David Congdon returned recently to UNCW, his alma mater, and provided a tutorial on the trucking industry, including the entrepreneurial journey of Old Dominion Freight Line.
University of North Carolina Wilmington business students filled the Burney Center Sept. 14 and heard Congdon describe his company’s rise from a one-truck operation in 1934 to a $3 billion company with 8,500 trucks with 32,000 trailers.
Becoming CEO of his grandfather’s company seemed preordained for Congdon. At 5 years of age, his father, Earl Jr., took him to the company’s loading docks. By 10, he was driving an old jeep, and at 14 was working on the loading docks.
“At that point, I knew I wanted to be in the business. I also decided that I wanted my father’s job,” Congdon said.
Named to Fortune’s 2015 Top 50 CEO Businesspersons of the Year, Congdon described the road traveled by his company.
His grandfather, Earl Sr., founded Old Dominion (OD) in the depths of the Great Depression.
He bought a truck and began hauling freight from his hometown in Richmond to Norfolk.
In 1935, the Motor Carrier Act ushered in freight-hauling regulations. The new law limited
OD to its one Richmond-to-Norfolk route. But business boomed during World War II while the Teamsters union organized within the company.
Then in 1946, when the company had grown to 100 employees, the Teamsters went on strike. Disaster was averted when a truck driver called Earl Sr. at home.
“He asked if he would reopen the company as non-union saying the drivers just wanted to get back to work,” said Congdon.
Four years later, Earl Sr. died at age 43. His wife and two teenage sons decided to keep the company rather than sell.
“My dad was 19 years old and worked full time managing operations while going to college at night,” Congdon said.
The company expanded in 1957 by acquiring Bottom-Fiske Truck Line in High Point. A year later, the acquisition almost turned deadly when the Teamsters launched a violent 18-month strike.
“They dynamited my dad’s office three times after my father rejected an offer that would have bankrupted the company. The union finally gave up,” Congdon said.
In the 1980s when industry deregulation arrived, the company lost money for three years.
Congdon’s father came out of retirement, reorganized the company and remains active today as the executive chairman of the board at age 86.
Old Dominion competes in the smallest trucking segment, the $35 billion “Less Than Truckload” (LTL) portion. The LTL moniker stands for the shipping of freight that occupies a portion of a trailer.
The $735 billion U.S. trucking industry has four segments that employ 7 million people. In the U.S., 70 percent of the freight moves by truck.
When Congdon returned to UNCW this month as part of Chancellor Jose Sartarelli’s Distinguished Lecture Series, he shared his leadership decisions that have helped the company achieve a current market capitalization of $8 billion.
During the 1980s, Congdon embraced the TQM or Total Quality Management movement. In 1991, the young vice president told company leadership that their autocratic management style needed to change.
“I told them we needed to get people involved. I volunteered to spearhead the TQM process for the company. This participatory style of management is the foundation of what we are today,” he said.
Congdon says a massive investment in technology helped widen the gap with competitors.
“We differentiated ourselves years ago with handheld computers for our drivers, tracking systems, scales on forklifts, cameras that measure the dimension of freight and technology that interfaces with third-party logistics companies,” he said.
