As the new president of AFLA, what are some of the initiatives you plan to pursue in the upcoming year?
There are a few things we are going to do. One is to increase our membership and focus more on the corporate fleet buyer. We have great overall attendance; over 400 people attended this year’s annual conference, but I would like to see more corporate fleet buyers. I also think we have an opportunity to broaden our sponsorships into nontraditional areas as well. We need to broaden our focus to include companies in the adjacent vehicle fleet space such as telematics and other relevant technology solution providers. I was approached by several folks at the conference that you wouldn’t necessarily think of as in the “core” fleet market.
We have to continue to drive the value of AFLA with our current members, as well as our new members. We need to continually raise the bar regarding the annual conference: speaker quality, networking opportunities, show production, and award ceremonies.
The corporate fleet manager will need technology tools that help provide cost savings, drive more fuel efficiency, increase safety, and improve overall driver productivity Operating a fleet of vehicles has gotten even more complex over the years. There are various industry trends and government legislation that a fleet manager has to be aware of over the next few years, CAFÉ regulations for example. I think that the “low hanging fruit” is over and many companies will be challenged with doing more with less.
Many of the fleet managers that I have talked to over the past two or three days are doing more than fleet. They still love it and have a passion for it but they do about six other things too. They get invited to many conferences – but they only get the budget for one or two. We want AFLA to be the one that is the “must attend” conference by corporate fleet managers because of the quality content and networking opportunities, which are important to feel connected to a larger group. I also think there is an opportunity to work closer with our friends at NAFA too, in particular in the education area. We share a mutual desire to meet the needs of the automotive fleet industry.
There is also opportunity with some groups that we thought were in our camp, but perhaps don’t know about us. You look at the dealers and Tammy Darvish’s presentation that closed out our AFLA conference. She represents 35 dealerships. She stood up there very honestly and openly and said she never heard of fleet and had never heard of AFLA. So, here’s a person who has significant amount of clout, has written a book, has influence in Washington – yet, she’s never heard of us. We think we have good penetration among our core constituencies, but there are some groups where we obviously don’t, like the dealerships. I think we need to do a better job for everyone’s benefit.
We need to continue to engage women in fleet management. When you look fleet managers, it’s about 50/50 as far as I am concerned. We need to make sure that we have women in leadership positions within AFLA, as well. Theresa Belding was a good role model for folks coming through. She is not done yet, she still has a past presidency to serve, but I think she did a wonderful job over the last three years representing the fleet manager group very well. It was a privilege to work with her.
Let’s talk about AFLA’s role in thought leadership.
I also think education and thought leadership will be important. There are some specific functional things that I think the fleet manager needs to do and we have the expertise. They have ideas but they need the tools to help them grow. Producing a good business case is critical. You know, what is the ROI? It’s about the numbers now that a lot of these folks report into sourcing, procurement, and finance. It is all about the metrics. A lot of the folks are really good at what they do; they are great at the relationship, great at the storytelling, great at managing the operational aspects of the fleet, but at the end of the day they have someone across the table saying, “yeah, yeah but how does it all add up?” I will give you an example: Jack Hanley from NETS probably said it best….”you still need a model for these folks.” I think that is another area where we could help the fleet manager.
Watching industry trends will be critical for fleet managers, and AFLA can play a key role here. There needs to be continued education on what is coming – one, two, three, four, five years out. CAFÉ regulations – what does that mean to a fleet manager? I think that the webinars that AFLA does are great, and I would like to see more of them. I know that everybody doesn’t have time to watch a webinar at scheduled times but they can download it afterwards and on their own time.
And of course, I think events such as this one are educational and important and that is why we get the speakers we do. One of the things that we’ve done the last two or three years is we have asked each speaker to have three to five takeaways that the fleet manager can go back and apply from day one. I get many requests for copies of speaker presentations. That’s important; that means we’ve connected. It is not just theory. Look, if you are away for two or three days you have to bring back something. I am sure the fleet manager is going to be asked: What did you learn? What did you get out of this? What is in it for the company? They need to have an answer. We’re giving them that.
Are you considering offering educational sessions at future conferences?
I think you bring up a good point. Again, and I don’t want to presume here because the Board and the members will weigh in, but I think there is an opportunity to do some more workshops; perhaps in combination with the speakers. I know networking is very important, it is sacred. You need to have a golf outing, you need to have this event, and you need to have that one. I do think we could work in some more key workshops. I think it starts with surveying the membership. What are they being tasked with?
I had a veteran fleet manager come up to me who has a fleet in the thousands. He was tasked with a situation where his company was splitting into two – what does he do? He has to write a business case for certain resources. A workshop on how to ask for those in the right way would be very important.
It troubles me when I hear a fleet manager say, “I am not being listened to,” or “I can’t get the resources,” or “I can’t make somebody listen to what I am doing.” I think workshops on how to promote yourself, on how to make yourself more valuable, on why you need things. And on important things…safety….how do I get ahead of the curve on safety? How do I get ahead of the curve on how to best manage my drivers? Or distracted driving or whatever the current trends are. And…the never ending, “how do I get cost out of my business?” Especially when you have raw material costs going up; vehicles will not be getting cheaper.
I think there is going to be a real need for fleet managers to understand technology in a better way. That can also be difficult, I know, because it’s difficult for the fleet managers to get their IT projects prioritized within their companies. There is always something that seems to trump them in their own organizations so they turn to us, for example, to help them with those IT projects. I have seen technology take this industry in a dramatic direction the last ten or fifteen years. I don’t think that is going to stop.
Our personal adaptation of technology is bleeding into our work lives, and it’s no different for the fleet manager. I am sure they are asking what does the iPhone 5 launch mean to us, should we be doing this? The iPad, where do we apply this type of thing? But in a practical way; what can they do in their world to drive technology change that is real and impactful for their drivers? A workshop to help them understand technology and its impact would be important.
You have an international fleet background. Do you have any plans to reach out internationally with AFLA?
That is a good point. One of the areas we all need to understand is the global fleet market. I can speak to that very well because I did spend six year in Japan, Australia, and the UK. I think that fleet managers will be asked about, and in some cases be charged with doing, global fleet management. Whether it’s a direct line responsibility or dotted line or best practice sharing, they will be asked to figure out what is going on: understanding the culture, the type of vehicles, working with the OEMs. I think you are going to see more and more of this. Large companies are already there; we have already had many requests for this type of information. It is complex.
Again, workshops and ongoing education in that area are important. It is not just the one and done. I think this will be an ongoing priority. However, I would probably challenge the way I’ve seen it done in the past. Previously, it was more around the culture but we need information that is more granular about what is really going on in the fleet market in that area. The product differences – and there are vast product differences – need to be addressed. The US and Canada are the anomaly. For instance, the only place where there is a TRAC lease is in the US and Canada. You go to Europe it is all closed end, you know, and then you go to Asia and it is sort of a rental/lease hybrid. An overview and understanding of what those markets are is going to be critical for fleet managers. I think it also makes more valuable for their organizations as they learn about emerging markets and the role of fleet in those areas.
Let’s talk about Donlen now; what’s new?
Well, a lot, actually. Our one-year anniversary just passed September 1st of when we became a wholly owned subsidiary of Hertz, and it’s been great. They had been looking for a leasing company for years. Mark Frissora, Chairman and CEO was always asked by his clients, “When are you going to get a leasing company”? And he finally had an answer. For the most part, they have let Donlen be Donlen. This is not a consolidation by any means; it was all about growth. We have been sharing best practices and we’ve also been working on different areas of synergy such as acquisition and remarketing channels.
Some of the greatest opportunities are for products. We have launched a couple of products which are unique to the market; true differentiators. Hertz Value Lease is one that was launched this year. We offer a potential pool of 300,000 Hertz rental vehicles for lease. No one else can do that. We think it is a great niche; it is a brand new category for fleet management. I think you are going to see more rapid product advancements from us.
Speaking of globalization, we have been involved with Hertz providing some tools for their organization, specifically China. We are ready to launch a couple of tools to help their business based on our FleetWeb platform. I think you will see Donlen become more involved with Hertz who has a huge global presence.
They have been very respectful of the Donlen brand here in the States. Our Client Advisory Board told them to “be careful, we don’t want you to change the ‘magic sauce’ that makes Donlen unique.” And so we are still the company that really focuses on service, consulting, and technology. That is our value proposition – and luckily these are priorities for Hertz as well. We have a great technology platform. We have a great consultation approach across every department at Donlen and we know that we have great services levels. We don’t want to change. I know everybody says that but we really have a commitment to not change, and Hertz supports that. There is an opportunity to grow significantly, even in an industry that may be slow to change. We have the resources that we can take some big bets and that is going to be very good.
Hertz has learned some things from us, too. It’s not all just been one way. We are very entrepreneurial and we’re able to make decisions a bit quicker than Hertz. We constantly ask the customers how we’re doing, has there been any change…we’ve not lost a single customer since we were acquired. That is a good thing. We know that many in the industry were saying that we would change, but we said we wouldn’t and we haven’t. So the fact that we were able to retain our customers is a great story and our employees are happy. For the most part, most of our employees have been dealing with their day-to-day responsibilities and haven’t been affected by it and that’s good. Let them do what they do best.
Talking about the future of the fleet industry, what role will mobility management play in the industry and at Donlen?
Integration is probably the single most important issue when talking about the future. As companies look to improve their bottom line, the “one vendor” model may be a thing of the past. Of course, we would like to provide every service for customers because we can, but we’re also realistic. Giving our customers the flexibility to manage everything in one place, keeping them productive and happy, is really our focus for the future. I know it’s been said before over the past year, but now that we have access to Hertz’s equipment and rental options, we have become the source for just about every need a company can have. Short term, longer term, lease, rent, buy, disposal…you name it, we can do it. That’s the true future of mobility for fleets.
BIO
Tom Callahan serves as President and Chief Operating Officer of Donlen. In this role, he leads critical operational areas including Vehicle Acquisition Services, Remarketing, License & Title, Quality/Project Management, Human Resources, and Information Technology.
Tom is also has responsibility for various customer facing groups including customer integration, account management and client relations. In addition, he has led Donlen’s efforts in establishing an international presence in the UK, Europe, and Mexico. Donlen’s international operations report to him.
Tom has held significant global leadership positions in general management, sales management, product development, quality, and operations in North America, UK, Japan, and Australasia with GE Commercial Finance – Fleet Services and GE Consumer Finance spanning a 19 year career.
He began his career at Ford Motor Company and held various sales and management roles of increasing responsibility including field sales, merchandising, and operations.
Tom is Black Belt certified in six sigma methodologies and has participated in several GE Crotonville leadership courses on strategy and business management. He earned a BBA from the University of Notre Dame and a Master’s degree in Marketing from the University of Wisconsin-Madison.