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Swift Transportation

During an interview with CEO and Founder Jerry Moyes, I discovered that in order to populate America’s roads with 10,000 Swift trucks for 364 days of revenue-generating power, the company needed to recruit 16,000 drivers annually. The reason given for the 160% turnover level in the driver pool:

“Drivers are a transient group of people. They want to be away from home, they typically are not schooled or skilled, and they usually have no other options than to drive a truck for a living. Driving our long-haul routes is a very difficult job. Most drivers don’t even make it to six months.”

Proud of his enduring history, Mr. Moyes went on to tell me that Swift’s turnover rate was about half the rate of competitors.

Moyes told me that hundreds of consultants had tried before us to solve this problem. His CFO, Bill Riley, added that Wall Street kept the stock price at $18 because ever-increasing recruitment and training costs – more than $50 million at the time – diluted too much of the revenue stream.

I pitched Jerry Moyes with a compelling thought, one that he had never considered before: The weighty turnover is a marketing problem. Drivers are vital customers whose needs are not being met here at Swift. We won an opportunity to discover the perceptions of drivers who had recently quit and went to work for a competitor.

Over the course of six months, MHG conducted a customized research study, and interviewed 700 drivers who voluntarily quit after at least one month of employment at SWIFT. We correlated the reasons with length of service, number of accidents, and the number and quality of driver-managers assigned to each. Here we discovered many disheartening factors about driver loss, for which the company was responsible and was empowered to change. The findings demonstrated how every driver-manager’s role of attending to each driver’s personal needs, was in direct conflict with the financial incentives driver-managers enjoyed with successful dispatch, ensuring each truck was on road duty 364 calendar days. In short, drivers’ needs were being ignored. As customers, they were leaving in droves.

MHG’s Findings had a huge impact on the company’s success:

  • Separating these roles resulted in a 63% drop in total turnover costs (recruitment, training, opportunity).

  • The new understanding that drivers are actually internal customers representing 80% of the total work force, significantly improved the organization’s culture.

  • Changes incorporated immediately into Swift Transportation’s strategic plans, the company’s stock moved to $27 in short order. Competitors took notice, adopting similar changes within two years.

  • A portion of the savings was used to build new conveniences for long-haul truckers, such as laundry facilities, rest areas, and cafes.

  • Most importantly, drivers now enjoy the dignity of people acknowledged for their contribution.

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