Doug Clark is the interim president of the Transportation Intermediaries Association (TIA), a job he took with the perspective of somebody who has seen it all in more than 40 years in the industry.
In his fireside chat with FreightWaves President George Abernathy as part of the FreightWaves 3PL Summit, Clark confronted the question that has dogged the brokerage industry for years: Where is its relevance when technology can displace so much of what it does now?
Clark operates from one starting belief. “Most shippers don’t want to have a carrier department,” he said in his discussion with Abernatny. “The last thing a shipper wants to do is manage freight. They don’t want that phone call at 1 in the morning.”
“Shippers just want to give an order and get it taken care of,” Clark added.
The personal touch with the ability to be hands-on remains brokerage companies’ greatest strength, Clark said.
“Most brokers I’ve worked with have good relationships with their customers, and these brokers have intellectual capital that can’t be bought, sold or traded,” Clark said. “They know where the keys are hiding when a driver is doing a three-drop load and it’s early in the morning. They know how to resolve a problem quickly, and the value there is enormous.”
But Clark is quite aware of the role of technology because he saw it close up in his early days in the industry, when he worked at Golman-Hayden, a brokerage where he eventually rose to executive vice president.
His company was one of the first two customers of what is now McLeod Software, which continues to be a major supplier of transportation management software to the industry.
“We were on the cutting edge of technology,” Clark told Abernathy. “Vendors like McLeod have taken us a long way and they continue to invest in their services and the things they provide, which has helped these brokers grow. They’ve continued to invest and that’s why we have legacy companies.”
Clark told the story of when a speaker at a conference Clark’s firm held roughly 20 years ago came into the event, held up a cell phone and said that “everyone will be gone and this will replace you.” “I never have forgotten that moment of somebody saying you’re going to be pushed around and replaced by technology,” Clark said.
“Just as the auto industry was challenged,” Clark said, the brokerage industry is “coming in with new entrants that challenge efficiencies. What we need to do as the TIA is that we have to ramp up and educate our members.”
Clark also said shippers aren’t a consistent bunch; they don’t necessarily have product to ship to market all year round. “Some of this freight is very cyclical and seasonal,” Clark said. “We have history, we have intellectual capital and we are a better front person and partner for this shipper than any bot is going to be,” he added, gently disparaging the idea of a computer-generated message being sent to a shipper rather than a human making a phone call.
Part of his goal at TIA will be to create an industry that works together more, Clark said. “We have to be more collaborative,” he said. “We don’t have anybody we can yell at. We can’t get mad at shippers, the drivers are the strongest or weakest link and in the middle.” The brokers are the “controlling” party of the transaction and need to operate “very, very smoothly to satisfy both parties.”