What Got You Here, Won’t Get You There

What Got You Here, Won’t Get You There

What got you here, won’t get you there is the message that we are increasingly delivering to our clients.

At TranStrategy Partners, our executive clients are very successful people, typically the owners and senior leadership of freight brokerage businesses. They have grown their companies through brains and hustle – lots and lots of hustle. Definitely a battle-hardened group of entrepreneurs.

These guys and gals are masters of the freight management universe and experts at cold calling, carrier network development, load tendering, customer service, problem solving and everything else needed to run a successful freight brokerage.

They come to us because they want to get to the next level, which means something different for every one of our client. Our engagements typically begin with a 360-degree business assessment to understand the current state of the organization. From the assessment, we make recommendations and partner with companies to develop:

· Strategy and implementation
· Training and people development
· Improved organizational structure and accountability
· Sales and marketing muscle

Our recommendations are changing somewhat, because doing the same things more effectively and more efficiently isn’t enough in the rapidly changing transportation market. To win in the new competitive environment, freight brokerage companies will need to do different things.

Do These 4 Things to Get There

1. Be an Industry Expert
Shippers are looking for a company who can solve their problems – ideally a company that specializes in solving problems for people just like them. If you are the shipping manager for an ecommerce company, wouldn’t you rather work with a company that specializes in ecommerce shipping? Stop generalizing and start specializing.

2. Become a Total Solution Provider
Freight brokers have a narrow niche – they match great carriers with great shippers and manage every step of the process. But shippers often have other transportation needs like LTL, courier service, freight forwarding, etc. It might make sense to expand your service offerings. The fast-growing ecommerce company you serve no doubt has LTL and home delivery shipments and your competition who moves those loads, will be pushing hard to take over the shipments you currently manage.

3. Provide Insights and Recommendations
Business intelligence, big data and analytics seem to be all the rage these days even though most people have only a vague idea what they mean. I like to keep things simple. I think all those fancy terms refer to collecting data, analyzing it and providing actionable insights. Your company’s transportation management system (TMS) collects and stores all sorts of useful information. Talk with your ecommerce customer and determine if data in your system can be used to help them make better decisions. Perhaps, shipment data from the last 6 months holds the key to a solving a big problem that your customer has. Put your data to work.

4. Focus on Marketing
The freight brokerage business has historically relied on cold calling, which isn’t working as well as it once did. Savvy transportation companies are using marketing, usually digital marketing to fill the top of their sales funnel. A focus on marketing and lead generation is a big shift for many companies that have lived and died by “smiling and dialing.” To be found online via digital marketing takes just as much hard work and dedication as cold calling. The good news about the web is customers find you and if you do it right, they will reach out to you. When customers reach out to you, they know they have a problem and they think you can fix it, which is a much better way to begin a business relationship.

Culturally Speaking

Culturally Speaking

In a recent study by student loan financial firm, Comet, one thousand respondents were surveyed about the dissatisfaction of their current career position. While not the worst industry (Hospitality), Transportation and Warehousing was the third highest rated industry regarding dissatisfied employees. The top five factors for the dissatisfaction in our industry were:

5. Lack of Growth Potential
4. Low Salary
3. Workload
2. Heavy Stress
1. Lack of Appreciation/Recognition

Each of these components is driven by the culture of any organization. With the right culture, each of these components can be turned around to bolster the satisfaction of its employees.

With the right training and development plans in place, employees can have a sense of movement along their career pathway. By providing the requisite skills and tools for each team member, an organization can establish a model of consistency and work ethic that supports the goals of the individual as well as the goals of the overall company.

By aligning compensation to properly defined metrics, employees can have full visibility of their contribution to the team, department and organizational goals. Both control and visibility of earning potential creates a motivation for employees that is tied to organizational expectations and behaviors.

Defining roles and responsibilities for each employee with clear expectations of execution helps to limit the creep of scope and undue additional work. Employees end each day with a sense of accomplishment of their daily tasks and preparation for tomorrow’s needs.

Stress is often felt when people are either unsure of what they are expected to accomplish or do not have the tools/time to fulfill those expectations. By providing clear roles, goals and the tools to succeed, stress can be mitigated and productivity can be increased.

Appreciation is such an important aspect of personal motivation, yet leaders often forget the power of a simple “thank you”. When an employee feels that they are accomplishing their work, the reinforcement associated with recognition of the accomplishment builds both trust and a desire to receive more positive reinforcement.

While our industry has much room to improve when it comes to dissatisfaction, your business can easily buck the trend by establishing a culture that supports its employees and aligns their goals to the overall goals of the company. Communicate, Appreciate, Calibrate and Motivate.

The Quest for Diversity

The Quest for Diversity

The power (and bane) of connectivity algorithms and data insights has helped us, as consumers, to find bounty in our cumulative searches for information. Unfortunately, these same search algorithms push us further and further in one direction or another. Our likes and preferences begin to form the basis of the majority of our information access, leaving us without an important contrary and balancing voice to temper ideas and question one-sided wisdom. While this is particularly true of political and social positions, it also can become a problem in creating a homogeneous business model that lacks necessary diversity.

In recruiting staff, businesses often look for the right fit for their culture – people we would like to have a beer with or folks we want to socialize with outside of work. This can create a strong camaraderie, but it can quickly devolve into a fraternity mentality where equal amounts of time are focused on work and on less productive pursuits such as fantasy football drafts, happy hour parties or questionable behaviors. While company events can be a morale booster, they should be organized with inclusivity and team building in mind.

It will be exceedingly more beneficial to focus on who will challenge you, who will keep your integrity intact and who will be able to make the tough decisions that are necessary to drive growth and manage change. Judge more on character and proven success than on familial connections. Innovation and creativity are the result of diverse ideas and backgrounds. Valuable insights come, not from a single source, but from varied, alternative and unexpected sources.

Look to your anti-self, not at what makes him or her wrong, but what they love to do – that you do not – and what makes that person strong and successful. Find ways to capture their valuable qualities and incorporate them into your organization to provide balance. As a leader, it is your responsibility to inspire those around you – through insight, wisdom, action and support. Foster a culture of diversity to gain valuable insight, help your people grow and help your business become best positioned for changes to come.

Revenue is Vanity – Margin is Sanity

Revenue is Vanity – Margin is Sanity

As an executive coach, I hear from my clients on a host of issues they experience. Sometimes those issues are external, while others are internal within the company. For example, one of my clients, a 3PL owner, found it difficult to get his employees to care about the company’s profitability. They pay their people well and have a nice, friendly company culture. However, he struggled to get the employees to care more about the bottom line.

It is smart to focus on profitability, rather than just revenue. At TSP, our philosophy is “revenue is vanity and margin is sanity.” After all, it’s not what you make, it’s what goes to the bottom line.
Focusing on revenue AND MARGIN is smart, but getting your employees aligned to your profitability goals is even smarter.

As the owner, your job is to set the goals (financial and others) and get the right people and resources necessary to reach the goal. In my experience, the owners of 3PLs and freight brokerage businesses try to do all the work themselves, which leads to burnout and frustration. Learn to delegate and hold your team responsible for meeting business goals including profitability.

You have created a nice place to work, which is very important. Now, you want to add ownership of business results to the culture.

To reach your profitability goal, you will need to enlist the help of your team. The following four-step plan will help you and your team set and reach your profitability goals:

1. Share your profitability goals. Once you have set your profitability goals, meet with your team to communicate your goals. As the leader, you must make it clear where you want to take the company. Be very specific and use SMART goals so there is no ambiguity about your profitability targets. Your people can’t reach the profitability goal if they don’t know what it is.

2. Communicate your expectations. Once you have set your profitability goals, communicate exactly what you need each team member to do to reach the goal. Be very specific about each team member’s roles and responsibilities in regards to the goal. The sales manager is tasked with getting higher margin business, the operations manager is going after cost savings opportunities, while the head of finance investigates refinancing equipment and provides progress reports to the team. By documenting your expectations for each employee, you are communicating that the profitability goal is important to you.

3. Measure progress. If you have set a significant goal, you will not reach it overnight, therefore it is important to measure progress to the goal. Provide your people with regular updates. Also, help your team develop plans and strategies that will enable the company to reach the profitability goal. As the boss, encourage, teach, but avoid taking responsibility for the work. When you do the work instead of the employee, you send a mixed message.

4. Reward and recognize. As your team meets your expectations on the profitability goal, you should acknowledge and encourage them for exhibiting the desired behavior and getting positive results. At TSP, we recommend the following three levels of acknowledgement: 1.) Review (lowest level) is non-formal, verbal praise for delivering on expectations. 2.) Recognize (second highest) is a formal recognition for meeting expectations. The praise could be part of a meeting or recognition presentation. 3.) Reward (highest level) is praise reinforced with a gift, bonus or a plaque. Be careful and consistent in your use of review, recognition and rewards for meeting expectations. Going overboard or being stingy with your praise can lead to negative consequences.