Why GE Decided to Sell Its Fleet Services Business
Kristi Webb, president and CEO of GE Capital Fleet Services
General Electric announced it will sell most GE Capital assets by 2018, including GE Capital Fleet Services, under a strategic plan to focus on its core business and shed most of its finance and banking businesses.
The forthcoming sale of these GE Capital business units will include GE Capital Fleet Services. GE Capital reported $9 billion in ending net investment for the fourth quarter of 2014 for its global fleet business and $74 billion from US CLL.
To learn more about the upcoming sale and how it will impact the Fleet Services' business, AF spoke with Kristi Webb, president and CEO of GE Capital Fleet Services.
AF: Why did GE decide to sell its Fleet Services business?
Webb: What GE did was make a strategic decision to reduce the size of GE Capital through the sale of most Capital businesses, including Fleet Services. This will allow GE to focus on continued investment and growth in its industrial and manufacturing businesses and create a simpler GE that is better valued by investors.
As Keith Sherin, GE Capital's CEO, has said, the company is making this move in part because it sees the value in the GE Capital business. They are excellent platforms, and there is a great market right now.
For our part, in Fleet Services, we are fully committed to serving customers. We have great people and a winning value proposition. We are confident this business will continue to thrive in its next phase.
AF: What plans are you developing to minimize disruption to your clients' businesses that may result from an ownership change?
Webb: Our whole focus is on serving our customers and helping them grow. Our customers should not have to do anything different because of this announcement. We're committed to their business as we always have been. More than ever!
The day GE made the announcement, we held an all-employee town hall meeting in our cafeteria. What we talked about then is the same thing I am telling our customers: that GE Capital Fleet Services has a great deal of enterprise value. The customer experience we deliver and our value proposition create this value. And, what we're doing is working for our customers. So, we anticipate that anyone interested in acquiring the Fleet Services business would want to keep that going, continuing to deliver for customers and helping them grow and meet their goals.
In Fleet Services, we have a strong franchise with talented professionals, deep customer relationships, and great technology and service offerings. We are focused on continuing to deliver for customers and helping them grow and meet their goals
AF: How do you retain your corporate culture under new ownership?
Webb: The answer is that culture is a part of who we are, no matter what logo is on the door.
Our Fleet Services business has been around for a long time — dating back long before it was acquired by GE. And, we have a strong culture here that incorporates what is great about GE and what is great about our Fleet Services team based in Eden Prairie, Minn. This is something we're thinking about and are focused on every day.
AF: How will your customers benefit from Fleet Services' change of ownership?
Webb: I can't speculate on who the buyer will be but I know that our commitment to executing for customers, a differentiated value proposition, and a culture of service will be a core part of this team.
AF: GE Capital Fleet Services has been growing for the past several years, with last year being one of its best years ever. To what do you attribute this growth and do you foresee it continuing through the 2015 calendar-year?
Webb: Last year was a great year for us and we are carrying that momentum into 2015.
When we talked in 2013, shortly after I was named president and CEO of GE Capital Fleet Services, I shared my goal to grow, simplify, and empower the Fleet Services business.
Fast-forward to today, and these efforts are paying off. For example, we put a focused effort on improving the invoice-to-order process — from the day the customer signs with us to when they can make their first order. We were able to cut this time by 43 percent using lean management principles — that is significant by any measure. On a smaller scale, we had a customer come to us with the suggestion that electronic document signing would make their lives a lot easier. They were right, and we were able to put in a solution that met our standards for security and compliance within 30 days.
The investments we are making in advanced analytics are paying off, too. The connected vehicle, telematics, and advanced analytics are changing what's expected from fleet management and from fleet managers. We're leading the way with innovations, such as our BrightWorks Insights platform for advanced fleet analytics, where we can bring all kinds of data together to deliver solutions for fuel efficiency, maintenance, driver performance, and more.
We've only scratched the surface in this area, but with our combination of technology and deep fleet expertise, I think we are in a great position to lead the way. And, customers are responding to that vision.
AF: What is GE's strategy to offer fleet/driver services and capabilities with the emergence of greater vehicle connectivity features, and how might these enhance driver productivity and better assist in controlling fleet operating costs?
Webb: Connected vehicles and advanced analytics allow fleet management companies to add value. We'll help them do this by integrating data from services, partners, and OEMs. The result will be a more common view of fleet services for fleet managers. And, through solutions built on our BrightWorks Insights platform, we'll have the ability to pluck insights and define actions from this more comprehensive set of data.
For example, with this data and predictive analytics, we can help fleet managers make smarter decisions earlier — before they become bigger, more expensive problems. We can build better predictive algorithms to optimize maintenance and vehicle replacement that lowers overall fleet costs.
When that happens, the connected fleet will impact total fleet costs, enable vehicle asset optimization, increase driver productivity, and improve safety.