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LabCorp's Dinwiddie Cuts Costs & Lifts Driver Morale

June 2007, by Cheryl Knight - Also by this author

Lynda Dinwiddie relies on proactivity, communication, teamwork, and research to maximize efficiencies and run a successful fleet operation. Associate VP, Fleet & Travel for Laboratory Corporation of America Holdings (LabCorp), she continues to look for ways to tighten costs and improve driver morale.

Managing LabCorp’s fleet growth during the past few years — from 3,500 to more than 4,300 vehicles — Dinwiddie has lowered monthly depreciation, expanded the company’s employee sales program, and implemented an online fleet safety program. Technology remains a keystone for LabCorp’s fleet efficiencies.

Dinwiddie, who has more than 18 years of fleet experience, was named Automotive Fleet’s 2007 Fleet Manager of the Year. Co-sponsored by Wheels Inc. and the Automotive Fleet & Leasing Association (AFLA), the award was presented May 6 at an awards brunch that coincided with the National Association of Fleet Administrators (NAFA) Fleet Management Institute and Law Enforcement Group (FMI-LEG) conference in Houston.

This industry award recognizes and honors an experienced and proficient fleet manager who has demonstrated special business acumen in developing and executing key management objectives. A 27-member judging panel, representing all areas of fleet, selected Dinwiddie as this year’s award winner.

LabCorp Operates Fleet of More Than 4,300 Vehicles
LabCorp, headquartered in Burlington, N.C., is more than a routine clinical laboratory. As a pioneer in genomic testing and the commercialization of new diagnostic technologies, the company is one of the world’s largest clinical laboratories, with annual revenues of $3.6 billion in 2006. Its mission is to provide the highest quality laboratory services for physicians and their patients.

With approximately 25,000 employees, LabCorp offers a broad range of routine and genomic/esoteric tests. The company tests more than 370,000 specimens daily for more than 220,000 clients nationwide.

LabCorp’s 4,300 courier-vehicle fleet — 85 percent of vehicles are driven by service representatives — includes Chevrolet HHRs, Uplanders, Malibus, Impalas, and Equinoxes, as well as Buick LaCrosses.

Generally, vehicles run at least 100,000 miles before replacement occurs; however, many locations have vehicles with 200,000 miles.

LabCorp drivers perform their daily duties under highly time-dependent circumstances, so Dinwiddie aims to keep driver focus on the customer at the highest level possible.

“Our drivers visit doctors’ offices daily, picking up blood that needs to be tested at our labs,” Dinwiddie said. “Many deliver reports and supplies, so the lab testing business that we’re in has the highest sense of urgency because the healthcare of patients is involved.”

Because drivers are on the front lines each day, they may be the only face Lab- Corp clients see day in and day out, so their role is very important, according to Dinwiddie.

“We do our best to try and provide vehicles that are comfortable as well as stylish for our drivers,” she said. “We want them to drive a vehicle that performs as expected so that a positive attitude is carried to the clients when our drivers enter their offices.”

Proactive Measures Lead to Tightened Costs at LabCorp
Recently promoted to associate vice president, Dinwiddie manages LabCorp’s courier fleet, which has an annual per-vehicle average of more than 50,000 miles. Her accomplishments include:

  • Decreasing effective monthly depreciation by 25.5 percent over the past five years.
  • Reducing underutilization to less than 5 percent.
  • Keeping out-of-stock purchases to zero as LabCorp’s fleet increased by 20 percent.
  • Maximizing resale dollars by generating 40-percent employee sales.
  • Cutting depreciation and overall cost per vehicle over the past year by starting the fall ordering cycle in late June.
  • Successfully introducing an online fleet safety program.
  • Rewriting LabCorp’s automobile policy manual.

Dinwiddie manages a staff of four who help run the fleet on a day-to-day basis, including fielding all incoming maintenance approval calls, accident management, and vehicle tracking. The team’s seamless operation remains a key to the fleet’s ongoing success.

“We have very seasoned professionals on staff who operate with minimal management intervention. They know their jobs well and can handle nearly any situation that occurs,” Dinwiddie said. In addition to continued teamwork with her fleet staff, Dinwiddie’s successful leadership of LabCorp’s fleet also stems from two other key areas: proactivity and communication.

“I need to be proactive at all times,” Dinwiddie said. “I research new areas and subjects as soon as I see or hear something that may affect us down the road.”

According to Dinwiddie, being open to researching or testing-out different ideas has led LabCorp’s fleet to repeated cost savings.

“My contact at the leasing company can throw something out that we would consider, even if it has never been heard of before,” she said. “We will pull numbers together and research it, and it might work, or it might not work. But at least we’ve investigated it thoroughly.”

Good communications also result in improved efficiencies and driver morale at LabCorp. Dinwiddie and her team work to help ensure that communications reach the field level, providing drivers with all policy expectations.

“It’s my job to answer questions, and I need to communicate our policies and procedures well,” Dinwiddie said. “The drivers feel more involved in the overall fleet process when they’re aware of the reasons behind the policies. By communicating through various methods, our drivers are informed about what is currently going on in corporate fleet.”

At the beginning of each new model year, Fleet regularly asks some drivers to test-drive specific vehicles and provide feedback on how the vehicle would handle as a fleet car.

Dinwiddie is keen on maintaining the fine balancing act of keeping drivers informed and comfortable and, at the same time, ensuring cost efficiencies for LabCorp.

“The bottom line is, whether setting policy or ordering cars, I have to keep the financial aspects in line,” she said. “But it’s not only about cost savings and cost avoidance. I also need to keep in mind how changes will affect our drivers.”

Cost Management Philosophy Leads to Policy Streamlining

Dinwiddie’s proactivity during the past several years has led to several key strategic decisions, which allowed LabCorp to cut fleet costs substantially. One such move included decreasing effective monthly depreciation by 25.5 percent over the past five years. Through cost management, Dinwiddie:

Negotiated cap agreements with her vehicle-manufacturing partners. “This helped us control the pricing of the actual vehicles,” she said.

Adjusted the company’s car-ordering process by hitting the peak selling periods. “We’ve also lowered depreciation and overall cost per vehicle over the past three years by starting the fall ordering cycle in late June,” she said.
Instituted multiyear contracts with auto manufacturers, which have eliminated several months’ worth of work finalizing contracts.

“Now, we can just head straight into the next ordering cycle. I’ve finished 2007, and am now setting up templates for 2008,” Dinwiddie said.

Generated 40-percent employee sales, which greatly maximizes resale dollars. “This has been a real benefit to our employees, and they often take better care of the cars as a result,” she said. “This is open to any employee in LabCorp, not just drivers.”

These initiatives have contributed to keeping costs in line over the past few years, according to Dinwiddie. “We basically tightened up controls,” she said. Other cost controls include ensuring that less than 5 percent of LabCorp fleet vehicles are underutilized, as well as eliminating out of stock purchases.

The cost reductions have occurred during a time when LabCorp’s business base has expanded. Cooperation between departments is key to ensuring a smooth fleet operation, especially during a time of growth.

“It is also vital that we work with all of our key departments to ensure that as soon as they hire an employee, vehicles are ready to go,” Dinwiddie said.

New Online Safety Initiative to Roll Out at LabCorp
Currently, Dinwiddie is introducing a new online fleet safety program to LabCorp drivers. The company’s accident management vendor helps administer the system.

To date, the program has been tested among corporate, human resources, safety, risk management, and 10 fleet managers from the field.

“This system will help us more effectively combine and track our driver and accident records,” Dinwiddie said. “There will be different sets of videos online that anyone can access and review, including accident prevention, refresher courses, annual training, and other additional driver training, such as how to handle road rage or driving with large trucks.”

Drivers’ online progress and test results can be tracked, as well as their MVR points. According to Dinwiddie, the system’s main benefit is helping management assess driver risk levels. “We need to know how to help our drivers perform better,” she said.

The system will be rolled out in small groups throughout 2007.

Auto Policy Manual Updated to Reflect Industry Changes
In January 2006, Dinwiddie’s team rolled out a new policy manual to fleet drivers. Previously released in 2002, the document needed updating.

“There were so many changes to standing policies and procedures because of industry changes,” Dinwiddie said. “The entire process took quite a while to go through and get everyone on the same line.”

Fleet & Travel worked with other key LabCorp departments to ensure effective policy-setting. The fleet team consulted with risk management, legal, human resources, environmental health and safety, insurance vendors, and safety vendors.

“This was a complete group effort between quite a few departments to get an accurate, up-to-date policy,” she said.

The teams went over each policy one by one, determining if changes were needed. They also needed to ensure nothing was missing from the manual.

LabCorp teams updated policies that generated frequent inquiries from field management and drivers, including issues that required clarification and, occasionally, more detailed information. LabCorp teams also worked to align the policies with applicable state laws.

To successfully implement and roll out the new fleet policy manual, Dinwiddie’s team distributed mass communications about the changes, including e-mail and quarterly conference calls.

The manual was also posted on the company’s Intranet site, with instructions on how to order a copy. To ensure that interim updates are communicated quickly and in detail, Dinwiddie also holds quarterly conference calls with the leasing company, sales personnel, and more than 160 general managers and field fleet managers.

“Our new manual update was a success, and our drivers were pleased because we changed some policies based on suggestions from the field,” Dinwiddie said. “It was really taken in stride by everyone.”

And because of this effective dissemination of policy expectations to drivers, Dinwiddie has not seen many compliance issues.

“Our drivers do follow the policies,” she said. “Everything generally runs smoothly, and the drivers deserve a lot of the credit for this.”

Technology a Key to LabCorp’s Fleet Success
To aid in tracking policy, compliance, and vehicle issues, Dinwiddie is currently developing an internal database, called FMS (Fleet Management System).

The new system tracks vehicle accidents and various ways fleet management records and reports data. The FMS allows the data either to be downloaded into Excel or e-mailed directly to the end user.

“This system will provide a comprehensive view of accidents and their effect on our company, including how, when, and where they are happening, as well as type of vehicle, etc.,” Dinwiddie explained. “This will allow us to have a virtual review board on a daily basis.”

Other keys to LabCorp’s fleet department’s success include:

  • Obtaining senior management buyin and support.
  • Holding regular staff meetings to keep team members informed and up to date.
  • Utilizing available technology to streamline processes and operations.

Dinwiddie’s parting advice to others in fleet management is to make processes as “virtual and real-time” as possible.

“Technology is a key area in the industry,” she said. “Utilizing it will shorten review and reaction time so that response is timely and more cost effective.”

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