What to do when unprecedented growth is your biggest problem.

 By Conrad Winter

You know you’re in strange times when one of your biggest challenges is managing success. Read the news lately and you’ll see that it’s not all roses when you’re winning. Just look at Peloton. Throughout the pandemic, their unchallenged business model could do no wrong; they had pricey products, a high-demand subscription and a captive audience of exercise-committed shut-ins. And now? A product recall, declining sales and a parade of bad press.

It’s a cautionary tale for any company experiencing unprecedented growth—and there are a lot in transportation and logistics. ATA Chief Economist Bob Costello said in December that freight volumes surged 7.4% in 2021. Two of the top 50 growers in the 2021 Inc. 5000 Fastest-Growing Private Companies in America are from logistics and transportation. MoLo Solutions swelled 7,597% and Stord surged 7,581%.

Transportation and logistics companies are experiencing big growth, so naturally lessons learned and tips for successfully managing growth factored heavily into the recent New Year, New Trends, New Opportunities webinar led by TMSA Executive Director Jennifer Karpus-Romain and BlueGrace Logistics Chief Marketing Officer and TMSA President-Elect Mark Derks. Here are their top tips for companies looking to grow their way to success in 2022.

Gain volume and resources through consolidation.

In the last year, the industry witnessed major consolidations like GlobalTranz merging with Worldwide Express and Uber Freight acquiring Transplace. “When you have these types of consolidations, it will bring scale,” Derks remarked. “Think about Knight-Swift’s acquisition of AAACooper. Think about ArcBest acquiring MoLo. This is a big truckload and refrigerated provider acquiring an LTL provider. This is a more historically LTL provider buying a freight brokerage,” Derks observed.

“What that’s telling me is these and other organizations are trying to manage their growth through cross-selling. They want to be able to provide more services through one provider, and there’s some gold in that. Being able to go to a single provider for multiple services gives you scale,” he said.

Leverage recent technology improvements to scale.

Karpus-Romain and Derks observed that supply chain, transportation and logistics still lag other industries in technology. They said that 50% of the largest U.S. importers still manage their supply chains on spread sheets. Karpus-Romain believes that’s changing, though, as technology partners get more familiar with the needs of the supply chain and transportation and logistics industries.

Karpus-Romain sees a lot of technology solutions out there that companies can lean into in order to successfully scale. The proliferation of all-in-one platforms and the ease with which preferred partners can now be integrated are supporting better visibility for organizations. “In breaking down your silos, you’re able to have access to understanding what other parts of your business are doing. So everyone has a better understanding of where things are and where we need to move forward with,” she explained.

“More people want to lean on this kind of information across many different departments and fortunately, you’re not always the first to want to buy into it. The technology partners are already building integrations and adding it into their platforms,” Karpus-Romain added. “So from a price perspective, something that might have been out of price range three years ago may be more aligned with your budget goals because you’re able to add what other people are doing.”

Look to other industries for inspiration in scaling.

In this time of unprecedented growth, Derks suggests looking to precedents set outside of the transportation and logistics space. He calls this “advancing across verticals” by borrowing technologies or business processes that work in one sector and applying it to another. “Something that works in the automotive industry also might work in the consumer packaged goods industry or food and beverage industry,” he said. “Think about crossing industries and what unique opportunities exist between those industries.”  

Ask what can be outsourced.

Rather than risking the potential downsides of unprecedented growth like overworking your staff, dissatisfying customers, making rushed hires or facing diminishing profits, companies do well to ask what can be easily and successfully outsourced. Growth hits an entire organization across departments. Can non-core functions like IT or finance be delegated outside? There are going to be things that are so sacred that organizations won’t want to outsource them, but many other functions can pose an unnecessary risk to hold onto if they are overlooked or underserved.

Keep your finance and hiring options open.

“If you’re in logistics right now, your business should be in or on the market, always seeking to connect with the finance community,” Derks says. He explains that doesn’t mean saying yes to everything. Rather it’s about keeping up with the market from an acquisition or growth perspective. “If there are opportunities for scale, seize them so you can get speed to market,” he says.

Similarly, Derks counsels companies to keep a pulse on talent. “I always keep an eye on my next 25 roles in my organization regardless of whether I have requisitions for the roles or not,” he says. “Because attrition and opportunities come up, and without bench strength, you fall behind.”

Hold onto the people you have.

It’s important to understand how engaged employees are through surveys, Karpus-Romain and Derks said. Studies show engaged employees help companies grow faster by being more productive, creative, innovative and agile. Asking alone isn’t enough, though. “If you’re going to solicit and ask your employees what they want and how to make processes better, you better be prepared to listen and make real changes based on what they want or what their needs are,” Karpus Romain said.

 Holding onto talent and “the great resignation” was another megatrend Karpus-Romain and Derks delved into in this webinar. Learn how this trend is manifesting in transportation and logistics and what companies can do to keep employees working happy by watching the entire presentation.

And don’t miss TMSA’s upcoming Driver Recruiting Case Study webinar on January 27th featuring ITS Director of Marketing Patrick McFarland and Randall-Reilly Vice President of Recruiting Seth Becker. They’ll be sharing data and jaw-dropping insights into their efforts to successfully grow their driver headcount in this hardcore recruiting market.

This blog post was written by Conrad Winter, TMSA Marketing Committee member.  Conrad is a freelance copywriter specializing in content and copy writing for transportation and logistics. Based in Metuchen, NJ, he creates website copy, campaigns, blog posts, whitepapers and case studies for carriers, 3PLs and industry associations. 

 

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