Just about every corporate department-level support function is fairly well understood by management. Whether it’s human resources, risk management, legal, or transportation departments, management (up to and including the “C-level”) has a fairly good handle on the value of the corporate function.
All too often, this isn’t the case with fleet management. Fleet management is just the “car thing,” which may just as well have a mechanic with his or her name stitched on a shirt pocket running things. Alternatively, it’s the place to go to find out “what’s my car worth?” or “is this a good price for that car?” when it’s time to buy, or sell, a corporate car.
So, how can fleet managers avoid this lack of understanding? What can you do to communicate the complexity and ultimate value of managing a fleet of company vehicles? Here are 10 ways that will help fleet managers get the point across:
1. Get a head start
Get out in front of the issue when first taking the job. Whether it is a promotion from within, or if you’re hired from the outside, fleet managers are smart to begin communication early.
First, know who the stakeholders are. These can include sales, procurement, administration, operations, finance, risk management, and whatever departments and functions have a stake in the fleet.
Next, within each area, try to schedule an introductory meeting, or at least a phone call, with the most senior manager there. Prepare a brief synopsis of who you are, what your responsibilities are, and, most important, how the fleet impacts their particular area of responsibility.
Some of them may not even know they’re stakeholders, or may have minimized fleet’s impact on what they do. Reaching out like this is a good way to begin the communications process, and the development of relationships that will serve a fleet manager well in the future.
2. Understand fleet vs. reimbursement
One of the more “sinister” ways senior managers try to minimize the importance of fleet is by championing the elimination of company vehicles and the institution of a reimbursement program. A fleet manager who is forced to face this challenge must be prepared with a good, carefully presented “business case”.
There are a number of studies and white papers that have treated this subject, but nothing can replace an internal, “real world” comparison between the two.
The first step is to know what the company vehicles cost the company, preferably in sterling per month and in pence per mile (most reimbursement programs are based on one or the other). Use examples of reimbursement programs based both ways for comparative purposes. However, it is also important to include a reimbursement program in the fleet policy; it can be used in many cases where mileage is insufficient to justify the assignment of a company car.
The key point is that there will be frequent instances when a senior executive requires justification for the fleet program, asking “Why don’t we just reimburse drivers for using their own vehicles?” The fleet manager who has a well-prepared, carefully constructed case to present will be far better received than one that isn’t.
3. Know all about lease vs. own
Being well prepared is also key to dealing with the inevitable lease vs. own question. Most companies conduct a lease vs. own study on some regular schedule, and rightly so.
Fleet managers come from varied backgrounds, some of them financial, but more often than not they are from an area completely outside of finance. It isn’t always important that a fleet manager be able to conduct the full analysis him or herself, however understanding the concepts behind a complex process will be appreciated, if not expected.
Fleet managers will also be looked to as a source for the assumptive data the finance people need to plug into the analysis, including lease rate information, terminal rate adjustment clause (TRAC) history/assumptions, purchase pricing, including incentives, and more.
Again, as with the fleet vs. reimbursement issue, senior management will have greater respect, and are more likely to view the fleet manager as necessary expert, if you are well prepared and express a thorough understanding of the issue.
4. Schedule a ride along
Probably the most direct stakeholder in the fleet operation is the function for which the fleet is provided. Whether it is sales, service, delivery, or even livery, drivers depend on their company vehicles to perform their jobs, and their management, in turn, depends on them to succeed at their own.
That said, the traditional fleet management “ride along,” where a fleet manager spends the day accompanying a driver out in the field doing the job, has become more challenging to accomplish, as fleet managers find their resources reduced and the job more time consuming. But, as difficult as it may be for the fleet manager to spend a full day or more out of the office, it is equally important that you do so.
Knowing, understanding, and actually observing the driver during a typical day will provide a fleet manager with insights that will come in very handy when dealing with the senior manager in charge of the driver function. Performing a ride along two or three times each year, and reporting observations to senior management, will help deepen management relationships critical to achieving appreciation for the fleet function.
If the VP of sales, for example, knows the fleet manager has spent time in the field with his or her drivers, he is more likely to support the fleet manager in decision making.
5. Know the numbers
The story may be apocryphal, but it bears repeating. A fleet manager of a medium-sized, East Coast maker and distributor of food products gets the call to head to the manager’s office. There, the fleet manager is confronted by the manager as well as a representative of a fleet service provider, who had arranged a meeting with the manager.
The rep had made a presentation, which included the savings the supplier said would result when its fleet programs were implemented. The manager asked the fleet manager whether the projections were realistic. The fleet manager retrieves the necessary (and up-to-date) cost information, and returned, informing the manager and sales rep the fleet was already operating at cost levels below those projected by the supplier.
The moral of the story: Fleet managers should be accurate and current in all cost data. Not doing so would have been embarrassing and possibly career threatening for the fleet manager in the story above. But, being fluid and knowledgeable in meeting such challenges provides management with a level of understanding and appreciation for what the fleet manager is doing.