Carrier Profiles
CEO Profile: FedEx Custom Critical
Given the relatively brief history of expedited trucking, it's unusual to find an individual within the industry who can boast of twenty years in the business, let alone the 35-plus years of experience possessed by the executive profiled in this article - Mr. Jack Pickard, President and CEO of FedEx Custom Critical.
Beginnings
Pickard graduated from Virginia Polytechnic Institute (Virginia Tech) in 1968 with a degree in Civil Engineering. As a participant in the school's ROTC program, he came away with a commission in the U.S. Army and spent time in the Far East, Germany and stateside.
After his military duty, Pickard sought a position in the construction business but there was a recession at the time. He found what he thought was a temporary job with Airborne Freight Corporation. His job as a sales representative with Airborne blossomed into a job as a District Manager with the company.
After a brief respite from transportation during which time he worked in a family business dealing in real estate and construction projects, Pickard returned to the transportation industry and found a position with Purolator Courier, spending 10 years with the parcel company. His work included stints as a District Manager in Dayton, Ohio and as a regional Manager in Iowa, Nebraska and South Dakota.
Following that, he moved to Long Island City, N.Y., and was responsible for the five boroughs in NYC, ultimately becoming the Regional Manager for New Jersey.
He left Purolator and transportation to work for a company that was involved in contract staffing and temporary help.
In his own words
"I re-entered the industry when I joined a little-known company called Roberts Express in 1986," says Pickard. "At the time, Roberts was a small company with around 200 trucks."
"I joined the company as a regional Sales Manager for what we called the Midwest region, an area that extended from Buffalo to Kansas City. I worked as Sales Manager, Vice President of Sales, Vice President of Sales and Marketing and Vice President of Service (Operations). I assumed the duties of President and CEO of FedEx Custom Critical around five years ago."
He sums up his work history with a laugh, "I guess one of these days I'll find a job in Engineering."
Roberts' early days
"Way back when, it was very exciting because we were on a growth tear," says Pickard. "I remember during my first few years with the company, we were growing at a compound rate of between 30 and 40 percent per year. We were constantly expanding the fleet."
"At that time, we were doing what I call missionary work. We would go into a business and tell them, 'We're Roberts Express' and they would say? Who? ' We would explain what we did and that, when they would call, we would make the pickup in 90 minutes or less with the same truck and driver making the delivery straight through, non-stop and door to door.
"I would explain that we were faster and cheaper than air freight on runs of up to 1,000 miles. They would look at us like we were from Mars and would say, 'C'mon, you don't really do that.'"
Pickard says that the prospective customer would ask about the price and then say, ’That’s a great service but we'll never use anything like that.' Ironically, two weeks later Roberts would get a phone call from that same company on a Friday afternoon.
He explains, "We'd have one of our contractors in there and make the pickup quickly, deliver flawlessly, and from then on we had the customer. They realized that when the chips were down, they could call and count on us. Our contractors really responded to our customers and they did a great job."
Reflecting on those early days Pickard says, "We used to do some crazy things back then. We would be selling someplace and get a call from a customer in the middle of nowhere who needed service. We would rent a truck and fly a driver out there to make the pickup."
"More than once, we had a truck break down and while it was still on the tow truck, it would pull it into the dock to make the delivery. We really lived up to the on time, every time motto."
"You can argue about who was first in the expedited trucking industry, but I think you can safely say that Roberts Express was the pioneer in the business."
Technology
"The real change happened for Roberts Express in 1989," says the FedEx Custom Critical chief. "Before that, our contractors were required to stop every four hours and make a call to update dispatch on their location. Dispatch would key in that information and the computer would tell them if the truck was on time."
"Of course, as soon as the contractor would hang up, the customer would call us and want to make a change. That was in the days before cell phones and that's when we became one of the first fleets to incorporate Qualcomm."
"We tested this with 30 or 40 trucks. We adopted the system and in fact, we developed a lot of the software. At the time, Qualcomm only delivered the latitude and longitude of the truck and it was up to us to figure out where that placed the truck and how to make that information useful."
The FedEx connection
Pickard addresses the integration of Roberts into the FedEx worldwide network:
"At Custom Critical, we're able to leverage our association with FedEx in order to gain recognition in the marketplace and get us in front of customers who we would otherwise be unable to see and we get freight from those customers."
Diversification
Pickard says, "Our business is actually pretty "steady as she goes" right now and the primary reason is this: When I started with the company, we were probably 80-85 percent automotive freight, and today, it's around 10 percent."
"Though expedite still tends to be a cyclical business, we don't get whipsawed nearly as much as in the days when our three biggest accounts were all automotive. They are still important accounts to us, but we have diversified and have gotten into a lot of specialty markets that require special equipment and special expertise."
"We've really tried to change ourselves from being a distribution company where the customer comes to us and we say 'we have five sizes of trucks and if the freight will fit in one of those trucks, we'll do business with you.'"
"Instead, we have become a company that is more akin to a know-how business where the customer comes to us and we will craft a solution."
"We've really become a technical know-how company as opposed to a trucking company. Trucking happens to be the business that we're primarily involved in, but in some respects we're like Microsoft. Microsoft doesn't manufacture anything; they use their intellect and their human capital to develop products that meet the needs of their customers. We are also a technical know-how company, only in the expedited logistics business."
FedEx Expedited Freight Services
"Through this focus, we have been able to develop FedEx Expedited Freight Services (EFS) and it has been doing exceptionally well."
"We have an array of services," continues Pickard, "from an exclusive-use truck to an LTL service, and we match a solution that best fits the customer's needs. We provide a solution that has the FedEx name attached to it. Customers really look at us as a solution provider."
"When we started this business, we thought that we were going to develop a lot of business all across the product array, but the thing that really fooled us was that when the customers call us, they seem to select the Surface Expedite Exclusive Use option, which is the traditional FedEx Custom Critical service."
"It really surprised us, quite frankly, and it has given us a lot of new business by getting us access to customers who we would otherwise never see, because they would never think of expedite. We have done better than our forecast by a considerable margin and we're just getting started!"
"In the final analysis, if you provide a solution to the customer's needs, they remember that it's a FedEx company. As far as the customer is concerned, if it says FedEx on the side of the truck, it's all one company. That's why we hear many stories from Custom Critical drivers who have customers who try to hand them a small package for shipment."
New initiatives
The FedEx Custom Critical CEO says that the company is always trying to find new and innovative ways to communicate with its contractors.
"It would appear that there will be more toll roads in the future and we wanted to get out in front of that issue. We're asking our customers to pay the tolls and so far, our customers understand that tolls are the new reality. We pass those tolls straight through to our contractors."
"In addition to our newsletters, we send videos out to our contractors. We don't see the contractors that often and they don't see us and I think it's important for them to see the faces behind the voices on the phone."
Pickard continues, "We also have our recognition awards like the Four Star Awards for safety, on-time performance, in-service percentage and load acceptance."
"In 2006, our top 50 contractors received a trip to the Bahamas and this year we're taking them to Las Vegas. Also, an award in which we take a great deal of pride is the ATA's President's Trophy for safety. That speaks volumes about both the contractors and the headquarters personnel."
"Obviously, our contractors are the backbone of our business. If it weren't for them, we couldn't get the job done. Our contractors understand who the customer is and they are aware that it's the customer who generates the revenue."
"Over the years, our contractors have clearly demonstrated that they have a customer focus and they deliver quality, reliability and value to our customers. Without that focus we wouldn't have been able to grow like we have or continue to grow as we intend."
"Our contractors are some of the finest people you'll ever come across. They are the hardest-working, patriotic group of people I've ever met and I can't say enough good things about them."
A good place to work
"For the last five years we have been part of the North Coast 99, which is an award handed out to the top 99 places to work in Northeast Ohio," says Pickard.
"Our employees help us to create an atmosphere in which it's fun to work and we accept the challenge every day."
Keeping tabs
"Every month, we survey about 150 customers and we ask them about their experience with FedEx Custom Critical during the prior month. We invariably receive praise regarding how good our contractors are and how good our employees are in communicating with them. A lot of them say, 'I called FedEx Custom Critical and I don't worry about the shipment anymore.'"
"In order to keep the best quality contractors with our company, we have to treat people fairly and we have to be honest with them. We've got to give them an opportunity to make money."
Industry overview
"With just in time inventories, lean manufacturing, etc., expedite is here to stay," says Pickard. "Expedited used to be that thing that management would sweep under the carpet because it was an admission of failure in their systems. I think now they're planning more to use expedited transportation and it's part of the way people do business."
He continues, "Expedite is at the top of the food chain when it comes to transportation and freight. I think everybody enjoyed some really robust years a while ago when there was a shortage in truckload capacity. I think there's more capacity available today than there has been in several years."
"There's no secret there; I think that expediters have enjoyed a lot of traffic due to truckload operators having too much business and not enough capacity."
In conclusion, the FedEx Custom Critical Chief says, "It's been gratifying to become a know-how company and solve customers' problems with a FedEx solution."