Motor Carrier Risk Management

Safety is a word that many people associate with accidents of some kind when it comes to their trucks and products, but the risk to your business may be a whole lot more.  Motor carrier risk management is many times put on the back burner; especially when nothing catastrophic is going on at the moment.  In any industry there are many risk factors to consider, such as:

  • Risk of loss to the customer
  • Risk to the product being transported
  • Risk to company finances
  • Risk of quick company expansion
  • Risk of not keeping up with technology
  • Risk of cyber-security, etc.

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There are many more types of risk that could be potential problems for your company, but if you properly identify them and then assess them, you can head off trouble before it begins.  You, or the board members of your company, must stay abreast of new regulations, rating agencies, and any investor issues you may have.  A properly trained professionals or motor carrier risk management managers, understand the motor carrier risk management and are able to evaluate motor carriers if contracting them is an acceptable risk or not before proceeding.

Much risk to the freight industry comes from driver fatigue, which in turn can cause motor accidents.  Regulations state a driver must have 10 hours of rest between work days with a minimum of 34 hours after reaching a limit of 70 hours in 8 days.

On June 7, 2014 there was a major accident that hit all the news.  A Wal-Mart truck was involved in a very bad accident which injured several people.  Some say the driver had gone too many hours without sleep while Wal-Mart denies this accusation.  It is up to the courts to decide but the media attention this accident received just brings to mind how important it is to follow the regulations.  One accident like this could not only cost lives, but completely ruin your business, and we don’t want that to happen.

Risk is almost built like a chain with many links.  To analyze risk you must walk through it from top to bottom.  Do this by realizing who you are doing business with; all the way down the line.  From investors all the way down to the person that cleans your office.  Take each person, group, or service and think of what risk you are exposing your business too.  This exercise is quite an eye opener and will certainly make you think.

Risk is just a part of doing business, but keeping risk to a minimum is what we all should be striving for.  Start with someone to take charge of motor carrier risk management in your company and then look for programs, systems, or services that will help you work smarter, not harder for safety.  Be safe and keep the ugly head of risk from popping up to bite you when you least expect it.

 

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