Data Trumps Delivery
Q & A – Jeff Thomas, President and CEO, Priority Dispatch
Industry veteran Jeff Thomas is on a mission: To make sure the industry understands the value of data. He firmly believes that the data associated with a delivery can actually be more important than the delivery itself. He calls it a “significant paradigm shift” that he believes is critical for any company to be successful in the last-mile space.
Jeff is an active member of the Customized Logistics and Delivery Association and President and CEO of Priority Dispatch, one of the leading providers of transportation service in the Midwest. They provide: on-demand delivery; out-of-town delivery; after-hours delivery; scheduled delivery; exclusive use driver and vehicle services; distribution and large truck services. In more than 25 years in the transportation industry, Jeff has cultivated a career as an accomplished corporate strategist and marketer.
Question: Why do you say “data trumps delivery” in the last-mile delivery space?
Answer: Last mile is all about a chain of custody continuum built with a series of delivery events. It could be two events or 20. The companies/customers that are fueling this last-mile explosion are asking for data that validates every one of those steps. What’s most important to them is that the data clarifies exactly what’s happening along the way. For example, if I miss a signature scan it may become a more critical issue than if I pick up on time.
Question: You talk about using the credibility and the real-time nature of data as a way to differentiate your company from its competitors. Tell us about that.
Answer: The timeliness of my delivery is not much of a differentiator any more. Customers presume that anyone can pick up at A and drop at B. They assume you’ll be on time. Now, the differentiator between you and your competition is the credibility of the data associated with that delivery. If I can give my customer visibility, transparency and an accountable chain of custody flow, I can differentiate myself immediately from another company that can’t do that as well as I do.
Question: Why is data so important to the customer?
Answer: From the customer’s perspective, the more data you can associate with a particular delivery, the greater the risk mitigation you can offer them. If you have a two-hour window to deliver and you do it within 15 minutes it’s all the same to the customer. As long as you’re within the expected delivery window you’re not changing the value proposition. In other words, you aren’t doing anything great by compressing that window. But, if you can give them the data that allows them to bill and collect sooner, that’s important to them. You’re eliminating work for them by essentially giving them easy accessibility to their own data to make their businesses more profitable.
When I go through the delivery event management process I have all the data that’s associate with that delivery. I know where we picked up; where we dropped off and what the account numbers are. It’s their data, but if I give them top notch, real-time access to it, they can better manage their logistics chain. That’s valuable to them.
Question: So if it’s their data, why is your role in handling it so important?
Answer: I add value by giving that data back to them in a format that’s easy to follow. We’ve made that date transfer a huge differentiator. We did that by investing in the IT to figure out the easiest way to transfer data to and from our customers. That’s what makes it easy for them to do business with us and to do business with their own customers.
Question: When did you first shift to this approach?
Answer: About ten years ago. It was all based on an incident with a long-time customer that resulted in our losing the business. When this happened we were 98.3% on time. I would go to bed every night thinking I was exceeding my customers’ expectations. We had an SLA of 97% on-time. I was proud of what I considered an exceptional on-time delivery percentage. I was pretty confident. I went to them to discuss additional business. They reminded me that there were so many things I was failing at that I never thought of. Chief among them was the value they placed on capturing all signatures. We weren’t doing that 100 percent of time. It was an important variable that ultimately meant we lost the business. I had assumed that being on-time was the most important thing, but we were neglecting the other events associated with that delivery. And I managed my world on that incorrect assumption. I had my eye on the ball, but it was the wrong ball at that time. It took that painful experience for me to want to change the culture of my organization.
Today, we’ve learned from that incident. We have a robust IT department that makes sure that the data from every delivery is valued and accessible. To the customer and to us. That’s a paradigm shift. There was a time when data was a necessary evil. Not anymore. If you strategize correctly, technology can become the differentiator that accelerates growth and reduces cost in your organization. The greater the visibility and credibility I can lend to the data I push to my customer, the more I win opportunities to pursue new business.
Question: How do you use that data in-house?
Answer: We mine that data. I probably glean more from it than my customers do. There are times when it tells us that what we think is happening is not happening. In truth, many of us in this industry still assume that if we have a pickup and delivery all else has gone well. The data may very well tell you the truth here. It will help you identify opportunities for improvement.
Question: How do you decide what data to look at?
Answer: Listen to the voice of the customer and let them define their KPIs. That’s what you measure yourself against. Something that might seem frivolous to you could be critical to your customer. It could define quality to them. That’s the data you need to measure in order to keep and grow their business.