UFP Magazine

Being a utility fleet manager today can be tough. How much tougher will it be tomorrow?

With the constant advancement of technology, the increasing need for communications savvy and leadership acumen, ever-decreasing budgets, and an aging workforce being replaced by a younger cohort lacking institutional knowledge and experience, it’s a nail-biter of a time.

So, how does a utility fleet manager prepare for the future?

Gary Lentsch, CAFM, fleet manager for the Eugene Water & Electric Board in Eugene, Oregon, said that people skills are huge, especially when it comes to the ability to “hold yourself accountable and focus on the things that matter most to the operation.”

Workplace ergonomics have been on employers’ radar for 20 years, but even now, ergonomic-related injuries remain a costly expense – one that’s growing due to an aging workforce, current worker shortages and inexperienced industry newcomers.

“As the age composition of the workforce changes, that does affect industry,” said Eric Bauman, principal technical leader and program manager for the Occupational Health and Safety Program at the Electric Power Research Institute (www.epri.com). “Now that early Baby Boomers have retired and the middle Boomers are retiring, the industry has been hiring new workers who tend to be less experienced. We’ve seen an increase in injuries in this younger age group.”

The primary causes of employee accidents haven’t changed much in the past two decades. “It’s the slips, the falls, the trips,” said Mark Stumne, director of truck and upfit at Element Fleet Management (www.elementfleet.com).

Bauman agreed. “Sprains and strains showed up in the first year or two in our industry injury database as the largest single category of injuries,” he said. “It’s continued since 1999. Sprains and strains are something we can do something about, and this industry has supported ergonomic research since then.”

Despite the seeming intractability of these types of injuries, there are myriad products available in today’s marketplace designed to help alleviate them. Where is a fleet to start?

Dale Collins, CAFM, fleet services supervisor for Fairfax Water in Virginia, faces an increasingly disturbing and familiar scenario in the next handful of years: Five of the eight people working in his two repair facilities will retire.

The good news is that his organization is “pretty attuned” to the so-called Silver Tsunami of aging baby boomers; a quarter of the organization will retire within the same time frame.

“So, we’ve been challenged to create some kind of succession plan,” Collins said, “to figure out the best way to approach this, so we can capture and transfer our institutional knowledge and technical expertise. Then have a good recruitment plan and hire top-notch technicians.”

Ask anyone in literally any industry today, and the story is the same: There simply aren’t enough willing and able workers to handle the roles currently filled by the older set. It’s particularly tough in skilled labor; there can be misconceptions about salaries, opportunities and advancement possibilities. There also can be lack of awareness about the need to attract and train students long before they graduate high school. Due to the dearth of candidates, companies are having to take on employees at ground level – and bump up salaries and benefits.

“There’s been a complete shift,” said Lucas A. White, interim associate dean at Madison Area Technical College School of Applied Science, Engineering & Technology. “Organizations are desperate and can’t be as selective now. The industry has had to increase wages, knowing that they aren’t going to find somebody for $10 to $12 an hour. The students know they can get that in fast food, without a skill.”

For organizations contemplating a fleet rightsizing effort that won’t anger end users, here’s some advice: use solid data, convey information clearly and seek understanding.

“At the end of the day, it’s ultimately about communication,” said Charlie Guthro, vice president of global strategic services for fleet management company ARI (www.arifleet.com). Prior to a rightsizing initiative, operators won’t necessarily be saying that the fleet has extraneous equipment, while others in the company may be focused on budget. But when fleet professionals get to know their internal customers and their needs, Guthro said, greater collaboration is possible.

“When you rightsize a fleet, it gives organizations more opportunity to hold on to their most critical resource: their people,” he said. “You have to approach it from, ‘We’re not here to do things to you, but for you, and we want you to be involved.’”

That’s easy enough to say, but it can be challenging to deliver, especially with new management – those who want to make a definitive mark through changes without perhaps fully surveying the landscape or considering long-term impact. This can affect productivity and diminish employee buy-in.

Imagine, for example, a utility fleet that cuts back on lesser-used equipment, believing it will be available as needed from external rental providers.

As drivers and fleet professionals explore the possibilities and realities of vehicle subscription models, they’re in good company. Fleet management organizations also are kicking the tires of the concept – including how it might eventually apply to utility fleets.

Under the subscription model, subscribers have access to vehicles on demand, often with insurance and maintenance included, and can switch out vehicle models, too.

Eric Schell, product manager for driver tools at Element Fleet Management (www.elementfleet.com), and Jayme Schnedeker, Element’s director of fleet products, said they are in discovery phase with the idea and looking to Element’s experience with car sharing for cues.

“For companies like us, as well as for manufacturers, the question is, where do we fit into all of this?” Schnedeker said. “How can we provide services for our core customers that make financial sense for them?” The subscription model provides flexibility in areas where there hasn’t traditionally been any, he added, and with individual consumers increasingly using services such as Uber and Lyft, those expectations of convenience are being transferred to work life.

Traditional fleet pools and micro car-sharing markets give fleets a taste of multiple drivers using one vehicle fractionally, Schell said. Even so, he believes, adoption of the subscription model in a broader sense would require “a fairly significant cultural change of how our customers are looking to do business today.”

The potential for lower acquisition costs, greater control over resale pricing, no debt added to the balance sheet – these are a few advantages of purchasing vehicles outright, which traditionally has been the prominent fleet acquisition strategy for many utility companies.

But according to Paul Lauria, president of Mercury Associates (www.mercury-assoc.com), a fleet management consulting firm based in Rockville, Maryland, there’s also a big downside to cash: It can lead to “suboptimal decision-making” that undermines your fleet’s performance, especially in an era of low interest rates. Lauria contends that paying for equipment over time – whether with a loan or lease – or as needed with short-term rentals creates a more flexible structure where fleet departments can improve the age, condition and performance of their vehicles at a significantly lower total cost of ownership.

“Any organization that wants to optimize the total cost of ownership of its fleet has to figure out the right balance of capital and operating expenditures,” Lauria said. “A lot of organizations don’t do this; they underspend on fleet replacement costs, with the result that they overspend on fleet operating costs.”  

So, why has the utility industry traditionally resisted financing equipment purchases? In what ways does cash purchase impact fleet decision-making? And how can fleets strike a more optimal balance between capital and operating expenditures? During UFP’s recent conversation with Lauria, who has advised hundreds of government and utility fleets since 1985, we dug deeper into these questions. Here are edited highlights.

When he’s off the clock, John Doyle, senior health and safety adviser at Florida Power & Light, drives a Ford Explorer as his personal vehicle. The SUV is equipped with a backup camera that audibly alerts him when he gets too close to an object.

When Doyle sometimes drives his wife’s car – which has a backup camera but no audible alerts – he still finds himself “waiting for the backup camera to tell me to slow down.”

Doyle’s experience provides a good example of an issue utility fleet drivers across the country are facing these days. They may have all sorts of tools and options on their personal vehicles that aren’t available on their work vehicles, which can potentially lead to a habit of relying on the tools and options – even when they’re not there. 

“People are gravitating towards using the technology to support the way they drive,” said Art Liggio, president and CEO of driver training company Driving Dynamics (www.drivingdynamics.com). “We see people come into our training programs who are looking at the backup camera monitor instead of the mirrors. If the monitor hesitates, they freeze. They don’t know what to do.”

Recent statistics back up the idea that the wealth of technology and safety features in today’s newer vehicles isn’t lowering accident rates. In 2016, 37,461 people died on U.S. highways, while 2015 saw the biggest jump in accident deaths in 50 years, according to the National Highway Traffic Safety Administration (www.nhtsa.gov).

It’s no secret that today’s utility fleets have encountered difficulty finding job candidates with the appropriate training, experience and technical skills. And not only that – once qualified candidates are hired, those workers can be wooed by other companies offering greater salary and benefits packages.

So, how can you find and keep the right candidates for your fleet job openings?

Those in the know recommend partnering with area technical schools and colleges to ensure the right skills are being taught – and the right candidates are being snapped up early. On the other end of the spectrum, they recommend providing current employees with training and career development opportunities to keep them engaged.

“There’s a lot of poaching going on, especially on the utility side,” said Jason Ball, who worked as both a heavy-duty mechanic and fleet manager before taking the helm of Utility Training Group (www.utilitytraininggroup.com) less than two years ago. Specialized on-the-job training – delivered by someone like Ball or an OEM representative – sweetens the pot by helping workers learn new skills, gain confidence and stay up to date on the latest technologies.

But it’s important, Ball said, to make sure those conducting the training have the right experience, in addition to good references.

Each issue, we ask a fleet professional to share three keys to fleet success.

This issue’s Final 3 participant is Tim C. King, author of the book “Fleet Services: Managing to Redefine Success” published by SAE International (http://books.sae.org/r-447/) and former manager of fleet services for what is now NV Energy (www.nvenergy.com), an electric and gas utility in Nevada with over 1 million customers. King also will be a presenter at Utility Fleet Conference 2017 at ICUEE in Louisville, Ky., a fleet education event that will take place October 2-4 (https://utilityfleetconference.com/).

#1. Aim high.
“Require excellence with everything. Benchmark your service performance on organizations that thrive in the most successful industries – such as high-growth startups – not just other fleets. The goal is to consistently exceed expectations by achieving unexpected win-win results with all your customers.”

#2. Remember that successful fleet management begins by identifying all your customers.
“Customers define your success. So, all customers must be identified. These include your executives/owners and all internal recipients of services, external customers and ancillary customers, such as internal supporting services. This last group also includes external regulatory customers such as local, regional, state and federal regulators.”

#3. Be bold and lead change.
“Recognize you’re going to do things differently. For this level of success, you won’t be able to rely only on typical industry standards as a guide. By gaining a broader knowledge and perspective of customer service, learn to outgrow baggage such as history, culture, paradigms and similar other misperceptions. And realize success depends on process redesign, not just the normally required process improvement.”

Several years ago, when gas prices were higher and an industry need arose to reduce costs and seek alternative solutions, conversations about harnessing the sun intensified. Combined with advances in electric vehicle technology, the possibilities of what manufacturers and fleets could do in this realm began to grow.

Solar power began to be used to extend the range of some electric and plug-in hybrid electric vehicles. And a full-size electric pickup truck using solar to extend its range was introduced at the 2014 North American International Auto Show.

Given the evolution of solar power use in vehicles over the years, where are we today?

As it turns out, on a slightly different course than one may have assumed. Rather than focus on the use of solar to add range to electric vehicles, utility fleets are, for example, adding panels as components of larger energy management systems. Solar power may be used to recharge vehicle starting and auxiliary batteries. It also can supplement battery charging while a vehicle is being driven or while it’s stopped – a valuable feature where legislation may prohibit idling. Additionally, solar power paired with an inverter system converts DC battery power to AC household power to charge cordless tools, laptops, test equipment and other work truck loads that require AC power without draining the battery.

Each issue, we ask a fleet professional to share three keys to fleet success.

This issue’s Final 3 participant is Todd Carlson, principal manager for fleet asset management at Southern California Edison (www.sce.com), one of the nation’s largest electric utilities, serving nearly 15 million customers in Central, Coastal and Southern California, with about 6,100 assets, including trailers, in its fleet.

#1. Learn from other utility fleet professionals.
“Leverage your peers in the industry to benchmark how they configure and utilize their utility trucks. And study their best practices and alternative work methods for crews. This way, you can shorten your own learning curve and put your fleet in the best position to succeed.”

#2. Avoid excessive customization.
“While most utility trucks are custom-configured for the buyer and their work methods, new fleet managers should be aware of all the costs of excessive or unique customizations not typically offered by OEMs. These costs can include longer lead times, engineering issues, trade-offs and unintended outcomes.”

#3. Track fleet performance so you can make smart business decisions.
“A good telematics solution can help you capture performance data – such as days utilized, idle time, boom utilization and driver performance – to equip you with the insight you need to make informed business decisions about your fleet.”

When Dan Remmert, manager of fleet services for Ameren Illinois Company, explored the reasons behind his group’s work-related injuries, one issue kept coming up: getting in and out of a vehicle or piece of equipment.

“We’ve had many issues over time related to getting to the back of a bed, a bucket or aerial device,” he said. He also noted that recent vehicle changes have resulted in chassis being taller, “which causes ergonomic challenges for loading, moving and working.”

Complicating matters is the fact that his workers can choose the size ladder they prefer, but Remmert is expected to standardize the fleet’s trucks, including ladder racks. “We use some of the fold-down products on the market, but they just never seem to fit everybody.”

While combatting injuries caused by stepping out of or lifting materials from vehicles is a growing problem for utilities, there are several ergonomically friendly products now on the market that can help prevent some of the most common injuries. Here are three that may benefit your fleet operators.

Developing an effective approach when it comes to a strategic replacement cycle is a challenge that every fleet manager faces, regardless of the kinds of vehicles or equipment they may manage. The ability to gather and analyze data about your fleet and understand exactly how your fleet is performing has made the run-a-vehicle-into-the-ground approach not only woefully out of date, but it also has revealed just how expensive it is when compared to a well-designed replacement cycle.

The goal for every fleet should be to replace a vehicle before maintenance costs and downtime begin to rise, and at a time in the vehicle’s life when resale values remain meaningful. Determining how to reach that goal can vary from fleet to fleet, but by implementing an optimal replacement cycle for each vehicle or segment of vehicles in a fleet, a fleet manager can realize tremendous benefits and advantages, ranging from minimizing downtime and lowering operating costs, to keeping up with the fast-changing safety and technology features in more recent models, ensuring the safety and comfort of the fleet’s drivers in the process.

So, what considerations and best practices should you adopt in order to get the most from your replacement cycle strategy and experience the benefits of lower operating costs and optimal total cost of ownership?

Your company has clearly communicated its distracted driving policy to all employees. And the safety department is doing its part by screening at-risk drivers, providing consistent driver training and building awareness throughout the organization of the dangers of distracted driving. But when employees are out on the road, how can management ensure that drivers actually comply with the policy – to protect their own lives, the public and your utility’s reputation and bottom line?

That’s where your fleet department can make a difference. How? By equipping vehicles with technologies that counteract a driver’s impulse to read a text message or scroll through social media feeds on their phone while driving – even when they know it’s the wrong thing to do.

All It Takes is One Time
No one is immune. Even the best, most conscientious drivers can succumb to the temptation to look at their smartphone while driving, at least every now and then.

Think about it. You’re driving a service truck through a residential area when you hear your phone buzzing in the console, notifying you of a text message. Because you know better, your initial instinct is to ignore the sound and keep focused on the road ahead. But then a few seconds later you hear the phone buzz again … and again.

Now you’re curious. Who could that be?

It’s been a long day, and you’re exhausted. You start justifying to yourself: I’m going pretty slow right now and there’s not much traffic; it won’t hurt to take a quick look.

You take your eyes off the road for what you think will only be a second. But by the time you look up from your phone, you see that a boy on a bicycle has darted out from behind a vehicle parked along the street, right in front of your truck. You slam on the brakes, but there’s not enough time to stop before your truck hits him.

About a year ago, the fleet team at Eversource Energy (www.eversource.com) launched an initiative to standardize vehicle and equipment specifications across their three-state service area that includes Massachusetts, Connecticut and New Hampshire. Their objective: Cut fleet costs by limiting vehicle configurations to specific job descriptions. This would enable the fleet to strengthen its buying power (by purchasing a higher volume of same-spec units); streamline parts inventories across all their locations (by operating more equipment from fewer OEMs); and benefit from shorter order-to-delivery cycles (by ordering from fewer vendors).

“If you're a lineworker, the function of a material-handling truck is going to be the same whether you’re in New Hampshire, Connecticut or Massachusetts,” said Steve Driscoll, vice president of operation services for Eversource, which is New England's largest electric and gas utility, with about 6,500 fleet assets, including trailers. “In the past, we allowed for differences and customization in equipment, based on an operator’s personal preferences. We recognized the need for going to a standard vehicle across the board to be more efficient and reduce costs.”

But the Eversource team also recognized that many of their end users might not like the change. After all, operators had become accustomed to having their vehicles a certain way for years. And they would likely feel resentment toward fleet, especially if no one clearly explained the why behind the changes.

Effective Change Management
So, to help ease the transition, Eversource decided to take a new approach to introducing new vehicle and equipment models to operators. Beginning earlier this year, the Eversource fleet team began conducting comprehensive in-service events, each lasting about two to three hours, with classroom instruction and hands-on demonstrations.

The events are led by each of the key vendor partners involved with the build-out of the truck, including the chassis manufacturer, body manufacturer and equipment upfitters. The utility’s insurance agency, Liberty Mutual, also sends an expert, who typically opens the event by teaching safe driving and equipment operation practices during the classroom portion of the agenda.

Each issue, we ask a fleet professional to share three keys to fleet success.

This issue’s Final 3 participant is Michael Rorison, director of fleet operations at Eversource Energy (www.eversource.com), New England's largest energy provider. The utility serves more than 3.6 million electric and natural gas customers in Connecticut, Massachusetts and New Hampshire, with about 6,500 assets, including trailers, in its fleet.

#1. Build strong relationships with your team and your customers.
“This is the hardest thing and one of the most important things you can do. The relationships you build today will play a major role in your success as a fleet manager. Employee engagement through developing relationships and team-building initiatives will help you retain good, productive employees. And your relationships with drivers will help them better understand the value of a vehicle’s safety features, with greater appreciation for how those features help the organization achieve its overall safety goals.”

#2. Communicate, communicate, communicate.
“The key to successful communication is to listen to all stakeholders who are involved and impacted by your business plan to ensure it supports your customers’ needs. And you must be able to clearly convey everything to your team. Consistent communication with team members and customers can solve or prevent most issues before they escalate into time-consuming crises.”

#3. Be a planner.
“Do you have a strategy that supports your organization’s business plan? And are you prepared for the inevitable crisis? Make planning a part of your standard operating procedure, with daily targets and goals to keep you on track. This way, you can reduce the number of ‘fires’ you need to put out on a daily basis, while putting yourself in a position to handle the inevitable crisis more effectively when it does happen.”

A backhoe is not likely to be the asset most often purchased for a utility company’s fleet. For example, Duke Energy – which has more than 15,000 fleet assets – “may only purchase three or four a year,” said Chris Jolly, Duke’s director of regional operations for Carolinas West.

That means a purchaser may not be as familiar with the required specs for a backhoe as he or she may be with, say, the specs for a standard pickup truck used by the utility.

But it is just as important to get the specs right, said Eric Zieser, NAFTA product manager for backhoes at CASE Construction Equipment. “Buyers really do need to understand their entire fleet and how a backhoe plays into it. By under-specifying a machine, you may actually be creating more work and cost for yourself in the future by having to bring in/rent/transport additional equipment to do the job.”

So, when spec’ing the next backhoe for your fleet, keep these three points in mind.

1. Know what you need.
At Duke Energy, an acquisition team works closely with crews in the field, despite having a corporate agreement with one manufacturer for a standard backhoe, according to Jolly. Even with that standard equipment, there are options.

“Listen to your customers and work closely with the manufacturer. They’ve got the history of what the product can do,” Jolly said.

Maintaining strong working relationships with vendors is critical to running a smooth fleet operation.

To find out what makes and breaks these relationships, UFP recently spoke with Ron Henne, transportation supervisor for Eversource in Connecticut and Western Massachusetts; Matt Gilliland, director of transportation and facilities for Nebraska Public Power District; and Mel Holloway, product manager for global fleet management company ARI.

For all three men, customer service stands out as a major factor in determining if a vendor is going to be a short- or long-term partner.

Nebraska Public Power District has been working with several suppliers for 10 to 20 years because they continue to meet the fleet’s customer service expectations, according to Gilliland.

“We look for a vendor who will fix or supply it right the first time, on time, and at a fair price,” he said.

In addition to great customer service, vendors that provide total support – including post-sales support such as training – help seal the deal for Henne.

But what prevents fleet managers and vendors from establishing effective relationships? Be cautious of these three pitfalls.

Each issue, we ask a fleet professional to share three keys to fleet success.

This issue’s Final 3 participant is Pete J. Matrunola, director of fleet services at Consumers Energy (www.consumersenergy.com), Michigan’s largest electric and gas utility with 6,227 assets in its fleet.

#1. Make safety the No. 1 priority.
“Safety is the most essential component of a successful utility fleet. So, take the time to invest in safety initiatives and programs that instill a culture around providing a safe work environment and excellent service for your employees and your customers. Safety must not simply be something that is done when it is convenient – it must be a core value and the only way to perform your work.”

#2. Build relationships.
“At work and in life, it is always easier to accomplish tasks and goals when everyone is working together. Spend time with your employees, customers and vendors to fully understand them and their needs, wants, limitations, abilities and so forth. By forging those relationships with your employees and business partners, each becomes engaged to achieve the common goal – to build a safe, reliable, cost-effective and compliant fleet operation.”

#3. Know your finances.
“Your fleet department will always be asked to do more with less. As such, it is critical to fully understand your finances and be flexible enough to quickly adjust to the growing needs of the business. Also, be receptive to change and look to instill a culture of continuous improvement. This will stimulate an efficient fleet that drives consistent financial performance.”

Each issue, we ask a fleet professional to share three keys to fleet success.

This issue’s Final 3 participant is Michael Donahue, manager of transportation and construction equipment at Omaha Public Power District, an electric utility headquartered in Omaha, Neb., with over 1,300 assets in its fleet.

#1. Master one aspect of fleet at a time.
“There are many aspects to learn about operating a fleet – learning how to write specs, learning about your customers’ needs, learning what vehicles are out there and available, and everything else that has to do with fleet. If you try to bite off everything at once, you’ll feel overwhelmed. Instead, I think it's important just to jump in and take one bite at a time, learning about one aspect until you understand it. Then expand your knowledge from there.”

#2. Invest time to study your customers.
“Get to know your customers. Go to their work areas and watch them work. Ask them questions about what they're doing, how they're getting the job done and what equipment ideas they might have. Ask them for feedback on what they think could help them get things done more efficiently. And observe the equipment and operators in action. The more you know about your customers, the more effectively you can serve them.”

#3. Get involved in industry organizations, forums and events.
“Attend fleet conferences. I think they're very valuable for networking and learning about issues and trends that could have the biggest impact on your operation. Attending industry events can help you connect with experienced fleet managers who can answer your questions and offer real-world advice.”