The Roemer Report On-Line, June 2005

TRUCKLOAD CARRIERS SEE PROFITS: The first quarter has been profitable for most truckload carriers, with many companies posting increases by as much as three times the previous year’s first quarter. For example, Swift Transportation’s first quarter income jumped to $19.4 million, compared to $6.4 million for the previous year’s first quarter. Knight Transportation also posted a big increase (38 percent) over last year’s first quarter. However, some carriers reported downturns for the quarter. The CEO of one truckload carrier said, “Softer than expected freight demand impacted both the average miles per tractor and our ability to obtain the level of rate increases we originally expected.” Still, the “softer” freight demand appears to be the exception, rather than the rule for most, as many carriers reported substantial revenue gains, excluding fuel surcharges. There’s some speculation that first-quarter losses could be due to an economic downturn in the carrier’s customer base or that customers are doing business with other carriers for more competitive rates. “It could be they got too aggressive on pricing and lost some freight to other carriers,” said one trucking analyst, who went on to add that a pricing environment for truckload carriers hasn’t been this strong in years. “The only thing carriers have to watch out for is whether freight growth will remain strong through the remainder of 2005 and not to get too aggressive in expanding capacity,” he said.

ROADWORK IN FULL FORCE: This may be the busiest summer yet for road building and repair efforts. Georgia has already begun more than $378 million in roadwork, and “that number likely will be in excess of $1 billion—and a great deal of that work throughout the state will be done this summer,” according to Vicki Gavalas of the Georgia Department of Transportation. For motorists driving through Georgia and the many other states that have begun roadwork, that means traffic delays and detours. Transportation officials try to minimize the impact on motorists by restricting most lane closures to nights and weekends. “Inevitably, though,” said Gavalas, “that much work is going to result in some inconvenience.” But inconvenience is not the only thing on road builders’ minds. Safety is an enormous concern. Nationally, more than 1,000 people are killed in work zone crashes each year, and another 40,000 are hurt. Maryland’s Governor Robert L. Ehrlich, Jr. urges motorists driving through a work zone to “slow down, pay attention, and remember 90 percent of all crashes are preventable.” Many states are increasing enforcement of speed limits in work zones to boost safety. “Imagine if your work desk was four feet from vehicles moving 65 mph or more,” said the chairman of a road builders’ association. “My employees face these conditions every day.”

TRAFFIC SIGNALS INEFFICIENT: Consecutive red lights aren’t just frustrating—they also waste fuel, contribute to air pollution, and create unnecessary delays for drivers. A new survey finds that the nation’s traffic signals are largely inefficient, with 68 percent having either no documented management plan or having a plan that consists of responding to problem intersections as they happen. The survey, conducted by a coalition that included the Federal Highway Administration, also found that: (1) 71 percent of traffic agencies interviewed said they don’t have staff to monitor traffic before and after normal working hours, (2) 57 percent said they do not routinely review traffic signals within three years, (3) many communities have not retimed their traffic lights in a decade, while others are “fighting fires” by targeting traffic problems at busy intersections, which creates tie-ups elsewhere. The researchers studied how traffic agencies manage their systems, review traffic signal timing, maintain traffic data, and provide sufficient staffing. Bellevue, Washington, cited as having one of the nation’s most efficient traffic signals, was the first community to have a centralized traffic computer. The system allows traffic managers to easily adjust signals for traffic flows, emergencies, and special events.

TEXAS DRIVERS BEWARE: A bill pending in the Texas State Legislature would make certain activities that qualify as “inattentive driving” illegal. Police officers could issue citations for motorists who read, write, use a computer or cell phone, or perform personal grooming while driving. In addition, activities that many drivers routinely engage in would be considered illegal: listening to a radio, using a GPS unit, eating, drinking a nonalcoholic beverage, and even “interacting with a vehicle passenger.” In other words, talking with someone while driving would be illegal. “Legislation such as this only serves to pad the coffers of the local and state treasurers,” says Steve Ehrenreich, CEO and founder of TixNix.com, a service that allows motorists to fight moving violations and protect their driving records. “There is simply no logical reason to make listening to a radio while driving illegal.” A TixNix.com attorney says, “The scope of activities deemed illegal in this bill practically gives officers carte blanche to add violation after violation for every traffic stop.” If the bill becomes law, motorists may pay exorbitant fines for violations. The proposed legislation states that, “An offense under this subtitle is punishable by a fine that is at least twice the minimum fine applicable to the offense and not more than twice the maximum fine that is applicable to the offense.”

CELL PHONES DISTRACTING: Further evidence suggests that talking on cell phones while driving is risky business. A study from the University of Utah finds that drivers are distracted when using both hands-free and hand-held cell phones. Researchers found that when 18- to 25-year-olds in a driving simulator were talking on cell phones, they were 18 percent slower to hit the brakes than drivers who did not talk on phones. In fact, these young adults took the same amount of time to react to brake lights from a car in front of them as a 74-year-old who was not talking on a cell phone. “Any activity requiring a driver to actively be part of a conversation likely will impair driving abilities,” said one researcher. Jim Champagne of the Governors Highway Safety Association (GHSA) praised the research as a reminder that all drivers who talk on cell phones are engaging in risky behavior. GHSA is concerned that bans on hand-held phones send the wrong message that drivers are being safe as long as they talk with a hands-free device. “GHSA’s opposition to hand-held cell phone bans is rooted in the fact that these limited bans urge drivers to continue an unsafe behavior behind the wheel,” said Champagne. “The best message to drivers is: Do not use your cell phone at all while driving.”

TERROR COVERAGE UP: Almost half of all U.S. businesses, both large and mid-sized, obtained property terrorism insurance during 2004, a big jump from the previous year when 27 percent of those businesses were covered by the insurance. The price of property terrorism insurance in 2004 remained unchanged from the previous year, suggesting that the increase in coverage was not driven by price. A new report finds that the purchase of property terrorism insurance varies according to region and a company’s total insured values. For example, smaller companies with a total insured value of less than $100 million were less likely to buy the coverage. In addition, about 53 percent of companies in the Northeast and Midwest purchased property terrorism insurance last year, compared with 47 percent in the South, and 34 percent in the West. “Clearly, several factors can influence a company’s decision to purchase property terrorism insurance,” said Stephen Lundin, a director of the firm that conducted the study. “In addition to considering the pricing of property terrorism insurance and its terms, many businesses are making decisions based upon their perception of risk.”

TIPS FOR OFFERING PRAISE: Praising employees for a job well done should be on every manager’s to-do list. Praise boosts morale and pride in work and lets employees know they are valued. One study found that of 65 potential incentives in the workplace, the most effective, as judged by employees, was a manager who personally offered congratulations on a job well done. So how exactly should a manager offer congratulations? Consider these tips:
(1) Make it timely. Offer praise immediately after you spot the desired behavior. This creates the strongest association between behavior and reward. Waiting too long can actually have a detrimental effect. If you congratulate someone weeks later, your message is this: “Your achievement slipped my mind (i.e. it wasn’t important)” or “I am out of touch with what you’re doing” or “I don’t really care.” (2) Be sincere. Praise only works when it’s sincere. If you just go through the motions, your words will ring hollow. On the other hand, don’t worry if you feel awkward offering praise. If you are sincere, employees will see this and appreciate your words all the more. (3) Make it personal. When you take a break from your busy schedule to offer words of praise or hand write a note, you are underscoring the importance of the employee’s achievement. Your effort will not be lost on the employee! (4) Don’t be stingy. Offer praise whenever it is merited, not just during performance reviews.

Establishing goals is all right if you don’t let them deprive you of interesting detours.