The Foxhole Mentality: Finding the Right Rates in a Tight Capacity Climate
By: Steve Moore, Vice President of Operations & Jeff Hart, General Manager at Transplace
It’s no secret that the industry has recently been dealing with a capacity shortage – and January 2018 was particularly difficult due to winter weather events and an intensely constrained market. When capacity is tight, it impacts service and creates additional costs for shippers all across North America. As a result, Transplace focused on analyzing results and processes to steer our teams to an enhanced process.
In our current Lean-Six-Sigma processes, much is automated – including tendering processes and our approach to the spot market – but in order to find additional capacity in such difficult market conditions, we needed to take an innovative approach to striking the perfect balance between automation and seasoned professional intervention. For one customer in particular, Del Monte Foods, we needed to find a new way to go above and beyond to secure better rates as part of our continuous focus on operational excellence.
Dialing for Diesel – And Del Monte
As a first step, we held a team-wide meeting to discuss each person’s experience with such tight market conditions – and since this is the tightest capacity has been in a number of years, many team members hadn’t faced such a capacity-constrained market before. We determined that some more traditional methods (e.g. “dialing for diesel”) would be much more effective in the current conditions than certain automated processes.
This led us to create our “Foxhole” mentality – we wanted our team to jump in feet first and get on the phones to secure the rates the customer needed, in addition to finding the best drivers (and those that had the most hours available). We had a vision of our team sitting in a foxhole together, creating a detailed, actionable plan to conquer the day. This is what that mentality meant to us:
- We are one team, working together in a difficult environment to thrill the customer. We’re fighting for capacity, demanding great service and holding carriers accountable to their commitments.
- A successful team in the foxhole feeds off each other’s energy, has each other’s back and shares best practices for winning across the entire organization.
The Foxhole Mentality Leads to Success for the Customer
In the past four months, Del Monte has been thrilled with the enhanced service that they’ve seen. Their spot-market cost control has been considerably improved month over month. In fact, the number of spot loads and the cost-variance average per load in January decreased by half in February and by half again in March.
We wanted to come at this problem with a determined mindset in order to secure reliable capacity for the customer in a highly-constrained market. This includes:
- Building relationships with carrier account reps. They are our allies who can truly help go to work to secure the right truck for your load.
- Understanding that email is great for track and trace, but sometimes you must use the phone to chase down the results that the customer needs.
- Understanding that an electronic tender reject is not a final verdict – it’s important to call and win the truck at the contracted rate. This also helps us to hold carriers to their commitments.
- Continually identifying high-performing carriers and working to provide them additional opportunities for growth.
- Reviewing results often and celebrating the wins!
As the market fluctuates, our teams are going to continue to focus on the ongoing refinement of our best practices and continue to seek new ways to thrill the customer. Additionally, we’re looking to implement the best practices that we’ve learned from our “Foxhole” mentality across teams. This is a unique time in our industry, and shippers and carriers alike are contending with a volatile landscape. In such a market, it’s important to take a step and look at things differently to truly create an impact to our operations and outstrip the norm.
How have you adjusted any of your processes in light of the current capacity market?