GE: Keys to Managing a Winning Global Fleet

Jeff Schlesinger

Vice President, Strategic Planning, GE Capital Fleet Services

Tell us about GE’s glob­al reach in the fleet are­na.

GE Cap­i­tal Fleet Ser­vices is a whol­ly-owned sub­sidiary of GE Cap­i­tal pro­vid­ing com­pre­hen­sive vehi­cle fleet financ­ing and man­age­ment ser­vices across three regions; EMEA, the Amer­i­c­as and Asia Pacif­ic.

In Europe, we have a pan-Euro­pean group to assist our larg­er cross-bor­der cus­tomers. In addi­tion, we have fleet units for sev­er­al coun­tries that serve intra-coun­try cus­tomers. In the Amer­i­c­as, we are one of the most respect­ed fleet man­age­ment com­pa­nies in the U.S. and we recent­ly announced a strate­gic alliance with Ele­ment Finan­cial Cor­po­ra­tion to serve cross-bor­der fleets oper­at­ing in Cana­da and the U.S. We also have groups in Aus­tralia-New Zealand, Japan, India, and ser­vice South Korea and Chi­na with joint ven­tures. 

What trends are you see­ing in the glob­al fleet mar­ket?

Three years ago, there were only had a hand­ful of com­pa­nies with a Glob­al Fleet Man­ag­er. Today, that num­ber is sig­nif­i­cant­ly high­er. The entire GE glob­al fleet staff work togeth­er to bring exper­tise and world class ser­vice for the cus­tomer. The trend toward our cus­tomers look­ing at fleet from a glob­al per­spec­tive, from con­tracts to ser­vices is here to stay. As com­pa­nies focus on a glob­al rela­tion­ship with an FMC, each coun­try has indi­vid­ual and some­times unique reg­u­la­tions. That presents a tremen­dous oppor­tu­ni­ty for GE Cap­i­tal Fleet Ser­vices to put our glob­al know-how to work for these cus­tomers. As a result, we cur­rent­ly part­ner with numer­ous glob­al cus­tomers who now feel more com­fort­able work­ing not only across bor­ders – but across con­ti­nents. 

When a man­ag­er has been giv­en respon­si­bil­i­ty for fleets out­side of North Amer­i­ca, what are some of the first steps to con­sid­er? 

Often fleet man­agers have inter­nal obsta­cles they have to deal with. We spend a lot of time in the ear­ly stages ensur­ing the fleet man­agers under­stand these poten­tial road­blocks. Before attempt­ing to repli­cate the U.S. busi­ness’ oper­a­tions in Europe, you need to con­sid­er local laws and cus­toms. For exam­ple, it might make eco­nom­ic sense to reduce the size of a driver’s vehi­cle in the U.S. for eco­nom­ic rea­sons, and the dri­ver might under­stand, but in cer­tain Euro­pean coun­tries, many fleet cars are also com­pen­sa­tion vehi­cles. If a fleet man­ag­er changes these vehi­cles, there might be a vio­la­tion of HR poli­cies.

The con­cept of glob­al fleet man­age­ment seems to be on the rise.

There was a con­fer­ence in Europe last year where 80 per­cent of the atten­dees said that with­in the next eigh­teen to twen­ty four months they would have a glob­al fleet man­ag­er as a title and a respon­si­bil­i­ty; that is a major shift in the dynam­ics of a fleet glob­al man­ag­er. Dur­ing the eco­nom­ic down­turn many com­pa­nies saw the dol­lars spent on their fleet pro­gram and decid­ed to place rig­or in this process as they do in many oth­er cat­e­gories. Over the last two years these glob­al fleet man­agers ana­lyzed the data, pre­sent­ed their find­ings inter­nal­ly and are now embark­ing on ratio­nal­iz­ing all aspects of their respec­tive fleet poli­cies. Con­sol­i­da­tion is the answer in cer­tain aspects of their fleet financ­ing and diver­si­fi­ca­tion is the answer in oth­er aspects. GE Cap­i­tal Fleet Ser­vices has worked with many of these com­pa­nies as they devel­op all aspects of their fleet poli­cies. 

If I were a glob­al fleet man­ag­er I would cer­tain­ly want to have a good part­ner. What do the part­ners bring to the table?  

The most impor­tant aspect a Fleet Man­age­ment Com­pa­ny can bring is con­sul­tan­cy. One of GE’s mot­tos is “We are not bankers, we are builders.” GE’s Strate­gic Con­sul­tan­cy Ser­vice –known as Key Solu­tions in Europe – is a big dif­fer­en­tia­tor for GE Cap­i­tal Fleet Ser­vices. We believe our ser­vice is world-class and is just one more way that we are active­ly work­ing to pro­vide a tru­ly glob­al solu­tion. To achieve this, we host glob­al con­fer­ence calls with cus­tomers around all parts of the world on one sin­gle day. It’s received great feed­back from cus­tomers 

How do you help a typ­i­cal fleet reduce their spend?   

The RFP process estab­lish­es a basis for com­par­ing the basic com­po­nents of financ­ing your fleet. But the inter­est com­po­nent of the Total Cost of Own­er­ship analy­sis relates to 5–6 per­cent of the over­all cost of the vehi­cle. Choos­ing a fleet man­age­ment com­pa­ny that offers the low­est rate but does not offer a world class con­sul­tan­cy ser­vice is short sight­ed com­pared to the mil­lions of dol­lars that can be saved. 

GE Cap­i­tal Fleet Ser­vices has a team of con­sul­tants that work with the cus­tomers to save mon­ey. This is one of the key dif­fer­en­tia­tors between GE and our com­peti­tors. Advis­ing a cus­tomer to switch vehi­cles to a less expen­sive mod­el is not a val­ue added ser­vice, but review­ing each cost that is asso­ci­at­ed with the Total Cost of Own­er­ship from the nego­ti­a­tions with the OEM’s through to the re-mar­ket­ing of the asset at the end of the lease, GE’s inter­na­tion­al con­sul­tan­cy teams can lever­aged the lessons learned in one pole to each of the poles to offer a glob­al view of poten­tial sav­ings.

What about man­age­ment ser­vices, main­te­nance and col­li­sion man­age­ment? 

Over the last few years GE has focused on deliv­er­ing new prod­ucts and ser­vices on a reg­u­lar basis. We have Cus­tomer Advi­so­ry Boards in the US and Europe and we meet reg­u­lar­ly with them to dis­cuss issues and desires. We are the only FMC that also has a Tech­nol­o­gy Cus­tomer Advi­so­ry Board that focus­es on the quick­ly chang­ing tech­no­log­i­cal advances and require­ments of the dri­ver, the fleet man­agers and the Envi­ron­men­tal, Health and Safe­ty groups with­in our cus­tomers’ orga­ni­za­tions. Safe­ty is a major con­cern of fleet man­agers and GE is work­ing with cus­tomers and ven­dors to pro­vide the lead­ing con­sul­tan­cy for all of these require­ments.

Let’s talk about an ide­al fleet.  

I learned a long time ago from a GE CEO that once you fix your top ten devel­op­men­tal needs you work on your top ten devel­op­men­tal needs. There is no “ide­al” fleet. Every fleet GE has tran­si­tioned is reviewed and rec­om­men­da­tions are made. On a reg­u­lar basis we con­tin­ue to review each customer’s fleet, learn­ing from oth­er fleet’s best prac­tices and con­tin­u­ing to improve tech­nol­o­gy, prod­ucts and ser­vices. It is a part­ner­ship that seeks to improve the cus­tomers’ fleet from all aspects.  

What are some of the mis­takes that you have seen that could be cor­rect­ed?  

I recent­ly spoke at a con­fer­ence with 30 glob­al fleet man­agers and told them that the sin­gle biggest pit­fall is fail­ure to under­stand their company’s inter­nal orga­ni­za­tion. Build­ing stake­hold­er con­sen­sus with­in the orga­ni­za­tion is the sin­gle biggest action item that any new­ly appoint­ed glob­al fleet man­ag­er can achieve. Hav­ing the title with­out the author­i­ty or send­ing an email to a far dis­tant coun­try with­out appro­pri­ate stake­hold­er buy-in will lead to frus­tra­tion and fail­ure. Look for low hang­ing fruit in the first 100 days, look to under­stand the var­i­ous cul­tures and reg­u­la­tions in each coun­try, and reach out to orga­ni­za­tions for the names of oth­er glob­al fleet man­agers.

Can you give us a suc­cess sto­ry?  

GE Cap­i­tal Fleet Ser­vices and one of its glob­al cus­tomers have expand­ed the rela­tion­ship from advis­ing on selec­tors, safe­ty, prod­ucts, replace­ment cycles, CO2 emis­sions and are now engaged in their long term plan­ning process. GE is known for its six-sig­ma process­es and we are the only FMC that can offer Access GE, a ser­vice that brings this six-sig­ma rig­or to aspects both with­in and out­side the cus­tomers’ fleet focus. Our suc­cess in expand­ing the scope of ser­vice from the plan­ning for the next order cycle to plan­ning for 2018 mobil­i­ty is a key dif­fer­en­tia­tor that GE brings to our glob­al cus­tomers.  

Let’s talk about the impact of CO2 emis­sions rules on the glob­al fleet. 

In the U.S. it relates to stan­dards imposed by Wash­ing­ton onto the shoul­ders of the OEMs. But in Europe CO2 emis­sions are on the minds and in the wal­lets of both com­pa­nies and dri­vers. There are new stan­dards for vehi­cles over the next few years and GE is work­ing with cus­tomers to devel­op a roadmap to achieve the CO2 tar­gets of both the reg­u­la­tors and the CEO. In addi­tion GE Fleet is at the fore­front of alter­na­tive vehi­cles. We recent­ly opened our Vehi­cle Inno­va­tion Cen­ter at our cor­po­rate head­quar­ters out­side Min­neapo­lis where cus­tomers can work with numer­ous alter­na­tive fueled vehi­cles in a sin­gle loca­tion. In addi­tion, our par­ent com­pa­ny GE offers “CNG in a Box” tech­nol­o­gy to advance the use of CNG vehi­cles and GE cur­rent­ly owns the largest fleet of sales rep­re­sen­ta­tive EV vehi­cles.

Why is Europe so far ahead of us in emis­sions con­trol? 

In recent years gov­ern­ments in Europe have seen a path to rais­ing rev­enue through tax­ing both the com­pa­ny and the dri­ver for using high CO2 emit­ting vehi­cles and the Euro­pean OEMs have respond­ed by devel­op­ing engines with both low emis­sions and high horse­pow­er. If you remem­ber 15 years ago in the U.S., there were few diesel pow­ered vehi­cles for two rea­sons; there were very few fuel­ing sta­tions that sold diesel fuel and the accel­er­a­tion of diesel pow­ered vehi­cles was sig­nif­i­cant­ly less than gaso­line pow­ered. Today, both of these issues are solved. Almost all ser­vice sta­tions sell both gaso­line and diesel and the accel­er­a­tion of diesel pow­ered vehi­cles is on par with gaso­line pow­ered. The U.S. has nar­rowed the gap with Europe on diesel and now the U.S. is look­ing to offer more alter­na­tives to the con­sumer with oth­er alter­na­tive pow­ered vehi­cles.

BIO

Jeff Schlesinger joined GE in 1996. Dur­ing his career at GE he financed air­craft, real estate, water desali­na­tion plants, Inter­na­tion­al Joint Ven­tures, man­aged Struc­tured Prod­ucts groups and was the Cap­i­tal Mar­kets Leader for most of the GE indus­tri­al busi­ness­es. Jeff joined GE Cap­i­tal Fleet Ser­vices in 2008 to posi­tion the busi­ness dur­ing the finan­cial cri­sis and now over­sees its Glob­al Ini­tia­tive and Busi­ness Devel­op­ment efforts. In this capac­i­ty he rec­om­mends strate­gies to many GE glob­al cus­tomers. Jeff received his BA in Eco­nom­ics from George­town Uni­ver­si­ty and an MBA in Inter­na­tion­al Finance from the Uni­ver­si­ty of Chica­go Grad­u­ate School of Busi­ness.

jeff.schlesinger@ge.com

 

 

 

 

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