The young person who has an inquiring mind, an analytical ability, and likes dealing in facts will find the work in the traffic department of a motor carrier a career that is both interesting and rewarding.
Since the industry is regulated, and the normal forces of a capitalistic free enterprise society are controlled, the setting of prices is another facet of industry that is subject to review and regulation by the Interstate Commerce Commission. Many times, the rate-making (pricing) by the motor carrier company is permitted to operate without review by outside interests. In many cases proposed changes and rates are reviewed and investigated by the Interstate Commerce Commission-presumably when there is some question as to the justness or reasonableness of the new rate. The traffic department therefore must have expertise in the area of developing appropriate justification for rate changes and further have the know-how in appearing before the Commission to present its case. The pricing activity covers all services that are required to be offered by a common carrier, from the simple job of providing an extra copy of certain documents to the charges for moving a truckload of freight from coast to coast. All of the charges for the myriad services provided must be published and placed on file at the carrier's various offices, the offices of the Interstate Commerce Commission, and any of the various state regulatory commissions that may be involved because of solely intrastate operations.
The traffic department of a trucking company has the responsibility of studying all available data in order to determine the prices for the various transportation services offered by the company and must arrange for their publication in accordance with ICC and state commission regulations. Under the present system of pricing, every commodity moving in interstate commerce is assigned a "classification" depending upon its size, weight, cubic displacement or value, and other related transportation characteristics.
The classification of a product helps determine the price that will be charged for hauling it. The price a motor carrier charges per hundred weight to move a product is called a rate and the publication that contains those rates is called a "tariff." Motor carriers have grouped themselves into ten major regional tariff bureaus that publish rates for motor carriers belonging to that bureau.
A carrier may charge any rate he feels reasonable for hauling a commodity, but the rate may require formal justification in order to be approved and allowed to become effective by the Interstate Commerce Commission or a state agency. Other motor carriers as well as other modes of transportation and shippers may oppose a rate as being too high or too low, and the carrier will then have to completely justify his proposed rate. It is clearly an area of specialization, and persons working in a traffic department must have special knowledge and training.
Requirements for a Traffic Career
The minimum requirement for a job in the traffic department of a motor carrier is a high-school diploma. Ideal qualifications would be an undergraduate degree with transportation major, and even additional education is desirable. Special education courses in rate-making and checking, such as the "Traffic Management Course" in the Academy of Advanced Traffic, are most helpful.
Traffic Careers Well Paid
The range of jobs in traffic extends all the way from rate clerk through assistant director of traffic and eventually to director of traffic or vice-president of traffic. Some traffic-oriented men have been elected to the presidency of their trucking companies.
Rate Clerk--the Starting Job
Rate clerks must learn the methods used to determine the correct rate at which a commodity moves.
A product such as chickens, for example, may have various rates depending upon whether the chickens are shipped alive, dressed, cooked or frozen, or as prepared food.
Rate clerks in deciding the correct rate must be able to use various freight tariff books to make certain the amounts on freight bills are correct.
If you like detail and figures and are good in arithmetic you can go straight into a job in the rate department upon graduation from high school. For advancement, courses in traffic and transportation are available at local night schools, and a course of study by the American Society of Traffic and Transportation leads to certification, which for traffic men is similar to that of a CPA for accountants.
Courses given by the Academy of Advanced Traffic are available in New York, Philadelphia, Chicago, and Los Angeles and also through the LaSalle Institute extension courses.
Senior Rate Clerk
This is an expansion of the rate clerk's duty to one of supervision and expert knowledge. The young person can take night courses in transportation and will also find transportation law more helpful in advancing to senior rate clerk.
Rate Audit Manager
The rate audit manager usually works under the general supervision of the manager of traffic or commerce and is responsible for staffing and directing the auditing functions relating to over and undercharges for the protection of company revenues and also for the development of special surveys and studies as they are needed.
The principal duties and responsibilities of a rate audit manager include supervising and directing the activities of the department, including staff training, the assignment of work and recommendations regarding hiring, promotion, and discharge. His work implements the rate audit policies of the company to ensure protection of company revenues and the prompt disposition of overcharge complaints. The job also requires the practice of diplomacy.
The rate audit manager also conducts continual evaluations of terminal rating efficiency through surveys of rating performance. In other words, his job is to see how well the rate clerks in the company's terminals are performing in determining rates for freight. The rate audit manager also frequently directs the preparation of rate quotations for customers and for company personnel and conducts rating analyses for ICC commodity studies and Regional Tariff Bureau functions. He also supervises the rating functions in support of centralized prorating and the interline settlement operation of the general office of a motor carrier company. (This function deals with dividing the total charge for a shipment among the carriers that transported the shipment from origin to destination on a through rate.) In addition, the rate audit manager will assist the various terminals by settling rating questions between company personnel. In other words, if the rate personnel in one terminal quote a certain fee or rate for shipping freight, and personnel in another terminal come up with a different rate, it is the job of the audit manager to determine which rate is the proper one for the particular transportation service involved. The direction of the detailed work of overcharge claim investigation and settlement, and the auditing of freight bills, rate quotations, and surveys also come under the rate audit manager.
To qualify for a job as a rate audit manager a person should have a college degree or the equivalent in practical experience and ideally should have a minimum of five years of motor carrier rate experience at the general traffic level including some supervisory experience. The rate audit manager must also be able to work closely with all levels of company management and with the representatives of their customers.
Assistant Traffic Manager
The assistant traffic manager works under the direction of the general traffic manager and in this position is responsible for the general rate activity in his assigned territories as well as other duties that might be assigned to him by the general traffic manager.
The assistant traffic manager assures the proper publication of the company's rates, rules, and regulations in the rate territories assigned to him. He analyzes and evaluates requests for rate adjustments, makes recommendations in regard to such matters to the general traffic manager, and files proposals with a Regional Tariff Bureau as directed. The assistant traffic manager also reviews the various docket bulletins (synopses of proposed changes) in the territories assigned, and analyzes information from them, and recommends and takes any action that may be necessary to protect the company's general rate policy. The assistant traffic manager also prepares and distributes special rate quotations offered to the government under Section 22 of the Interstate Commerce Act. Section 22 is one that allows the government to ask motor carriers to submit bids or special rates for the hauling of government freight. Since the government is the largest shipper in the country, there is frequently a good deal of competition for government traffic, and many companies have specialists who work exclusively in the field of government traffic. Those specialists are often based in Washington where they are able to keep in contact with the various government agencies involved in shipping government materials.
The assistant traffic manager also furnishes interpretations of freight tariffs, including applications of rates, routings, rules, and regulations.
An interesting part of the assistant traffic manager's responsibility is that he represents his company at carrier committee meetings regarding rate and tariff matters from time to time in various cities throughout the territories in which the company operates. The assistant traffic manager may also be called upon to assist in the defense of rates protested by railroads or other parties, and also in the preparation of rate exhibits for presentation at formal hearings before the Commission. In conjunction with this, he also conducts traffic studies and surveys that may be required by the general traffic manager.
The education and experience for such a job usually involve a college degree with specialization in transportation or traffic or transportation law plus equivalent practical experience. The assistant traffic manager should ideally have a minimum of two to three years' experience in motor carrier rate-making with some exposure to other traffic department functions.
Interline Traffic Manager
In the motor carrier company it is not unusual for the carrier to share the freight charges with another trucking company that has different routes and rights into various cities and territories. For example, a trucking company might have rights to carry freight from Baltimore, Maryland, to Kansas City, Missouri, and pick up a shipment for delivery in Denver, Colorado, to facilitate movement; carriers, on a joint arrangement, publish rates that apply from Baltimore to Denver, and the shipment is hauled by the origin carrier to Kansas City, Missouri, where it is delivered to a "connecting line" carrier for movement to Denver and delivery. The total freight charges are divided between the carriers, and this is called an interline settlement. The division of revenue is based on predetermined and somewhat standard arrangements, which involve a formula based on mileage, pickup or delivery service, and other related items.
Since there is a great deal of this shared business, it requires the supervision and direction of a specialist who is called the interline traffic manager.
The interline traffic manager works under the general supervision of the traffic manager or whatever the title is of the top man in traffic. The interline traffic manager is responsible for the overall development and maintenance of connecting carrier relations so as to provide the company with the best continuous or through service, the least cost, and the greatest revenue. In addition, his position is also responsible for specific recommendations regarding matters before the Interstate Commerce Commission, and he is also required to assist and often himself handle presentation of rate matters or other traffic matters before the ICC.
The interline traffic manager has a number of heavy responsibilities. He directs the negotiation and maintenance of interline contracts, the establishment of bases for dividing revenue and the accomplishment of joint routing concurrences with connecting lines.
In addition, the interline traffic manager coordinates interline activities with all of the departments of the company involved. He also assists the sales department and the interline terminals in selling desirable interline services and evaluating connecting lines. To continue the example of the carrier who carries freight from Baltimore to Kansas City, it may well be that the company itself does not originate too much freight in Kansas City to take back to Baltimore, but there may be carriers from other parts of the West, from Phoenix, Denver, Wyoming, Montana, or other states who have freight coming in to Kansas City routed to destinations in the East and Southeast. This makes for valuable cargo so that the Baltimore-Kansas City company can avoid having to run its trucks back to the East coast lightly loaded or even empty.
That is what makes the job of interline traffic manager so important in working out interline agreements and selecting connecting carriers to help balance the operations of the company and also to bring in more company revenue.
Other responsibilities of the interline traffic manager include the development, distribution, and maintenance of company routing guides, a joint routing directory, interline revenue percentage estimate charts, a list of points the company is authorized to serve, and studies of their relationships with connecting lines.
The interline traffic manager also assists in the evaluation of potential applications for additional operating authority by the company, and makes recommendations to the traffic manager or director of traffic. He also recommends and assists in the preparation and filing of such applications with the appropriate governing bodies. In that activity, he recommends and arranges for legal counsel when required and he also directs the obtaining of witnesses, preparation of exhibits, and testimony in proceedings, and in general, represents the company before the Interstate Commerce Commission at oral hearings.
The interline traffic manager also frequently assists in evaluating company actions to be taken in connection with mergers and purchases and the applications for operating authority of other carriers that may adversely affect the company's interest.
As you can see, the interline traffic manager has a great many duties, and many other duties develop from his job that are not listed in this brief description.
To qualify as interline traffic manager, a person must be a college graduate with experience in transportation and he must have, ideally, a minimum of five years of progressively responsible interline traffic experience. Many companies require that he also be an ICC practitioner. Very often he may have two degrees -a degree in business and a degree in transportation law as well.
The interline traffic manager is a responsible and key management executive in a trucking company, and his salary is in accordance with the size of the company and his responsibilities.
Traffic Director Must Be a Master of Many Skills
The top job in traffic is that of the traffic director or as he is called in many companies, vice-president of traffic. These positions are highly paid. The traffic director must be experienced in all aspects of traffic and must keep up with any developments that might change the cost or methods of transportation.
New developments in packaging and shipping could well affect the cost of hauling a product. New packaging that could reduce breakage on a fragile product could well lower the cost to the company of handling such freight.
Other things that influence the cost of hauling freight are the geography of the land, whether the highways are good or bad, whether die trucks must go through large cities or in mountainous territory where more fuel and time might be expended. The traffic director keeps in close touch with the director of sales or vice-president of sales of a motor carrier and also with shippers in order to advise of changes in shipping rates, and to be currently aware of competitive changes that might require adjustment of rates to avoid the loss of certain types of freight to competitive motor carriers or modes.
Since truck companies often form a network of many independent organizations, it is necessary to have working agreements with other truck lines so that shipments may be exchanged in a free-flowing manner or go through to their destinations. Although this function has been described under the job description of the interline traffic manager, it is nevertheless the overall responsibility of the director of traffic to work out and supervise a good many of these arrangements as well as to supervise the work of the interline traffic director and that of all the other specialists in the traffic department of the motor carrier.
The traffic director also is actively in touch with the various Regional Tariff Bureaus throughout the country. He travels frequently in his job and attends Tariff Bureau rate conferences and meetings, as well as conferences with shippers and other carriers involving all facets of effective transportation of freight.
To become a traffic director, a person must have a great deal of experience in a motor carrier company and must have a college degree with specialization in transportation and traffic. Ideally he should also have a degree in Transportation Law and be able to practice before the Interstate Commerce Commission.
Traffic a Changing Field
Since pricing is at the heart of the competitive transportation business, the traffic director occupies a place on the management team that is certainly most important. His work and responsibilities contribute a great deal to the financial success or failure of a company. The job of traffic director as well as any job in traffic is challenging and exciting and offers a continually improving career for the young person who begins at .one of the basic jobs in a traffic department and is able to work his way up through the department gaining a tremendous amount of practical experience in the considerations that make up a motor carrier pricing theory and including the many other job responsibilities, such as personnel management. Such experience, supplemented by the knowledge gained through a solid background of formal education, produces the leaders for this nation's largest transportation industry--the second largest employer in the United States.
