The link between driver turnover and motor carrier safety
While it makes sense that an increase in driver turnover would have a negative effect on the carriers' safety, little is known about the exact nature of the relationship and about whether managers can take steps to mitigate those negative effects.
THE ARTICLE
"How does driver turnover affect motor carrier safety performance and what can managers do about it?" by Jason W. Miller of Michigan State University, John P. Saldanha of West Virginia University, Manus Rungtusanatham of The Ohio State University, and Michael Knemeyer of The Ohio State University. Published in the September 2017 issue of the Journal of Business Logistics.
THE UPSHOT
Truck driver turnover—the rate at which drivers voluntarily and involuntarily leave their jobs—and motor carrier safety are big concerns for the trucking industry and shippers who use trucking services. However, relatively little is known about the effect of turnover on safety. While it makes sense that an increase in driver turnover would have a negative effect on the carriers' safety, little is known about the exact nature of the relationship and about whether managers can take steps to mitigate those negative effects.
To answer those questions, Dr. Jason Miller of Michigan State University and his fellow researchers utilized a multimethod research design where they first surveyed managers at for-hire U.S. motor carriers, and then combined that information with data on carriers' safety violations that are publicly available from the U.S. Federal Motor Carrier Safety Administration (FMCSA). Analysis of the data found that the relationship between driver turnover and safety is not linear. Rather, a given percentage-point increase in driver turnover has a more pronounced negative effect on the rate of safety violations for a carrier with a low rate of driver turnover than it has on one with a high rate of driver turnover. The research also found that having formal rules and standard operating procedures for drivers and centralizing decision-making can mitigate the negative effect of driver turnover on some (but not all) facets of motor carrier safety.
Miller, the article's lead author, spoke with Supply Chain Quarterly Senior Editor Susan Lacefield about the practical implications of these findings.
What was the impetus for your research?
This research formed one of the three essays of my Ph.D. dissertation. I decided to examine the issue of how driver turnover related to motor carriers' rates of safety violations because 1) there has been limited empirical work on the topic despite its importance; 2) people have generally assumed that this relationship is linear, by which I mean a 1 percentage-point increase in turnover has the same negative effect on safety regardless of a carrier's baseline turnover rate; and 3) there is limited understanding concerning whether managers can mitigate the presumed negative consequences [of the relationship] between turnover and safety.
What did your research show about the link between driver turnover and motor carrier safety performance?
This research finds evidence that an increase in carriers' driver turnover rates results in worse performance for the "unsafe driving," "hours-of-service compliance," and "vehicle maintenance" safety metrics tracked by the FMCSA. However, for all three metrics, we find that the relationship is highly nonlinear, such that a 1 percentage-point increase in driver turnover has a far more pronounced negative effect when a carrier has a low baseline rate for turnover (for example, 20 percent annually) versus when a carrier has a high baseline rate for turnover (for example, 100 percent). We further found that when carriers determine how drivers execute work activities—what we term "activity control" in our paper—it helps to mitigate the negative consequences of increases in driver turnover on the unsafe driving measure.
Can you provide some examples of activity controls that can improve motor carrier safety?
Activity control represents the extent that the carriers' managers shape how drivers execute their tasks. This includes things such as scheduling work (for example, trying to prevent drivers from operating during the riskiest nighttime hours), establishing standard operating procedures for drivers to follow (for example, how pre-trip inspections should be conducted, how to alert dispatchers of drivers' locations, etc.), and determining what routes drivers should follow.
So companies that have such activity controls in place are able to reduce the negative consequences of turnover on some aspects of safety?
Activity control only mitigates the consequences of driver turnover on unsafe driving; it does not reduce the negative consequences of driver turnover on hours-of-service compliance or vehicle maintenance. In retrospect, this finding makes sense in that we would expect activity controls to more strongly influence drivers' in-cab operations, which are a direct cause of unsafe driving behaviors. In contrast, compliance with hours-of-service rules and maintenance are more directly influenced by carrier-level actions. Thus, activity control is not a panacea that can address all of the negative safety consequences arising from driver turnover.
Were there any other findings from the research that may be surprising or interesting to supply chain professionals?
One thing we found was that higher levels of driver turnover were negatively related to carrier safety for the three metrics tracked by the FMCSA (unsafe driving, hours-of-service compliance, and vehicle maintenance) that we utilized in our study. I had anticipated that this effect would only hold for unsafe driving and hours-of-service compliance, given that these two metrics are under the control of a carrier's drivers to a greater extent than vehicle maintenance is. This just goes to show the importance of addressing turnover.
The research also showed that driver turnover displayed a very strong nonlinear relationship with each of the safety metrics, which indicates that the carriers that should be most worried about a 1 percentage-point increase in turnover are, somewhat paradoxically, those with lower baseline turnover rates. The explanation we offered for this set of findings is that firms with a high baseline turnover rate are likely to have developed routines that help mitigate the consequences of turnover, such that a 1 percentage-point increase in turnover has limited impact on their operations. In contrast, for firms that tend to experience far lower turnover rates, a 1 percentage-point increase in turnover is far more disruptive.
What are some ways managers—both those who work for motor carriers and those who hire motor carriers—can apply the findings of your research?
Motor carrier managers can gain a better understanding of how reducing driver turnover is likely to improve their safety as well as a better understanding of when increases in turnover are likely to be the most detrimental to safety. Shippers can use carriers' data on driver turnover to develop better forward-looking projections of carriers' safety.
Our research further lends credence to the recent report by the National Academies of Sciences, Engineering, and Medicine (NASEM) that urged the FMCSA to collect more detailed information regarding carriers' operating characteristics that could affect their safety. Driver turnover was mentioned in this report as an area warranting data collection. The findings reported in our research corroborate the NASEM's recommendation.
What do you think the key takeaway from your research is for practitioners?
Driver turnover negatively affects carriers' safety across a variety of safety dimensions measured by the Federal Motor Carrier Safety Administration as part of the Compliance, Safety, and Accountability (CSA) program. But this relationship is highly nonlinear, in that a 1 percentage-point increase in driver turnover has a more pronounced negative effect on safety for carriers that have lower baseline rates of driver turnover. Thus, when practitioners evaluate the benefits from reducing turnover, they need to also incorporate costs that stem from lower safety compliance in addition to recruitment and training costs.
Editor's Note: CSCMP members can access JBL articles by clicking on the "Develop" tab at cscmp.org, selecting "Journal of Business Logistics," and using the secure link to the Wiley Online Library.
Artificial intelligence (AI) tools can help users build “smart and responsive supply chains” by increasing workforce productivity, expanding visibility, accelerating processes, and prioritizing the next best action to drive results, according to business software vendor Oracle.
To help reach that goal, the Texas company last week released software upgrades including user experience (UX) enhancements to its Oracle Fusion Cloud Supply Chain & Manufacturing (SCM) suite.
“Organizations are under pressure to create efficient and resilient supply chains that can quickly adapt to economic conditions, control costs, and protect margins,” Chris Leone, executive vice president, Applications Development, Oracle, said in a release. “The latest enhancements to Oracle Cloud SCM help customers create a smarter, more responsive supply chain by enabling them to optimize planning and execution and improve the speed and accuracy of processes.”
According to Oracle, specific upgrades feature changes to its:
Production Supervisor Workbench, which helps organizations improve manufacturing performance by providing real-time insight into work orders and generative AI-powered shift reporting.
Maintenance Supervisor Workbench, which helps organizations increase productivity and reduce asset downtime by resolving maintenance issues faster.
Order Management Enhancements, which help organizations increase operational performance by enabling users to quickly create and find orders, take actions, and engage customers.
Product Lifecycle Management (PLM) Enhancements, which help organizations accelerate product development and go-to-market by enabling users to quickly find items and configure critical objects and navigation paths to meet business-critical priorities.
Nearly one-third of American consumers have increased their secondhand purchases in the past year, revealing a jump in “recommerce” according to a buyer survey from ShipStation, a provider of web-based shipping and order fulfillment solutions.
The number comes from a survey of 500 U.S. consumers showing that nearly one in four (23%) Americans lack confidence in making purchases over $200 in the next six months. Due to economic uncertainty, savvy shoppers are looking for ways to save money without sacrificing quality or style, the research found.
Younger shoppers are leading the charge in that trend, with 59% of Gen Z and 48% of Millennials buying pre-owned items weekly or monthly. That rate makes Gen Z nearly twice as likely to buy second hand compared to older generations.
The primary reason that shoppers say they have increased their recommerce habits is lower prices (74%), followed by the thrill of finding unique or rare items (38%) and getting higher quality for a lower price (28%). Only 14% of Americans cite environmental concerns as a primary reason they shop second-hand.
Despite the challenge of adjusting to the new pattern, recommerce represents a strategic opportunity for businesses to capture today’s budget-minded shoppers and foster long-term loyalty, Austin, Texas-based ShipStation said.
For example, retailers don’t have to sell used goods to capitalize on the secondhand boom. Instead, they can offer trade-in programs swapping discounts or store credit for shoppers’ old items. And they can improve product discoverability to help customers—particularly older generations—find what they’re looking for.
Other ways for retailers to connect with recommerce shoppers are to improve shipping practices. According to ShipStation:
70% of shoppers won’t return to a brand if shipping is too expensive.
51% of consumers are turned off by late deliveries
40% of shoppers won’t return to a retailer again if the packaging is bad.
The “CMA CGM Startup Awards”—created in collaboration with BFM Business and La Tribune—will identify the best innovations to accelerate its transformation, the French company said.
Specifically, the company will select the best startup among the applicants, with clear industry transformation objectives focused on environmental performance, competitiveness, and quality of life at work in each of the three areas:
Shipping: Enabling safer, more efficient, and sustainable navigation through innovative technological solutions.
Logistics: Reinventing the global supply chain with smart and sustainable logistics solutions.
Media: Transform content creation, and customer engagement with innovative media technologies and strategies.
Three winners will be selected during a final event organized on November 15 at the Orange Vélodrome Stadium in Marseille, during the 2nd Artificial Intelligence Marseille (AIM) forum organized by La Tribune and BFM Business. The selection will be made by a jury chaired by Rodolphe Saadé, Chairman and CEO of the Group, and including members of the executive committee representing the various sectors of CMA CGM.
Businesses were preparing to deal with the effects of the latest major storm of the 2024 hurricane season as Francine barreled toward the Gulf Coast Wednesday.
Louisiana was experiencing heavy rain and wind gusts at midday as the storm moved northeast through the Gulf and was expected to pick up speed. The state will bear the brunt of Francine’s wind, rain, and storm damage, according to forecasters at weather service provider AccuWeather.
“AccuWeather meteorologists are projecting a storm surge of 6-10 feet along much of the Louisiana coast with a pocket of 10-15 feet on some of the inland bays in south-central Louisiana,” the company reported in an afternoon update Wednesday.
Businesses and supply chains were prepping for delays and disruptions from the storm earlier this week. Supply chain mapping and monitoring firm Resilinc said the storm will have a “significant impact” on a wide range of industries along the Gulf Coast, including aerospace, life sciences, manufacturing, oil and gas, and high-tech, among others. In a statement, Resilinc said energy companies had evacuated personnel and suspended operations on oil platforms as of Tuesday. In addition, the firm said its proprietary data showed the storm could affect nearly 11,000 manufacturing, warehousing, distribution, fabrication, and testing sites across the region, putting at risk more than 57,000 parts used in everyday items and the manufacture of more than 4,000 products.
Francine, which was expected to make landfall as a category 2 hurricane, according to AccuWeather, follows the devastating effects of two storms earlier this summer: Hurricane Beryl, which hit the Texas coast in July, and Hurricane Debby, which caused $28 billion in damage and economic loss after hitting the Southeast on August 5.
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Supply chain managers at consumer goods manufacturing companies are tasked with meeting mandates from large retailers to implement item-level RFID.
Supply chain managers at consumer goods manufacturing companies are tasked with meeting mandates from large retailers to implement item-level RFID. Initially these requirements applied primarily to apparel manufacturers and brands. Now, realizing the fruits of this first RFID wave, retailers are turning to suppliers to tag more merchandise.
This is one more priority for supply chain leaders, who suddenly have RFID added to their to-do list. How to integrate tagging into automated production lines? How to ensure each tag functions properly after goods are packed, shipped, and shelved? Where to position the RFID tag on the product? All are important questions to be answered in order to implement item-level RFID. The clock is ticking on retail mandates.
Different products, new RFID considerations
Hangtags, the primary form of apparel product identification, present a relatively easy way to attach an RFID tag. Pressure-sensitive labels likewise can carry an RFID inlay. The inlay, consisting of a microchip and antenna, holds the product’s unique identifying information. This tiny device is activated when the RFID reader passes by it. For nonapparel products, in many cases, there is no way to attach a hangtag. Therefore, a pressure-sensitive RFID label often must be put directly on the product. If the product is packaged in a box, the RFID carrier can be attached to or placed inside the box. Either way involves the use of just the right solutions, including the adhesive, shape, dimension, and placement. Moreover, there must be an efficient way to attach the labels to products. This requires process engineering and sometimes capital investment to integrate RFID labeling into highly automated manufacturing lines.
Metals, liquids, and low-surface-energy (LSE) materials pose hurdles for RFID item tagging. Tag and label inlays cannot be read properly through metals and liquids, and the pressure-sensitive labels do not always stick well to product surfaces containing silicone, vinyl, polyethylene, and polystyrene. Very small items are also difficult to tag. Metal paint cans, caulk or paste tubes, lipsticks, and reusable water bottles are just a few products that present RFID tagging challenges.
In other cases, it is not so much the product itself that hinders readability but rather the shipping method. For example, it is relatively straightforward to apply an RFID tag or label to a bag of fertilizer. But the fertilizer bags might be stacked 60 deep on a pallet. The pressure is too much. It damages the inlay, killing the tag’s readability. So, RFID tags, which were perfectly fine coming off the production line, are now dead from the stacking pressure.
Solutions and testing
RFID tagging and labeling programs take time to get right. While some manufacturers can set up a successful process in a few weeks or months, for others it can take six months, nine months, a year or longer. Variables influencing implementation time include capital equipment investments, the product types (for example, are the materials, shapes, or surfaces potentially problematic?), label supplier capacity and capabilities, and third-party testing rounds.
The good news is that best practices are being refined every day to incorporate RFID on difficult-to-tag products. A case in point is finding answers to RFID-inlay readability issues on metal or liquid products. There are ways to attach an RFID label to the product’s lid or cap.
The University of Auburn RFID Lab is the de facto U.S. authority on all things retail RFID. Through its ARC program, the lab works with end users to make sure RFID tags meet or exceed their required performance and quality levels. Walmart, for example, requires its suppliers to source from Auburn RFID Lab’s ARC program-approved inlay companies. “ARC is a test system and database that stores comprehensive performance data of in-development and market available RFID tags,” according to the lab’s website. “ARC has been working with end users to translate RFID use cases into specific levels of performance in the ARC test environment.”
High-quality RFID tags and labels are at the heart of it all. The following are some considerations to keep in mind when choosing an RFID tag and label provider:
What are their quality control and testing capabilities? Can they confirm that every tag is readable? Do they have software to verify that UPC and RFID information match up? Do they possess familiarity with Auburn’s RFID Lab approval process?
What is their capacity? How many thousands or millions of inlays do they create per day? Are there minimum order quantities?
What are their order management and shipping processes like? What is their delivery speed? How easy are they to order from? Where are their print facilities located?
Do they offer customization? Do they possess specialized equipment? Can they die cut irregular shapes, including very small dimensions? Do they possess adhesive expertise and application equipment? Do they have solutions for metal, liquid, and other difficult-to-tag items? Are they able to configure label rolls to work on automatic label dispensers?
It takes trial and error to implement RFID item tagging for nonapparel products. Effective, compliant programs do not manifest overnight. Collaboration with experienced label providers and the Auburn RFID Lab will help manufacturers overcome even the most complex RFID tagging challenges. There will be a roadmap to success, and the results in the form of better inventory visibility, swifter sell-through, and stronger sales will be well worth it.