Professional fleet managers generally inherit previous fleet operations. It is rare that, in a company with a fleet large enough to merit in-house fleet management, a fleet manager is hired where there has been no predecessor.
In these circumstances, they both bring along their own way of doing things, and study what the predecessor might have been doing, otherwise known as the predecessor’s legacy behavior. This might encompass any number of fleet management processes: replacement policy, vehicle selection, personal use, or safety. Legacy behavior can, however, become a trap, a “safe space” for a fleet manager who might be hesitant to make changes. But with the fleet world around him or her changing at a dizzying pace, refusal to throw away the burden of legacy behavior can be the road to failure.
Change has always been one of the challenges fleet managers must deal with. Change in vehicle design, power trains, the dizzying pace of technological change, even change in laws and regulations. Adapting to change can be challenging, but it’s difficult to adapt by falling back in the comfort of legacy behavior.
Dealing with change requires that a fleet manager first understand what change means, how it will impact his or her responsibilities and those of fleet drivers, and decide what action(s) to take to meet the challenge.
For example, vehicle technology has brought much dizzying change. Beginning decades ago with advances such as electronic ignition and fuel injection, we now are very close to having vehicles that communicate with each other and that drive themselves. Fleet policy for vehicle assignment, replacement cycling, and safety training that have been in place for years may well now be obsolete; legacy behavior that screams out for change.
Let’s consider replacement policy. For decades, replacing automobiles has been an algorithm of time and mileage. Replacement occurs at a chosen number of months in service or mileage accumulated, whichever occurs first. Very commonly, that policy is something around 36 months in service or 65-75,000 miles, with typical fleet mileage of 24,000 miles per year.
Now consider the circumstances that led to the 36 month/75,000 mile policy. Decades ago, vehicle warranties were 12 months/12,000 miles, bumper to bumper. There were no extensions of that for powertrains as there often are today. The key was to replace at the time where the combination of fixed and variable expense were at their lowest.
The latter basis for replacement is the same today. But consider how vehicles have changed. New, longer lasting materials, better quality lubricants, advanced manufacturing technology leading to far more accurate fit and finish. These, along with changes, now produce vehicles that are stronger, run better/longer, and retain value at a higher rate than ever before. That has led to extensions of both basic warranties, from 36 months/36,000 miles to as much as 10 years/100,000 miles, and also longer powertrain warranties. These advances are positive changes for fleet managers — and considering the legacy replacement policy — should encourage altering replacement policies to reflect all the advancements that have been made.
It can be difficult to break free from the “common wisdom” that a legacy replacement policy provides, but it doesn’t need to be done overnight. Certain vehicles can be selected for a test of the new replacement policy, and from there simply track the numbers carefully and adjust accordingly.
A key element of any fleet operation is the establishment of a firm preventive maintenance regimen and a means by which it is enforced. Manufacturers have established preventive maintenance schedules, usually one for retail use and another for severe use. The schedule for the former calls for maintenance every 5,000 or 7,500 miles and every 3,000 miles for the latter, with the latter being for most fleet usage.
Once again, advances in technology and manufacturing, in some quarters, render the above legacy behavior obsolete. More and more, fleet managers are examining the possibility that they may be over-maintaining fleet vehicles. Synthetic oils, which maintain viscosity far longer than their predecessors, now give fleets the opportunity to extend maintenance criteria to as long as every 7,500 or even 10,000 miles. Some vehicles now have oil monitoring technology, which tracks oil viscosity and viability. Together these changes can allow a fleet manager to cast off the legacy preventative maintenance scheduling, and venture into new schedules that both retain vehicle viability while saving money.
Going back some years, the same holds true for some of the standards of preventive maintenance scheduling. Electronic ignition replaced the classic “tune up,” replacement of ignition points, spark plugs, condenser, and rotor. Fuel injection replaced carburation as the means by which fuel was controlled and ignited. Plugs last far longer today essentially rendering tune ups as a thing of the past. Preventive maintenance now primarily consists of an oil change and checking a raft of systems and fluids. Extending PM schedules — with less to pay for — should be an easy break away from the legacy thinking regarding preventive maintenance.
It wasn’t too many years ago that a major national fleet management consulting firm was very aggressive in selling reimbursement programs to fleets. They caused quite an uproar, as fleet managers scrambled to justify why providing company vehicles was the best option for on-the-ground transportation.
Since then, there have been a couple of major additions to the wheeled transportation market. Reacting in the same, borderline paranoid, way as in the past can backfire on a fleet manager. These options fit nicely into the mobility management philosophy where fleet managers become mobility managers, managing all aspects of the movement of people within the organization.
The two primary additions to the market have been:
Uber/Lyft: Uber and Lyft are two relatively new ride-sharing programs. Coming on the heels of the “BnB” phenomenon, where people rent out an entire — or section of a — home to travelers and vacationers, through a private transaction. Similarly, ride sharing provides people that need a ride somewhere the ability to use their smartphone to hire a private driver, driving a personal vehicle, to get them where they need to be. A private taxi service, essentially.
Car Sharing: Car-sharing was pioneered in the United States nearly simultaneously by ZipCar, Flexcar, and City Car Club. All were founded in 2000 and work on the premise that rather than taking public transportation, or using one of the above-mentioned ride share programs, individuals needing short term transportation can “borrow” a car, charged by the hour. It is a particularly good fit for urban dwellers, who usually use taxis or public transport, but also need to go out of the city for shopping, visiting, or business. Now there is even a sharing service specifically designed for trucks. GoShare, a smartphone app, connects those who need a truck or van with those that have them for hire. The service offers a range of trucks, from standard pickups to trucks large enough for pallet and appliance delivery.
Legacy thinking might look at the above and fear that they are yet another part of a movement to eliminate company-provided vehicles, and jeopardize the fleet manager’s career.
In fact, breaking out of the past, and building a new mobility management program would include company vehicles, car rental, reimbursement, and even one or more of the above services. Indeed, it is better for the fleet manager to get out in front of the issue with a well-presented program, rather than have the idea considered piecemeal beyond the fleet manager’s desk.
Business managers are often told that thinking outside the box — one way of casting off legacy thinking — is necessary in an environment thick with rapid change. This is, of course, true, but how you do so is critical to the success of the endeavor.
First, such thinking often begins far too broadly. A fleet manager, for example, might begin by thinking, what do I want this fleet operation to look like when I’m done? This is looking for a solution before identifying the challenges, creating pressure, and causing too much confusion.
Start with one idea, and go with that. Going back to the preventive maintenance issue, a fleet manager may start with the question: what can I do to reduce my PM costs, while maintaining the regimen for all vehicles in the fleet?
Think of possibilities, discard the ones that aren’t practical, and settle on the one that accomplishes the goal. Then move on to the next challenge, one by one, anchor them into the fleet policy and operation, and the solution will present itself.
Don’t take the burden all on oneself; it is more likely to cause frustration than success. Use all of the resources the company offers. Say you’re a leased fleet. You lease via the standard fleet open end, TRAC lease. It makes sense. The company has always done it that way, and no one is complaining. But your company has a treasurer, whose expertise can help create innovative alternatives that can create valuable change. Spend time with him or her, explain the lease (few outside the fleet industry have been exposed to the TRAC lease as it exists in the industry), and brainstorm ideas for alternatives.
Though the purchasing or strategic sourcing discipline has much the same impact on fleet managers as did reimbursement, they can also provide insight into negotiation with suppliers. Consider also running ideas by those who may not have any connection to fleet at all, even non-employees. Business colleagues, friends, and family can all bring a perspective untouched by the legacy thinking in the first place.
And, don’t forget two other valuable resources: your staff and your drivers. Good managers delegate. Your staff — if you indeed have staff — should know the fleet operation well, and it wouldn’t be unusual if they already had ideas for change that perhaps they’ve been reluctant to offer. And drivers are for whom the company vehicle is for. The vehicles, which they spend more time in than most anywhere else, are essentially their offices. Drivers can offer ideas for better vehicle selection, specification and configuration, upfits (for trucks), just about anything related to the vehicle itself. The point is, picking your challenges one or two at a time, using all resources available, and managing change can be rewarding.
No matter how good your solutions may be, there will always be objections and skepticism. Legacy thinking creates a cocoon, a comfortable way of doing things that can avoid catastrophe, but in an environment of constant change are seldom the best way to do things.
Indeed, often times the objections come from those whose thinking is the legacy: the managers who implemented the way of thinking in the first place.
Certainly the best way to overcome objections is to document everything done on the way to the change; notes, numbers, everything. Cite those who have contributed, particularly those in house. Put it all together in a proposal, a presentation that can be made to senior managers whose approval is needed to proceed. Make it short. Condense the process into a few pages or PowerPoint slides, using graphic representations whenever possible.
Change Isn’t Bad: It’s Only Different
People and organizations can get into a rut, finding ways that seem to work, have worked well in the past, and slip comfortably into the legacy. Shaking things up, challenging the legacy and common wisdom is daunting. It can even be frightening, when one’s career may be on the line. It also isn’t a one-time event. Today’s new idea can become tomorrow’s legacy as quickly as the change that demanded it. But keeping up with change demands it, and using all resources available can help ensure success.
Originally posted on Fleet Financials