Some time in the evening the dispatcher called me in and gave me a load bound for Cincinnati. That's a pretty good first step in getting me home, plus it's a 1,365 mile weekend so that ain't bad. Since I couldn't leave until after midnight, he said he would let me swap it out if any Canada-bound loads crossed last night. Apparently nothing crossed because I never heard from him again. No big deal though. I moved an appointment from the 15th to the 22nd so I have plenty of time to get to Taylor. So I spent the night in Laredo and headed out this morning. My truck got a much-needed bath and then I was on my way north.
That drive up I-35 sucks balls. I mentioned that I angled over on the way down, so I had to go through Austin and San Antonio a couple nights ago. That was in the middle of the night though. It wasn't so bad. Today I thought about angling over toward Texarkana but I decided to take the interstate instead. This way my hours work out pretty well in terms of stopping at CTL terminals tonight and tomorrow, so I know I have plenty of parking no matter how late I arrive. So I got to deal with the stupidest hundred miles of 'no trucks in the left lane' in America. Way too much time riding the brakes for my liking.
So I pulled into Lancaster a little while ago and I'll head for West Memphis tomorrow.
As I sat at the tire shop yesterday, I made some phone calls. On a whim, I dialed the number for CTL's information system and listened to the latest message from our CEO. He mentioned that he will be hosting driver forums in the next few months to get ideas for a good fuel bonus program. If you're invited, and you want to have some useful ideas, look no further. The following is provided to you at no charge, courtesy of Fenian Godfather Consulting:
The first issue with the old program was that it was seen as unattainable by several drivers. To remedy this, you have to lower the standard at which a driver sees a tangible benefit. The catch is that it's not financially sound to pay extra money to people for meeting a subpar standard. Carrot & stick time. If the fleet average was previously 5.9mpg, as we've been told, anyone at 5.9mpg or below should get the truck turned down to 65mph. Anyone at 6.0mpg to 6.2mpg gets 67mph. Anyone at 6.3mpg or above gets 70mph. The company has expressed concerns about the excess fuel burned above 65mph. The built-in trigger would remedy this to an extent. If a driver with a faster truck does indeed burn more fuel, he will no longer have a faster truck. In comparison to the system in place until a week ago, this produces zero additional cost. In comparison to a full fleet of 65mph trucks, it may produce some cost. (Some people who were getting good MPG may get even better MPG with a slower truck.) But some of that cost will be countered by an added incentive for drivers not to idle their trucks. I presently sit in comfortable 55 degree air, with every truck within hearing range idling around me. The trucks are turned to 65mph, but the drivers have no reason to give a shit about the fuel that they're needlessly burning. Carrot=faster truck. Stick=running with the pack.
Next, the dollars and cents of it all. Mpg is the standard number used, but it's only a partial indicator. The company provides information, after each dispatch, telling drivers where they can buy the cheapest fuel along their route. The drivers ignore these recommendations since they don't give a shit where to buy the cheapest fuel. We are told that the company gets bulk fuel at 18 cents below retail. Might want to encourage drivers to route themselves through terminals, eh? But what do we get if we decide to add a few miles to our route and top off at a terminal? Reduced MPG, for starters. MPG is the only number that CTL cares about, so that's no incentive. How about the inspection bay in Joplin? Maybe they find some minor issue and you end up in the shop all night. Not much incentive there. How about cruising into whatever neighborhood houses the terminal, as opposed to a truck stop right on the interstate? Not much incentive there. The same general thoughts (although in smaller dollar figures) apply to using cheaper truck stops. If the fuel in New Jersey is a few cents cheaper than the fuel in Delaware, but a driver was planning to take a break in Delaware, he has no incentive to top off in New Jersey, does he? You need a more comprehensive approach to the bonus structure if saving money is the ultimate goal. Luckily I have just such an approach.
You start by establishing a baseline. The baseline would be as follows; (Total dollars spent on fuel as a fleet)/(Total miles dispatched for the fleet)=CPM. The CPM figure is how much money, as a company, CTL spends on fuel for a mile that a truck drives. I don't know what that number is, but I don't need to know. Somebody knows. If the average truck goes 120,000 miles in a year, at 5.9mpg, with an average fuel cost of $3.10, we can come up with an imaginary number to use in this example. Those figures would give us a CPM of .5254 ((1/5.9)*3.1). That would be [((120000/5.9)*3.1)/120000] in the long form, but the numerator and denominator parts cancel out the two 120000's. Anyway, .5254 per mile for the (imaginary) average truck.
There are a couple of ways for an individual driver to get a better (lower) CPM number. One is to use less fuel. The other is to use cheaper fuel. A MPG-based bonus addresses the first variable but ignores the second. I would recommend that a given driver (let's say me) should be expected to meet the CPM baseline, multiplied by the number of miles that he drove. For our "fuel year" (December through November) I drove 127,508 miles. So you multiply that by the CPM baseline and you have the amount of money that I should have spent on fuel for the year. $66,992.70, that's the number our imaginary CPM baseline would yield. So if I spent less, I did a good job. It should make no difference to the company if I was very judicious about MPG or if I was very judicious about routing myself to fuel at terminals and other cheap locations. A dollar is a dollar.
So if I got 6.4mpg, but spent $3.25 per gallon on average, I would have spent $64,750.15.
If I got 6.085mpg, but spent $3.09 per gallon on average, I would have spent... $64,749.33.
See how that works? Under the first scenario, CTL thinks I'm a good boy. Under the second one, they think I'm so-so. The first way would have gotten me a meager fuel bonus under the old program. The second would not. But what if that first Godfather, despite spending a little more on fuel, totally killed the MPG standard, achieving 6.9mpg? He would have spent $60,058.11. Almost $5,000 less than he did at 6.4mpg. Surely he gets a bigger reward, right? Not under the previous system, he didn't.
This is so incredibly simple, I can't believe they haven't seen it yet. You use the baseline CPM to establish what a driver "should" have spent. You compare that to what he did spend. If he spent less, you share the savings in the form of a bonus. If he spent more, he deserves no bonus. For every dollar saved below the baseline, maybe the driver gets 50 cents, maybe he gets 20 cents. I don't own the company, so I don't know the economics of their situation. What I do know is that under the Fenian Godfather Doctrine, every one of the following statements is true:
- A driver just below the company average still has an incentive to improve, if for no other reason than to earn a faster truck.
- A driver exceeding the company average has an incentive to exceed it by even more, since every dollar saved would mean some amount of money in the driver's pocket.
- A driver faced with a choice of fuel stops will have an incentive to find the cheapest one on his route, most notably if a route passing a terminal is an option.
- A driver stuck in cold weather and idling a lot won't conclude that all is lost after the first few months, essentially giving up on fuel conservation, since he can dramtically lower his CPM by combining effective MPG driving and cost conscious fuel stops.
- A driver who may or may not need to idle on a given day will have something to think about. He will be forced to weigh the possibility that a portion of that fuel he is burning will result in a corresponding reduction in his bonus. If he is below average and not earning a bonus, he will have to consider the impact of his decision on the speed of his truck.
- There is no potential for manipulation, i.e. buying fuel "out of pocket" to get a bigger bonus. Since the bonus is a function of dollars spent, the driver would in essence be spending the price of a gallon in order to get a portion of that price as a "rebate."
I addressed this approach, along with a few other suggestions, several months ago on the CFI Drivers message board. The conversation had me a little rankled at that point, but I think I was fairly coherent. That topic can be found here. I don't know. Sometimes things just don't seem that complicated to me. Anyhow, maybe if a few drivers take actual logic to the table the company will listen. I doubt it, but you never know.
Cheers until next time.
Awesome idea on the fuel bonus. Have you presented that to Con-way through e-mail or other communications? I hope so, it sounds like a viable solution.
ReplyDeleteJohn
No, I prefer to stay an anonymous peon, as referenced in some earlier entries. Conversations with people from this company usually leave me scratching my head, so I try to avoid them. I'm losing my hair fast enough as it is.
ReplyDeleteAnyone feeling more motivated than I am is certainly welcome to share it with whomever they choose. I got a couple of interesting challeneges to the system from a friend of mine. I'll try to get into those tonight.