The paperless chase

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Updated Mar 4, 2021

The long-expected transition from paper to imaging – let alone data-only business transactions – remains a work in progress.

Electronic data interchange (EDI) sprouted in the mid 1980s, and its arrival signaled the beginning of the end for paper documents in the transportation industry. With EDI, two or more businesses could transmit information electronically, from order through invoice and payment.

However, since its inception, EDI has been plagued with exceptions. Only large customers use it, and each customer has unique standards for the transactions they exchange with carriers. Plus, many customers that use EDI still require “hard-copy” documentation, such as a signed proof-of-delivery (POD) receipt, to pay an invoice.

In the mid 1990s, carriers began using imaging systems to streamline the handling, storage and retrieval of their paper documents. Customers began to accept images created by those systems in place of original documents to pay invoices – a shift that enabled fleets to speed up billing and collections. More recently, many carriers have developed sophisticated e-commerce tools that eliminate the need for paper altogether.

Even so, the use of hard-copy documents remains the standard way to account for the many exceptions that occur in supply chains, such as overages, shortages and damaged freight. “Customers still want a paper copy in hand,” says Bruce Kalem, chief financial officer of Milan Express, a 950-truck carrier in Milan, Tenn. “It would be wonderful if we went paperless, but I don’t know how you would account for exceptions.”

The challenge certainly isn’t technical. Today’s technology would enable a totally paperless operation, and the equipment cost continues to drop. Rather, as Kalem suggests, the issues are customer relations and management’s resolve. Yet many carriers are forging ahead with new technology, tackling exceptions and hurdles along the way from customers and even their own employees.

Challenges from within
Much of a company’s paperwork is generated internally. Due to a lack of integration among internal systems, many employees still use printers, copiers and fax machines more than should be necessary.

“Some carriers type orders into a system and then print lists of drivers and loads that need to be covered,” says Mike Ludwick of Canadian carrier Bison Transport. “They match up everything on paper and then enter the plans into the system.”

Like many carriers today, Bison Transport – an 800-truck carrier based in Winnipeg, Manitoba – uses a commercial enterprise software system that provides operations personnel with live “planning grids” so that hard-copy prints virtually are eliminated. “Combine that with the electronic filing of confirmation faxes, quote sheets, scale tickets and PODs, and everyone who touches the order can see the ‘paperwork’ right from their desk,” says Ludwick, the carrier’s vice president of information technology.

Bison Transport has a homegrown imaging system that employees use for quick access to imaged documents such as PODs, bills of lading (BOL) and incoming faxes. The images are tied to order numbers and other index values in the carrier’s enterprise software system. Bison employees can fax or e-mail documents directly to customers from their PCs.

Today, the company has clerks that scan important fax documents, such as load confirmations, into its imaging system. But management plans to integrate incoming faxes into its imaging system as well.

“We have started to receive and send border-crossing documents using electronic fax, but haven’t extended that to the quotes and confirmations,” Ludwick says. “We hope to get to that point.”

Management at TFX – a 200-truck intermodal carrier based in Durham, N.C. – cut down on printing and faxing costs by creating electronic Web-based forms that employees use for common communications between terminals and departments. The company has eliminated other types of internal paperwork by using Instant Messenger (IM). The company saves all IM files and can investigate if something was not executed as planned.

Customer communications
For many carriers, e-mail is the most efficient form of communicating with customers, especially when it comes time to send an invoice. For example, all customers for hazmat hauler Robbie D. Wood accept e-mail or faxed invoices, says Betsy Barnett, systems manager for the 130-truck fleet based in Dolomite, Ala.

Every Monday, the company collects trip documents that its drivers gather from the previous workweek. On Tuesday, all the paperwork – including PODs, BOLs and hazmat inspection receipts – is scanned and indexed into its McLeod Imaging software. For Robbie D. Wood, indexing is a software-driven process wherein a clerk identifies each image using a keystroke, such as “B” for bill of lading and “P” for delivery ticket. Indexing ties the appropriate documents to the order numbers generated by the company’s dispatch and accounting system.

Before using imaging, one person spent all day Wednesday at the copy machine. As a result, Robbie D. Wood mailed its bills on Thursday. The company now sends its bills out automatically on Wednesday through e-mail, complete with attached images of important billing documents. The company has eliminated printing and mailing costs, and has increased its cash flow significantly as a result.

“Customers are paying a lot quicker because invoices get there immediately,” Barnett says. “Normally, if we bill on Wednesday, we get paid the next week.”

Inbound communications from customers can be a headache as well. Customers that fax documents to TFX now are the exception, says Hardy Butler, executive vice president of Enterprise Distribution, the parent company of TFX. When a customer offers to fax over a rate confirmation, Butler says his first question is “Can you scan it or e-mail it first?”

“I’ve reached a point where 75 percent of customers can say ‘yes,’ ” Butler says. “You have to be proactive. It is worth it in the long run.” To handle the exceptions – its customers that continue to live by the fax machine – TFX uses eFax, a service that routes incoming faxes to an e-mail inbox to eliminate paperwork.

Scanning from afar
One reason carriers have been slow to adopt imaging is that in the early days, high-end scanners and storage media were expensive – especially when a carrier had to deal with multiple terminals. But that worry is basically history. Although the software side remains an investment, scanners and storage are both cheap. So many fleets are extending document imaging to all their locations.

TFX, which has seven terminals in the East, used to ship documents three times a week by courier to its headquarters in Durham, where they were imaged and processed. “We kept FedEx in business,” Butler says. About 21/2 years ago, the company began scanning documents at each terminal, eliminating its paper collections costs and time required to process bills centrally; internal faxing also was eliminated. The company was able to speed up its collections by three to five days, Butler says.

“The biggest benefit is that when we pushed scanning down to the terminal level, images immediately become available,” Butler says. “What we have strongly encouraged is to scan and send an e-mail. You don’t have to print out a report and fax it. You can store it all electronically. It makes it much easier to retrieve information, and you don’t have paper.”

The bigger challenges for many carriers are getting documents back to the office quickly for scanning and providing the staff to scan documents. After all, if slow document return and inadequate staff impede the processing of PODs and other documents, then imaging produces limited benefits.

So in relation to the growth of document imaging, perhaps as significant as the decline in hardware costs is the emergence of solutions that don’t require the carrier to image most documents onsite. For example, Pegasus TransTech and TripPak Services both offer truck stop scanning at all major truckstop chains. With drivers on the road for several days at a time, carriers can get documents to the office the same day a load is delivered by having drivers use these scanning services. The Web-based services send images directly to carriers’ existing in-house imaging systems or any other destination specified by the fleet – such as a printer, an e-mail inbox or a third party, such as a log-auditing service.

Another option to speed up document delivery is to outsource the delivery, scanning and indexing process altogether. Since 1995, Sitton Motor Lines has been using an in-house document imaging system. The 450-truck, Joplin, Mo.-based company traditionally has used TripPak Express for next-day delivery of drivers’ trip envelopes from truck stops to the office. But in April 2005, management decided to outsource the scanning and indexing of its documents to TripPak Services, an ACS company.

Drivers deposit their trip envelopes in TripPak Express drop boxes located at truck stops: The documents are sent overnight to TripPak’s document processing center, where the images are scanned, indexed and downloaded into the customer’s imaging system by the next morning.

The decision to use TripPak’s scanning and indexing service came down to efficiency, says Kris Belk, Sitton’s director of management information services. Since images are available at the beginning of the workday, Sitton has sped up its billing cycle by at least one day. Previously, the documents would arrive by courier later in the day and still had to be scanned and indexed.

Portal to efficiency
However you collect and process important billing documents today, document imaging is only a step toward eliminating paper altogether. Even with the most advanced technology systems in place, hard-copy documentation remains the most agreed-upon format to assign liability should something not go as planned. Few are ready and willing to conduct business totally in a digital world.

Milan Express, which has truckload, less-than-truckload and warehousing operations, has the information systems necessary to be completely paperless today, Kalem says. The company uses a mobile application that runs on Intermec 760 handheld computers and the Cingular wireless network. Drivers use the handhelds to receive load assignments and update shipment status along the way. With the handhelds, customers could sign electronic BOLs or PODs, eliminating the need to sign printed copies of these documents.

But customers simply aren’t ready to go paperless – and for a good reason.

“We have got to have a bill of lading when we pick up,” Kalem says. “The driver has got to sign to say how much he picked up. It puts us on the line. They can send us information electronically, but we have got to be able to sign something.”

Management at Milan Express has talked to customers about using electronic signature capture to go paperless, but the idea has met stiff resistance. And even if some customers agreed to electronic documentation, Kalem says it is still better to stick with printed documents until all Milan Express customers are ready.

“We decided that it had to be one way or the other,” he says. “It’s hard to tell drivers to do one or the other. You’ve got to give them one direction.”

The company has a policy that should an exception occur, the driver calls the office for an over, short and damage (OS&D) number. The driver puts the number into the handheld so the company can match up the OS&D number to the particular shipment, should the customer decide to file a claim.

Kalem sees no easy solution for ending the use of paper documents completely. But the growing use of Milan Express’ website by customers has helped reduce inefficiencies caused by paperwork, he says. Delivery documents get scanned each day when drivers return, and customers then have immediate access to their documents and other delivery information through the website.

“(The website) has not reduced paperwork, but it expedites the flow of information,” Kalem says.

With all the technology available today, going paperless remains a continuous improvement exercise for any size of carrier. Fleets can start turning paper into electronic processes by changing from within, which increases efficiency for both parties – but don’t expect customers to be ready and willing to follow your lead. Then again, you can’t expect customers to go paperless unless you are ready and willing to take them there.

Hours without paper
The motivation for document imaging traditionally has been to store and transmit customer-related documents, but fleet owners also have used scanning to store and help audit driver’s records of duty status, or logs. And with carriers using outside services such as truck stop scanning and centralized outsourced scanning to handle business documents, many are using such services for driver logs.

Roehl Transport – a 1,600-truck carrier based in Marshfield, Wis. – once used in-house driver log scanning and auditing software. Now, the carrier’s drivers scan their logs at truckstops or terminals: The images are sent to Rair Technologies, where they are processed, audited and available to Roehl Transport via a secure website within 24 hours.

With Rair’s Web-based software, log violations from the previous day are color-coded, and drivers’ hours can be shared among safety and operations personnel to improve safety and compliance. By outsourcing the scanning and filing of logs, safety personnel have more time for driver training and to “really manage our logs,” says Jason Spiros, safety director for Roehl Transport.

Before using Rair, “it took a couple of days before we knew if anything was wrong,” Spiros says. “Now we do it in real time. That is fantastic.” At first, Spiros was apprehensive to use a third party to process and store sensitive logbook information. But after using Rair for about three years, he says he never has had a problem with a lost document or missing data.

RapidLog, offered by TripPak Services, provides instant, Web-based log-auditing and reporting for fleets that have drivers use TripPak Services truckstop scanning. Another RapidLog option is for TripPak to scan logs at its processing centers: Drivers can deposit their paper logs with their other paperwork in TripPak Express drop boxes located at truckstops and fleet terminals.

Sitton Motor Lines uses this option and has achieved a “tremendous improvement” in accuracy and efficiency, says Kris Belk, Sitton’s director of management information services. Sitton used to have paper driver logs delivered to its office the next day through TripPak Express; clerks then would scan the logbooks into its imaging system. Since its log scanning, verification and reporting process now is automated, employees have become “infinitely more efficient,” Belk says, and supervisors have more time to counsel drivers instead of spending their time auditing logbooks.

J.J. Keller provides Keller Scan, an in-house log scanning and auditing software; the company also offers log auditing as an outsource service. Next year, J.J. Keller plans to add log scanning and auditing features to Driver Management Online, its Web-based system carriers use to manage driver qualification files, background checks and drug and accident reporting requirements, says Tom Reader, data solutions product manager for J.J. Keller.

A smaller price to pay
Since Con-Way launched its first website in 1994, the less-than-truckload carrier has invested substantially in developing online transaction functions. Con-Way customers can log on to initiate shipments, get rates, track equipment, receive invoices, retrieve delivery receipts, view notations for exceptions and file claims.

“We are apostles of the religion of e-business,” says Ned Moritz, vice president of marketing for CNF, the parent company of Con-Way. “We think it’s wonderful. Not only does it offer better clarity and documentation, but it saves both sides money.”

Customers had the ability to manage all their shipping needs online, but they didn’t flock to the website as soon as Con-Way made these tools available. In the past two years, however, management has offered several successful incentive programs to encourage more customers to share in the benefits of going paperless.

In October 2003, Con-Way began offering a $2 discount off any invoice for customers that submitted an electronic bill of lading (BOL) online for a shipment pickup. The program lasted through April 1, 2004. In the six-month period, use of the electronic BOL increased from less than 1 percent of Con-Way’s total bill count to 10 percent. Customers that took the incentive all have stayed on.

“It’s like nicotine or any other drug,” Moritz says. “It just makes so much sense once you get on it. The incentive cleared the hurdle.”

On Jan. 1, 2004, the company began a six-month program to entice customers to accept electronic invoices. Anybody new who signed up received $1 off every bill delivered through e-mail in a PDF format. “It grew very nicely from a low level to where about 10 percent of the bill count is now by e-mail,” Moritz says.

An advanced tool that Con-Way offers customers is an XML interface from its website so that customers can translate information from Con-Way’s website into their own system. For example, they could interface Con-Way’s online rate quotes into their enterprise resource planning (ERP) system to pull rate quotes automatically – to ensure that the rate they get charged is the rate that was previously agreed upon. Con-Way customers also can use the XML interface in their own websites to offer their own customers real-time quotes for shipping when they place an order online.

“On their website appears a bill with transportation and delivery charges and transit time as well,” Moritz says. About 50 customers use it today, which, Moritz says, “is not inconsequential.”