Descartes’ exec highlights impact of ELD mandate on shipper operations

With the Electronic Logging Device (ELD) mandate now having been in effect for the better part of a year, there have since been various impacts from the mandate on shippers supply chain and logisitcs strategies, as well as having an effect on emerging time constraints on shipping lanes rather than a loss of truck drivers. Logistics Management Group News Editor Jeff Berman talked to Brian Hodgson, SVP, Industry Strategy, for Waterloo, Ontario-based Descartes, a provider of logistics based on-demand, software-as-a-service offeringsabout the ELD impact on shippers' operations, as well as ways in which the ELD manaELD mandate has actually led to a growth in data on location, which has increased shippers' interest in leveraging real-time visibility. A transcript of their conversation follows below. 

Logistics Management (LM): How do you view the impact of ELD on the freight/logistics market since it was implemented late last year?

Hodgson: Taking a step back, when it was being implemented with a hard deadline, there were concerns about drivers leaving the industry and serving as a triple whammy to the capacity crunch. In talking to customers there has been less of that but there has been an impact on out certain lanes, with one day [runs] getting stretched to two days. And then when you think about capacity there is the ELD element taking things out, as well as the general driver shortage and economic growth. Interestingly, we have one customer that has taken it as an opportunity to increase retention and focus it on giving drivers better tools and complimenting ELD with other technologies to let the driver know ‘I am going to this location for this particular load and here are some details behind it,’ whereas before that was done by phone, text, and dispatch and it is not well organized so by giving drivers this they can be more professional when they show up and they understand/have a bit more context regarding the work they are doing.

LM: What are some other examples?

Hodgson: They also leverage owner/operators in their network and they have gone and extended ELD to be used by them so they view that as retention. On the retention side, drivers are viewed as a key part of the face of the company and also safety improvement. With capacity and driver shortage issues, there is more focus now on using the data to execute and operationalize things more efficiently and thinking about quicker turnaround and how to better achieve dock deliveries, which are also elements of driver satisfaction and getting them in and out more timely for stops on their route so it does not impact HOS (hours-of-service) and they can get paid and leverage that data across that network, which is becoming critical.

 LM: How would you characterize or define the ELD rule's impact on time constraints in shipping lanes as opposed to a loss of truck drivers?

Hodgson: Some lanes that were covered in one day are now stretched to two days and that is assuming they are meeting the HOS and the speed limit, but if they run into traffic or delays at a particular stop that further extends it. It is also about sharing data more broadly so people can plan and optimize things more efficiently by looking at things like traffic and weather with that route to get a better handle, or ability, on when a truck will arrive and the consignee can have a better plan

LM: What are some suggestions on how to avoid shipper issues and being able to work around them when things come up?

Hodgson: The earlier visibility they have the better. I was talking to a large discount retailer that had a regular delivery every Tuesday morning, with its other stores having a regular delivery on Tuesday or Wednesday. But they did not have good visibility into truck being late or missing an appointment, and it was not necessarily congestion-related…for those unloads, they hire a temporary crew of four or five people come in and in certain states they have minimum hours.  So if a truck has an appointment for unloading at 7:30 or 8 and it does not get there until 10 or the next day, then the additional costs become quite significant and have to pay them and bring them in for more hours…but if they get visibility eight-to-ten hours earlier, they can manage that, as an example.

LM: How, in your opinion, can shippers focus on things like re-optimizing” distribution networks, reevaluating their carrier partners and selection process, and rethinking bids and pricing well into 2019?

Hodgson: On an operational basis, it is about getting predictive ETA or getting notification either at a store or a dock, which are operational cost savings but then taking a step back to leveraging that in a more strategic way and continuing on to operational improvements.  This requires looking across your customer base that you are delivering to and identifying certain customers with higher detention rates or higher unloads and using that data in an analytical way to say ‘here are certain data by things like location, time of day, how does that detention time, vary and working strategically with those customers and carrier to drive those things down i.e. big data leveraging of information that is coming off of ELD.  

LM: Is the industry still going through the ELD growing pains or has a “new normal: been reached?

Hodgson: The bigger players with more resources have been better at being able to operationalize it so from a straight ELD mandate standpoint the smaller players are still working through the basics and there is also variance in how are those customers and those players and partners and customers are leveraging that data. So things like predictive ETA and being on time to be able to leverage that and analytics for things like temp control or security for high value loads so they stay on track are key.