Key performance areas in road transport

Maintaining a competitive and profitable transport business means keeping careful watch on a host of key performance factors, says VIC OLIVER

The start of the New Year is a good time for road transport operators to re-examine the management of their business’s key performance areas.

Good management saves money and increases profits – but practices and processes need to be continually monitored, refreshed and upgraded, especially given the type of tough, competitive market environment that has been forecast for this year.

First the basics need to be right in all sectors of the business. Daily operations need to be watched carefully and immediate steps taken to address any procedures that start to run out of line.

In addition to the daily monitoring and controlling of basic vehicle operating costs, both fixed and variable, it is essential to control and monitor other related key performance factors, for instance vehicle productivity.

Operators need to constantly focus on ensuring that all vehicles in the fleet are fully and effectively operating at optimum capacity. Fleet size needs to be carefully controlled to ensure that there are sufficient vehicles in the line-up to do the job effectively without having some standing idle.

Workshop productivity also has to be maximised. Ensuring that all the available labour hours are effectively used is one way of safeguarding efficiency. These hours are being paid for and if they are not used timeously, they are lost, since they cannot be stored for use at a later date.

Workshop efficiency must also be carefully monitored every day. Productivity can be measured by comparing the number of hours worked in relation to the standard flat rate time that is set by the vehicle’s manufacturer.

Retaining satisfied customers is another important key performance area, as your competitors will be monitoring your customer base and trying to steal your good clients. Therefore, looking after your customers and giving them world-class service is another key performance area to be carefully monitored.

Ensure that your entire team is aware of the importance of looking after customers and are well-versed in treating your client base with the utmost respect.

It is also important that good technicians and administrators are well looked after in order to ensure that they are not enticed away by competitors. Offering good reward incentives to employees for efficiency and work well done is an excellent tool to get people to perform at their best.

Past surveys that have analysed the roles employees play in making a business successful have found that if the following points are understood and implemented by staff members, the company tends to succeed.

• Do I know what is expected of me at work?

• Do I have the material and equipment I need to do my job right?

• Do I have the opportunity to do my best every day?

• Have I received recognition or praise for good work in the last seven days?

• Does my supervisor, or someone at work, seem to care about me?

• Is there someone at work who encourages my development?

Positive responses to the above questions correlated to higher productivity, profitability, employee satisfaction, customer satisfaction and staff retention.

To reiterate, a focus on the retention of good people is critical for a transport business to survive and continue to produce good results.

Published by

Vic Oliver

Vic Oliver is one of this country’s most respected commercial vehicle industry authorities, and has been in this industry for over 50 years. Before joining the FOCUS team, he spent 15 years with Nissan Diesel (now UD Trucks), 11 years with Busaf and seven years with International.
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