Measuring for Success Workshop

Third Blog Post from the Convention
May 15, 2010

Today’s “Good Ideas” from the 23rd MCAA Annual Meeting come from member Rick McMcClelland, a passionate believer in the power of metrics and 25 year veteran of the same-day transportation industry. If you missed his session, you missed bright ideas about “Turning Intent Into Reality” through metrics

Here are a few Good Ideas from that session:

• Objectives - Create a Road Map for success for your business that includes: Personal and professional objectives; metrics to measure progress against those objectives; a performance management system to help you track progress; a look at your people and a look at the way your time is being spent.
o Set your objectives by starting with an analysis of your current market position. That starts with market awareness. To develop this, talk to current customers to learn how to maintain their loyalty. Also, do a “hit and miss” analysis of proposals. Add to that an analysis of your competitors, including finding out why former clients shifted to them and an in-depth look a lapsed accounts.
o Create a profile of the best customers to pursue. To do that, analyze your best customers. Do they come from specific SIC codes? Do they tend to use one of your services more? Are they in a growing segment? Are they loyal? Are they served by a particular driver? Do they require excessive driver support and what is your yield quality from them?
o Ask yourself what percentage of your time you spend on your biggest customers. Then look at what percentage of your revenue they take up. Do you want more customers like them?

• Metrics – Now it’s time to develop systems that will help you track your progress against those objectives.
o Develop a one-page income statement summary that allows you to measure actual and budget numbers for the month as well as percentage of sales from specific services, both monthly and year-to-date.
o Do a P/L on each major account and educate your talent pool to these metrics so they can do their jobs in line with your objectives for these accounts.
o Do a P/L for your on-demand work in particular. “Most people started in this segment but have expanded into other segment,” Rick said, “That means this part of the business is left to flounder.”
o Do a “Run Chart” that looks at month-by-month gross margin numbers to identify trends.
o Chart your cost and income momentum “report card”
o Put all of these together on one page for in a monthly business dashboard. This will put the numbers, moment and history on one sheet.

• Customers – Develop an operational index that allow you to look at customer satisfaction.
o Survey existing and prospective clients to determine their top priorities. Train customer service people to do this during their down-time.
o Sample a percentage of your current customers each week and develop a chart of the percentage of good or excellent ratings for each of the above priorities. This is also a good use of customer service reps.
o Feed these into a Customer Satisfaction Index to determine what you’re doing right and what needs to improve.

• People – Include your people in the process
o Use the metrics above as feedback tools to help them measure and adapt their behavior
o Feed information back to your people to tap into their ideas for improvement. Rick reminded us that, “Nobody is smarter than everybody.”
o Find out why drivers leave to lower driver turn-over and improve hiring.

• Time – Look at where your time is spent
o Do you have an excessive concentration on large, low-margin accounts? These kinds of accounts inhibit your ability to focus on more profitable client and to bring in more profitable clients.

For a copy of Rick’s insightful Power Point from this presentation, including helpful metric templates, go to info@mcaa.com.

Tune in to our next MCAA Annual Meeting for a legislative update on the key issues that continue to affect each and every member of our expedited delivery members.