March 2011, Fleet Financials - Feature
5 Nominated for 2011 Fleet Executive of the Year
Five professional fleet executives vie for the prestigious award, to be presented at the 2011 NAFA Institute & Expo in Charlotte, N.C.
Company: Schindler Holding AG
Title: Vice President of Corporate Purchasing
Total Vehicles: 17,000
Total Staff Supervised: Fleet : 1 (global category manager), 30-50 national fleet responsibles, otherwise 250+ buyers
Replacement Policy: 3-5 years depending on vehicle mileage and optimal TCO
Else-Jack manages Schindler's global fleet of 17,000-plus vehicles, both from a strategic and operational perspective. Prior to Schindler, Else-Jack's fleet experience included helping bid vehicles within his purchasing role and as a British territorial army officer commanding a unit with 40-plus vehicles (from armored personal carriers to Land Rovers), and as a fleet user.
He is globally responsible within Schindler for the vehicle fleet from a purchasing and operations perspective. The company's overall policy is owned by corporate HR but was written and is maintained by Else-Jack. He keeps HR up to date on any major exceptions he grants or when he wishes to query with them. As such, Schindler structurally manages 80 percent of costs from the company's headquarters and 20 percent in the countries it operates in; the day-to-day fleet administrative processes remain in country. This is in addition to Else-Jack's day-to-day job as corporate purchasing vice president, responsible for Purchasing Excellence and Indirects.
Major accomplishments include the 2003 introduction of a global fleet policy, bi-annual fleet managers' conferences, plus reduction of more than one third in CO2 emissions and fuel consumption over the past eight years (ongoing 10 percent per annum). In addition, under his leadership, Global Category Manager Raphaelle Jeanneret won the 2007 Fleet International Fleet Manager of the Year award.
Over the past year, Else-Jack installed a safety initiative in 2010 to remove two- and three-wheeled vehicles from fleet (sold on basis of safety first, irrespective of cost). He's currently completing an initiative to stretch global rebates linked to a European RFQ. The complexity of which requires it is conducted over five rounds of bidding in 24 countries with seven manufacturers, four main lessors, and national "local heroes." Benefits will include stronger contractual protection from "end of contract" charges and savings of approximately 10 percent. This is also linked to the introduction of a Fleet Electronic Invoice Payment and Monitoring program (FEIPM), delivering an additional 2-3 percent in savings. For 2011, Schindler is targeting continued CO2 reduction of 10 percent plus and is currently trialing electric vehicles in its fleet.
Company: Ferguson Enterprises, Inc.
Title: Director of Risk Management
Total Vehicles: 4,000
Staff Supervised: 17 (3 dedicated to fleet - 1 fleet manager)
Replacement Policy: 36 months/75,000 miles (cars); 48 months/90,000 miles (light trucks); medium- and heavy-duty trucks vary
Helmandollar began her involvement with fleet in January 2010, when Ferguson's fleet function transitioned to the Risk Management Group. Ferguson is a diverse wholesale distributor with operations spanning multiple business groups and is also the industry's leading distributor of pipes, valves and fittings, water-works, and heating and cooling equipment in North America. The existing fleet staff includes experienced professionals with a sound strategy as follows:
■ Lease vehicle assets at the lowest cost and attain the highest possible resale value upon disposal.
■ Strive to partner with operations to control total cost through various strategies.
Helmandollar's challenge was communicating the strategy effectively across an organization of 1,300-plus sites. She and her team created an operations-friendly fleet management policy document to achieve buy-in and execution in the field. This convenient resource serves as a road map for managing local fleets. The result has been greater visibility and understanding of the methods underlying their strategy and the benefits to the bottom line.
Helmandollar's management strengths are process improvement and maximizing key vendor partnerships. Ferguson's relationship with its fleet management company has evolved into a team approach. In the past year, they have collaborated on the following key initiatives that have enhanced Ferguson's overall fleet program:
■ Creation of a selector program for manager vehicles.
■ Consolidated data to create one database for all company vehicle information.
■ Implemented required maintenance programs for all vehicles.
■ Extensive site visits across the organization by geography and business unit to gain feedback from the field to guide future programs and policies.
■ Specifically timed order cycles designed to maximize resale on disposals by selling at peak market values, and avoid maintenance cost associated with old, high-mileage vehicles.
As the director of risk management, she is also responsible for the overall insurance program, health and safety, DOT compliance, and claims management. The addition of fleet responsibilities has offered a unique opportunity to connect fleet and safety. It has also united a team of diverse professionals who share ideas across several disciplines.
Company: Henkel North America
Title: Vice President, HR
Total Vehicles: 750
Staff Supervised: 22 (non fleet)
Replacement Policy: 36 months/75,000 miles
Henkel's 750-vehicle U.S. fleet is "owned" by the Human Resources department, which works closely with the vice president of procurement. In 2010, Henkel eliminated the fleet manager position and went to greater control by Human Resources, under the direction of Vice President Kemper. The company's goal was to achieve higher cost take-out while maximizing driver productivity.
Under Kemper's active engagement and authorization, Henkel accomplished the following:
■ Went from a centralized model to a more decentralized fleet and implemented efficiency initiatives that shifted administrative functionality to the fleet management company (PHH).
■ Adopted a short-cycling strategy that:
● Allowed Henkel to convert from six-cylinder to four-cylinder sedans in its sales fleet, replacing 84 percent of the fleet in the past 17 months.
● Increased the four-cylinder population from 38 percent in 2009 to 93 percent in 2010, which reduced fuel costs and greenhouse gas emissions.
● Decreased depreciation expense by 54 percent, going from 19.4 to 8.8 cents per mile.
● Took advantage of a strong resale market and allowed Henkel to achieve a 15-percent premium over normal resale pricing. This helped to push down depreciation expense along with lower cap costs.
Kemper's leadership in the area of change management and implementing best practices in Henkel's fleet led to a total cost take-out of 14 percent last year through increased efficiencies, total cost reduction, and improved productivity. He notes the success of the fleet program has been due to the strong collaborative efforts between HR, procurement, and the company's external fleet management company.