A Strong Global Fleet Partner Can Save Big Dollars

Share with us some back­ground into how FleetVi­sion has been work­ing with NAFA to devel­op the Inter­na­tion­al Fleet Acad­e­my.

The 2013 Inter­na­tion­al Fleet Acad­e­my (IFA) was the fourth in a row since we start­ed with a pilot project in the NAFA offices. Since then, we have been grow­ing and grow­ing and devel­op­ing more con­tent. For NAFA, we are what you can call a con­tent part­ner. We don’t dri­ve the bus — we are in the bus — and we help find the right peo­ple to bring the right con­tent and to serve the need for pro­vid­ing infor­ma­tion to NAFA mem­bers about the inter­na­tion­al land­scape.

We are very hap­py with the mix of indus­try rep­re­sen­ta­tion that impor­tant­ly pro­vides nec­es­sary input and the num­ber of fleet man­agers that attend. We planned for about 40 peo­ple in a room because that leaves a cer­tain lev­el of inter­ac­tiv­i­ty and com­fort with peo­ple to exchange knowl­edge among each oth­er. We see that a lot, even dur­ing cof­fee breaks; we fin­ish the pre­sen­ta­tion and peo­ple gath­er togeth­er and exchange infor­ma­tion, anec­dotes and war sto­ries.

The atten­dees appre­ci­ate hear­ing the sto­ries among them­selves, not just from the sup­pli­ers that are also in the busi­ness to sell ser­vices, which of course we under­stand they need to do, and we are hap­py they are here because of their sup­port for the event. But it is impor­tant that NAFA mem­bers have this lev­el of com­fort to exchange ideas among them­selves.

The lev­el of edu­ca­tion has increased too. The guest speak­ers have become more com­fort­able with the top­ics. The mem­bers get more demand­ing, which is great because they push us to the next lev­el and we like to see that. It is a good mix of hav­ing an excel­lent venue and social activ­i­ty in the evenings as peo­ple build rela­tion­ships.

I am very pleased with the feed­back. Peo­ple are real­ly ecsta­t­ic about the amount of infor­ma­tion that they get. I must say, we are some­times a bit con­cerned that there is too much and that peo­ple are able to con­tin­ue to absorb infor­ma­tion at 4:00 in the after­noon. We also have atten­dees from dif­fer­ent time zones, which is not always evi­dent and we have to bear that in mind when we devel­op the pro­gram.

What is your cur­rent focus at FleetVi­sion?

First of all, we are very pleased to have added Tobias Kern to our team.  He pre­vi­ous­ly head­ed up the con­sult­ing busi­ness of a renowned fleet man­age­ment com­pa­ny in Europe.  Not only does he rep­re­sent all of our busi­ness­es in the Ger­man speak­ing areas, but already man­ages some very suc­cess­ful projects where he sup­ports the inter­na­tion­al approach and helps us devel­op good rela­tion­ships with multi­na­tion­als that seek help on how to devel­op strate­gic fleet pro­grams. That is a very impor­tant addi­tion for us in Europe.

The oth­er area that we have start­ed to explore more is South Amer­i­ca. We have reju­ve­nat­ed our con­tacts there and are doing projects for our clients. We are sup­port­ing them in under­stand­ing the mar­ket­place, the user pro­files and eco­nom­ic cli­mate. We help them make strate­gic deci­sions, such as which sup­pli­ers to talk to for the prop­er line-up and how to struc­ture their fleet pro­grams.

What are your clients telling you about their great­est con­cerns?

They are con­cerned that while think­ing through their fleet pro­grams and the bud­get con­straints that they have, they lack resources and funds to help make the deci­sions that will ben­e­fit their com­pa­ny most in the long run. So, you see a ten­sion build­ing up between avail­able resources and pro­vid­ing the right lev­el of atten­tion to a glob­al fleet to pro­vide long term sus­tain­able effi­cien­cy improve­ments vs. short term gains.

That also means that there is demand for peo­ple who are very expe­ri­enced in the mar­ket­place who can help our clients make those deci­sions more effi­cient­ly and demon­strate a sol­id, finan­cial­ly sound busi­ness case.

We also see that peo­ple now are bet­ter able to col­lect data on their fleet that they can upload  into exist­ing glob­al report­ing tools such as FleetCube, and that will give them the insights to improve their deci­sion mak­ing process.

For us, it means that our clients become more chal­leng­ing, which is excit­ing. It also allows us to devel­op the rela­tion­ships that they have with their sup­pli­ers to an even high­er stan­dard, which is a ben­e­fit for the whole mar­ket­place. I am hap­py to con­firm that many sup­pli­ers are doing a real­ly good job of work­ing to a high­er stan­dard and improv­ing their com­mu­ni­ca­tion with their clients and their account man­age­ment pro­grams. Cer­tain­ly sup­port­ed with sol­id ser­vice lev­el agree­ments, KPI’s and a trans­par­ent exchange on under­stand­ing prof­it mod­els and the cost relat­ed to the ser­vices pro­vid­ed. In the end we all need to make mon­ey.

Let’s talk about the finan­cial chal­lenges that fleets have been fac­ing.

There are a cou­ple of chal­lenges. It real­ly start­ed in 2008–2009 where the finan­cial short­fall, the cash short­age, hit leas­ing com­pa­nies. As a result, we did see that com­pa­nies were denied the abil­i­ty to fund their fleets, which is quite a chal­lenge if you have a busi­ness part­ner that you rely on to help you fund your trans­porta­tion — your mobil­i­ty require­ments. They had to polite­ly say no because they had no fund­ing to back them up them­selves. That was a big chal­lenge for some of our clients. It also meant that there was an increase in the cost of mon­ey, which was not fore­seen. So, their cost for per mile – per kilo­me­ter has gone up.

And you saw some leas­ing com­pa­nies also increase their mar­gins on the inter­est rates to cap­ture the risk that they addi­tion­al­ly had to charge to be able to pull the mon­ey from the mar­ket­place. As a result, some of those rela­tion­ships had to be reestab­lished because, as you can imag­ine, clients were upset when they were denied access to those funds. It also made them rethink their depen­dence on those sup­pli­ers. For some clients it meant that they were recon­sid­er­ing mul­ti-ven­dor vs. sin­gle ven­dor rela­tion­ships and per­haps not putting all their eggs in one bas­ket. Some chose to spread them a bit so if any­thing like that would hap­pen again, or there might be a change of own­er­ship with the leas­ing com­pa­ny that might not be to their lik­ing,  there was less risk on their over­all per­for­mance and con­ti­nu­ity as a com­pa­ny and their val­ue added to the mar­ket­place.

So, after that mon­ey short­age, one of the inter­est­ing ele­ments then, of course, was the clear pres­sure on cost reduc­tions. Now, a ben­e­fit of such a strug­gling econ­o­my is that dri­vers became slight­ly less mobile. As a result, there is more abil­i­ty to put pres­sure on the car pol­i­cy. Human Resources may be slight­ly more will­ing to give in on the extras that are pro­vid­ed on the com­pa­ny car and as a result, we could help clients to be a lit­tle bit more strin­gent or more restric­tive on their car pol­i­cy and be able to cre­ate cost improve­ments and increased dri­ver account­abil­i­ty.

That mobil­i­ty has not changed a lot. Peo­ple are still very hap­py to keep their job where in the past they may have gone to anoth­er one for a bet­ter com­pa­ny car. The mobil­i­ty at that lev­el is no longer there. It doesn’t mean they can go over­board with that, but what you see a lot is most of the com­pa­nies are still main­tain­ing the car lev­el and equip­ment lev­el, but mak­ing a bet­ter engine choice with a low­er CO2 emis­sion lev­els, which is extreme­ly impor­tant in Europe.

It has brought them sig­nif­i­cant ben­e­fits and espe­cial­ly for those com­pa­nies that were ear­ly adopters; they have been able to bank sig­nif­i­cant cost sav­ings because they took the biggest ben­e­fit from, let’s say, the sup­port that came from the gov­ern­ment to reduce the CO2 foot­print of the com­pa­ny cars.

What glob­al trends are you not­ing?

We recent­ly did a study with NAFA on where fleets were putting their pri­or­i­ties at the moment. We see a sig­nif­i­cant trend where com­pa­nies start­ed to devel­op region­al cov­er­age in 2005–2006 and bring some of the region­al cov­er­age to a glob­al deci­sion-mak­ing process on pol­i­cy, health and safe­ty stan­dards and so on. What we see now is those com­pa­nies that built region­al struc­tures to make deci­sions on sup­pli­ers, sup­ply chains and sourc­ing pro­grams are now bring­ing the region­al cov­er­age into a glob­al cov­er­age.

In the past a lot of coun­try man­agers still had to be involved. You see now an increas­ing num­ber of board mem­bers or head­quar­ters spon­sor the fleet pro­gram and through that spon­sor­ship the imple­men­ta­tion of what­ev­er the deci­sion is that the group made is facil­i­tat­ed. Where there might be resis­tance in a coun­try, it can be over­come by the board spon­sor­ship. That is very impor­tant also for the sup­ply chain.

One of the key frus­tra­tions still is with OEMs and leas­ing com­pa­nies. You work hard with your prospects to do a deal and when the deal is done the imple­men­ta­tion doesn’t reach the lev­el of where the expec­ta­tion was because of local resis­tance, local rela­tion­ships, pol­i­tics with­in a team, and so on. Increased com­pli­ance to the cen­tral deci­sion mak­ing process­es is an improve­ment because that frus­tra­tion with­in the indus­try has not helped the com­mit­ment from sup­pli­ers to those clients.

So, now I think we are break­ing that neg­a­tive spi­ral more and more and we are mak­ing this a very pos­i­tive process where the sup­ply chain sees that the oppor­tu­ni­ty is tru­ly deliv­ered and our clients, the multi­na­tion­als, see that the account man­age­ment pro­grams are improv­ing and that mak­ing glob­al deals tru­ly make sense.

Clear­ly, sav­ing mon­ey is vast­ly impor­tant; what oth­er val­ues does FleetVi­sion offer?

Our key val­ue is pro­vid­ing access to our part­ners and our very rich expe­ri­ence in the indus­try for decades. Ful­ly under­stand­ing where the key top­ics, the key com­pli­ca­tions and the key chal­lenges are with­in this indus­try. And bring­ing that overview to a client does not give them the answer because we have to lis­ten to them first.

But after cap­tur­ing their sit­u­a­tion, their pri­or­i­ties, we can trans­late our expe­ri­ence into a very strong val­ue propo­si­tion where we can help them and coach them to achieve their objec­tives with the oppor­tu­ni­ties that are avail­able in the mar­ket­place.

Also, we always empha­size the impor­tance of build­ing rela­tion­ships with their sup­ply chain. So, if we see our­selves in a rela­tion­ship shape, it is always a tri­an­gle. We are there next to the client to sup­port and devel­op a rela­tion­ship with the sup­ply chain. We are nev­er in between. Also, we keep our ser­vices tru­ly on a strate­gic lev­el. We are hap­py to sup­port and help our clients with their sup­pli­er rela­tion­ship man­age­ment, but we would nev­er go into the trans­ac­tion part of the busi­ness.

BIO

Since 2008, Hans Damen has served as Man­ag­ing Part­ner of FleetVi­sion. Hans is also Man­ag­ing Part­ner for TCOPlus. He start­ed his inter­na­tion­al career with­in Fleet Syn­er­gy Inter­na­tion­al (FSI) in 1997 as the Region­al Sales Direc­tor. In 2003, Hans was named CEO of FSI, work­ing to devel­op the rela­tion­ships with the multi­na­tion­al clients and prospects whose vehi­cle needs they served in 31 coun­tries. Hans plays a key role in help­ing clients under­stand the var­i­ous fleet mar­kets around the world, in par­tic­u­lar Europe, and in enabling clients to meet their goals for fleet econ­o­my and effec­tive­ness.

hdamen@fleetvision.biz

www.fleetvision.biz

www.tcoplus.com

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