Steering ArcBest with Values and Trust

If Judy R. McReynolds could talk to her 18-year-old self, she’d tell that young woman to be open to change. "But make sure you embark on that change with people who share your values and whom you can trust," adds McReynolds, chairman, president, and chief executive officer of ArcBest in Fort Smith, Arkansas.

The words "change," "values," and "trust" figure prominently in McReynolds’ business philosophy. For example, she has led a major initiative to broaden ArcBest’s focus to better match its customers’ evolving needs. She credits the company’s values-driven culture for the success of that transformation.

In a recent conversation with McReynolds, we dug deeper into her leadership approach.

IL: You started your career as an accountant. How did you find your way into transportation?

During part of my public accounting career, I worked for Ernst & Young in Little Rock, Arkansas. My client base there consisted largely of less-than-truckload (LTL), truckload, and flatbed carriers. As I learned about the industry, I observed the hard work and dedication of the leaders and leadership teams in those companies.

I also appreciated the entrepreneurial spirit of many of those companies. ArcBest (then called Arkansas Best Corporation) was one of my clients. Working in the tax area, as I saw the leadership team’s approach and integrity, I grew more interested in the business. I first joined ArcBest in the accounting and finance area.

IL: What did you learn early in your career that helped shape you as a leader?

In my public accounting days, and later when I joined this company, I came to appreciate the importance of a values-driven culture when you’re trying to develop strategies and get things done. To move fast as a leadership team, you have to be able to collaborate and trust one another.

IL: How have values and trust helped you get things done?

When I first came to ArcBest, more than 90% of our revenue came from the LTL part of our business, ABF Freight. But many customers were evolving, spending on other transport modes.

We wanted to evolve to reflect our customers’ changing needs. So in 2017, we launched what we call the enhanced market approach. We merged the siloed sales teams across our business units into one organization to enable our sales team to serve the customer across the entire supply chain. Additionally, several key functions—talent development, pricing, customer service—operated in silos. We began to integrate those functions to align our resources with the way our customers wanted to do business.

In a company that’s nearly 100 years old, change on that scale takes courage, along with a strong focus on change management. It takes a values-driven culture to develop the level of trust needed to accomplish that kind of change in an organization.

IL: What keeps your customers awake at night?

They’re trying to work through the effects of COVID-19. Many customers had their supply chains disrupted. The issues are different for nearly every customer. One by one, we’ve been working to help them normalize their supply chains and look at creative ways to endure the pandemic.

IL: How would your team describe your leadership style?

I get characterized as courageous, because of some of the changes we’ve made in our business; strategic, because I love strategy and planning; and values-driven.

One example of my strategic focus is the quarterly meeting of our Horizon Growth committee, which I started early in my tenure as CEO because I wanted to make sure we were looking to the future. I saw how we could get absorbed in the whirlwind of current concerns and not spend time on the next three to five, or even 10, years.

Our Horizon Growth meetings include the leaders who report directly to me and a few others who work in areas critical to our planning. Throughout the process, it’s important that I hear from other leaders; I don’t want to be the only one talking.

IL: What three things do you check first in the morning?

I check my messages for anything urgent I need to address. I look at the previous day’s activities—revenues, shipments, and key operating statistics—to see how we’ve done in all our businesses. I also review news about the industry and our customers.

IL: How do you give criticism or correction?

I like to discuss a leader’s strengths but also mention areas where there’s room for improvement. Most of the time, our leadership team is aligned. But when I see that things aren’t working well, I try to jump in and address the issue quickly.

IL: Who is a business leader you find particularly inspiring?

It’s not often I see all the characteristics I admire in one leader—inspirational leadership, great communications skills, willingness to take risks, and appropriate balancing of the needs of customers, employees, and shareholders. But I do find all those traits in Tim Ogilvie, chief executive officer of innovation firm Peer Insight, a company we have worked with.

Ogilvie is a small-business owner and leader with a mission to help other businesses succeed by deeply understanding their customers’ desires. He’s an entrepreneur and has taken appropriate risks. But he also sees the value in developing employees, and he has a strong desire to help businesses meet customers where they are.

IL: How do you like to spend your time outside of work?

My husband and I enjoy any opportunity to get together with our grown kids. We all love the beach, and we love to travel in Europe. I like to stay fit and be healthy. I play the piano. I love reading to absorb new information or just for pleasure.

How About If We Try This?

"We get curveballs thrown at us daily," says Judy R. McReynolds at ArcBest. And unusual requests can spark creative solutions.

In one recent example, a customer was arranging deliveries to its storefronts, which had no receiving docks. "Our people would bring the product in, set it up in a particular room, and remove all the materials at the end of the delivery," she says. "As you can imagine, this kind of delivery is typically more expensive than a regular one."

But while it was asking for special services, the customer also wanted to reduce its costs.

"We asked to review their entire supply chain, so we could suggest portions of the process that could be reduced," McReynolds says. "They ended up asking us to manage their business in this area, so we could ensure that the right carriers were in the right places based on their needs."

The customer loved that solution, noting that no other third-party logistics company in their experience had ever taken such an approach. "We are willing to roll up our sleeves, try to understand the steps in the process, and then make recommendations," she says.