In 2009, trucking company executives faced the most serious economic challenge since the Great Depression. Many leaders adopted a survivor mentality. The focus was on maintaining essential business while cutting all discretionary costs. Despite the departure of an estimated 3000 trucking companies, most industry leaders were able to right size their business model, park excess equipment, reduce staff and freeze or cut salaries to remain in business.
This year is shaping up to be very different from the previous one as trucking company executives are facing a new set of challenges. Business levels are improving but at an agonizingly slow pace. The European debt crisis has created a new level of uncertainty as to whether or not the economy will continue its growth pace or slip into a double dip recession.
In the LTL sector there is still excess capacity that is making it difficult to increase rates. In the truckload sector, capacity shortages are being experienced on certain days in specific geographic areas. The intermodal business is running at about full capacity.
The new CSA 2010 initiative will raise the bar on truck fleet operational performance at a time when driver shortages are occurring. In the U.S. potential new cap and trade legislation and new emissions standards could have far reaching effects for the trucking industry. Truckers are buying fleet equipment again but mostly as replacements rather than in anticipation of growth. Consumer confidence has taken a step backwards in recent months.
This evolving economic environment will require modifications to the leadership styles of truck fleet executives. The “bunker mentality” of 2009 must be replaced with a new leadership paradigm.
Improved Skill Sets
According to a new survey conducted by ExecuNet of 3,636 executive recruiters and human resource professionals, big changes are under way. Over one in four companies surveyed plan to expand their executive teams with new hires and 56 percent are planning to “trade up.” They are seeking replacements that are better equipped than the incumbents to meet current expectations and market demands.
Drivers of Business Growth and “Quick Wins”
This year industry executives must be able to drive growth. Business owners are looking for “adaptability,” the ability to change course and take decisive action to make things happen. Executives must be able to secure “quick wins,”. . . . “launch new initiatives and make an immediate positive impact on the organization and its bottom line,” according to Craig Herner, a partner with recruiter Odgers Berndtson in Vancouver.
Motivators
This year leaders must be motivators. As reported in a prior blog, many survivors of staff cuts are suffering from “employee layover syndrome,” an emotional and physical state brought on by over work and stress. These employees are looking to their leaders for good direction, a solid plan, support and team building skills.
Retention of High Potential Staff
In a recent Toronto Globe & Mail article, Rick Lash, Toronto-based national practice director of leadership coaching company, Hay Group, expressed the view that “in a recovery, organizations want managers who can retain their high-potential staff because, as the economy improves, top quality staff are usually the first group to look elsewhere for other opportunities.”
Operational Excellence
Trucking company executives will also need to bolster their operational skills to ensure their drivers pass the CSA 2010 checks. For truckers that have not focused on this area, this initiative will force these companies to improve their fleet management processes. This will take operational excellence and quality improvements skills.
In summary, trucking company leaders will need to drive business growth, upgrade their skill sets to meet changing environmental factors and regulation, improve morale, retain their top performers and upgrade operational performance to achieve success in 2010.