Driven to Innovate

I just returned from a quick trip out to the NC mountains. On my way back, I passed a tractor-trailer with a transport company's logo on the side, along with the slogan "We Do It Right the First Time". It struck me as an odd phrase. Doing things right the first time was a huge push in manufacturing in the '80s and '90s, when the Total Quality Management movement was in full swing. There are pretty much only three ways to goof up a shipment: get the right stuff there late, get the right stuff there on time but broken, or get the wrong stuff there. My initial thought was that if there was an endemic goof up problem throughout the logistics industry, it would be news, but the right stuff almost always shows up at the right place at the right time. Why would you make this your slogan? So I set off to do a little research on this apparent silliness. What I got was (another) eye opener on innovation. The short answer to the question is "customer service". Here's the story: The truck is owned by Benton Express, a regional carrier in Atlanta, GA serving the LTL (Less than Truck Load) delivery needs of businesses throughout the Southeast. Some quick facts:

• It is a family-owned company, founded in 1934 and run by the third generation.
• They have over 600 employees, about 300 trucks and twice as many trailers, and revenues of about $50 million.
• They started out delivering movie reels to theaters. The only option up to that point was for theater owners to go to the rail station for pickup and delivery. A rail strike cemented their hold on the market -- when the strike was over, the theaters wanted to continue doing business with Benton.
• Deregulation of the trucking industry in the '80s opened the door for then to move into general commerce.
• Clete Cordero, VP of Business Improvement, said this in an interview on eTrucker.com: “You rarely see a trucking company go out of business because of lack of freight. It’s usually too much freight, too cheap.”

So they innovate. They have a Voice over IP (VoIP) phone system throughout the company with a single handset that is in every location. They use software from 1MAGE Software, Inc. to do business online (here's a link to a case study), which differentiates them. There's a great quote from Mark Headrick, Director of Information Technology in that case study: "The thing is, we don't just move freight – we actually supply information. Anybody could ship the cargo." Probably true for a lot of businesses -- anyone can do [the commodity part]. The trick is to find ways to innovate that customers care about and are willing to pay for. The eTrucker article ends this way: " 'Our mission is to be the best LTL carrier for our customers, doing it right the first time,' [CEO Chip] Matthews says. Given that its competitors are many times larger than Benton Express, innovation is a necessity, he says." Once again, I'm amazed at innovation in unlikely places, and how companies use it to break out of the commodity, price-war style of business they face. I still am not sure whether or not the trucking industry has a problem (I couldn't find any industry data on on-time delivery or claims numbers to compare with Benton) but it is apparently important enough that Benton Express has taken it to heart.