Measuring Driver Turnover in Detail

The following article is an edited excerpt from the Truckload Carriers Association’s Driver Retention Manual, Chapter 30.

OBJECTIVE: To get much more granular in measuring driver turnover by focusing on sub-categories such as dispatch board, Company Driver vs. O/O and entry-level drivers. This exercise will reveal where your company strengths and weaknesses are – providing an opportunity for overall improvement.

These more focused numbers will give your company a much better understanding of where you stand – and why. This drill-down will focus on the different dispatch boards in your company. You should look at your dispatch boards as though they are individual fleets within your company because they are. Different boards cover different regions and various types of services and skills; therefore, they often have different kinds of drivers. These types of drivers are often managed differently by dispatchers. It’s easy to see why some boards are harder to staff than others.

One of the reoccurring themes in this effort is that we are not looking for bad guys – but low hanging fruit in different dispatch situations that can provide insights. This more detailed look at turnover may reveal ‘stars’ – boards with lower turnover. What is it about some of these boards and dispatchers, that allows them to have lower turnover? We can emulate their success if we understand it. The boards are different so measure their retention in detail, find out why they are different and tune your actions accordingly.

In our company, we had six different dispatch boards (three flatbed, three van) defined by geography and trailer configuration. For each board, we calculated the same short and long term turnover rates that we had already done for the entire driver team. Use the same short and long term calculation formulas shown for the whole company and do the same for each of your dispatch boards, divisions or even terminals.

At our company, the monthly reports were based on six different dispatch boards that produced two turnover numbers for each board. Moreover, I would also receive the overall and short-term numbers for the entire fleet. So that was 14 reports each month. We found this very insightful. So much so that more detail seemed like a good idea – and it was. So, we looked even deeper.

At our fleet, we had 100 company drivers and 200 owner operators, and we decided that we wanted to measure each group separately. So now we are at 28 separate monthly reports. You’ll realize soon enough that once you get the formulas up to date, these reports are not difficult to generate. They all use the same data, just broken down into finer sub-categories. It’s not nearly as complicated as it first seems.

This set of dispatch board calculations is not done merely out of interest. By doing them monthly, you will now track your progress going forward. Produce these numbers every month and monitor which are going up or down as you introduce improvements towards reducing your turnover. Which of your new initiatives is having the most significant impact and where? With these monthly numbers, you can track progress in real-time and react to the effectiveness (or not) of the new things you are doing. Measure, watch and learn.

We said we were not looking for bad guys, but we are looking for STARS. What and who is working well with your dispatch team? What can we learn from these bright spots? What are the traits of these successful dispatch boards? Use this insight to make process or style improvements among dispatchers or to hire more people in the future with these same behavioral traits.

Apart from the insights we can obtain from these more detailed turnover numbers, keep in mind that things are often affected merely by measuring them. The act (and awareness) of measuring tends to shine a light on positive trends and accelerate improvements through this awareness. From now on, you will have monthly turnover numbers by dispatch board to monitor trends, spikes and leading indicators – in close to real-time. As stated earlier, this is not an arduous task once it is set up. It flows well from things you are already doing, and it is essential to tracking and tuning our activities as you go forward with this project to reduce driver turnover.

Before you get started, let’s note that it is imperative here to include all drivers in these calculations, regardless if they left on their own, were terminated, retired or left for health or family issues. At this point, why they aren’t at your company now doesn’t matter. We are just looking for the exact bottom line of the turnover problem.

First, we are going to calculate the Overall (or Long Term) Company Driver Turnover rate, using this formula:

Drivers no longer with the company year to date, divided by the elapsed calendar days, multiplied by 365, divided by your total number of drivers.

Now you have the overall company turnover and you can easily now do the same exercise by dispatch board.

Now we are going to determine our 12-month or our Short Term, Turnover Rate. This looks at a sub-set of our drivers – those who have been hired within the last 12 months. Please note, this is an important distinction because we all know that the longer an employee stays with us, the less likely they are to leave. For our short-term turnover, use this formula:

Drivers hired in the last twelve months that have left the company divided by all drivers hired during the previous twelve months.

In coming articles, I will share additional elements of the TCA TPP Driver Retention Project Plan that will hopefully assist you in getting a handle on your companies’ driver turnover efforts. Please feel free to reach out to me if you require additional clarification on the above and I look forward to hearing from you.

Regards and safe trucking,

Ray J. Haight
Co-founder
tcaingauge.com