Driver Safety Incentive Programs

Love them or hate them, incentive programs generate an emotional response from most safety professionals. 

On the plus side, incentives can influence behavior and I’ve met fleet safety teams who wouldn’t consider a safety program complete unless it specifically included an incentive plan.  On the flip side, I’ve heard from safety professionals who suggest that incentives can become perceived as an entitlement and their ability to influence (or reward) safe behaviors may be viewed by top management as a wasted resource with little or no measurable result. 

Naturally, there are many arguments and case studies that could be cited to build the case for or against incentive programs.  I’m not actually interested in taking sides to defend or attack the benefits (real or perceived) of incentive programs, but I do get asked about them frequently.  While I’m the first to admit that I’m not an expert on incentives, I’d like to share my observations based on my experiences with policyholders whom I’ve worked with during my insurance career.

Several critical questions have to be asked when someone is interested in launching an incentive program:

  1. What’s the goal? (or “What are we trying to affect/change by implementing an incentive plan?”) AND is the goal clearly/precisely communicated to everyone who has an interest in the program?
  2. Why isn’t the goal being met now? (If the goal isn’t being met because of a correctable non-performance situation, why not address the root causes before developing an incentive plan?)
  3. What’s the status/effectiveness of your communications plan?  Do the drivers understand what you need to achieve and are they on board with attaining those results?  (See our two part article on Driver Communications Plans @ http://safetyismygoal.wordpress.com)
  4. Have the drivers been involved in figuring out what types of incentive(s) would work? (What’s going to attract and hold their attention?  You’ll get different results from and have different responsibilities from cash (taxes), paid leave (HR), vendor based programs, etc.)
  5. What’s the budget?
  6.  What’s the timeframe — is this a one year plan, three year plan, or an open-ended plan?
  7. How will you know the plan is working (producing results)? (What and how will you measure to determine success?)
  8. What are the possible side effects (i.e. unreported damage, phantom collisions, any other unintended consequences, etc.)?

Once these questions have been addressed in earnest, then the real work begins in setting up a program and administering the performance data, the awards, and any legal issues (i.e. tax withholdings, reporting requirements, etc.)  Of chief concern is designating a coordinator to be the primary point of contact on the program.  This coordinator must have top management’s support and be a leader – someone who’ll be able to look anyone in the eye and deliver a calm, reasoned answer to any question about the program details.

If you’ve determined that an incentive plan is needed to achieve specific goals, there are many resources available to help set up the mechanics of a program.  These range from “do it yourself” (DIY) plans to fully supported and administered vendor-based programs.  It is well beyond the scope of a blog article to spell out all the details you’d need to consider; however, we’ve provided a small sampling of links to some of these resources at the end of this article, and we have a relationship with a full service vendor in case you need that type of support or don’t want to do it yourself.

Summary

Without a doubt, incentive programs can play a productive and rewarding (pun intended) part of any driver safety program when specific goals are defined and the program is carefully measured along the way.  Incentive programs are specifically mentioned in ANSI Z15 and by the Federal Motor Carrier Safety Administration and many other agencies that deal with driver safety (to be clear, incentive programs are not part of the FMCSRs, but position papers have been provided on this topic showing support and providing advice about them).

We’re not taking sides in the debate about incentive programs.  We just feel that it is vital to have a very detailed game plan in place before starting an incentive program.  Preplanning helps minimize the potential that the plan will either fail outright or become a source of frustration for both drivers and managers. 

What has been your direct experience with incentive programs?  Has your firm implemented one with specific results?  If you didn’t get the results you wanted, did your team perform a post-mortem to learn lessons from the program’s failure?  Similarly, have you been able to document great results from an incentive program?  If so, what did you set out to accomplish and what advice would you provide to other safety professionals who are still sitting on the fence?  Please feel free to add your comments here are our blog site or through the SafetyFirst Client Networking Group on Linked In.com

Sample Resources (we’re not responsible for the content at the other end of these links):

Joe Zingale Joins SafetyFirst Team

PARSIPPANY, NJ; July 19, 2011 – SafetyFirst Systems, provider of various driver safety and fleet safety programs, has named Joe Zingale as its new Vice President of Business Development.

Mr. Zingale, who had been Vice President of Sales at Driver’s Alert, will be in charge of increasing SafetyFirst’s core business while expanding into other markets and offering additional programs through key partner relationships.

“Our company’s core mission is to meet the needs of our customers by offering ways for them to reduce the likelihood of commercial vehicle collisions,” noted Dan Lessnau, President of Sales at SafetyFirst. “Joe’s extensive network of relationships with insurance personnel, safety managers, risk managers and innovative vendors will help us expand product offerings and grow our client base.”

Before joining SafetyFirst, Mr. Zingale spent 17 years at Driver’s Alert in a variety of roles with a special focus on developing relationships with fleet managers, safety directors, and insurance industry professionals from carriers, agencies and brokers.  “If you ask me what I do, I’d have to say ‘find out what clients want and then make it happen!’’ said Mr. Zingale.  “By teaming up with SafetyFirst, I feel empowered to deliver a higher level of customer service and custom program elements than ever before in my career.”

His passion for living comes from his interest in health and fitness as a personal trainer.  Mr. Zingale has pursued outdoor activities and team sports ranging from his involvement in high school and collegiate football as well as active participation in the Boy Scouts of America’s youth leadership program.

CSA BASICs and ANSI Z15

Some parallels worth examiningThe American National Standards Institute’s (ANSI) z15.1 standard titled “Safe Practices for Motor Vehicle Operations” was formally adopted in 2006; however, some fleet safety professionals may be unaware of the standard or how it can help regulated fleets maintain strong BASIC scores.

ANSI Z15 provides a “baseline” of fleet safety practices that are common to all industries and fleet types.  It can be expanded to fit unusual exposures to loss or specialized operations.  It separates fleet safety programs into five key areas:

  • Management Policies
  • Operational Environment
  • Driver Issues
  • Vehicle Issues
  • Incident Reporting and Analysis

Each of these five areas has a direct bearing on the seven CSA BASICS:

  • Unsafe Driving
  • Fatigued Driving (Hours-of-Service)
  • Driver Fitness
  • Vehicle Maintenance
  • Cargo-Related
  • Crash Indicator

Some of the connections are especially obvious:  the “Incident Reporting and Analysis” section of ANSI helps fleets systematically address their history of past crashes and try to manage that information to their advantage (ie. use trending to know where to focus current efforts.  This is a strong parallel to the “Crash Indicator” section of the CSA BASICs.

Other connections may be less obvious until digging into the standard and exploring its approach to structuring an encompassing program.

Yesterday, at the NJ State Safety Expo, I lead an industry discussion on this topic with both insurance and private fleet professionals.  There was considerable interest in re-evaluating ANSI Z15 in light of the FMCSA’s CSA program.  Our primary focus was using the Z15 standard as a “self-audit tool” to uncover gaps or weak points in a carrier’s existing safety policies, program elements, etc.  It’s a good way to test your program before you ever get a “warning letter” from FMCSA or become engaged in an “investigation” of your safety practices.

Additionally, if a motor carrier does become involved in an investigation, being able to work from an established, National standard provides a backstop to establish a reasonable, documentable “Cooperative Safety Plan (CSP)” which would be used to address any identified deficiences due to one or more low BASIC scores.

Current SafetyFirst clients can access several published articles and slideshows about the ANSI Z15 standard at our secure web site.  If you’re curious to learn more about the program we can also recommend two articles published in the ASSE journal called “TransActions” which specializes in transportation safety issues:

If you’d like to learn more about the FMCSA’s CSA program, check out:

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Motor Carriers Asked to Weigh in on CSA

The following announcement was sent to us from ATRI and may be of interest to our readers….

The American Transportation Research Institute (ATRI) has launched a survey to identify CSA impacts on trucking operations, as well as carrier perceptions and attitudes toward FMCSA’s new regulatory program.  The brief on-line survey asks carriers for information on how operations have changed or been affected since the full deployment of CSA in December of last year.  The survey also seeks to capture attitudes toward the program and general understanding of its key components.  Motor carriers are encouraged to provide confidential input on CSA through ATRI’s survey, available online at www.atri-online.org.  The results of the carrier and driver surveys will be available later this year.