“They’ve invested in hiring and training employees to serve the growing needs of today’s owner-operators and truck fleets.” –Mike Conroy, director of dealer network development at Peterbilt, on the award winning performance at Peterbilt of Sioux City

It’s a tough time to be selling trucks these days, no doubt about it. Class 8 sales fell nearly 47% last year, dropping to 150,965 units from 284,008 in 2006, according to Ward’s AutoInfoBank. Sales in the medium-duty Class 6 & 7 market fared only slightly better, contracting by 36,608 units or 22% to 220,128 units in 2007.

This year hasn’t been much better. Bill Jackson, general manager for Peterbilt Motors Co., for one, believes Class 8 sales in the U.S. should total 175,000 to 215,000 units for 2008, while medium-duty Class 5-7 sales should total between 80,000 to 95,000 units for the year.

With those statistics in mind, you’d think this would be a time for dealers to pull in their horns, ratchet back on costs across the board, probably delaying investments in their business until some form of light is visible at the end of the current economic tunnel we’re in. But that’s not always so.

Take Sioux City Truck Sales (SCTS) for example. Founded in 1954 by G. L. Wilson, SCTS operates three full-service Peterbilt dealerships serving Iowa, eastern Nebraska and southeastern South Dakota (in the cities of Sioux City, Des Moines and Council Bluffs, respectively) providing new and used truck sales plus all-makes parts and service. And they don’t just sell one kind of truck, either: SCTS offers a full-line of Peterbilt highway tractors, vocational and medium-duty delivery trucks.

(SCTS’s dealership in Sioux City, Iowa, which racked up several national awards for sales and customer satisfaction.)

As a family-owned business, SCTS is what I like to call “old school” in a good way: the biggest reason being how the company quickly gives credit for their success to their hard-working employees. That’s the basis of SCTS’s reputation and the reason they’ve managed to keep selling trucks and other services despite the current downturn.

“I believe our great success during 2007 was built on a combination of ingredients,” said Brad Wilson, the company’s CEO. “Our employees have a long history and good reputation of providing quality service to our customers. Now, our skilled workers have an excellent new facility through which they can more efficiently serve our customers.”

He’s talking about their now-finished effort to replace its 40-year-old building at the Sioux City dealership and construct a new $5 million facility, plus hire additional employees. The new building, which opened in fall of 2006, features an indoor vehicle inspection/diagnostics area and quick lube area, offers 16 service bays, a body shop completed with a frame correction and alignment center, 80-foot-long paint booth, two wash bays and stalls for working on seven trucks.

(The new interior at Peterbilt of Sioux City.)

“We invested in the new facility that allows us to provide a higher-level of service to even more customers,” Brad noted. “And our customers responded during 2007 with increased purchases in several categories.”

He also pointed out that his family’s Peterbilt of Sioux City location recently received the 2007 “Best in Class Dealer of the Year ” and the “TruckCare Dealer of the Year” awards from Peterbilt Motors Co. – and he gave all 60 employees working there a custom jacket in honor of their contribution toward earning these awards, something I think goes a long way to reinforcing esprit de corps in this industry.

Note, too, that his Sioux City dealership won the awards in competition against all other Peterbilt dealers in the U.S. and Canada – and that’s some pretty serious competition in anyone’s book.

“The ‘Best in Class’ award recognizes overall dealer performance, including the business side of the dealership – profitability, growth, business processes and financials,” said Mike Conroy, director of dealer network development at Peterbilt. “The Sioux City dealership demonstrated outstanding performance during 2007 in all of these business measurements,” noting that Sioux City’s market share of Class 8 trucks sales more than doubled Peterbilt’s national average during 2007.

The “TruckCare Dealer of the Year” award recognizes the dealership that achieved its parts, service and preventative-maintenance contract sales goals and provided the highest levels of customer satisfaction – an Sioux City received a perfect score of 100% for its roadside assistance call center response rate and a 99% customer satisfaction rating.

“The TruckCare award is a tribute to the employees in our service, body shop and parts departments for outstanding performance and growth in 2007,” said Wilson. “The sales volume for parts and service increased 29% and 23% respectively during their first year in the new building. This award honors the skills and dedication of our customer-focused employees.”

You don’t rack up numbers – or awards – like that without staying focused on the fundamentals in the trucking business, and those fundamentals are getting tougher all the time. It’s nice to see some very hard work get some high accolades as well.

(Displaying Sioux City Peterbilt’s awards are (left to right) Jeff Petersen, sales manager; CEO Brad Wilson; Rick Burkhart, parts manager; Jim Gard, warranty manager; Jerry Hesse, body shop manager; and Harland Gylfe, service manager.)

We have more information now than we can use, and less knowledge and understanding than we need. Indeed, we seem to collect information because we have the ability to do so, but we are so busy collecting it that we haven’t devised a means of using it. The true measure of any society is not what it knows but what it does with what it knows. –Warren Bennis

Are your drivers happy with their jobs? Angry? Indifferent? A lot of carriers don’t really know until the driver gets up and leaves – and by then, of course, it’s too late. That’s why creating some sort of channel for feedback might be a good way of giving them a chance to air their views non-combatively in order to figure out if there’s a way to change things.

Now, sure, employee surveys are considered by many to be a joke – and for good reason. Everyone is trying to put food on the table and pay the bills while getting miles driven and freight delivered, yet here comes another piece of paper to fill out. But if viewed properly, surveys can be a good way to sample the mood of your driver corps, if not the company as a whole – giving you a chance to address problems before people start voting with their feet.

Professor Jerry Osteryoung of the College of Business at Florida State University has some thoughts on the subject I’d like to share, and while his comments are broadly based, I think there are some good ideas fleets can draw upon for their own use. Professor Osteryoung, the floor is yours sir:

“I have seen so many cases where the culture of an organization changes dramatically because of new management, a new work environment or just complacency of management – all of which affect both turnover and morale. Probably, the biggest problem with the culture of an organization is just a lack of management knowledge of the employees’ real perceptions and feelings about the organization.

It is estimated that each time you lose a worker; it costs your firm 150% of their annual salary for retraining, rehiring and just reeducating a new employee. It is so very important to keep turnover low especially given the tightness of the forthcoming national labor shortage.

Employee surveys are effective in improving retention rates, increasing profitability, lowering absenteeism and just making your business a better place to work. Many firms are moving to employee surveys conducted on the web in order to evaluate employee perception of their work environment, as well as management effectiveness. These online surveys are very cost effective, especially when compared to the archaic approach of compiling surveys with hand written responses.

When surveying employees you need to make sure that the results remain anonymous. If workers think that they can be identified, participation and effectiveness decline dramatically. You need to guarantee each worker that their responses will remain anonymous, and you must make sure that each worker feels comfortable with the process of submitting their thoughts and feelings.

One of things that really helps raise the response rate is to notify your staff that the survey is coming. There are so many ways to do this. For example, you can post the information on bulletin boards in your business or include it emails to your staff. Some firms assign participants a specific time to complete the survey so that they can do so when they are free of other work duties. Additionally, many firms offer employees incentives, from restaurant gift certificates to cash. With these types of incentives, the response rate is frequently increased by 15% to 20%.

One of the best things that you can do is explain the purpose of the survey both in advance, as well as on the survey instrument itself. The purpose could be anything from gauging worker morale to evaluating the ability of the firm to accept change. Regardless of what the purpose is, it must be communicated many times to each survey participant.

Not only must you communicate the purpose of the survey, but you must also communicate how the results will be used. In one instance, they may be used to generate a plan of corrective action. However, whatever the case may be, the intended use of the results must be communicated very succinctly to your staff.

Once the survey is complete, you must also communicate the results and your plan of action. This must take place as soon as practical in order to prevent employees from thinking that their efforts just went into a black hole, never to be seen again.

The final piece of the survey process is a follow up survey. The follow up survey will help you evaluate how effectively your plan is producing the desired results. Normally, most surveys are done at least annually to keep track of these important issues.”

You can reach Professor Osteryoung by e-mail at jerry.osteryoung@gmail.com or by phone at 850-644-3372.

“Repetition builds continuity – continuity builds history – and history builds identity.” –Roshan Samtani

So, I’m down here in Louisville, Kentucky, getting ready for the mammoth Mid America Trucking Show. All the suppliers to the trucking industry – from manufacturers of big rigs, trailers, and engines, down to the smallest of components and pieces of chrome – are going to be lined up to show of their wares. It’s one of the biggest and boldest marketing performances these companies – large and small – put on every year, so it’s worth thinking about how to get the most bang for the marketing buck spent on such efforts.

For some insight on this topic, I am going to turn (yet again!) to Professor Jerry Osteryoung with the college of Business at Florida State University. He’s got some pretty interesting thoughts about how “repetition” is the key to building band identity in the marketplace – something suppliers and trucking firms themselves could put to good use. Professor Osteryoung, the floor is yours:

“We were working with an entrepreneur who owned a professional service business. He was trying to increase his revenues, which had been flat for the last three years, and his profits were falling as well. He had tried numerous ways of bringing in new customers, from targeted direct mail with post cards to TV advertising.

However, none of these methods had any effect. His sales remained flat and even began to decrease as he was harvesting very few new customers. When I asked him about his marketing plan, he said that he was trying to spend around 3% of his revenues. He said he did not have a marketing or advertising plan. Rather, he was looking for that one advertising medium that would produce the results he was looking for and turn his revenues and profits around. However, when it came to waiting for these results, he was very impatient. He was constantly switching from one form of advertising to another, looking for one that would bring in many new customers or the magic bullet.

It is very reasonable to expect results from advertising dollars; however, it takes repetition of a marketing message to get a potential customer to act based on the advertisement. In our busy, multi-tasking life, we are bombarded with information daily. Information overload is so common, and it is showing no sign of slowing down. Customers just will not act on any advertisement unless it is both unique and repetitive.

I know that when I get regular mail every day, I look for bills and personal notes and just trash most of the rest. I just do not have the time or the inclination to look at anything else, unless it grabs me at first sight.

Okay, so what does all this mean in relation to spending money on advertising? In order for advertising to produce results, a customer must see the ad five to seven times. Potential customers need to be frequently reminded about your firm and products. Just look at Nike and how they put their “swoosh” symbol everywhere, especially at athletic venues.

Repetition and unique advertising generates what I call “top of mind awareness.” It is this “top of mind awareness” that brings in new customers. If I am a plumber, I want my company’s name to be the first one a potential new customer thinks of. That way, they will call me when they need service. The only way to accomplish this “top of mind awareness” is through repetition of ads.

It always surprises me how many relatively small companies spend so much to advertise for thirty seconds during the Super Bowl, but are never seen advertising again. It would make so much more marketing sense for these firms to advertise more frequently with their unique message.

That’s the key: making sure that your advertising is both repetitive and unique, and that in turn, you are getting the maximum out of every advertising dollar.”

As always, you can reach Professor Osteryoung by e-mail at jostery@comcast.net or by phone at 850-644-3372. All of Dr. Osteryoung’s articles, by the way, can be found in a searchable form at www.cob.fsu.edu/jmi.

“There is an old joke among economists that states: A recession is when your neighbor loses his job. A depression is when you lose your job.” –Anonymous

OK, OK – I’ve already been taken to task for using the “R-word” in this space when, technically at least, the U.S. isn’t in a recession (defined as a decline the U.S. gross national product or “GNP” for two consecutive quarters). And I’ve also been told rather bluntly that continuing to use the “R-word” can become a self-fulfilling prophecy of sorts.

All that aside, it’s pretty hard to ignore the economic troubles bombarding the U.S. right now — from paying $100-plus for a barrel of oil, a meltdown in the housing market coupled to a total collapse in the value of mortgage-back securities. Just look at the fate of the venerable 85-year old investment bank Bear Sterns: worth $20 billion in January this year (a scant 10 weeks ago), J.P. Morgan bought it lock, stock, and barrel for a mere $236 million this week, with the Federal Reserve guaranteeing the value of Bear Stern’s mortgage-back ed securities holdings in the bargain.

Yet the fate of Bear Sterns also shows the flip side of a downward economic slurge – those that have husbanded their capital can reap some big rewards. Call it “vulture capitalism” if you like, but J.P, Morgan just got one heck of a deal – and many other businesses, even in trucking, may be in a position to make some similar gains if they play their cards carefully.

As usual, Professor Jerry Osteryoung of the college of business at Florida State University has some thoughts on this subject. So I am going to lay off digging my own hole on this sensitive topic to let him fill it back in for me. Professor Osteryoung, the floor is yours:

“With the economy slowing down and probably moving into a recession, you must take caution as sales for most firms are going to be reduced. However, a number of positive opportunities that were not available before will be coming out of this recession as well.

The number one positive by-product of this recession is that loan rates are falling dramatically. Now is the time to look into refinancing all of your assets. Whether you have short-term or long-term debt, now is the time to secure a much lower rate. Look at all your assets, from car financing to building mortgages, and consider refinancing them. Just a 2% decline in rates on a 15-year loan of $100,000 will save you about $100 a month or $18,000 over the entire loan period.

Another thing to consider in this economy is buying a building for your business. With both property values and interest rates falling, the real estate market for commercial property is getting softer. It is almost as if this is the perfect storm (in a good way) to buy commercial property. We just may not see this type of buying opportunity again for many decades. Additionally, you may be able to afford a much larger building now that these two elements are being driven down.

Many firms are too heavily leveraged with debt to survive the falling sales of a recession. This is another perfect opportunity to step up and acquire some of these firms to gain market share at a very reasonable price. There will also be more business bankruptcies, which presents yet another chance to acquire some very inexpensive assets. Normally at a business liquidation auction, the average price is ten cents for every dollar of cost.

Another function of a slowing economy is that firms often let good employees go, as they can no longer afford the overhead. Consequently, if you can afford it, this is a perfect time to bring on some great new employees that would otherwise be unavailable. This labor surplus will last mainly during this year, however. Once the economy starts to improve around the middle of 2009, you can expect the labor supply to be very tight for the next five years.

Finally, the last thing that you can do is look at every vendor contract to see if you can negotiate better prices. Like you, most of your vendors are seeing their sales slow and will want to maintain their customers at almost any cost. If they have to choose between a price reduction and losing you as a customer, they are going to give you the price reduction – so long as it is within reason.

While sales and profits will be negatively affected, recessions present a number of business opportunities, from property acquisitions to price reductions. The key is to go out and find these opportunities, then take advantage of them.”

Good advice, as always, from someone who’s been there and done that over the course of his career listening to and teaching a wide variety of business entrepreneurs.

You can reach Professor Jerry Osteryoung by e-mail at jostery@comcast.net or by phone at 850-644-3372. All of Dr. Osteryoung’s articles, by the way, can be found in a searchable form at www.cob.fsu.edu/jmi.

“The great virtue of free enterprise is that it forces existing businesses to meet the test of the market continuously, to produce products that meet consumer demands at lowest cost, or else be driven from the market. It is a profit-and-loss system.” –Milton Friedman

There’s no question that the trucking industry is served by many top-notch suppliers of everything from new trucks and aftermarket parts to engine oil and maintenance services. That’s been my experience covering this industry and it’s all the more remarkable because trucking is such a tight-margin business, with 5% to 7% profit margins the norm for many fleets out there – numbers that usually aren’t attractive to the best suppliers in the market.

Yet the reverse is also true; that there also suppliers that exasperate fleets to no end, with customer poor service probably the top issue. Professor Jerry Osteryoung from the college of business at Florida State University is very aware of how much trouble suppliers like these can cause, especially for the entrepreneurs he works with. Truckers, like many entrepreneurs, recognize the value of customer service and how critical it is as a competitive advantage in the marketplace. That’s why is can be a real problem on more than one level if their suppliers don’t follow the same playbook.

So, as usual, I’m going to give Professor Osteryoung some space here to detail his thoughts on the subject of difficult suppliers, as he’s had a lot more experience with this issue than I have. Professor Osteryoung, the floor is yours:

“Suppliers allow you to function as a business and provide products and services to your customers. They determine the cost, as well as the availability, of your products and services. In so many ways, suppliers are the lifeblood of your business. They are clearly indispensable … and that means you will probably have to deal with at least one difficult supplier at some point during your business’s life.

We were helping one entrepreneur deal with an incredibly difficult vendor. Compared to the firm’s other suppliers, this vendor had the highest cost, but it was the industry leader, with a name that was considered the flagship of the industry. This vendor did everything possible to avoid being supportive of this business, from not returning phone calls to charging for each and every sales brochures that was designed for the ultimate customer (including their catalogs, which listed the product description and the wholesale price of each and every product).

Because of the supplier’s position in the industry, the firm thought that they had no choice but to keep this vendor on. They thought that they absolutely needed the vendor’s name to lend credibility to their business. While they tried to negotiate a better relationship and terms with this vendor, the vendor just was not interested, as they believed that they were the ‘elephant’ in the market.

I was able to work with this firm and show them that, while the vendor had a significant market share, the firm’s customers trusted them and relied on their product guidance – that the customers came to my client’s firm, not to their vendor!

It was tough for the firm to let go of the vendor, as they really believed that their business would not be as successful without it. However, after one year without the difficult vendor, sales were down by 5%, but profits were up by 10%. On top of the improved financial considerations, the entrepreneur is sleeping better and just feeling much, much better. Now, in hindsight, the entrepreneur wonders why it took them so long to make this decision.

Some of the red flags indicating poor vendors are continuously unfulfilled orders, poor relationship with the vendor’s sales rep, questionable value in the products that they are distributing or manufacturing, and the feeling that you are just not getting the service that you require to service your customers. The key is to examine each and every one of your vendors to ensure that they are servicing you in the manner that your business requires.”

And let me add one thought here to those of Professor Osteryoung: don’t forget the positive, to tell your vendors and suppliers when they do a great job. Positive feedback, in my view, is probably an even more vital ingredient to building and sustaining a long-term relationship with solid vendors than criticism alone.

To reach Professor Osteryoung by e-mail, go to jostery@comcast.net. You can also contact him by phone at 850-644-3372. All of Dr. Osteryoung’s articles can be found in a searchable form at www.cob.fsu.edu/jmi.

So I just got back from the ninth annual fleet management conference put on by PHH FirstFleet, a third party vehicle management provider based out of Ft. Lauderdale, FL. (Incidentally, they just changed their name to PHH Trucks, to make the trucking aspect of their business crystal clear to their customers and the industry as a whole.)

I look forward to this event every year, despite being asked to speak at it (because I am just deathly afraid of speaking in public) because PHH Trucks brings in top-notch experts from across the industry to give the audience (made up of mostly private fleet managers) deeper insight into the business, regulatory, and equipment issues they will face today and especially tomorrow.

I already posted a story on our website about the engine panel PHH Trucks put together to go over the lessons learned for 2007 and what’s ahead for 2010. Richard Nelson, an engineer with the National Biodiesel Board, gave a truly excellent presentation called “The Good, The Bad, and The Ugly” concerning biodiesel’s use in commercial trucking, warning fleets that they must rigorous in determining the quality of both the biodiesel they use and the producer that makes it.

Mike Romaine from Eaton Corp. laid out the roadmap for hybrid vehicle development, telling the gathered fleet managers where Eaton thinks hybrids can be most advantageous in commercial use – which, frankly, is looking like everywhere as oil prices spike over $100 a barrel and diesel fuel nears $4 a gallon.

Jackie Yeager from Cummins talked about the California Air Resources Board (the infamous CARB) and the plan it’s drafting to force the replacement of older model trucks and buses in successive stages between 2010 and 2013. Following that effort is a proposal to start regulating carbon dioxide (CO2) emissions much the same way they’ve addressed particulates and oxides of nitrogen – for both California and out-of-state trucks that work in California.

I missed Dee Kapur’s outlook on truck manufacturing issues (expensive hotels like Hyatt should not have a third-rate, outside company run their business center computers for them, nor charge Internet fees when guests are shelling out $250 a night … but that’s another story), which is a bummer for Kapur, the president of the truck group for International Truck & Engine Corp., always has some interesting (if not controversial) things to say.

I did catch Rick Schweitzer’s talk about how states are eyeing more tolls and the sell-off of toll roads to third parties as a way to raise revenue. As legal counsel for the National Private Truck Council, Schweitzer also noted that the industry’s ongoing effort to get Congress to address commercial truck size and weight issues – an effort that could reduce the numbers of trucks needed to haul freight, while boosting overall trucking productivity – probably isn’t going anywhere anytime soon.

But by far the best presentation came from Jim Meil, Eaton’s chief economist, who once again used his insightful mix of economic analysis, uncomplicated language, and humor to give the assembled fleet managers a potential picture of the days ahead. Will there be a recession? Meil thinks not – but it’ll be a very “close call.” He believes the government has reacted in time, using a $165 billion in economic stimulus package combined with “bonus depreciation” for equipment bought by businesses this year. Also unheralded by most economy watchers is the strong ongoing boom in U.S. exports, up some 42% or $184 billion between 2006 and the end of 2007, which is helping balance out the 39.4% or $173.4 billion decline in housing starts.

That export boom is coming from strong economic growth in the rest of the world, particularly China, where the economy is literally expanding by 16% to 17% a year. That’s also translating into demand for new and used trucks, with Meil noting 15% of new trucks built in the U.S. are being exported – some 30,000 Class 8 units, compared to 3,000 units eight years ago. “We’re see used truck exports to Russia, South America, Nigeria, and Chile – a channel that literally didn’t exist several years ago,” he noted.

It helps, too, that the U.S. dollar is weak abroad, which is encouraging a lot of foreign purchases of U.S. goods as they can get more for their money. And with trucking so tied to manufacturing in this country, that’s a good bellwether for freight volumes in the months ahead. Meil also things that’ll help push Class 8 truck sales up to 240,000 units for the year.

This doesn’t mean the U.S. economy is in the clear – not be a long shot. If some big banks start failing from the subprime loan mess and oil prices climb up to $120 or $130 per barrel, that’ll spell real trouble. Demand for oil is exploding across the world, again with China in the lead, and that’s what will keep oil prices high for the foreseeable future.

“The freight worry here is that shippers are reacting to costly energy by cutting shipment weight,” he noted. “We’re also seeing a shift in freight from truckload to private carriers and more efforts to improve logistics efficiency to control costs. The bottom lime is that many tailwinds have turned to headwinds … but the trucking industry is resilient. And trucks still continue to be the major transportation mode, compared to available alternatives.”

Overall, Meil expects the economy to grow very slowly – “creep” might be a much better word – for the next few months, then ramp up toward the end of 2008. Anemic gross domestic product (GDP) growth of 0.6% in the fourth quarter in 2007 and 0.8% for the first quarter this year should shift up to 2.2%, 3.3%, and 3.5% for the remaining three quarters of 2008, averaging out to GDP growth of 2.1% for all of 2008. Not good numbers, but not too bad either, Meil said. “Those are not recession numbers,” he added. “We’re keeping our fingers crossed that in the end we’ll dodge a recession this year.”

Let’s just hope that scenario plays out in the end this year.

“To be really great in little things, to be truly noble and heroic in the insipid details of everyday life, is a virtue so rare as to be worthy of canonization.” –Harriet Beecher Stowe

Sure, sure, we’ve all heard it before – how “the little things” can add up to be a really big thing in terms of customer service. But I’ve found it’s true that just a kind word here, some extra effort over there, or even the addition of some little extras makes a big difference at the end of the day.

For example, there’s a barbershop I favor in Burke, VA, operated by Vietnamese immigrants, where I’ve gotten haircuts for the last 12 years. I don’t live in Burke anymore, yet I still head out that way, because they greet me warmly every time I come in, know how I like my hair cut, and get it done in record time (very inexpensively I might add). Still, it’s that little thing – the personal greeting – that keeps me coming back.

Professor Jerry Osteryoung with the college of business at Florida State University had some thoughts on this subject and what it can mean for small business owners trying to win (and keep) clients for the long term. So, Professor Osteryoung, as usual, the floor is yours:

“I was in Jacksonville to give a speech, and I was up very early (the older I get, the earlier I seem to wake up). I knew that I needed to eat some breakfast, so I stopped at Panera Bread and ordered a toasted bagel (multi-grain) with cream cheese (low-fat) and some coffee to have in the restaurant (they also had a free wireless internet connection). When I sat down in a booth with my bagel and coffee, much to my surprise, on my tray was an old-fashioned metal knife – not the usual plastic cutlery.

For me, spreading the cream cheese with the metal knife was easier and just felt good. I am sure it is not as economical to use metal knives, as they have to be washed, but it sent the beautiful message that the customer is very important at this restaurant. In addition, I also felt as if Panera Bread was helping the environment by not serving a plastic knife.

Given that every new customer represents a significant investment of dollars, you must make sure that each and every detail pertaining to your customer service delivery is thought through and carefully planned out. As I like to say, ‘The devil is in the details, especially with customer service.’

Another example of where details make a difference is with paper towels in bathrooms. I hate, hate electrical hand dryers, as it seems to take forever to get my hands dry. Of course, some of this may have something to do with my strong impatient streak; however, having paper towels in restrooms just creates the right customer service experience.

I work out at Premier Fitness and Health Center. When you first walk in, there is a check-in counter where they scan members’ ID cards. What is neat here is that when you are leaving, the staff tries to say ‘Good bye’ to you – and if they know your name, they will mention that as well. Having one of the staff say ‘Goodbye, Jerry’ on my way out makes a wonderful final impression. Small things do matter!

Another detail that many overlook is their voicemail message. Suppose you call someone and his or her voicemail message says ‘I will call you back as soon as possible.’ Does that mean in two weeks, two days, or to hours? This vague message does not tell me that the customer is important; rather, it says ‘I will get to you whenever it is convenient for me.’ Clearly, this is just not a good message to transmit.

I prefer a message that says, ‘I am in the office today, February 18. I am sorry that I could not receive your message directly, but your call is important to me. If you leave me a voicemail message, I will get back with you before the end of the day. Thanks for calling me.’ Messages like this are so much more effective than those that say ‘I will get to you as soon as possible.’ Looking at all of the details of your customer service delivery is important, for it’s the small things that really matter.”

You can reach Professor Jerry Osteryoung by e-mail at jostery@comcast.net or by phone at 850-644-3372. All of Dr. Osteryoung’s articles, by the way, can be found in a searchable form at www.cob.fsu.edu/jmi.

“You may be deceived if you trust too much, but you will live in torment if you don’t trust enough.” –Frank Crane

This is the reef where driver recruiting and retention efforts run aground and come to grief in the trucking business: Trust. Too many times, I’ve heard from drivers about pay packages, benefits, and home time offered at signing that never materialize once they get behind the wheel. And too many times I hear from fleets about drivers that hide traffic accidents, jail time, and other potentially damaging information at signing time, only to see all the dirty laundry aired at a later and most unwelcome date – like during a roadside inspection.

Let’s face it: with the truckload industry facing turnover rates in excess of 120% on AVERAGE in recent times, we know that trust (and other virtues, such as ‘loyalty’ and ‘respect’) is in short supply these days. Not to paint this industry with a broad brush here, but such turnover numbers indicate a mammoth problem before both drivers and fleets. Pay, benefits, and home time are all critical issues, of course, and must be addressed, but without trust, none of them are worth a hill of beans. You can’t get drivers to stay on if you say one thing but do another, and fleets can’t rely on drivers that fudge their records and pay only lip service to professional and safe conduct on the highway.

As usual, I’d like to turn to Professor Jerry Osteryoung, one of resident sages at Florida State University’s college of business. After working with business entrepreneurs for years, he knows a thing or two about the critical importance of trust – and has his own tale to tell where this virtue is concerned. Professor Osteryoung, the floor is yours, sir:

“I have been at Florida State University for 34 years, and I really love this university. Before I came to FSU, however, I taught for two years at another university. I left that position because the dean promised me research support and a higher salary, neither of which ever materialized. When I approached him about these two items, he said that it was his sole prerogative to make or break promises.

After this discussion, I felt that there had been a complete breach of trust. My wife and I left the university and came to FSU, leaving our house unsold. It was worth it to me to pay almost any cost to get out from underneath a boss that I could no longer trust.

Employees need to be able to trust you, or your credibility goes out the window. A firm that we were trying to help had some cash flow problems, so they unilaterally cut the sales staff salaries and commissions in order to balance the budget. You guessed it: they lost every single sales person, as they no longer trusted management.

Sure, this firm had some serious financial issues, but they should have gone to their employees and gotten some feedback before they cut salaries. Lowering employee salaries is a sure way to lose the trust of your staff and send them looking for new jobs.

Another entrepreneur decided she needed to improve profitability and, without notice, eliminated the coffee and coffee makers that she had been providing for over five years. Obviously, the staff felt as if they were blindsided, and the morale of the organization plummeted as trust was destroyed.

In yet another case, an entrepreneur wanted to improve the profitability of his business, and he told his staff that he would distribute 10% of the increase in net profits among the staff. The staff really liked this idea and worked much harder to make this happen. The employees knew that profits were increasing, yet they never received a cent or an explanation as to why. In fact, the entrepreneur never even mentioned the arrangement again. Obviously, morale declined, and employee turnover increased dramatically.

I like to say that leaders have a ‘trust bank’ with each employee. Funds are added to the bank when the leader demonstrates trustworthiness, either through actions perceived or actions viewed by the employee. Funds are deducted, however, when trust is breached in some fashion. For example, if the employee feels that a leader is not being consistent, funds are withdrawn.

Leaders and managers can only be effective if employees feel as though there is a positive balance of trust in the bank. If the bank hits zero or drops into the negative, employees will simply be unable and unwilling to trust the manager. The employees will either begin seeking other jobs, or they will just reduce their work output to the absolute minimum.

Trust is such an important part of the leadership of any business. You must make sure that your staff trusts you both now and in the future to ensure that your ‘trust bank’ stays full.”

You can reach Professor Osteryoung by e-mail at jostery@comcast.net or by phone at 850-644-3372.

You know, when you begin talking about “brand names” and all the advertising and hoopla that goes along with them, most people start rolling their eyes with impatience – and for good reason. We’re constantly bombarded these days with “brand” messages – heck, we even wear them on our clothing. The commercials we watch, hear, and read have become just another part of the landscape for most of us – part of the daily background noise we must wade through in the course of our lives.

And yet … there’s a point to all of it because – believe it or not – it works. That steady drumbeat, be it from fast food joints or soda pop makers, keeps the brand name lodged in out consciousness so when we go to eat or drink, there it is, in living color, subtly influencing our choices.

(And making us fat, I might add: too bad ‘broccoli’ and ‘regular exercise’ don’t have the same high level Madison Avenue help McDonald’s and Coca-Cola do!)

For truckers, all this stuff boils down to keeping your brand name alive in the minds of shippers – a brand name that should be synonmous with on-time delivery and highway safety – so when they need to move freight, your name is in the forefront of their mind when they pick up the phone (or send an email).

Jim Walton, president of Indianapolis, IN-based PR firm Brand Acceleration knows all about this – and writes a regular online newsletter addressing branding issues. He knows his stuff, so I am going to share his much wiser thoughts on this subject. Jim, the floor is yours:

“Building the brand in the consumer’s mind is one thing. Positioning it in the heart of consumers is another. There is much more to branding than just creating an attractive logo or an inexpensive brochure. Without discovering what will resonate with target audiences, companies often communicate a message that means little or nothing to the people who might purchase their goods or services. Simply put, they don’t believe it! Strong brands are emotionally connected, resulting in a trust that leads to long-term customer relationships and that competitors find hard to crack.

Now, let’s assume that by now you have conducted some formal or informal benchmarking research to identify just what your brand represents. You’ve established a clear and concise message strategy and standards to follow in your tactical effort. Great! Now what?

At this point, it’s important to understand that your brand is a living, breathing thing that resides in the mind of your customers, prospects, and staff. If you feed it and care for it on a daily basis, it will serve you well. If you ignore it, it will become weak and die.

Here’s why: People forget. If your target audience isn’t fed a consistent and on-going positive message about your company, products, and services, time and competitive efforts will eventually take their toll.

Consider great brands like Coca-Cola and McDonald’s. Do you think they advertise because they want us to know about the great properties of colored water and sugar or burgers and fries? No! They are constantly feeding the brand in order to hold onto their position in the mind of the consumer. Coke is the “Real Thing” and you’re “Lovin’” McDonald’s.

It’s crucial to develop an annual marketing communications plan that identifies key audiences and consistently and repeatedly conveys a believable brand message that your employees can deliver. A powerful tactical plan communicates a consistent and convincing message through several channels that support one another. Media advertising, e-newsletters, direct marketing, brochures, blogs, web sites, and trade shows, to name just a few, are all valuable pieces of an integrated tactical plan. Even with a limited budget, it’s very important to set a priority and do something. Otherwise you have a beautiful business card and a web site that is nothing more than cyber driftwood. You’ve gotta do something.

Remember, brands are like pets. If you feed them, groom them, and love them, they’ll love you right back!”

If you want to get in touch with Jim, drop him a line at jim@brandaccel.com or check out his web site at www.brandaccel.com

“The great corrupter of public man is the ego … looking at the mirror distracts one’s attention from the problem.” –Dean Acheson, secretary of state under President Harry Truman.

OK, we all know that details matter in trucking, largely because a few pennies here and there can make the difference between profits and losses for a carrier. But there is such a thing as going overboard on the details – micromanaging things to a point where employee (especially driver) morale goes south. Micromanagement is no stranger to trucking, too, due to the ‘family-owned’ nature of many carriers out there. I mean, if it’s a company your family built up over decades, you are dang certain to be engrossed in the details – it’s your baby, after all. In many cases, too, it’s your name on the side of the trucks and trailers as well.

But micromanagement has a lot of pitfalls – especially in terms of its impact on human relations. That’s why I’m going to let Professor Jerry Osteryoung from the College of Business at Florida State University address the subject. He’s seen the negative impact micromanagement can create first hand, as well as the benefits micromanagement’s opposite – delegation and trust – can bring to the table as well. Professor Osteryoung, the floor is yours:

“When I first started to work as an engineer (this was a long time ago), I had a boss that had to make changes to our work no matter what we brought him. Eventually, the staff got tired of his comments. They stopped showing him work-related projects when they could avoid it, and the projects they did show him had little of their creativity, as they knew he was just going to make several suggestions (more like orders) for improvements.

In this case, his micromanaging caused the morale of the engineering department to drop so low that they had to replace the manager. The sad thing about this episode is that he, like most micromanagers, did not even realize he was micromanaging. Employees, on the other hand, always seem to know when they are being micromanaged.

The classic definition of a micromanager (sometimes referred to as a meddler) is someone who closely watches and controls the work of staff. Rather than delegating work to be done, the manager watches all the projects very closely. This is just not a good management style at all. Micromanaging destroys the morale of an entire organization and discourages people from trying to be creative and effective. More often than not, staff needs to be told that they did a good job without any corrections or modifications.

While you clearly need to know what is going on in your organization, staying in the know is significantly different than watching and commenting on every decision. Try to understand when you are being given information as compared when you are being asked for advice. So many emails are there just to inform you, and staff does not want or appreciate your comments on them. Another type of micromanager is someone who has been with the company for years and has worked up to a management position. This individual thinks that their role is still to produce rather than to manage people. This type of manager alienates staff and becomes ineffective.

In order to fix the problem, you first need to find out if you are a micromanager. The best way to do this is to ask someone you trust to find out what the staff feels about your management style, since they are the ones who are really impacted by this type of management. I have seen many micromanagers change their ways to become great managers once they were made aware of their tendencies.

One thing that seems to help micromanagers is to simply understand the difference between helping and meddling. One of the best ways to see if you are meddling is to ask staff to tell you, with no repercussions, when you are meddling. As staff does not like to be micromanaged, I promise they will tell you if you ask them.

I think the real secret to helping a micromanager is remembering that staff is valuable and that they are being paid to do a good job. Many micromanagers just do not trust their staff, and this is a difficult problem to fix. One micromanaging entrepreneur that I was working with had some issues from his childhood that prevented him from trusting employees and being promoted. He went in for counseling and was able to fix the trust issue, and as a result, the staff noticed a significant change. The staff felt so free because their manager was able to let go of his micromanaging tendencies and trust them with their tasks.”

Of course, changing your management style is no easy task – especially if it’s produced good results to date for your carrier. But the whole point isn’t to focus just on what’s happening today: it’s about preparing for the future as well, being in the best position possible to handle new and different challenges down the road.

To contact Professor Jerry Osteryoung, you can e-mail him at jostery@comcast.net or call 850-644-3372.