The construction industry manages and pays for trucking with paper tickets, and this decades-old practice has hidden costs in the billions of dollars. Some problems are easily visible, such as the cost of employees who have to organize boxes of tickets each week and then hand-enter data into a spreadsheet. Other problems, including data errors, fraud, lost tickets, invoicing disputes and delayed payments, are understood and tolerated, even if they are hard to quantify.
The real problems with paper tickets are hidden, though, and they are an anchor holding back companies from higher productivity and profits.
Supervisors Are in the Dark
The first problem with paper truck tickets is the negative impact they have on front-line employees and supervisors. Paper tickets are typically processed in the back office several days after the work has happened, so employees have no access to real-time data to make decisions.
If a foreman could see the trucks and materials en route to the jobsite, they could make smarter decisions about how to employ field crews. If a plant manager knew exactly when trucks were arriving, they could make better decisions about staffing and production. If a trucking company knew earlier when drivers were missing or there were changes in the field, they could better manage their fleet. And drivers could be more productive if they knew exact pickup and drop-off points, and even the best routes for traffic.
One of the largest aggregate producers in the world is working on a project to move away from paper tickets to a digital system. They are building dashboards and reporting and giving access to this data to frontline employees for better decision-making. Some of their early findings and solutions are projected to bring millions in savings to the company, all by uncovering hidden problems.
Trucks Are Paid to Drive Empty
The second significant problem with paper tickets is that the system is not collaborative. Every company operates in a silo, working each day to meet their needs for trucking. There aren’t enough trucks for every job, so companies hoard resources to avoid expensive delays.
With silos, trucks are paid to move materials from point A to point B and then return to point A to repeat the process. They spend 60 percent of their time driving empty (deadhead miles), often driving by materials that need moving because they have no way to collaborate with those locations.
Trucks driving empty is a lose-lose situation for everyone, and the enormous costs impact everyone. But the system is tolerated largely because paper tickets are used for payments, and tickets are only capturing information about the loaded miles. All other costs are ignored.
Technology is Unplugged
Lastly, with paper tickets, the industry is unplugging the capabilities of technology around it. This is similar to an administrator manually entering ticket data into a spreadsheet, and then using a calculator to add the numbers. Construction ranks almost dead-last in the country for technology adoption, and paper truck tickets are a perfect example for poor technology usage.
Virtually all drivers have a smartphone in their pocket with the ability to give real-time locations, status updates, route suggestions and more. Multiple vendors have built systems to leverage smartphone or GPS device capabilities in a truck, but adoption is slow.
By sticking with paper, the industry fails to leverage even greater advantages of technology. It could be using data and artificial intelligence to provide dispatchers with suggested loads. By collaborating with technology ecosystems, routes for trucks could be built so they travel from point A, to point B, to point C and back to A, all with loads. They could easily get 30 percent to 40 percent more production out of current fleets, and share the savings across all in the market.
The Future of Paper Tickets
Seeing the future where everyone is collaborating digitally is easy. The trick is how to move an entire industry away from paper tickets when there are multiple obstacles to adoption and a highly fragmented market. When the real value of technology depends on everyone adopting the digital system, then market adoption will move at the rate of the slowest adopters.
One important first step might be to use technology to improve the current system of paper tickets. Smartphones, scanners, optical character recognition and software could digitize the information on paper tickets in near real time, getting data up to the cloud where it could integrate with data from digital systems. When all trucking data is in the cloud, then the industry can start to empower frontline employees to make better decisions. It can start to collaborate electronically to reduce deadhead miles, adding profits back to the market. And then it can begin to experiment with even more disruptive collaboration models that let it move materials for the lowest possible cost.
