Strength in numbers

After spending thousands to implement a new information technology, you may soon become discouraged when your results do not meet the expectations that you or your vendor had for certain processes. Or maybe you achieved your initial goals but now wonder what areas could be improved even more with better use of the system.

One of the most significant benefits of information technology is the ease with which you can track internal performance. That intelligence is needed to ensure continual improvement, which should be the goal of any enterprise.

But as useful as technology can be for supporting internal benchmarking, consider how powerful it would be if you could compare your key performance indicators – in nearly real time – to those of dozens or hundreds of other motor carriers. But that kind of benchmarking is a pipe dream, right?

Perhaps not. In July, PeopleNet Communications told its customers that it planned to develop a customer scorecard as a way for its customers to automate the reporting of key statistics for its vehicle tracking, mobile communications and onboard computing systems. Customers will be able to tailor the scorecard to compare actual numbers to their set targets and to the averages of a selected peer group, says Brian McLaughlin, director of marketing for PeopleNet. Examples of data that can be compared to a peer group include statistics for fuel mileage, idle time, hours-of-service compliance, detention time, on-time deliveries and out-of-route miles.

Users will receive weekly, Web-based reports to show how their performance in such areas compare to other reefer or flatbed carriers, private carriers, private tanker haulers, or any other carrier group, McLaughlin says.

“All the data is out there, but the reality is that it is not in one place. We will provide an executive-level snapshot of fleet performance and the ROI of the system,” McLaughlin says.

Collecting data from users of a network-based application can also be vitally important to reveal weekly trends that could significantly impact your business. Carriers that use TransCore Exchange to find loads and post equipment, for example, can use the system to gauge supply and demand by looking at the ratio of trucks to loads in a certain lane, says Don Thornton, vice president of core business solutions at TransCore.

“As the biggest marketplace for freight matching, this is a good indicator of what is happening in that state,” Thornton says. As a service to its readers, CCJ includes a monthly demand index based on TransCore data in each issue.

Comparing financial information such as cost-per-mile, averages for freight rates in certain areas, and administrative costs per truck to a peer group is a more complicated scenario that would require data from a group of users of a certain dispatch or accounting software system.

Because this information is highly sensitive on a company-by-company basis, many carriers choose to store this information on site and, therefore, the data is not accessible to the vendor to provide to its users in a composite form. Through an application service provider (ASP) arrangement, customer data is stored in a central location and, therefore, could be aggregated and shared among users. Users would know how the group as a whole performed, but individual members of the group would remain anonymous.

The National Association of Small Trucking Companies, for example, is currently developing an ASP-based enterprise software solution for its 1,500 members that will allow users to access group data from other users according to categories such as the number of trucks and type of equipment, says President David Owen. The software will soon be in beta testing and available in about one year, Owen says.

Using an automated process to compare your results on a frequent basis to your own targets and peer averages can help managers focus their attention on where and how to improve. This functionality of an information system might not produce the scope of insights offered by full-scale benchmarking initiatives, such as the one currently being pursued by the Truckload Carriers Association. But it certainly is a significant added value.