Truck Topics
Behind the Scenes: Con-Way NOW
The business of expediting is a simple process, right?
A customer calls ABC Expediting Company with a load, and:
1. ABC dispatches a truck that picks up the load
2. The truck delivers the load,
3. Everyone gets paid.
That's about it, right?
We all know there's more to it than that, but how many know the incredible amount of detail involved in maintaining a trucking (expediting) company?
An expediting company is an entity whose sum is greater than its parts. It's a synergy of various departments, each with their own area of responsibilities, and all with the goal of keeping its contractors' trucks loaded with its customers' freight and delivered safely and on time.
Most of us have a grounding in the general company functions, but to borrow a cliche, "the devil is in the details." In addition to the standard business areas of marketing, accounts receivable/payable, people management, etc., expediting and trucking also have the burden of Big Brother's scrutiny.
The expedited carriers are under restrictive guidelines imposed by the Department of Transportation and other regulatory agencies, and this governmental watchfulness influences all aspects of this industry.
One expedited carrier that has met and overcome these business challenges since its inception is Con-Way NOW of Ann Arbor, MI. This company has gone from startup to an industry leader in seven short years and all indicators point to its continued growth and success.
In a trim industrial park located on the rural south side of Ann Arbor sits Con-Way NOW Inc's headquarters where ground and air expedited services are offered to customers along with full service truckload brokerage through Con-Way Full Load.
Con-Way NOW markets it's services to customers throughout the U.S. and Canada and are a wholly owned subsidiary of Con-Way Transportation Services, Inc. Con-Way Transportation Services revenues exceed $2 billion and they are a wholly owned corporation of CNF, Inc traded on the NYSE as CNF.
The Ann Arbor facility has expanded a great deal in the last few years. Con-Way NOW has secured the adjacent offices in their building over the last few years and has increased their area to accomodate an increase in staff and operations.
Because of Con-Way NOW's full-size trucking parentage, it has access to one of the largest customer bases in expediting which results in low empty miles for its contractors.
Michelle Potter, VP of Operations, is responsible for all company operations, information technologies, customer service, and safety and Con-Way Full Load. She is a Con-Way NOW veteran who began with the company in the months prior to the actual opening.
"I came to Con-Way NOW in April 1996 to help establish the operation before we began service in August of that year."
"One thing I find most gratifying within our organization is the volume of statements that we hear from owner/operators who join us; it's the results of word-of-mouth. Our owner-operators are talking amongst their peers, and people are hearing that Con-Way NOW is the place to be."
Michelle Potter describes the process of dispatching the typical load:
"Our customer service team receives a call from a customer and they prepare the origin and destination information and with the support of the customer, determine what type of vehicle is required. Many of our customers are sufficiently educated in expediting to say, 'We need a straight truck' or 'We need a cargo van.' "
"Other customers who don't have that kind of knowledge will explain to us what type of freight they need to ship (dimensions and weight), and we'll make a determination of what type of equipment is required. We'll then provide them with a price and our senior dispatch team will see what the availability is for their needs."
"We'll make a determination of what the Estimated Time of Arrival is, go back to the customer and provide them with that solution."
Potter continues, "We can book a load with a knowledgeable customer in under one minute where the computer system has identified all of their customer information with one code, their custom price has been populated on the screen and the choices of trucks to service the load have been found through the satellite system."
"All of this information is instantaneous once the customer tells us what they need. Different from most companies, our customer service people and dispatchers have visibility to all of the information on their desktop."
"Conversely, a customer that is not sure what they need is provided all the time and information from all of the various ways we can solve their challenge with a combination of ground expedite, air, the extensive Con-Way LTL network, Full Load's extensive network of truckload, cartage and drayage companies and the support of Con-Way Air and Con-Way Logistics."
Don Fegtley is the Vice President of Sales and Marketing. He started with Con-Way Transportation in 1980, working in the LTL sector until his move to Con-Way NOW shortly after the creation of the expedited carrier.
"I learned expediting, at least in the early days, through trial and error," he says jokingly.
He outlines the vast sales support staff for his company: "Con-Way NOW has regional account executives throughout the U.S. and Canada along with a substantial inside sales group where their only responsibility is to promote our expediting service."
"In addition, we have 28 Con-Way national account executives who have access to all of the top corporations in America as representatives for all Con-Way companies. Added to that, we have access to over 650 account executives that work with LTL accounts where Con-Way is viewed as the premium LTL service because of their industry leading service, quality and commitment to customers.
"As for Con-Way NOW, we are in our seventh year of operation, so we are still somewhat in our infancy. We see this company doubling in size in the next five years. We believe our ability to further grow the synergy with the other Con-Way organizations is the key to growing our ground and air expedite business with customers who are seeking solutions to daily challenges.
"We offer options to our customers - whether it be air or ground transport or outside solutions - to cover their needs or dedicated equipment. The ultimate thing for us is that we focus extremely hard on the customer service end of it, and we have been told by many, many national accounts that our level of customer service has already significantly differentiated us from our competition.
Con-Way NOW, Inc, along with its subsidiary company, Con-Way Full Load, continues to be one of the fastest growing companies in ground expedite. Con-Way Full Load is a truckload brokerage company that utilizes NOW tractor-trailers and straight trucks to move a portion of their loads. Con-Way Full Load is experiencing tremendous growth in its second full year of operation.
"Con-Way Full Load is a full truckload, intermodal, reefer support service that is different from the typical trucking brokerage," says Michelle Potter. "We provide our customers with tracking, proof-of-delivery information and we support those customers at a very high-level."
"It gives the Con-Way NOW expedited units the opportunity to move within the Con-Way Full Load system as well. So, where Con-Way NOW is strong in one lane direction, Con-Way Full Load provide the shipment in the backhaul lane as well as move within the head haul lanes."
The shipment and revenue growth is fueled by the brand recognition of Con-Way throughout North America. The dominant, industry leading customer service that is bench marked from retail companies and the Con-Way core values that ensure that owner operators are treated with the same respect as the one of the nation's largest non union employee groups are the keys to our success. - Ed Conaway, President and CEO, Con-Way NOW
Recruiting Department
Lori Blaney has a number of titles within the company: Manager of Recruiting, Manager of Human Resources and Business Development. She entered the transportation field in 1993 with less-than-truckload carrier CCX.
"I started with inside sales, then worked in field sales with CCX for five years. I joined Con-Way NOW in 1998 with the mission of establishing an inside sales department. I entered the area of recruiting, and in addition to that, I work in the Human Resources field," says Blaney.
She says that Con-Way NOW's 100% owner-operator fleet is doing well, and despite an uncertain economy, its business continues to grow over last year.
Blaney states that less than 30 percent of Con-Way NOW freight is automotive-based and that the company has recently began handling government shipments - a new source of revenue opportunities for its owner-operators.
"We need to grow the fleet in anticipation of the upcoming busy season. Fortunately, our biggest recruiting tool is word-of-mouth referrals from our Professional Business Owners (PBO's)."
Blaney says that Con-Way NOW's cargo van fleet is still busy, but that the company is not presently recruiting that size unit. She says that straight trucks and tractors are the focus of the Con-Way NOW recruiting efforts, particularly those with teams, and that the company is recruiting in all of its operational areas.
Education
"We have to educate our tractor PBO's about expediting," Blaney states. "For those owner/operators coming into this business from conventional trucking, they expect to run thousands of miles per week and not to sit waiting for a load. We have to show them that this is not like line haul or over-the-road trucking."
In a departure from "conventional" expediting, Con-Way NOW fields a small regional fleet that services selected locations in Michigan, Ohio and Indiana.
"The straight truck PBO's in this specialized area transport loads that are typically under 300 miles in distance," Blaney relates, "and frequently, they can do multiple loads in a day. Because of the lower mileage nature of this freight, the pay is structured a differently."
Lori Blaney says that Con-Way NOW is extremely proud of its reputation as a contractor-friendly organization:
"Our PBO's know that they can always call Ed Conaway or Michelle Potter and express their opinions or discuss an issue. Many times, Ed will hear from one of our PBOs and he will come back to us and ask how can we resolve this issue."
"We are sincere when we stress Con-Way NOW's open door policy. Ed and Michelle always make themselves available to our PBO's."
As an example of that PBO-friendliness, Blaney says that the company will work with new PBO's on the startup costs by deducting those from the first few checks they receive.
Darlene Krohn is the Recruiting Supervisor with Con-Way NOW and has a strong background in the placement and recruiting fields.
"I worked for a temporary placement service for 3 years and then worked in the air freight business for 8 years. I joined Con-Way NOW in August 2002, and was promoted to my present position in January of 2003."
Krohn's duties include all functions within recruiting: advertising placement, offsite recruiting and representing the company at trucking shows such as the Expedite Expo.
An example of Krohn's dedication to her company is demonstrated daily by her daily commute from the Toledo, OH where she and her husband are building a home - an hour and ten minute drive each way.
"When I came to Con-Way NOW from the air freight company, Krohn relates, "I was quite pleasantly surprised to discover the very low owner operator turnover rate for Con-Way NOW. My previous company had very heavy turnover, and this told me that Con-Way NOW does sincerely care about its PBO's."
"When interviewing a prospective Con-Way PBO, I like to find out why they're leaving their present company. If we can't offer them anything substantially different from their last carrier, I suggest that they might want to take a look at other companies. I don't want them to waste their time because it's important that the contractor and the company are a good match."
This veteran recruiter says that her job is also one of education for the prospective expediters she meets. "Many, for example, don't know that part of expediting is sitting and waiting for the next load."
Keys to Success
"I think it's essential to impart to the prospective expediters that this is not a get-rich-quick business. The keys to success for a Con-Way NOW PBO include:
-The owner/operator's money management
-A professional attitude in dealing with our customers
-A Serious truck maintenance program
-Knowledge of the industry
Krohn continues, "I find that they often don't consider the expenses and the need to have the necessary back up funds. I will often refer them to Expediters Online.com for general information on this business."
IT Department
Michelle Potter says, "Although we are part of a large corporation, we do all of our Informational Technology (IT) work in-house. From a customizing and development perspective, Jim Gibson and his staff do all of our own programming including both hardware and software support. The IT department also does website design for operations applications; currently, much of that development is concerned with Full Load applications.
Safety Department
Safety Department Manager Rob Trumbull's background is actually in the construction business, with a foray into the trucking business that he began with his father. After his father's retirement, they closed the business, and Trumbull entered the world of expedited freight.
Trumbull says that not everyone is cut out for expediting: "It's a different animal than typical over-the-road trucking. Expediters need to be patient, but at the same time, they need to be aggressive in finding the freight. A PBO has to take most of the runs that come along."
"For the former OTR drivers, they have to realize that in expediting, it's not running the thousands of miles every week that they are accustomed to. In this business, it's running less miles for more revenue."
"Our duties in safety include the qualification and the training of drivers. We perform background checks on prospective PBO's and our DOT drug testing is done on-site. The Con-Way NOW Safety department also handles Orientation, Log Books and Hours of Service issues, among other areas. They also arrange the Qualcomm and Con-Way NOW sign installations."
Trumbull says that Con-Way NOW strictly observes the Federal guidelines on various safety issues:
Hours of Service (HOS) violations are few are far between as we do not allow repeat offenders to remain in our fleet. We find more log book violations; some people come into expediting with poor training as regards how they should log." Safety is our number one core value and we believe in operating within DOT guidelines as all times and without exception.
"During orientation, I will hold up the green book of Department of Transportation regulations and tell the group, 'if you want to know what our company's policies are, these are our policies.' We will follow the DOT regulations as closely as possible."
The DOT regulatory audits are random, but can be triggered by having a poor safety record or by having too many accidents.
FAST Program
"We are encouraging our PBO's to get the applications for the FAST program," Trumbull continues, "but ultimately it's their responsibility to go through the process. I think everyone is unsure about how long the approval process will take. It's up to the government as far as how quickly the paperwork will go through the system."
Trumbull says that GM, Chrysler and Ford are pushing for the FAST program; their trans border drivers are already approved. This is a security issue and there will be some form of background check as part of the approval process.
"We have to offer support for our PBOs. For example, truck maintenance is the responsibility of the PBO, but in the event of a breakdown we will jump in and try to help."
"We've found that in matters of HOS or other compliance issues, we are talking to our PBOs rather than mailing them the information. The phone calls we make to our PBO's are more of an education process with the emphasis being on instructional."
Business Development
This department is responsible for customer relationships, scheduling appointments for the regional account executives and for increasing the frequency of contact with customers. It also acts as a back up for the customer service when call volume is heavy which ensure that customers are responded to immediately regardless of how busy the regular customer department is.
NLM department
Rodney LaCour came to the expedited freight world with 15 years in airfreight behind him. He is a five-year veteran of Con-Way NOW and has been in the National Logistics Management (NLM) department of the company the last two years. This department is an example of how a successful carrier such as Con-Way NOW pro-actively searches for freight.
"NLM handles expedited freight shipments for the Big Three auto builders and a few other major manufacturers," LaCour explains. "This freight is presented over NLM's web site on a 24/7 basis; we either accept the shipment or give them a reason why we cannot cover that load.
"From the time we are awarded the load, we have to keep NLM updated with all the details of the run. This is all done online. We are judged on a point system and if we don't keep them updated in a timely fashion, we are penalized with service failures."
The NLM system leaves little margin for error; it imposes a 15-minute window for pick up and the same time frame for delivery. Accessibility to the NLM system is highly restricted as well...
"An unapproved trucking company cannot bid on their freight. We had to work a contract with all of the accounts - GM, Chrysler and Ford in order to be one of their preferred carriers. We have to maintain a high enough score to continue our relationship with them."
Orientation
"It's always gratifying to hear the comments from many of the new PBO's in orientation," says Michelle Potter. "They have received so much positive feedback about Con-Way NOW from our PBO's at truck stops and gathering places.
"Our orientation program is focused on safety," says Mike Wyandt, Con-Way NOW Safety Supervisor. "Seventy percent of the orientation process deals with DOT compliance. Con-Way NOW is very serious about our drivers running legally and safely."
He describes the comprehensive two-day orientation schedule:
Day One
"We welcome the new PBO's and then we get down to one of the most demanding parts of the education - the paperwork."
"We then perform on-site vehicle inspections and check the truck's paperwork.
Wyandt says that the company performs the DOT Drug testing on-site. When it's done on Monday morning the results are back Tuesday evening after classes are done, so the PBOs are ready to roll.
In the next step in the class, the trainers cover pay issues and then begin to acclimate them to the satellite system and communication process.
"After that, our staff will come in from different departments and talk to the class for 5-10 minutes each. Our President and CEO, Ed Conaway opens the orientation, has the members of the class introduce themselves, has an open discussion with the new PBOs, and then is there for lunch with them. Ed spends a lot of time explaining the open door policy and ensuring that they understand that he answers his own phone and returns his own calls.
"PBOs coming to Con-Way from other expedited carriers are often very surprised to see our President in orientation, when many of them have never met anyone higher than a front line person in their previous company."
"We then touch on the Canadian border crossing issues with the accompanying security topics. Following that, we have a long session regarding Hazardous Materials that we take very seriously. We have a long video on that topic, followed by a HazMat test that every Con-Way employee and owner/operator in the country has to take."
Wyandt says that videos on the various topics have proven to be a great instructional tool and are used throughout the two days of classes.
The class is then visited by Don, the VP of Sales and Marketing, who talks about Con-Way NOW's marketing approach and how the PBO can help market the company.
"We finish up the first day with a drug and alcohol class with video," says Wyandt.
Day 2
"We start out with settlements and the accompanying paperwork. We then move into log books and impart to the new drivers that we are very serious about log book compliance.
"We will finish up the morning with instruction on insurance, permitting, fuel taxes and proper fuel tax reporting."
"Wyandt continues, "We provide the class with lunch and the new PBOs sit with the staff. They meet other supervisors and managers, and we try to put faces with the names of the PBOs. At this time, they're also given a complete company phone/fax number list from the President/CEO on down."
After lunch, Wyandt discusses how the NLM department functions and its guidelines. This is followed by Operations training.
Qualcomm training comes next, and then the manager of Operations comes in for a short review of what has been covered in Orientation. Before the new drivers leave the building and are put in service, he touches on the problems that new drivers sometimes experience and how to avoid them.
"We issue permits and parting gifts and ask them to fill out a survey about the orientation. We keep a strict schedule because there is so much information to share and a limited time to do so."
Operations VP Michelle Potter says, "I think that the positive attitude and friendly atmosphere within our fleet speaks to the success of our business. If we have people that want to come and work with us in this business, that means that something is being done correctly - the service is good and people enjoy working with us."