1997 RISK MANAGEMENT HONOR ROLL: RISK MANAGER DRIVEN TO ENSURE SAFETY IN TRUCKING OPERATIONS

When a National Freight truck goes out on the road, John J. Carney feels a considerable responsibility to the public, the client and the company to make sure the person behind the wheel has had the best possible preparation for the trip.

"You put 80,000 pounds of steel on that road, you should be certain that you have the best-qualified driver, the best-maintained equipment out there, and it goes far beyond any dollars, any punishments they can give us," said Mr. Carney, vp-risk management for Vineland, N.J.-based National Freight Industries Inc.

"I've been to accident scenes, in both my former life and this one, and I know what it can do to an individual. We can repair a truck. We can take a truck to our service area and maintenance and make it look brand new. I can't do that to a human being," said Mr. Carney, who was the third-highest ranking officer in the New Jersey State Police before joining National Freight in 1990. He became vp-risk management in 1991.

Getting the best possible driver behind the wheel is a multifaceted process that begins with hiring and continues through comprehensive training and reinforcement of safety procedures.

"Our criteria are among the most demanding in the industry, and for us it's been key to putting the professional driver in the truck."

"Probably one of the biggest hurdles is hiring professional drivers," Mr. Carney said, pointing out that finding qualified drivers is an issue for the trucking industry as a whole.

The pool of potential drivers is not as large as it once was, he said. In addition, federal funding for driver schools is drying up.

At the same time, "today, the driver has to be more qualified than he ever has before," says Mr. Carney. "It's a demanding industry, and it should be."

To find qualified drivers, National Freight spends $800,000 annually on personnel advertising, he said.

National Freight does not compromise its hiring standards, he said. The company will not jeopardize seven years of safety improvement to fill one employee space, Mr. Carney stressed. "We do what's required and go beyond that."

National Freight drivers must be at least 23 years old and have a minimum of one year and 100,000 miles' experience, he said.

As an added safety precaution, National Freight equips all its trucks with speed governors that will not allow the vehicle to go faster than 63 miles per hour.

The company also has a matrix set up for accidents and summonses to determine whether a driver, given his or her experience, falls into an acceptable safety category, said Mr. Carney.

Applicants undergo a thorough background check. "We have zero tolerance for DWI or drug use."

The driver who makes the cut then goes through a comprehensive training program. This wasn't always the case, notes National Freight's "Essentials of Risk Management" handbook. In fact, before 1990, driver orientation might have lasted only 15 minutes, depending on the person carrying out the orientation.

The orientation program, which must be completed before a driver can get behind the wheel of a National Freight truck, now lasts two days. Drivers who pass a written test and meet other criteria then enter a 90-day probationary period, during which they can be terminated without cause.

Drivers receive a comprehensive driver manual that covers everything from the orientation schedule itself to specific maintenance requirements, procedures for accident prevention and reporting, and the corporate drug and alcohol policy. The manual also contains lengthy addenda including facsimiles of documents needed for accident reporting and other roadway events.

Mr. Carney said the manual was first issued in late 1995 and is now in its third printing. The manual grew out of four days of brainstorming during which representatives of each department detailed exactly what expertise someone needed to function in that department. The team effort reflected the fact that "no single person" knew enough about every facet of the company to put the manual together.

The manual is designed to be a reference for every driver to carry on the road, said Mr. Carney. Although some other trucking companies provide their drivers loose-leaf binders spelling out regulations, Mr. Carney said that, to his knowledge, the National Freight manual is the only one of its kind.

"I hope everybody copies it," he said, adding he thinks doing so would make the industry safer.

Another key facet of National Freight's safety and training program is the driver manager system, said Mr. Carney.

"We have at National what we

call the 'premier asset' theory. In a trucking company, your premier asset is the driver. In the military forces, as we learned in Desert Storm, no matter how advanced the technology became, regardless of the air superiority, all the other things that make our military the No. 1 operation that it is, it's the foot soldier that's the premier asset," he said.

"What you need to do is protect that asset," said Mr. Carney.

One way National Freight preserves that human asset is through its driver manager system.

"As the company grew, as he would go through the system in the contiguous 48, a driver sometimes felt like he was being treated like he was a foreign driver," he said.

"The key to the driver manager system is that you have one person who handles that driver wherever he is in the company," Mr. Carney pointed out.

When a driver leaves orientation, he meets his driver manager. They exchange expectations; for example, a driver might want a driver manager to know he would like to be home on certain weekends. They then sign a contract contained in the manual spelling out what each expects from the other.

Mr. Carney said this exchange is particularly important because generally drivers' top three complaints will include how management is treating them.

In addition, the system also brings operations and support services closer together, said Mr. Carney. Every message to a driver goes through the driver manager.

"It adds structure to the organization. That driver knows wherever he goes he's dealing with one person. It adds structure in the sense that you can transfer that manager among facilities and he knows what his function is. It also allows you sometimes to manage by exception, such as all new drivers would be put under one manager," he said.

For example, the new driver doesn't know the National Freight system. To make sure drivers learn that system, National Freight can put all drivers with under 60 days experience under one driver manager. The company can take all its independent contractors and place them under one driver manager.

The driver managers themselves come from a variety of backgrounds, said Mr. Carney.

Some are former drivers. Others previously were dispatchers and managers, Mr. Carney said. Others are recruited out of college, while still others are former military officers with eight or nine years' experience who have resigned their commissions to return to civilian life, Mr. Carney said.

Regardless of his or her background, the driver manager knows the strengths and weaknesses of each driver, said Mr. Carney. The driver manager knows which drivers are always on time and can assign them to trips that involve time-sensitive cargo, he said.

They also know such things as which drivers "have a real fear of going into New York City," and which ones don't, and can assign trips accordingly.

Knowledge of the drivers' skills also means that driver managers can match loads to specific drivers who have experience in transporting certain types of goods or using certain equipment, said Mr. Carney, thus reducing the chance of accidents.

Driver managers also share responsibility for safety with the drivers they manage, said Mr. Carney.

If a driver goes out when he or she has already logged the maximum number of hours permitted during a specified period and has an accident, the driver is appropriately disciplined, said Mr. Carney.

"But if it turns out he was dispatched into that accident, where someone-the dispatcher, the driver manager-did not sit down and preplan with him how many hours he had and how many miles he needed to cover," then that manager is disciplined as well, he said, noting that previously the driver bore all the blame.

Mr. Carney said National Freight is seeking to constantly improve its safety performance by sticking to the program and documenting all of its aspects.

"We've committed a lot to writing the standard operating procedures," he said. That helps assure all managers are managing the same way.

Mr. Carney said the safety program has the added advantage of acting as a recruiting tool for executives.

One of the first things executives want to see when they're considering joining a trucking company is the safety record, and National Freight's reputation as one of the safety leaders in the industry has proved effective in drawing talent to the company, he said.

"We won't compromise the program. We've been on the other side. We know what it's like to spend millions of dollars needlessly. We're not going to do that again."