Coming together

In efforts to run a city or county government in the most effective and coordinated manner, fleet management often gets short shrift. That is because the people who maintain and manage the fleets and the people who use them often have different needs and expectations.

External service departments (e.g., police, fire, sanitation, power and water) rarely are allowed the flexibility to directly manage their fleets strictly according to their own needs. Rather, it is almost universally true of local government fleets that the vehicles are administered and maintained by a centralized maintenance department or manager.

In those cases, there often are gray areas (such as determining the correct number of vehicles in the fleet and the specifications for those vehicles) in which fleet management and fleet maintenance overlap. However, invariably, operation and fleet maintenance are managed separately.

The relationship between fleet management and fleet maintenance not only presents challenges but, sometimes, can create real rancor. The reasons for that vary from fleet to fleet. However, erformance measures can help improve that relationship.

Three concepts

Modern fleet management information systems (FMIS) can capture and manage information in ways unheard of 10 years ago. They offer a wealth of information that should make fleet management easier. However, that abundance of information can cause problems if there is no consensus on what truly is important and what is less so. The problems are not insurmountable. Fleet operations managers and fleet maintenance managers just have to agree on the goals and objectives of operating their fleets and must determine how to measure their progress toward attaining those goals and objectives. Three concepts should drive the effort.

• Viewing the fleet enterprise

  The fleet enterprise generally encompasses two major sub-functions: fleet administration, performed primarily by the fleet user, and fleet maintenance, performed by the fleet manager. Fleet administration activities include policy making for operations; records management for inventory, operation and maintenance; acquisition and disposal of vehicles/equipment; administration of equipment leases; operation of vehicle/equipment pools; coordination of vehicle/operator licensing, permitting and regulatory compliance; and coordination of driver/operator training.

  Fleet maintenance activities include supervision and operation of garage facilities and mechanics; the management of preventive maintenance, inspection and testing functions; the coordination of required repairs; management of initial assembly and repair of mechanized truck-mounted and other specialized equipment; and acquisition of repair parts and materials.

• Information partnership

  Fleet users and fleet managers should be able to summarize their own sets of defined performance measures and be able to articulate, at the very least, a general idea about how their employees and vehicles are performing in relation to a finite set of measures. For the fleet user, the applicable measures inevitably will be designed to address mission objectives, unit operating costs, unit life-cycle costs, vehicle use, staffing, operator training and safety.

  The fleet manager will want measures designed to address availability of vehicles/equipment, quality of repair work, preventive maintenance objectives, staffing, safety, communication and customer service. If fleet users and fleet managers are not addressing most of those topics, serious performance deficiencies can go undetected — and costs for the fleet will be too high.

  (The American Association of State Highway and Transportation Officials (AASHTO), Washington, D.C., suggests that answering certain questions (see above) can help fleet managers assess current skill levels of maintenance personnel, identify training needs and develop training priorities.)

  The overlap that exists between fleet users and fleet managers makes it critical that the two groups agree about which measures will be used jointly to effectively and efficiently manage the fleet. An “information partnership” must exist.

  Unfortunately, in many fleets, turf battles often prohibit such a partnership. Additionally, operations managers and maintenance managers often disagree about what data is useful in the first place.

  That was the problem within one Ohio sanitation fleet, in which the sanitation fleet manager was inundated with reports and documents provided by the fleet services department from the FMIS. The sanitation fleet manager ignored or misunderstood almost all the information, and frustration and distrust set in.

  The situation was resolved by crafting an agreement between the fleet services manager and the sanitation fleet manager about the amount of performance data necessary to manage the fleet — the four or five reports that provided the most vital information needed on a weekly or monthly basis. That set of key data became the basis for future decisions from setting equipment maintenance task priorities to sizing the fleet, and, because both managers agreed on the importance of the information, tensions eased.

• Performance measures that measure up

  The basic question for local government fleets is: What are the measures that represent the essence of performance tracking? Those measures will vary greatly depending on the type of fleet (police sedans, electric utility trucks, sanitation collection trucks, etc.).

• Five measures commonly are used to determine performance for the fleet enterprise, which basically comes down to keeping the vehicles on the job at the lowest cost.

• Unit cost

  Unit cost captures the fully loaded cost of operating a piece of equipment on a monthly or annual basis. To properly compare with industry standards and internal costs over time, the unit cost should include labor (direct and apportioned overheads) and non-labor (parts and apportioned consumables). Fuel should be accounted for separately. The measure easily can be applied to a finer breakdown of costs such as maintenance labor cost per unit.

• Ratio of preventive maintenance (PM) costs to total maintenance costs

  Each type of fleet has an optimum ratio of PM to total maintenance cost. Fleets consisting predominately of large, complex equipment classifications will have higher optimum ratios than fleets of sedans or pickup trucks. Electric utility fleets consisting of large bucket trucks or digger-derrick trucks may reach a 0.5 optimum ratio, meaning that up to one-half of the annual maintenance costs are PM. That measure is useful for understanding fleet costs, but it is rarely tracked.

• Availability

  Availability is the percentage of time that a vehicle is available for operation. Therefore, if a vehicle is needed for only four days of the work week, and maintenance can be accomplished on the fifth day, availability should not take a hit.

  Typically, fleets of smaller vehicles should demonstrate average availability of 97 percent or above. Fleets consisting of larger, more complex units should target the 80 to 90 percent range. Availability not only tracks the quality of maintenance services; it also is useful when analyzed in concert with utilization.

• Utilization

  Utilization measures the workload on an individual piece of equipment and often is measured in hours used per month or year. The measure helps determine fleet size in numbers of vehicles.

  Utilization measures that are too low may indicate the fleet has an excessive number of spare units. That rapidly would drive up total fleet costs starting with capital outlays, extending through unnecessary permitting/licensing fees and the necessity for preventive maintenance on too many vehicles.

  Low utilization rates also can indicate below-par maintenance services, which could require large numbers of spare vehicles for operational backup. Alternatively, utilization rates that are excessively high may demand unrealistic availability rates. High utilization rates can indicate a fleet size that has been trimmed so tight that even good performance cannot support the demand for vehicles.

• Labor productivity

  Labor should be analyzed using the concept of full-time equivalent employees (FTE). One FTE is 40 hours of work per week by one or more employees. Converting to the FTE convention allows comparisons to industry standards and eliminates the uncertainties associated with trying to account for overtime or part-time staff. Although labor productivity can be measured in the administrative sub-function (FTEs per vehicle purchased), the measure is generally applied to the “wrench-turning” labor and associated overheads. The relatively straightforward measure is best viewed as vehicles per FTE, and it can be valuable when analyzed in concert with maintenance labor costs.

• A common language

  Performance measures form the basis of a common language for fleet users and fleet managers and allow them to strive toward the same objectives, independent of a county’s or municipality’s organizational structure, fleet management arrangement and mix of external service departments. Problems or shortfalls in any of the performance measures can signal the need for further investigation into the operation of the fleet department and, ideally, improvement of that operation.

  Implementation of appropriate fleet management performance measures can be aided by a number of strategies, including performance benchmarking with other fleet organizations or retaining a professional fleet management consultant. Concentrating on performance measures can create a clearer focus for decision-making, ease the contentious atmosphere and lead to decreased costs.

  Daryl Pullin is the director of performance management in the Infrastructure Services Group of R.W. Beck, Austin, Texas.