Ask Thorn Valley #1 (Tom Nitza)
I was reviewing a motor carrier’s violation report and found this violation: 395.208 – The ELDs display screen cannot be viewed outside of the commercial motor vehicle.
I looked up the regulatory citation and it reads as follows: 395.20 ELD Applicability and Scope. (b) An ELD used after December 18, 2017, must meet the requirements of this subpart.
Is this something new?
Part 395 Appendix A: 18.104.22.168. Display Requirements
(a) This section does not apply if an ELD produces a printout for use at a roadside inspection.
(b) An ELD must be designed so that its display may be reasonably viewed by an authorized safety official without entering the commercial motor vehicle. For example, the display may be untethered from its mount or connected in a manner that would allow it to be passed outside of the vehicle for a reasonable distance.
Ask Thorn Valley #2 Profitability Through Safety
Just recently we received the following consultant viewpoint regarding the Pre-Employment Screening Program. The broker asked for Thorn Valley’s opinion.
Question: PSP is a great tool to use when hiring drivers who have prior commercial driving experience. It supplies the recruiter with information that they might only know if the candidate is completely honest and volunteers his/her prior safety history without reservation. Not too many candidates are confident enough with their abilities to do this during the hiring process.
Problem is it cost ~ $10 – $15 to run a candidate’s history. Therein lies the monkey wrench. Many motor carriers don’t really want to know the complete history and past record if it cost money to gather the information. They hang their hat on “well, it’s not required so we’ll bypass that step and go with what we have”. Problems arise when the new driver goes down the road and becomes involved in something serious (i.e., fatal accident, vehicle rollover with major damage and injuries, etc.). Plaintiff attorneys have an uncanny way of checking the driver’s past record to cite patterns of violations that could have and should have been identified by the recruiter. Then the negligent hiring, retention and management claims take over. Again, many carriers subscribe by the “that probably won’t happen….we’ll worry about that if and when it does.”
If you recall, checking files for PSP reports was part of our captives’ risk assessment. If I were to venture a guess about PSP usage based on all of the audits I’ve performed since the program’s inception, I’d say approximately 5% or less use this valuable tool. It just simply hasn’t caught on and probably won’t unless FMCSA makes it mandatory as part of the driver hiring process.
Answer: Download the Profitability Through Safety PDF to Follow Along
Thanks for sharing this individual’s point of view. They certainly have the negligent hiring risk exposure identified. Unfortunately, if you leave it up to that, many truckers struggling to make ends meet may be willing to simply roll the dice and not invest in safety. From a leadership perspective, this decision can affect not only the company, but their driver’s families and loved ones as well. Understanding that people make emotional decisions backed by logic – not vice versa, is why we lead with “Can you imagine your driver’s family not having their daddy to come home to play with them ever again?” proposal. That is an emotional statement backed by the fact that motor vehicle crashes continue to be the #1 cause of workplace fatalities.
The “price” objection is usually the first one offered by the prospect (either that or time). It doesn’t matter what the objection is, my all-time favorite counter has been “well that’s exactly why we should get started right away!!” In these two examples, I’d follow up with “That’s interesting – can I take a look at your cost benefit analysis?” or “That’s’ interesting – what would you estimate your current time investment in safety to be?” In this situation, the objection is cost, but if they truly realized how much it costs to hire just one driver, they’d understand that another $15 for a PSP is less than half percent – nil! Consider the following;
- Most recent studies by the American Transportation Research Institute (ATRI) indicate that driver wages and benefits now comprise a 43% share of total fleet Marginal Cost. The ATRI poll has Driver Shortage topping the list of industry concerns. Driver turnover is more costly than ever – current industry cost estimates to hire a commercial driver exceeds $5,000. Setting fleet goals to reduce driver turnover can improve the company bottom line as well as overall performance. Determine the top five (5) reasons drivers quit, and the top five (5) reasons drivers stay. Develop a retention strategy to emphasize these components, and your goals could be attained. Consider using the Pre-Employment Screening Program as a method of screening out drivers who are likely to quit within their first year. A fleet of 50 power units that is able to reduce turnover by just 10% could save approximately a $25,000 savings in personnel cost. At a 3% operating margin, this represents over $833,333 in annual sales needed to retain margin! The numbers don’t lie – monitoring, measuring and managing driver turnover and establishing a percentage reduction goal, putting a realistic action plan in place and attaining goals will add profit dollars that can be invested back into the company.
After we’ve raised awareness about the importance of leadership, company stewardship and responsibility, and helped identify the relative cost of PSP vs. total hiring costs, we discuss RAB (Risk Associated Behavior). If the PSP reveals instances of roadside violations (speeding, cellphone, seatbelt, brakes, lights, tires, fatigue, driver’s license, medical, etc.) that they would not see on the MVR, at the most critical moment (hiring the driver) they can make a much more informed safety leadership management decision and pass on that prospect. The chances of a commercial driver being involved in a crash go up logarithmically with Unsafe Driving, to Crash, to Fatigue, to Vehicle Maintenance, to Driver Fitness BASIC methodology. Spotting these violations in advance is huge. “Oh we fired that driver” because they were involved in a crash is no longer acceptable. The question should be “Why did we hire that driver in the first place?” Was it really worth filling that empty seat? Probably not, when you consider the revenue needed to offset the True Cost of a Collision.
Slide #6 on the attachment is for those with senior management decision making influence. Many line level employees, operators and dispatchers might not get the message, and will likely say “it costs too much”. Bottom line, this slide reveals that the crash we hired 6 months ago, didn’t just cost us an insurance deductible (and possible premium increase – or worse yet, cancellation), it also eroded our top line revenue by hundreds of thousands of dollars. Speaking in those terms to the true decision maker within the organization, or someone who is willing to champion the message along will likely lead someone to question how thinking that a $15 PSP record “costs too much” ever existed. Consider the following;
- We can learn from experience, even the negative ones. Crash countermeasures start with a thorough review of data surrounding all accidents, tracking these on a log to determine not only root causes, but any trends that can be identified to prevent similar future occurrences. While the natural tendency is to “get it over with” and put the crash behind us, it is important to track all employee, equipment and environmental data from company, insurance and police reports as well as any other available data surrounding similar collision types (SMS, NSC, NHTSA, etc.). This is done for three reasons; 1) to determine preventability, 2) to look at root cause(s), analyze trends (driver, vehicle, collision type, time and location, etc.), develop a documented prevention program based on trend analysis (modify work process, re-train, discipline, etc.), and develop the crash countermeasure program, and 3) to prepare written summary for senior management in regards to safety investment decision-making. Each crash report and executive summary should include any and all direct and indirect costs associated with the crash(s), along with the needed revenue to offset the loss(s). While most crashes, collisions and near-misses are preventable, a formal Accident Review Panel to rule on any challenges to preventability findings should be established. It is important to know that indirect costs such as lost productivity typically amount to 4 times the direct cost (such as insurance deductible) resulting from the crash so the impact on the company’s profitability and bottom line is often times not fully understood because a thorough analysis had never been performed. Determine needed revenue by dividing total crash cost by the company’s operating margin percentage. The results will definitely raise some eyebrows.
I truly appreciate your obvious interest in helping your client, and look forward to any opportunity to collaborate in helping any of your insureds attain “Profitability Through Safety!”
Thank you for your business!