Are You a Tactical or Strategic Fleet Manager?
February 21, 2006
These fleet managers have autonomy to implement innovative initiatives to drive cost out of their fleet operations. These companies recognize the strategic aspect to fleet management and view vehicle acquisition, replacement planning, funding alternatives, and sourcing alliances with manufacturers and vendors as strategic corporate decisions.
Exemplary fleet managers rise above the level of simply managing day-to-day work. Their understanding of the company’s business transcends fleet management. Besides being an expert in fleet management, an exemplary fleet manager is also intimately aware of the company’s product line and services, marketing objectives, corporate culture, and the needs of user groups. They are proactive and anticipate changes in their corporate environment.
These fleet managers implement fleet programs that contribute to the achievement of overall company goals. For instance, some companies focus on cash flow, while others zero-in on employee retention, hiring, productivity, and satisfaction. Each corporate objective dictates different policies and fleet programs. The manager who manages the fleet to support these objectives is doing an exceptional job. He or she links fleet operations to the corporation’s overall mission and keeps senior management informed as to how fleet is helping to improve the corporate mission.
Technology is Fueling Change
In the early history of fleet management, the original “fleet person” often spent much of his work hours manually processing new-vehicle orders, updating driver records, and handling routine phone calls from drivers in the field inquiring about vehicle-order status or reporting maintenance problems. But there were also many “strategic” fleet managers of that era, such as Al Cavalli, Ray Breault, Helen Bland, and Les Landau, to name but a few, who helped pioneer the science of fleet management. But for every strategic fleet manager, there were a like number whose responsibilities were primarily administrative. The majority of these jobs have vanished as a result of outsourcing and automation.
Technology has pushed many of these mundane tasks to the driver level, such as ordering vehicles and maintaining preventive maintenance schedules. Also, many specialized fleet tasks have been outsourced to companies with the expertise and systems to more effectively manage these processes, such as accident management and subrogation.
Technology has freed fleet managers from much of the day-to-day tedious details that were the hallmarks of a manually based fleet management system. These changes, in turn, have changed the traits required to be a successful fleet manager. A strategic fleet manager must have a skill set that focuses on fleet policy development, the implementation of driver safety programs, vehicle selector creation based on exhaustive lifecycle cost analyses, and establishment of metrics to manage fleet suppliers.
Fleet’s Greatest Asset
In the final analysis, the greatest fleet asset is not the “metal,” but rather the in-house fleet manager. An in-house fleet manager will always be needed, and the role is strengthened when a strategic and proactive management style is implemented to run the corporate fleet. One example is in the area of cost containment. Fleet managers are under constant and ever-greater pressure to reduce expenses to make their fleet operations more efficient. These fleet managers proactively seek to maximize the productivity and revenue-generating capacity of each company driver at the lowest possible cost.
A fleet manager, with a strategic perspective, can easily save a company millions of dollars by implementing the right fleet policies and selecting the right vehicles and suppliers. A fleet manager who reduces annual fleet expenses by $100,000, generates the equivalent of $1 million in sales, if a company operates at a 10-percent net profit margin.
It takes years of hard work to develop fleet management expertise. A professional fleet manager validates his or her importance day-in and day-out by cost-effectively managing hundreds of thousands to millions of dollars of corporate assets and controlling the expenses associated with operating these assets. Each year, fleet managers save their companies hundreds of millions of dollars.
To all of these fleet managers, I salute you for a job well done and applaud you for taking a strategic approach to fleet management.
Let me know what you think.
Posted @ Tuesday, February 21, 2006 1:04 PM