent driving skills and clear understanding of different situations on the road, with the option of modular assessment;

* New opportunities to take extra training post test; working with the insurance industry and employers in the driving for work sector we will develop new courses and qualifications to be taken after the driving test that could lead to lower premiums and a better chance of securing a career in the driving for work sector;

* A star-rating system for driving instructors so that learners can make an informed choice based on pass rates and the level of training instructors have undergone;

* A review of driving instructor training and testing to ensure they provide a quality service and are focused on those areas of driving performance that are closely linked to safe driving.

What are the results that Kelly hopes to achieve with all of this? Pretty straightforward:

* A driving test that gives a more realistic and rounded assessment of whether someone is fit to drive alone;

* More focused and efficient learning, with greater clarity about what is required, so learners should not face any increase in costs;

* Better training and testing of driving instructors and better information for the public on instructors’ qualifications and performance

* A wider range of opportunities for drivers to acquire skills and demonstrate that they have done so, both before and after they qualify, creating a culture of lifelong learning and driver development.

* Lower numbers of accidents;

* More opportunities and greater incentives for post-test learning, with this becoming increasingly common;

* Higher levels of employer confidence in the driving test and driving qualifications;

* Lower insurance costs for drivers who have taken advantage of a wider range of learning options, both pre and post test, to improve their competence.

It’s bold stuff, what the U.K. is attempting to put in place here, as it will require a lot of time, effort, money, and above all patience. But if this program results in fewer highway deaths and better drivers for the long term, it will be well worth it – and may be something we need to look at copying here in the U.S.

“We must learn to reawaken and keep ourselves awake . . . by an infinite expectation of the dawn, which does not forsake us in our soundest sleep. I know of no more encouraging fact than the unquestionable ability of man to elevate his life by a conscious endeavor.” –Henry David Thoreau, from “Walden: Where I Lived, and What I Lived For.”

If there’s one four-letter word that rules the trucking industry with a hammer, most would think it would be “fuel.” I mean, with diesel prices up over $4.21 per gallon across much of the country, trucking companies are on track to spend $135 billion on fuel this year, up from $113 billion in 2007.

Yet fuel costs can be managed to a degree, if carriers spec their equipment to get the best fuel economy and their drivers operate in the most fuel-efficient manner. And don’t forget fuel surcharges – the industry collected $65 billion worth of fuel surcharges last year, which knocked its out-of-pocket fuel bill down to $48 billion – significantly less than the $53 billion this industry paid for fuel back in 2003, when diesel cost half as much as it did today.

No, the four-letter word that really dominates this industry is “time.” Because that’s what shippers of all shapes and sizes are focused on: how long does it take to get my goods from here to there. Some may be willing to wait longer than others, but not too many. That’s the reason “just-in-time” and its ubiquitous acronym JIT permeate this industry top to bottom.

Yet “time” doesn’t just relate to freight pickup and delivery – it’s also a key component in the back office functions (witness the rapid rise of real-time electronic billing and the use of telematics to enhance this capability for truckers) and in the individual manager’s workday. One reason so many paper-driven processes in trucking are going electronic is to free up the manager’s work schedule so he or she can have more time on more pressing issues.

Professor Jerry Osteryoung of the college of business at Florida State University has some thoughts on this subject, based on his long experience working with entrepreneurs from across the business spectrum, so I am going to let him share those with you today. Professor Osteryoung, the floor is yours:

“The most limited resource all of us have is time. Time is something that is so precious in our lives, yet we just do not appreciate it enough. In my case, what surprises me the most is how fast I have come to be 66. I feel as if I have missed so much in my life – both in terms of business and personal – just because of poor time management.

I could go on and on about various techniques for improving time management, such as dealing with interruptions, setting priorities, etc; however, I think time management is a much deeper subject. After having given a myriad of seminars on the topic, I have learned that people can improve their time management techniques for a short period of time, but very rarely have I seen long-term changes.

If you are going to change how you manage your time, it will take much more than just trying a new technique. Rather, you are going to need to take a conscious approach to time management.

All of us use habits to cope with life. In this complex world, we form them to allow us to deal with the many things that need our attention. Some of these habits are good (exercising), but others are not (overeating). Having habits is not a bad thing, but not being aware of when you are operating in habitual mode is not good.

Unless we are consciously aware of our time management, we tend to go after the urgent items rather than the most important. Which would you look at first: a new email or some old-fashioned snail mail? Most folks would look at the new email even though the regularly mailed letter might be much more important. I think this is because we are just not conscious of how we are responding to both important and urgent items.

While it is glib to say that we should pay more attention to the important items rather than the urgent, it is really not as simple as it sounds. We are frequently totally unaware of our decisions and behaviors. Our habits drive us towards those urgent items every time.

So many spiritual leaders, such as Buddha and Gandhi, have talked about the importance of consciousness in our lives and how to go about achieving it. However, very little has been written about conscious decision-making in business. I believe that consciousness applied to time management is the secret to making real changes in how we manage our time and our lives.

In 1973, Alan Lakein wrote a book detailing a process he invented for bringing consciousness into our time management. This process consists of two main elements that you repeat many times (at least 10 times) throughout the day. First, take a deep breath, and second, ask yourself, ‘Is this what I want or need to be doing right now?’ This process takes you out of the habitual mode and gives you a much more holistic approach to time management. I have been using this process for a while, and I can personally attest to how effectively it works to make sure that I am focusing less and less on the urgent items in my life.

So take a breath, then ask yourself, ‘Is this what I want or need to be doing right now?’ Your life and so many others are going to be improved by using this simple technique to bring consciousness into your time management.”

As always, Professor Osteryoung can be reached by e-mail at jerry.osteryoung@gmail.com or by phone at 850-644-3372.

“Shutting down the ports in defiance of the contract and the arbitrator’s order in no way benefits an already-fragile U.S. economy.” –Steve Getzug, spokesman for the Pacific Maritime Association, the group representing 29 ports on the U.S. west coast.

In case you missed it, there was a “May Day” work stoppage at all the ports on the U.S. west coast last week on May 1, as 15,000 members of the International Longshore and Warehouse Union (ILWU) stayed home between 8 a.m. and 5 p.m. ostensibly to protest the ongoing war in Iraq. However, the May Day work stoppage is in actuality an annual event conducted by the ILWU and it shows that labor still has some pretty big muscles to flex, especially in the transportation industry.

It’s also worthy to note that the union went ahead with its plans despite a ruling by the Coast Arbitrator – essentially the Supreme Court on the waterfront, according to Steve Getzug, spokesman for the Pacific Maritime Association (PMA), which represents the ports – that ordered the ILWU to treat May 1 today as a normal work day.

“This work-stoppage, illegal under the ILWU-PMA contract, comes just two months prior to the expiration of the current labor agreement,” noted Getzug in a press statement last week. “Today’s actions raised the question of whether this was an attempt to leverage contract negotiations.” He also expressed concerns that the ILWU might use slowdowns as a negotiating tactic when the current six-year labor contract expires on July 1 this year.

This is a bog deal because the west coast ports represent a critical linchpin in the U.S. economy. Since 2002, overall container volume is up 45% and as a result, west coast port operations (including non-containerized cargo such as bulk and autos) now support eight million U.S. jobs and contribute 11% of the U.S. gross domestic product (GDP). The domestic business impact of West Coast port trade is $1.3 trillion – roughly equivalent to the GDP of Canada or Mexico.

Needless to say, the longshoremen have some serious clout out there on the west coast – and good pay to boot. The average full-time wages for fully registered port workers are $136,000 a year, and their benefits package, including pension and health care, costs more than $50,000 per worker. Why, you may you ask, do they get so much? Answer: necessity. These folks unload all the goods coming from Asia into the U.S. – goods that are partly the result of efforts to outsource manufacturing to cheaper locales overseas. Without the longshoremen, commerce grinds to a halt – as do many of the global supply chains many companies here in the U.S. rely upon.

The need for labor – and the need to treat it well – is occurring in trucking as well, to an extent. More than 7,000 members of the International Brotherhood of Teamsters union, for example, just ratified a new labor contract with DHL Express – a company owned by German giant Deutsch Post. That follows a pact approved at UPS Freight – the former Overnite Express – covering 10,700 Teamster members this past April. Both of these deals are the first new national pacts negotiated by the Teamsters in more than 30 years, the union noted.

We’ll be seeing more of this, I think, as labor gets scarce not only in trucking but in the U.S. as a whole as the “baby boom” generation retires and is replaced by the far smaller “Generation X” population.

“Look at the overall demographic shift here – you have 78 million baby boomers that start retiring in 2008 being replaced by Generation X, which is comprised of only 45 million workers,” says Richard White, VP-marketing and communications for the Automotive Aftermarket Industry Assn. “Basically, you have a lot of people retiring very soon and not enough people to fill the jobs they are leaving.”

Trucking is especially feeling this pinch. According to the American Trucking Association (ATA), the industry is short 20,000 drivers annually right now compared against the amount of tonnage it hauls – which will grow to 114,000 by 2014 if current conditions remain unsolved.

This is but one reason why the balance of power may shift to the labor side of the ledger fairly soon in this industry – and none too soon for many drivers in the long-haul segment of the market. Yet it also may not be a huge negative for trucking, if handled correctly: lord knows, UPS has managed to become a more than nimble competitor in the freight world with its unionized workforce. Look at the Teamsters deal with DHL Express, also: it’s five-year contract (which expires on March 31, 2013) offers annual wage and benefit increases, including $8.35 over the term of the contract for pick up-and-delivery and clerical workers; all health-and-welfare and pension funds are maintained for current employees; and a cost-of-living adjustment, or COLA, applies to all employees.

The Teamsters added that the deal should help save DHL money, as its lost billions since purchasing Airborne Express in 2003, including $900 million last year. “Creating a national contract was a complicated undertaking and our members have shown that it was worthwhile work,” said Brad Slawson, co-chair of the Teamsters national negotiating committee. “Not only were we able to negotiate significant economic gains for members, this agreement provides job security by allowing DHL to better compete in this tough industry.”

And the freight market is only going to get tougher in the months ahead.

“We are not asking trucking companies to do anything differently than they are doing it now – we’re just offering them an opportunity to do their work at a lower cost … using offshore resources.” –Anthony Aliengena, CEO of Aliengena Inc., parent company of Aliengena Outsourcing Pvt. Ltd.

OK – even this is catching me off-guard. I mean, outsourcing routine back office functions to workers overseas is one thing (and I think it’s a bad idea to start with), but then move DISPATCH overseas? TO INDIA????

I mean, PLEASE! We all seem to be forgetting that trucking is a PEOPLE business here. Sure, it’s all about getting freight from point A to Point B as fast and as cheap as possible. But there are human beings behind the wheel, mapping out the route, making sure the equipment is safe, and making sure if there’s a problem they can take care of it – fast. Do you REALLY think a dispatcher based in INDIA is going to manage drivers rolling in the southwestern U.S. BETTER? Sure, it’ll be done CHEAPER, but does that improve the service?

Look, all regards to Anthony Aliengena, CEO of Aliengena Inc. of Pune, India: he’s trying to solve cost issues for trucking companies here in the U.S., suffering under the weight of $4.21 per gallon diesel. He believes that in tough times, companies can outsource their non-core jobs for significant savings without losing their focus or their industry-specific skilled work force.

But is this really a good idea in the long run? To have all your back-office functions – the folks writing the checks and dispatching trucks – based halfway around the globe? What if servers and phone lines go down? What if DOT inspectors show up asking for records? Are you going to book them on Air India and say “good luck”???

Of course, it’s all about the money. Aliengena Outsourcing admits right up front that the big savings come from salaries, taxes, insurance, vacation time, overhead and infrastructure costs can add up quickly. For an employee earning $15 per hour in the U.S., the benefits and other items can easily tack on another $6.50 or more per hour, the company noted in its press release. That means an employee earning a base salary of $31,200 a year might actually cost the company approximately $45,000, the company noted.

The same job in India could cost half that amount. By shifting just 10 jobs offshore, a company could save hundreds of thousands of dollars annually, Anthony Aliengena said. “Savings like that can mean the difference between riding out this economic storm and not making it,” he added. By moving much of their routine work overseas – jobs like auditing, credit, collections and even billing and posting checks – companies realize significant savings, Aliengena noted.

Look, I am not knocking India here – let’s be clear. That nation is investing in technical infrastructure – dedicated Internet lines, servers, etc. – like crazy and they have a HUGE well-trained English-speaking workforce. We should be hanging our heads in the U.S. when we see things like this because OUR workforce for decades has never even been close to the multi-lingual capabilities of our countries. (That includes me: I practically flunked Spanish in high school.)

And Aliengena isn’t just theorizing here – he actually pilot-tested his overseas staffing idea with two truck companies in Utah, not far from his American HQ in Heber City, UT.

“Our pilot companies found that by moving non-mission-critical jobs to a lower-cost market, they were able to focus on their core business. More importantly, they were able to make more money while maintaining customer service levels with their current home office management staff,” he said. Now they are intent on expanding this effort to other jobs, such as dispatching.

“Overseas staffing gives companies the flexibility to add or remove people quickly and easily as their needs fluctuate, allowing them to better weather the industry’s ups and downs. In our pilot testing, the average savings per worker has been between 33% and 50%,” he noted.

Look, we live in a global economy now, so we’re competing with everyone for jobs and business. But it just seems to me it would be a strategic liability to have the guts of a trucking business thousands of miles away on another side of the world. That’s my take at least.

“This is hard work. It’s a serious job and you really have to be alert out here on the road.” –George Ertel, 41-year veteran driver for Batesville Casket Company

This week I got the privilege to meet four new inductees into the National Private Truck Council’s Driver Hall of Fame: George Ertel, James “Jimmy” Perkins, Tommy Stoddard, and Kenneth Wright.

(Left to right: Perkins, Stoddard, Ertel, and Wright.)

In the words of Gary Petty, NPTC’s president and CEO, these four represent “the best of the best” from the truck driver community – guys that have racked up millions of safe miles without a single chargeable accident, that do it the right way every day and night, year in and year out.

Ertel, for instance, racked up 4.8 million safe driving miles over a 41-year career with Batesville Casket Company in Batesville, IN – a carrier his father work for, and one his son has joined as well.

The luck of Irish has smiled on Perkins over the 4 million miles he’s accumulated during 36 years of driving, most recently with Trimac Transportation Inc. in Braddock, PA.

(Perkins receiving his “Driver Hall of Fame” plaque.)

Tommy Stoddard, a contract driver with Vanguard Services, totaled 3.75 million miles over his 34-year career, lately spent with Bridgestone/-Firestone North American Tire’s fleet in Memphis TN.

(Stoddard gets his “Driver Hall of Fame” award.)

Finally, there’s Kenneth Wright, a 36-year veteran driver with 4.3 million safe miles under his belt, most recently tallying them up for NCI Building Systems out of Houston, TX.

Dan Baker, a trucking consultant and noted motivational speaker with this industry, noted during his speech at the luncheon inducting these four into NPTC’s Driver Hall of Fame that they represent the rock-steady truckers of the old school, that drive trucks because they love to drive trucks.

“This is a passion-based business – they get that inner something behind the wheel that makes their blood run,” Baker said. “That’s the kind of passion that needs to be passed on in this industry – we need to infect other people with it.”

(Perkins is the first driver from Trimac to be inducted.)

Unfortunately, I only got to talk to Ertel myself about his truck-driving career and about some of the reasons he thinks he’s been so good at it. For these are the types of drivers a reporter like me wants to talk with the – the “iron cowboys” representing the top class of driver, the ones who live and breathe high performance every single day.

“The equipment sure is a lot better these days and so are the roads – but the roads are also far more congested than they used to be,” Ertel told me. “That’s what makes this job so hard today – watching all the other drivers on the road.”

As noted before, Ertel is but one link in a generational chain of drivers – a tradition handed down to him from his father and passed on to his son. Working for Batesville Casket Company also offers a range of benefits not found at the typical trucking carrier. For starters, he runs dedicated routes from factory to warehouse, out at most two to three days on the road. Batesville also remains a family-owned company, one that honors and respects the value of its driver corps.

For example, Ertel told me that when he reached the two million safe mile mark, he got a new truck with a $10,000 credit for the options of his choice. At the three million mile mark, he got a new Freightliner FL Class 8 with a $15,000 credit for his choice of options. At 4 million miles, he could’ve gotten a new truck, but since he loved his current rig, he asked – and received – a bigger upgrade package, which included new paint, chrome, exhaust stacks, and seats for his ride. “My feeling is, if the truck works for you, stick with it,” he said.

The secret to this industry is really no secret at all, Ertel noted: work for a good company, one that treats you with respect. That and really watching yourself when you are out running fully loaded down the highway. “There’s not as much courtesy anymore from the motoring public for us – means you must really keep your eyes open,” he explained. “Aside from that, though, it’s a great lifestyle. It’s what my dad did, what I do, and now my son does. I wouldn’t want to do anything else.”

“We need to raise the profile of our business in the minds of people who may not know they can find well-paying careers as service professionals in our dealerships.” –Gary Gibson, president of Tri-State Sterling Trucks in Cincinnati, Ohio.

Ryan DeLaRoi cut his teeth working on diesel engines under rather hazardous conditions: on deployment in Iraq. During his second tour in the war zone, DeLaRoi – a Corporal in the U.S. Marine Corp – repaired Humvees and other diesel-powered vehicles: sometimes in the face of sandstorms and far-deadlier bullets.

But after nearly 10 years, the Marines discharged DeLaRoi due to knee and back injuries sustained during his military service. He decided to attend the diesel mechanics program at Western Iowa Technical Institute (WIT) to enhance his technician skills gained on the battlefield, participating in a veterans-civilian workforce transition program, which helped pay for his tuition and the tools he needed for his trade.

(Once a Marine, always a Marine is how the saying goes … but Ryan now works on civilian trucks to make a living.)

When he heard the local Peterbilt dealership in Sioux City, Iowa, was always looking for a few good technicians, DeLaRoi stopped by for a visit with its service manager, Harland Gylfe, and the 32-year-old quickly found himself – despite his minor disabilities – maintaining and repairing heavy-duty trucks for a living after graduating from WIT in December 2007.

“The working conditions are great, especially compared to working on Humvees in Iraq,” he said. “Most of my military equipment repairs were done outdoors and it was hard to keep the parts clean. Sometimes, a vehicle would break down on patrol and there was a chance I would get shot at while fixing it. This happened several times.”

Another disadvantage for war zone mechanics is the lack of power tools, which is why DeLaRoi appreciates the equipment he gets to use at the Sioux City Peterbilt dealership. “It’s a lot better working conditions and less strain on my knee brace and back,” he said.

One reason DeLaRoi works as a heavy-duty truck technician today is that Sioux City’s Gylfe is active on WIT’s diesel mechanics advisory committee and hired DeLaRoi to work part-time on the evening shift while attending school.

“I find veterans make good workers; they’re experienced, dedicated, dependable and have a strong work ethic. Ryan is another good example of a vet’s transition to a skilled civilian worker,” Gylfe said. “He is doing a good job servicing diesel trucks and learning to do more types of maintenance and repair tasks.”

(Finding enough technicians to handle the maintenance and repair needs of the trucking industry is going to be a challenge for dealerships and fleets alike.)

Gylfe has hired many military veterans for Peterbilt’s service department over the years as he continues to seek new pools of recruits to fill out the technician ranks at his facility. And it’s this struggle – finding an adequate supply of techs – that he shares with much of the heavy-duty truck dealership community in the U.S. these days.

“We need to recruit qualified dealership employees, especially truck technicians, to protect the industry’s long-term viability,” said Gary Gibson, president of Tri-State Sterling Trucks and the new chairman of the American Truck Dealers (ATD) division of the National Automobile Dealers Association (NADA) during the 45th annual ATD Convention & Expo in Dallas, Texas, earlier this year. “Dealers will have their hands full as they attempt to operate profitably during these difficult times.”

George Grask, the outgoing chairman of ATD, called on dealers to take steps to protect the viability of dealerships during challenging times. “Whether it’s the service we provide, the parts we sell, the hours we keep – we need to continue to evolve to meet the needs of our customers … to offer the very best customer service and support,” he said.

In addition to first-rate customer service, Grask – owner of Cedar Rapids Truck Center, Cedar Rapids, Iowa – emphasized the need for dealers to keep pace with the newest technology, including proprietary engines, hybrid technology and telematics. He also called on truck dealers to continue to educate themselves on the management and leadership qualities required to run increasingly complex businesses.

(Technicians are essential — which is why a sufficient populations is critical to the trucking industry’s future.)

“The fact is our business is essential,” he stressed. “Nothing happens until a truck delivers it. In the U.S., trucks and truck dealers will continue to be a necessary and vital part of the economy.”

This is oh so true. But finding the technicians necessary to keep those trucks rolling is going to become and bigger and bigger challenge for dealerships in the months and years ahead.

“Continuous improvement is the name of the game.” –Gary Petty, president and CEO, National Private Truck Council

We all know it’s a challenging time for the trucking industry, whether you operate 10 or 1,000 trucks, whether you are a for-hire or private carrier. That reality got serious acknowledgement at the National Private Truck Council (NPTC) annual conference in Cincinnati, OH, this week.

(The show floor at NPTC’s annual convention, held in Cincinnati this year.)

The 900 or so attendees all worried about the impact of sky-high diesel fuel prices on their businesses – then expressed further concern about finding and keeping drivers, getting more productivity out of their existing assets, managing equipment costs better, and on and on.

“Many of you are also going through fleet justifications – a ‘re-evaluation’ of the private fleet within your company’s business,” noted Gary Petty, NPTC’s president and CEO, during his keynote speech. “That’s why events like these, where you can share ideas and network with your peers, is so critical. For you never know when an idea may be found to help solve a problem your company faces.”

(Gary Petty, NPTC’s president and CEO, is on the right. That’s Dan Baker on the left, trucking consultant and motivational speaker.)

A lot of ideas and information-gathering projects are getting up a head of steam at NPTC, ones geared to help the industry as a whole improve across a range of areas. First, the group is looking to add a dozen or so carriers to the 125 fleets already participating in its benchmarking study, so private fleets can compare themselves against the industry leaders to see where they can make improvements.

Petty mentioned that NPTC is also going to take a fresh look at the size and weight issue ahead of the next highway funding reauthorization bill, funding a study with the University of Michigan’s Transportation Research Institute (UMTRI) to see if larger trucks carrying 97,000 lbs. versus today’s 80,000-lb. limit can reduce the number of trucks on the road and thus reduce energy consumption. NPTC is looking for six carriers to participate in this study, Petty added.

“We’re going to try and scientifically establish gains in productivity plus more effective use of highways and bridges via this study, which should start this may and end in September,” he said. “We believe it will be an important contribution to public policy.”

NPTC is also going to redouble its focus on the truck driver community as it looks to expand current driver recognition efforts. That includes the creation of an “All-Stars” program in Sept. 2009 (based on safety data compiled this year) where drivers will be nominated based on customer service, personal appearance, cleanliness of equipment, on-time delivery rates, as well as safety. “These non-driving functions are so critical to the private fleet’s function today and deserve recognition,” Petty said.

(Robert Boyich of CPC Logistics took home an award from FleetOwner for being the top gradutate in NPTC’s Certified Transportation Professional program for 2008.)

Finally, NPTC is forging a new relationship with third-party logistics provider C.H. Robinson, to provide NPTC member fleets with access to pools of backhaul freight nationwide. Called “Fleet Optimizer,” Petty said the program seeks to reduce the average 28% of deadhead miles private carriers log every year by giving them access to consistent freight volume in lanes they already cover.

(Many suppliers at NPTC’s convention used tricked out trucks as part of their exhibit displays.)

“We already work with private fleets – this program formalizes and expands that effort,” Eric Jax, branch manager for C.H. Robinson’s national carrier group, told me at the show. “Private carriers not only have consistent capacity on dedicated routes, they have the kinds of drivers and focus on safety and professionalism we look for. We are always looking to build more consistent capacity and we plan to begin ramping up this program over the next several months.”

So despite the challenges now engulfing the trucking industry as a whole, private fleets and the association that represents them, aren’t standing still – their mapping new courses to help improve their business models.

“We need to let the world know our value,” said Petty. “They need to know how we help our nation keep rolling.”

“Leaders learn by leading, and they learn best by leading in the face of obstacles. As weather shapes mountains, problems shape leaders.” –Warren Bennis

You’re going to hear a lot about benchmarking in the days ahead – how to benchmark the price you pay for fuel against others fleets, truck stops, etc.; how to benchmark your overall fleets costs against industry averages; how to benchmark your customer service levels; and so on and so forth.

Bernchmarking is a tool that goes in and out of vogue in American business, but it’s also one that is becoming more critical for fleets today as they seek to gain much tighter control of costs. As Jim Angel, director of business development for T-Chek Systems, said here at the National Private Truck Council meeting here in Cincinnati this week, it’s all about the pennies: what can two cents saved per gallon or per mile per truck add up to over a year’s time. The answer is a LOT; so fleets need to look for every penny of savings they can.

As usual, Professor Jerry Osteryoung at the college of business at Florida State University has some thoughts on this topic, so I am going to turn the stage over to him today. Professor Osteryoung, the floor is yours:

“One thing every firm needs to have in place is a system to measure their performance against an industry average or some other criteria. Benchmarking is one such way to compare your firm’s performance against others to get an idea of how you are doing. In addition to sales growth rates, you may benchmark against advertising expenses as a percent of sales, debt to total asset ratios, gross profit margins and net profit margins, as well as a number of other operating and financial figures.

When it comes to measuring how well your firm is doing, you just cannot compare past performance with the current year’s performance in isolation of what other firms are doing. One of the firms we were helping thought that their 6% growth in sales from last year was evidence of how well they were doing. However, as the industry average for the same period was 12%, it was clear that they were not doing nearly as well as they thought there were.

A restaurant that we are working with had a cost of food percentage (food costs divided by sales) of 56%. The owner thought he was doing ok, but the typical benchmark for restaurant food costs is right around 30%. The owner did not really understand how far off his food costs were, as he had no basis of comparison.

After working with him and showing him these numbers, this restaurant owner was able to reduce his food costs to 35% with more reductions to go – all within a period of one year. Additionally, his net profit margin went from almost zero to 10%, and his dollars of profit skyrocketed. For this entrepreneur, the reduction in food costs was easy once he had a goal in mind, and that is exactly what benchmarking can do for you.

It is important to bear in mind, however, that with most numbers, you cannot take an industry average or benchmark as a perfect goal or standard. Rather, benchmarks should be used as a guide, and you must use judgment to interpret what the results are really saying. For instance, in many cases, firms’ net incomes are much larger than the benchmark. However, this is frequently caused by the owners’ desire to take out distributions of profits rather than salaries.

There are a number of neat places that provide information about benchmarks. One such source is www.bizstats.com, which offers some of this information free of charge.

The source I consulted is Financial Research & Associates (FRA) who, for the last 23 years, have issued an annual book reporting firm benchmarks. Most of their data comes from accountants who produce financial statements for companies, and the figures are broken down enough to provide a good industry comparison and benchmarks. The cost for this book is around $140.

Another source I used is the RMA Annual Statement Studies. This database is much larger than the FRA, and the data comes from financial statements provided to commercial banks by accountants. It shows 16 “classic” financial ratios, each grouped by industry: current ratio, quick ratio, sales/receivables, cost of sales/inventory, cost of sales/payables, officers compensation and sales, gross and net profit margins, and more. This is a great data source providing a wealth of information, but the cost per year will run you about $500.

The bottom line is that there are many sources of financial information that can be used to benchmark your company’s performance. Every firm should utilize benchmarks in order to ensure that they are properly measuring how well they are doing.”

For more insight, you can always reach the good professor by e-mail at jerry.osteryoung@gmail.com or by phone at 850-644-3372.

“It’s all too common for middlemen in the trucking industry to push shippers to pay fuel surcharges, but only pass along a portion of those surcharges, or none at all, to the truckers who are actually transporting the goods and paying the fuel bill.” –Todd Spencer, Executive Vice President, Owner-Operator Independent Drivers Association.

It’s no secret that fuel surcharges are an absolutely critical piece of the trucker’s survival kit these days. Without some quick, turn-key financial mechanism for offsetting skyrocketing fuel prices, carriers and owner-operators would find themselves broke in a hurry.

Yet most shippers don’t like fuel surcharges, largely because they feel – and there is some truth to this – that they are getting “double billed” for freight service. That’s not to say shippers reject the whole concept of fuel surcharges, mind you – indeed, forward thinking companies like Wal Mart use them as incentives. For example, carriers that become certified under the Environmental Protection Agency’s SmartWay program actually get a bigger fuel surcharge from the colossal retailer (talk about an incentive for going green!)

(Fuel costs are putting a huge dent in the wallets of big carriers and independents alike.)

On the whole, however, there is a kernel of truth in the shipper complaint about fuel surcharges. Look at some recent earnings reports and you’ll see. For example, Werner Enterprises reported that revenues increased 2% to $512.8 million in first quarter of 2008 compared to the same period in 2007 … but if you take out money gained from fuel surcharges, its revenues actually DECLINED 6% to $417 million in first quarter this year compared to the same period last year. That’s almost a $100 million swing in revenues, based solely on fuel surcharges.

One complaint from small carriers and owner-operators – and this is very true – is that many brokers charge shippers a full fuel surcharge for moving freight … yet then only pass through a small part of that to the truckers themselves. That’s a nice way to make a tidy piece of change, but it sure leaves a hole in the trucker’s wallet.

The Owner-Operator Independent Drivers Association (OOIDA) has fought this kind of business tactic for years and has also lobbied hard (but unsuccessfully) for a mandatory fuel surcharge for trucking. That effort got torpedoed several years ago, but now OOIDA is taking a roundabout stab at it again by supporting legislation to pass through the entire surcharge to whomever pays the fuel bill. This makes some sense, but it’s bound to encounter some heavy resistance, I think.

Called the “Truthful Reliable Understanding of Consumer Costs” or TRUCC Act, introduced into Congress by Senators Olympia Snowe (R-Maine) and Sherrod Brown (D-Ohio), it requires that 100 % of fuel surcharges levied on shipping customers be passed through to whoever actually pays for the fuel to haul the shipper’s goods – in most cases, that’s truckers, says Todd Spencer, OOIDA’s executive VP.

(Freight’s gotta move — and that requires trucks to burn fuel, no matter how you look at it.)

“This bill will go a long way toward helping truckers survive the brutal cost of fuel,” he notes. “And it will provide needed assurance to shippers and ultimately consumers that higher shipping costs are actually because of higher fuel prices and not gouging by greedy middlemen.”

He stresses that fuel surcharges have long been the primary mechanism for trucking companies to respond to increased fuel costs. With diesel prices consistently rising, shippers are paying more now in fuel surcharges to get their freight moved than they ever have before. “It’s all too common for middlemen in the trucking industry to push shippers to pay fuel surcharges, but only pass along a portion of those surcharges, or none at all, to the truckers who are actually transporting the goods and paying the fuel bill,” Spencer says.

The crux of the problem is that independent, small business truckers seldom deal directly with shipping customers as most of the freight they haul is acquired through third-party logistics companies or through larger trucking companies they are leased to as independent contractors. Mid-size trucking firms often have contracts with shippers for “front hauls,” but depend entirely on brokers for “back hauls” and it’s these small and mid-sized trucking firms that are being hit hard by diesel prices that now average $4.21 a gallon.

Now, the last time such legislation came up – OOIDA looked for not only a mandatory pass through but also a mandatory fuel surcharge for the entire trucking industry starting back in 2001 – it got heavy resistance from shippers and carriers, too. The American Trucking association resisted it, because the trade group said at the time that it had not been demonstrated that failure to pass through fuel surcharges to owner-operators truly exists, thus deserving Congressional intervention.

“To the extent that motor carriers are able and willing to negotiate with shippers for fuel surcharges and collect such surcharges, those surcharges are generally passed on to those responsible for paying for fuel – if such party is not the carrier itself,” the ATA said back in 2005 right before the legislation got quashed. “Responsibility for payment of fuel costs is an item to be negotiated as part of the owner-operator lease between an owner-operator and a motor carrier. Due to the driver shortage, owner-operators are in a position where they have considerable bargaining leverage.”

The ATA also said it didn’t know of any statute or regulation that prohibits the ability of owner-operators to negotiate either a rate that covers the owner-operator’s fuel expense or a fuel surcharge. “They are in the same position and have the same ability to ask,” the group said.

Some 40 groups opposed the last fuel surcharge legislative effort, including the U.S. Chamber of Commerce, the National Industrial Transportation League (NITL), the Transportation Intermediaries Association (TIA), the National Association of Manufacturers (NAM), and I’d expect at least some of them to oppose this one.

One thing is for certain, though: fuel costs are turning this industry on its head. In 2003, the trucking industry paid $52 billion for fuel. This year, it’s going to be north of $135 billion, according to projections from the ATA. Just 10 years ago, diesel hovered around 90 CENTS per gallon. Today it’s over $4.21 and may go higher still. Fuel is now the number one cost – surpassing employee wages and benefits – at many carriers now and it looks like things may only get worse where fuel is concerned in the near future.