Workday Podcast: How Werner Enterprises Keeps America Moving With Workday

Kalan Comba: It's not an exaggeration to say that, without the transportation industry, your morning routine would look so different. Need coffee? Good luck making it without beans and coffee maker that didn't make it to the store so you could buy them. Time to get dressed? That's going to be tough with an empty closet. I can go on, but you get the idea that, in an increasingly digital world, the physical parts still really matter. It's estimated that there are 3.5 million truck drivers in the USA alone. And my guest today is right at the center of operations for one of the largest truckload carriers in North America. Welcome to the Workday Podcast. I'm your host, Kalan Comba, CTO of the Americas at Workday. Today, I'm joined by Daragh Mahon, EVP and CIO at Werner Enterprises. Glad to have you along for the ride as we talk about how Werner uses innovative technology to keep America moving. Daragh, welcome.

Daragh Mahon: Great to be here. I'm glad to be here. I'm going to enjoy this.

Comba: So Daragh, thanks so much for joining us on the podcast today. And welcome to the Forever Forward bus. So to get us started, tell us a bit about yourself, your role, journey, and Werner.

Mahon: I've been here just four years. I was working for a company called Vonage, who you guys might remember, the grandfathers of voice over IP. Had a great run there, but it just felt like it was time to move on. And I'd gotten a couple of calls, and one of them was for Werner. If I'm honest, my first reaction was, "A trucking company in Omaha, Nebraska, not really interested."

But then I came up. And they persuaded me to come up and interview and have a chat with some people. And meeting the team, understanding the technology, understanding the need for newer technology, and then meeting my new boss, Derek Leathers, who's the CEO here, it just sort of all came together. And it felt like the right move, and it has proven to be the right move. It's been fantastic in terms of what we're doing in changing how the trucking industry, not just Werner, I think, the trucking industry uses technology.

Comba: That's amazing. And that leads into the next question, which is, when we think about transportation and logistics, it's essential to the world economy. And then technology, how does that overlay, and how do you kind of see that and use that in day-to-day?

Mahon: That’s why we have the tagline, "We Keep America Moving." You said it in your intro. Every single thing you buy in the store got there by a truck. It was on a truck at some point. And I think that really got highlighted during COVID, how important the entire trucking industry is. And we'll talk about that a little bit later, I'm sure. I think what I found when I came here is it was depending on old, the trucking industry, in general, the transportation industry, in general, is very dependent on older technology. Now, it's technology that works. It's a technology that's been around a long time. It was resilient. It was fast. It performed well. High uptime. But it was becoming very hard for customers to integrate or use that technology because it really is rooted in 45, 50 years ago old technology. So the challenge was for us to come in here, me and the entire team, and look at what can we do? How can we make technology work for the transportation industry better? And Werner, specifically, but, but we did like to think that we could help from all aspects, cybersecurity, from the integration, from the passing and movement of data. It all starts with data, right? You got to get the data for the loads. You got to get the data to the truck. You got to get the truck to the location. So that was the challenge, and, that's what we've been working on for the past four years.

Comba: Think about the prevalence of the internet and connectedness and everything's always on. If you are going down the path of using an emulator to emulate an old system, you're going in the wrong direction.

Mahon: Yeah, yeah.

Comba: That's the wrong way to go to wrap something old in something new,

Mahon: I'm a rip-and-replace guy. And that's what we're at at the moment. I don't believe in bolting onto old systems because ultimately that comes back to bite you. Because at some point, that old system becomes tech debt, if it's not already when you start out. The philosophy we've taken and the approach we've taken is, first of all, we're moving to the cloud, and we're probably 60% of the way there, which is no mean achievement. This team has been fantastic. So we moved to the cloud. We move onto platforms that exist already, like Workday.

So I don't want to build. We already built a HRMS. I don't want to build another one. We already built a financial system. I don't want to build another one, especially when they're out there. So we moved to SaaS products or applications available over the cloud as quickly as possible. And then we only build what we absolutely have to build and there are areas in the transportation industry where there is no specific commercial product available.

Mahon: However, there is also areas where there is good commercial product available that we can just configure or we can change and make its secret sauce, make it something that nobody else is doing, which is what we think we're doing and what we like to think we're doing with Workday and the other platforms we're using.

Comba: So let's talk perspective. You've been a driver.

Mahon: I have, yeah.

Comba: You've been a driver, and you're an IT leader. Talk to me about what's the advice you have for other transportation leaders, other tech leaders, other folks, from a perspective standpoint?

Mahon: The funny part is, me being a driver gets a lot of press around here. And the reality is I drove for about nine months. When I speak to, I speak to some of our drivers who have two, three, four, five, and one guy has five million, actually, two guys have five million safe miles. I think I have 39,000 safe miles, right? And even that's questionable because, I did get accused one time of running a curb. So my perspective is limited in, in the amount of miles I've driven, when you think about it from that perspective.

However, nine months is nine months. And I do have a perspective of what a driver goes through. I do carry that through to what we're doing. It also fits with the ethos of this company because, one of the things, during the interview process, everybody talked incessantly about drivers, drivers first and safety, two things that came up in every single conversation and multiple times in every conversation. And honestly, you kind of feel, "When I get here, am I going to find out that that's the lip service? That's what they tell people who are coming in the door." And it's not. The ethos of this company is embedded in drivers, drivers first and safety above everything else. We have a saying around here, "Nothing we do is worth getting hurt or hurting others for," period, end of story. So we are one of the only fleets that park, when we have inclement weather, when we have snowstorms, we just park our fleet in that area. And an awful lot of other trucking companies don't do that. That speaks to we will put safety above profits every single time. So that fits in with everything I believe in. It reinforces what I believe in. I learn from that type of attitude. I see it reinforced here every single day. So that was really key to me coming here, and it's key to me staying here.

Comba: So think about frontline workers and drivers, always on the road, always going. You retain and engage your employee with the focus on bringing your whole self to work.

Mahon: Yeah, yeah.

Comba: Can you talk about that a bit?

Mahon: What we have is a very simple philosophy on this. Just bring your whole authentic self to work. We mean it in every sense of the word. One of our board members, Michelle Greene, who's the CIO at Cardinal Healthcare, she's been on our board for just about a year now. She came, and she did, a fireside chat And it just reinforced that whole mentality that we have from the board on down that just if you can bring yourself to work and you do your job, it doesn't really matter who you are, what you are, what religion you are, what color you are, what creed you are. Just come to work and do what you do. We shouldn't and don't care what, what any part of you is other than you come to work, you're a good person, and you do your job.

And if you look at our stats in the driver community, 16% of our drivers are female, which is extraordinarily high in the industry, the highest among the big fleet carriers, by a long way. I think the industry average is published at 6%. And we kind of feel like that's inflated a bit. And in military, we just, we've won various awards for, for hiring veterans, but our veteran population is now approaching 20%.

So, and that's across the, the fleet, and that's within the, within the associate community, the non-driver community as well. So we live it. We breathe it. I don't think we think about it too much. I think we just assume and accept that if people bring themselves to work and do their job, we're in a good place.

Comba: So I'm gonna come back on something that you talked about there, in terms of the population. Talk to me about the bridges that you've created and kind of career-pathing for folks as well. So I think that's another interesting aspect here.

Mahon: What I love about drivers is, so we're introducing an awful lot of tech to trucks, right? So we were the first back in the '90s. And, and Werner are pioneers in this regard. They were the first to introduce ELDs, electronic logging devices, on trucks. Before that, it was all paper. And they were the first to get the OT certified for that. And throughout that whole process and over the years and adding GPS to trucks and adding technology to truck and looking what we have today, we include drivers in this conversation. And we have this really neat team, driver success that work in the IT department. And what their job is, is to just communicate with drivers all day, every day. And talk to those drivers, find out what works for them, find out exactly what they think of the technology, whether it's the mapping systems, the workflow systems, the electronic logging device, the safety systems.

What's their opinion of that? And give us this feedback. We share that, along with safety, with the maintenance group, with the IT department as well. So the developers know exactly what we're looking for. And I think what we end up with is this driver community that's well-informed, that feel like they have a voice in what we're doing. And then, when we have opportunities within the company, whether it's to come work in safety, which drivers are fantastic at because they've been there and done that. We recently just had a driver, she was a part of a husband and wife team. And they drove for about three years, decided they wanted to get off the road. I talked to this lady numerous times at various events across those three years and said to myself when I met her the first time, "Someday I'm going to hire that lady." Because not only is she extremely focused on driver enhancements and what driver tech could look like, she's also had an IT background. So she just went into driving. So she called me one day and said, "Hey, I'm thinking of getting off the road. Can we talk?" And she's working for us now. Within the IT department, we have four or five. We have a ton of them in safety. Drivers have made the move into safety. And that's part of how we want to work to retain drivers. Bring them into the business when they're done driving because driving is a tough job.

Comba: Thinking about the fact that Werner is recognized as one of America's greatest workplaces for diversity, parents, families. You mentioned veterans. I think that's a really important aspect to this as well. How do you communicate with the broad mass of drivers? Do you use employee listening? Like, is there things that you're actually doing today to make sure that you've got a really good perspective?

Mahon: So first of all, like I mentioned earlier, we have this driver success team, who communicate daily with---and now, it's hard to get that 9,000 drivers in that perspective, but they do communicate. We have a road team. It's a group of drivers who have various degrees of experience at Werner. They've got varying degree of experience, but they have to have minimums. And these are people who get nominated and then interviewed. It's not like they just ask, "Hey, I'll be a road team captain." Like, it is a very stringent process to get into that group. And their job is to represent the drivers to the rest of the company, and represent it in every way, at events, but also give feedback. Here's what drivers are saying. Here's what we want. Here's what we need. So we get a tremendous amount of feedback on technology from that group. And then we have Driver Appreciation Week, which, which is the week that we go and we visit all the terminals. Most of the executive staff, we jump on airplanes. We get to those locations. We meet with drivers. We have events. While it's meant to celebrate the driver - and we do - it's also meant to be an opportunity for drivers, and there's hundreds of them at these events. Come to us and tell us exactly what's going on. And it's a no-holds-barred conversation with these drivers. They're told, "Daragh's here from technology. You need something about tech. You need an answer to a question, go talk to Daragh." And so we stand there, and we have conversations. And they're just fantastic conversations. Like, we really understand, and we get where they're coming from.

Comba: Right. Oh, that's excellent.

Mahon: And then Derek will randomly do some drives, and go and visit terminals across the country and stop and talk to drivers. We do it here all the time. Like the, the Omaha office where we're at right now is a terminal. You'll see trucks and trailers all over the place. So it's just nonstop constant feedback. Talk to them. The other great thing when I say is, we communicate with them. We take them seriously. We listen to what they have to say, and then we do our very best to, to implement whatever we can to help them.

Comba: Yeah, amazing. And the safety side of it. So we are on campus. We did walk from the bus to the other building. And had to make sure that we go around the red so that we're in the safe zone. It's everywhere.

Mahon: We have these very elaborate and very technology-advanced simulators, right? So they're made by the same people who made aircraft simulators.

But they're just truck-driving simulators. And we use those. Every driver is required to do a certain amount of training, just like a pilot does every single year, on those simulators. So every driver hits those simulators every single year. They're in a lot of terminals. We have them in trailers like this where they go from event to event so that drivers can get in there and do it. We use Workday. So I think I saw the number. We did almost 50,000 training events in Workday. 40,000 of those are drivers. So they have to go and do their safety training. Whatever certifications they need, whatever training they need, and they have to do it. So it's all about the driver here. It really is.

Comba: So we can't do a podcast these days without talking about AI.

Mahon: Do we have to?

Comba: It's such a huge, broad topic. Two years ago, nobody was talking about it. Now everybody's talking about it. There's such a huge buzz about it. Are there any real things that you're seeing or any real kind of examples that you can give?

Mahon: Absolutely. First of all, I think we confuse machine learning and AI all the time. Most of what we're seeing today is truly machine learning. It's machines learning, remembering, figuring out, and doing it better. We’re being very intentional about how we're using AI and machine learning within our environment. So first of all, we're all in, right? This is in my mind, one of the greatest technology advancements. I think it's internet level, right? So this is 1990s all over again when the internet became ubiquitous. AI is becoming ubiquitous. We have to accept it as a technology that's going to help us do our jobs better and make us more efficient, make us safer, make us more productive. And if we look at it that way and implement it that way, with the right guardrails around it, it becomes a great thing. From our perspective, I think what we're seeing is, we're looking at it when we implement TMSs, right? TMSs are transportation management systems. So how do we optimize our loads? How do we optimize routes? You can imagine, right? The more optimization we do-- and we're really good at optimization.

We've got a whole lot of very experienced, very smart people who work on optimization. But it's about where does a trailer need to be? Where does a truck need to be? Where does a driver need to be? Where does a team need to be? The more we optimize, the less empty miles we run. We're much more productive. We make more money. Margins get better. Revenue gets better. That's probably the area I'm most excited about. How do we optimize our entire network using AI? Because it does those calculations. It does that work so much quicker than any human being can do it. So we're building that into our TMS right now. But then we're using it in platforms like Workday, right?

So you guys have released a lot on AI. We're using the platform. Even the search capabilities have improved tremendously in the last 12 months. I don't use Google anymore. I use ChatGPT.  If you go to ChatGPT, you get a much quicker answer. We use it on Zoom. We use it for meeting notes. We're using it in Workday. We're using it in Salesforce. So it’s going to become ubiquitous, but it is the next big technology advancement.

Comba: And it sounds like, if you call back to something you said earlier around, "If you can buy it rather than build it.” You own it. It already comes in Workday. It already comes in these platforms. You're going to take advantage of what's there. You're going to leverage what's there. Is there an idea to build anything overarching or build things dedicated just for--?

Mahon: There's no question what, what we're doing-- like I said, we've been very intentional. And I'm not a big fan of committees, but we do have an AI steering committee, the idea here is that let's make sure that when we implement AI, we're doing it for a good reason, not just because it's cool. And there's a lot of cool stuff you can do with AI.

So we're looking at how do we implement it? How can we use it in our day-to-day lives? And how can we improve all the time? As we move all of our platforms to the cloud, the ability to have all this data in a single place, through APIs, and where we can then apply large language models, to not just optimize our routes and our loads, but think about it. Can we look into the future and say-- we know how many drivers we have to hire roughly on a weekly basis to stay current with customer demand? But man, if we could look six months into the future and say, that particular week, we need 248 drivers to be hired, versus, we'll take a shot and hire 180 or 200 and see what happens and be short. So I think there's overarching needs that we, we have identified that we will work towards as we move more and more of our platforms to the cloud, we can then start to see the real benefit of having our data all in a single place. I think anyone who's not thinking that way is probably going to lose at some point.

Four years ago, when I came, actually, the very first call I joined, I think it was two or three days before my official start date, Derek, my boss, asked me, "Hey, can you join this final call about Workday? I want to make sure you're in, in agreement." And I said, "You don't need me there. I'm in agreement." "Let's go." We had selected Workday as our HRMS platform right before I joined. If you think back to then, when we were doing payroll on our homegrown HRMS system. We were doing all HR operations as they were.

Most of them were paper, on old legacy HRMS systems. And now we're doing all of that in Workday, everything, benefits, all the HR operations. All employee engagement. And then same thing on, on the accounting side. We had our own homegrown accounting platform. We did all accounts payable, all accounts receivable, everything, financials, month-end, year-end, quarter-end, divisionals, you name it were all done on our own legacy platforms. And you heard Alan Colson, one of our VPs, this morning talk about the difference that they have, from a closed cycle to actually producing divisionals to send out to our division leaders. I mean, it's gone from a couple of weeks to a couple of days. And that's across the board. Now, we've got a long way to go, but man, have we come a long way in four years.

Comba: I mean, the engagement and alignment is amazing. The conversations, the transparent conversations.

Mahon: You can't do what we're trying to do here without the entire executive team, vice presidents, the senior vice presidents, the leadership. But then it's just not that. All of that has to filter down, which comes from the top. And we're lucky that I have a group of people around me who are as engaged in this as I am. And I couldn't do what I'm doing. You can't do it without this level of belief that this is the right thing to do. Our COO is, like, crying out for more of this stuff. Our whole C-suite believe that this is the right path forward. We might get into disagreements and arguments about the nuances of the path, but everyone sees the same vision, which is fantastic.

Comba: That's amazing. So what kind of advice would you give to other organizations, other transportation leaders on what they should be doing---

Mahon: I'm not telling, I'm not telling them anything. At a very high level, it's two things. It's, let's drag transportation technology out of the, the 1990s. I mean, and, and I don't say that with any level of sarcasm or condescension. I just mean, so many industries get so used to, look at the airline industry, right? They get so used to technology that works that they tend to forget about it. Someday, it's not going to work.

I think the airline industry is there. I think the transportation industry was there, but it's coming out of it. And I talked to a lot of my counterparts at other large trucking organizations. And we're all sort of on the same page now. Let's lift it out of the 1990s technology and get it onto modern technology. And there's a couple of reasons for that. First of all, it makes us more efficient. It makes us move better. It makes us move the country better. It makes goods get there quicker, cheaper, more efficiently. And that has an impact on the environment. That has an impact on all of our pockets. But then I think, it also, from a cybersecurity perspective, it's very hard to secure old legacy systems. Like, we do our best, and we can firewall the heck out of them and surround them. I don't think anyone believes in perimeter security anymore, but sometimes that's your only option when you're mired in that technology. So if you move up a couple of levels, I say this all the time. Would I rather have all my HR data on my own platform surrounded by a perimeter security firewall, or would I rather Workday have it and I don't know how many security engineers you have, but it's a whole lot more than I have. And that doesn't mean I can shirk responsibility for that security, but it does mean that I have partners who can help me manage that security. And it makes us sleep easier at night. So that would be my advice. Let's lift ourselves out of the 1990s in terms of tech, and let's focus on security.

Comba: Right. Well, there's some great stuff in here. We've been talking about trends in the transportation industry with Daragh Mahon, EVP and CIO of Werner Industries. Thank you for your time today. I really appreciate it.

Mahon: You're welcome. I enjoyed it.

Comba: Awesome. If you enjoyed what you heard today, be sure to follow us wherever you're listening. And remember, you can find our entire podcast catalog at workday.com/podcasts. I'm your host, Kalan Comba, and I hope you have a great work day.