Equalizing Executive Fleet Management
Photo via iStockPhoto.com.
There are many tough parts of the fleet manager’s job, and one of the toughest may be managing an executive fleet program.
But, it doesn’t have to be. In fact, if handled correctly, an executive fleet can be handled much like the rest of the fleet.
Efficient executive fleets, no matter the size or the industry, share many of the same aspects — including being integrated into the overall fleet and having a well-defined policy with drivers, no matter their level in the company, held accountable.
Probably the No. 1 factor in running a successful and executive fleet is setting a clearly defined, consistent policy that holds all drivers equally accountable.
“The most effective policies have consistent messaging throughout all levels of the organization,” said Kevin Brunetti, research analyst for ARI. “Though executive-level drivers may have more options when choosing selectors, all personnel should have common standards and protocols when operating company vehicles. A uniform policy provides a clear, company-wide message to all employees on expectations for vehicle operation.
Also, providing an adequate level of detail in each section is important so drivers have a thorough understanding of the company’s position on certain matters.”
Practically, that means executive drivers need to know not only that there is a policy in place, but also that they’re accountable to it.
“You need to have a clear policy executives understand and adhere to,” said Josh Hobday, CAFM, senior fleet management specialist for GE Capital Fleet Services. “I’ve found that with the executive fleets we have fewer policy exceptions, because there is a high level of accountability.”
For instance, Crop Production Services (CPS) requires that all drivers read its vehicle and driver policies, and acknowledge these policies in writing. This signed acknowledgement helps later if the driver claims he or she didn’t know about a particular policy.
“They have different levels of vehicles, but everybody is treated the same and it is uniform, it’s written, and it’s signed, and they can’t say, ‘I didn’t know.’ No, you signed it and you got a copy of it,” said Michael Gates, fleet department manager for CPS. “We’ve never had a particular issue. The policies are visible for everybody to see.”
Gates oversees the U.S. and Canadian CPS fleet, and help set up the fleet policies for the Australian and South American arms of the agricultural company.
Christy Coyte Meyer, CAFM, director of global fleet management for Johnson Controls, said that the company’s solid fleet policy has been a key factor in the efficient management of the company’s 220 management drivers.
“I have the policy to back me up,” she said.
Recently, Coyte Meyer put this into practice when an executive’s vehicle registration lapsed.
“The leasing company was trying to reach him for six months, and just found out that he had moved. Last month, he received a parking ticket and he e-mailed me about where he could send the ticket to get it paid,” she said.
The answer was simple — it was found in the policy. It was the responsibility of the executive driver to pay the ticket.
The policy does allow for exceptions to choices off the vehicle selector if it does not meet the policy criteria — does not exceed a monthly TCO, a minimum residual value, maximum CAP cost, and minimum MPG — but, in Coyte Meyer’s own words, the approval process for an exception is “rigid.”
While, across the board, fleet managers agree that having a consistent policy is crucial to the effective and efficient management of an executive fleet program, there is another key to success as well.
“The program is well-defined. The program is endorsed by the CEO of the company. It’s something he took an active part in, making sure it was defined according to his wishes. That’s the starting point. The second aspect is that the executives understand up front their roles and responsibilities and what their obligations are for taking care of that vehicle, and what benefits they get from that executive vehicle program,” said Mark Walters, VP of FIG Leasing Co., Inc., which manages the Farmers Insurance fleet.
Having C-level support is important for a number of reasons, according to Ken Johnson, managing director of customer solutions for GE Capital Fleet Services.
Chart by AF Research Department.
“Most of the time fleet managers are not C-suite executives, so, if they don’t have the endorsement of the CEO or the senior management team, it becomes much more of a challenge to endorse any policy, particularly one that impacts executives. Top-down support is critical to a policy being followed across all levels of an organization,” he said. “This also makes sure that it’s structured and administered equitably, which is important from the perspective of all employees.”
But, there is a factor that may be even more fundamental than senior company leadership support. Sue Miller, CAFS, director – fleet program services for McDonald’s, noted that she had few issues with her executive drivers.
“They are true leaders. They will lead by example. They know that they’re representing the brand and they know that the way they will behave will be a reflection on their team. We’ve had really tremendous compliance from our entire leadership team,” she said. “My leadership team is very accountable.”
While all of the fleet managers reported that they work in companies with a strong culture of compliance, there are those times when a fleet manager may receive push back from an executive driver in spite of a strong, well-defined, and supported fleet policy.
Brandi Stensos, strategic customer manager for GE Capital Fleet Services, noted that strong leadership culture is also a factor in creating a successful executive fleet program.
“In many organizations we see executives held up to lead by example,” she said. “Executives should really be holding the torch in terms of safe driving and good driving behaviors.”
Gates of CPS joked that he threatens to “torture” executive drivers with his groan-inducing jokes if they won’t comply, but, seriously, discusses the executive driver’s role as a company leader and role model.
Chart by AF Research Department.
“They’re the model for the company, and it’s just important that they set the example, and we expect more out of them than others,” he said. “I approach them in a manner that isn’t intrusive or overbearing.”
Usually, this reminder that the executive is a leader and example alleviates the problem. If not, Gates said he’ll handle this issue confidentially and have a compliance officer, who is typically a staff attorney, discuss the situation with the executive.
Coyte Meyer of Johnson Controls described the way the exception process works at Johnson Controls.
“The way the process is supposed to be done is to engage the compensation and benefits team, and they would do their due diligence and ask if they’ve ever done this in the past,” she said. “What would be the pros and cons? We are addressing them and entertaining requests and acknowledging if we do it for one we need to do it for others.”
While a consistent policy is the fundamental component to creating an efficient and effective executive fleet program, there are other ways fleets have increased efficiency.
Coyte Meyer of Johnson Controls is in the process of streamlining spec’ing for executive vehicles.
“We’re looking internally how to streamline the process of ordering and spec’ing that’s driver-oriented,” she said. “We have that option at the lower level because we have specs there. The ones where they can play around with the options and have more flexibility, are the areas we’re going to look at next. That just helps with our internal processes and resources.”
Chart by AF Research Department.
While this will help drive efficiency, Coyte Meyer noted it has a downside as well.
“If you lose touch with it, you lose touch with the vehicles and the options that are available,” she said.
Walters of Farmers noted a number of policies and practices that he has put in place to help the fleet run more efficiently.
Among these have been:
- Putting a plan in place for supplying new executives a vehicle outside the normal ordering cycle.
- Leveraging OEM manufacturer programs — including door-to-door delivery service, the maintenance program, loaner car programs, and roadside assistance programs.
- Having an internal point of contact specifically designated to assist executive drivers with any issues regarding their vehicles.
Miller of McDonald’s said that, for her, one of the biggest impacts on increasing efficiency of the fleet has been clear and frequent communication with the executive drivers.
“Clear and frequent communication, exception reporting, and understanding what makes them productive in terms of how we communicate to them and the type of messaging and follow-up we provide them,” she said. “For field executives it’ll be different than for home executives, because of how they’ll manage the maintenance on their cars. Also, what kind of car they have will determine how frequently they will have to service their vehicles. So, targeting those messages to those particular people is important.”
While consistency is always a goal in any fleet policy, Coyte Meyer of Johnson Controls also noted that her company’s executive fleet policy has added a dash of flexibility to the mix.
“There’s a level of flexibility that anyone working with an executive fleet has to have,” she said. “For example, I had an executive driver with one of the highest level categories who wanted to buy a vehicle off the lot. Our policy is to factory order vehicles. He couldn’t understand why we couldn’t just order off the lot. In this case, I chose not to argue. I ended up with a happy customer.”
From an operational and morale perspective, it makes good sense to treat every driver equally. But, that being said, executive drivers are also part of the leadership of the company, and this should be kept in mind when working with them.
“The car is one of the last things they think about. That’s why they have the company car, we don’t want them thinking about that. We will remind them — that’s the secret of our formula,” Miller of McDonald’s said.
To that end, Miller noted that her goal is to simplify the process of having an executive vehicle or any vehicle.
“We try to do that for all of our company drivers — because we want them focused on the business,” she said. “It’s the same philosophy, but, at the executive fleet level, they have some assistance with tasks such as maintenance.”
Walters of Farmers noted that executive drivers are busy and that fleet managers with executive drivers need to be respectful of their schedule and be flexible in working around it. He also recommended tapping an important executive resource.
“Use the executive assistants to help wherever they’re available to minimize the burden on the executives. We have a lot of great executive assistants that work with us to drop off cars and pick up cars,” he said.
Johnson of GE Capital Fleet Services echoed Walters.
“There’s a level of white glove service that executives expect or need in terms of the level of communication or responsiveness that you’re providing,” he said. “One of the ways to do that is to minimize the number of times you speak with the executive, and work through their admins or support team and deal with some of the minutiae that goes along with ordering a vehicle or managing it, and only speak to them about important issues. You want to make sure that you’re keeping them informed about what’s important to them and out of the things that are less important.”
One fleet manager who asked to remain anonymous noted that his company has an employee who handles all the day-to-day needs of its executive fleet as a de facto concierge.
Overseeing an executive fleet program can have its benefits for the fleet manager as well, according to Hobday of GE Capital Fleet Services.
“When you’re working through any executive situation — whether getting them a vehicle or resolving a concern — you’re getting exposure to those leaders, and oftentimes their support team, which is a great opportunity to develop relationships,” he said. “I always try to look at different ways to resolve an issue, whether it’s an order to delivery issue or a hard-to-get car. When working with executives, it’s all about being proactive and finding quick solutions.”