Derek Leathers, Vice Chairman, President, & Chief Executive Officer, Werner Enterprises

https://werner.com/
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Derek Leathers

The combination of significant business and personal impacts of COVID-19 forced Werner to be more nimble, flexible, and creative in all aspects of our business, to challenge our internal processes and rethink all aspects of how we do business.

During normal operations, we create mode-neutral capacity solutions for seasonal events or customer product launches. During the pandemic, our Werner EDGE technology platform tools played a critical role in allowing us to minimize empty miles and service impacts in our network caused by fluctuations in freight volumes and flows. On the management side, we adjusted the team’s routine to conduct shorter, more frequent meetings throughout the day to facilitate faster decisions.

Tactical customer communication changed out of necessity, resulting in quick and solid decision-making. We performed mode conversions, pop-up fleets, and relays to expedite shipments, and we shifted dedicated fleet drivers among sites. We also found both parties were able to create quick and simple commercial agreements that were easy to bill and collect.

We implemented a remote working strategy to minimize exposure and allow our associates flexibility to balance the personal challenges presented by school closings. Our team quickly learned that individuals were just as productive — in certain cases more so — at home. And by opening key roles to remote working, we now have the potential to access talent that previously wasn’t available.

Werner has had a pandemic plan for our drivers in place since 2009, following the H1N1 outbreak. In the very beginning of the COVID-19 pandemic, professional drivers found themselves struggling to find resources for their basic needs while out on the road. Werner shipped hand sanitizer and other needed supplies to all of our terminal locations for distribution to drivers and reached out to our vendors, customers, truck stops, restaurants, and other partners urging them to help. They responded without hesitation, and with the designation of truckers as “essential” personnel by the Department of Homeland Security, drivers started to see more necessities available while on the road.

Even prior to the COVID-19 pandemic, the industry was experiencing capacity and demand imbalances that were more severe and frequent than in the past. We believe longer-term agreements, coupled with a diversified portfolio, are optimal for addressing and managing this market volatility. For shippers, changing suppliers frequently can result in negative impacts on inventory, service, workforce planning, and even strategic initiatives such as sustainability. For providers, changing customer relationships can drive cost into networks in the form of empty miles and poor asset utilization.

Creating and standing behind longer-term agreements works when both parties are committed at all levels. This is critical since, depending on where we are in the cycle, one party must resist the pressure to “take advantage” of the market and stay focused on the long-term relationship. The use of shorter-term agreements, such as mini-bids, can also bring great value to address impacts such as seasonality and vendor/sourcing changes, but shippers and carriers all must be careful not to overcorrect to what — hopefully — will be a once-in-a-lifetime set of circumstances in 2020.