During your term as president of AFLA you have made some significant changes. Bring us up date.
We looked at our association management and realized that we needed a more involved, engaged partner. We initiated an RFP process to select the right partner. We received a lot of good responses and decided on Acumen. Acumen had strong association management credentials in multiple industries and came highly regarded when their references were checked. They have a broad and strategic view of how they think AFLA can get to the next level.
I think every once in a while you have to change things up and, frankly, I felt that we had gotten stale. By changing to Acumen we are already seeing good things. Part of it could be very basic, like a more robust audit process. The enthusiasm is back. When you have new players they challenge the status quo. That’s all good.
I think the ideas for speakers are more diverse and impactful and there is engagement that I haven’t seen for a while. I have been involved in the leadership at AFLA for two or three years and I am starting to see more excitement come through. So, that is one of the first things that we did. You could say we moved from administration to full-on proactive management for our first step. That was a big change, and change is not always easy for people.
The second thing we did was conduct an off-sight strategic planning session. We came up with four or five key initiatives that we want to look at. Obviously, one of the big pieces is the conference itself but we also want to look at increasing corporate membership. And that is a big thing; the corporate fleet buyer was not increasing at the level I would like to see it. If you increase the corporate fleet membership the rest will follow.
Fleet managers need to be able to communicate the good things they are doing, and also build business cases to be more effective in their organization with leadership. So, we are focusing more on education and we have reached out to our friends at NAFA for further collaboration when it makes sense.
The other initiatives include looking at the way we are promoting with social media. As you can see, have quite a bit going on right now. One of the key challenges we face is that we are a volunteer organization and most people have a day job so it’s finding the time. I commend everybody on our team who volunteers a lot of valuable time to get and keep things moving for us.
Let’s talk about the upcoming conference.
We have a variety of very informative sessions including personal branding, generational diversity in the workplace, a look at the “car of the future,” inspirational tips on leadership, legislative and business updates, America’s global energy positioning and impact on our industry, CAFE and greenhouse gas standards, liability issues with new fleet technologies (i.e. telematics), and much more.
We also received feedback that we need to get more “industry specific” categories. We are going to dive deeply into the future of vehicle engineering and maintenance, remarketing trends, fuel efficiencies, and other key things that are on the minds of fleet managers. There will also be plenty of time for networking and best practices sharing!
What about the fleet industry professionals, the leasing companies, the management companies, dealers, etc. Are you going to have anything that talks to them?
We’re going to have specific items around alternative fuels, vehicle maintenance and engineering, fleet management liability, and resale trends. In addition, we will be honoring individuals who have had significant impact on our industry via Fleet Industry Hall of Fame. The OEMs, FMCs, dealers, and fleet management suppliers obviously are key partners with us to meet the needs of the fleet managers.
What are you focusing on right now at Donlen?
We are focusing on being a fully integrated fleet management company. Whether you have short term rental all the way through to a long term lease, Donlen is your full service provider. We became part of Hertz in September of 2011, and have collaborated on a variety of different things, introducing two or three interesting products already with them. We’re going to be launching other innovative products as well. We are also rounding out our other initiatives like trucks and equipment, for example, getting more involved into that segment, and we’re adding some pretty neat new capabilities.
We’re already strong in telematics, and we continue to advance in that area. We’re also helping Hertz in this area, releasing new products to help their fleet. We have done some work internationally, including work in Hertz China and Hertz Brazil. We will continue to do that; build out some global capabilities for us as well. We are continuously looking to improve in the US and Canada as well. So, we continue to look at the people to get the best and the brightest in the industry. I think in conjunction with the Hertz name and brand, Donlen is attracting some very good talent.
I think it is going to be a very, very good five to ten years for Donlen going forward. We are on our way.
What are fleet managers telling you about their concerns?
Every year they are asked to save more money. They need proactive advice to save time and money from their outsource partners. They want to be able to have the fleet management companies call them and say, hey, I am noticing these costs are out of line, here are some proactive and predictive ways that you can reduce them. Sometimes they feel that the FMCs can be a bit complacent and we can’t have that – because I know at Donlen, we’re not. So, I think just in general they want to have access to the information and tools to keep saving money. They are always asked to do more with less; technology that helps them is something they want more and they need.
More than ever we see that the fleet manager reports into an area that may not understand what they do and the value they provide every day…and of course today’s fleet manager wears a number of hats. Multi-tasking is a prerequisite skill set!
We are basically their outsourced technology provider. Often, they don’t seem to be able to get their technology projects prioritized within their own business so they use us. Hence, we are the outsource provider allowing a company to do what they do best: their core business. Another important thing to point out is that we are not trying to displace the fleet manager; we are trying to complement the fleet manager. I think sometimes there is suspicion but we’re really looking to be a good partner, not a threat.
Donlen has always been known for excellent customer service. How do you keep your employees trained and motivated?
We have incentive plans that focus on customer satisfaction and employee satisfaction so our management teams are rated based on how well they do. Our entire operating philosophies are on our service success chain: if you take care of your employees and you take care of your customers the profit will come. It has been that way since 1965 – it continues today. Interestingly enough, Hertz has a similar philosophy so we mesh well together. We also have a reward system for all of our employees that reinforce this core belief.
The other thing is we have people who really love the industry. They are passionate about the industry and it’s obvious. We don’t just have people that want to do an 8:00-4:00 or 8:00–5:00 job. They live and breathe the industry. We have a lot of long-term employees within Donlen. We also have a lot of younger folks coming in too, some new blood, and technology savvy. I think across the business there is an appreciation for technology. It has always been one of Donlen’s strengths. Rapid deployment of technology solutions has been one of the things that we are known for. We want to continue that and we also reward our employees for that, as well.
Hertz has helped us to attract good people; Chicago is a very good source of talent, especially in technology. So, I think in our core competencies we have been able to attract some really, really bright people and we want to retain them. We also have stock options and performance grants that Hertz has introduced that can help us retain good talent.
What are the leadership attributes you look for when you hire and promote?
It starts with integrity. You have to be collaborative; you work in teams, no one is an island. You have to be execution focused because a lot of people come with ideas but it is the people that actually make it happen that are worth so much to any organization. At the end of the day you have to be somebody that likes the industry, likes to be part of a winning team. That is what I’m looking for.
I am not looking for people who are just into themselves. I am not looking for people who want to only spend a year or two in the industry; I am looking for people who are committed and people who really want to make a difference. It sounds like a cliché but at the end of the day I think passionate people who want to make a difference bring it every day. That is what you need: consistency. Our customers demand it, I think our employees demand it; we need to have managers who want to build good teams and are proud of getting their people ahead, getting their people a promotion, getting their people visibility.
Then you need to support your people with the right reward system, processes, and systems to build out capacity and capability. That is something that I look at when I am evaluating managers and employees.
Hertz has some things that they look at, as well, including many of the key attributes that I already mentioned. The other thing that we look for in higher level employees is courage to make a tough decision. Sometimes it is difficult but you have to make it, you have to have the guts and determination to make a call. If you don’t you are not going to help your organization as much as you can.
The one thing that we are all guilty of is waiting too long to take action on problems. I am guilty of it myself so I try to coach people—it never gets better by kicking the can down the road so deal with it upfront and you will be better off.
What should fleet managers be doing to elevate their positions within their organizations? What is your advice?
Well, first of all, learn how to develop a good business case; be able to develop the cost benefit analysis to sell the idea or project to the key decision makers. In the world of sourcing procurement and finance it is all numbers, so understand your numbers and how you got to them. Understand the ROI on whatever you are doing. That is point number one.
I would say point number two is sharing your corporate goals and how you are measured with the FMCs so we can help you succeed. It doesn’t have to be a black box. Collaboration is so important, and then it’s a win-win. If I can help that fleet manager achieve their metrics, their KPIs, it is going to be good for everybody. If I don’t know then I can’t help the way I know that we can.
The third is education. Get yourself educated – take ideas from anywhere. Be a believer in continuous improvement, of yourself. Things like NAFA, AFLA, industry publications, advisory boards, etc. — any way you can, even if it isn’t in your immediate domain of responsibility, you never know because I have to tell you, not all of our Client Advisory Board has cars, trucks, and equipment but every one of them wants to know about them because they realize knowledge is power.
And the fourth thing is remembering you have a personal “brand” – make sure you identify and communicate it effectively. We have a workshop at the conference specifically addressing this.
You know, there are a lot of really, really great fleet managers that do a lot of great things. So, this is by no means a criticism, but focusing on these three or four things could make a real difference.
How should fleets approach the bid process?
You know, numbers are one thing but it is really capabilities and who is going to be a true partner with you and not just based on the dollars and cents. At the end of the day when you look at the savings that a fleet management provider can give you it is huge compared to the fees that a company pays out. So I wouldn’t focus as much on that. Everybody is pretty competitive as far as the pricing but focus on the overall operational capabilities, organizational fit, on-site visit presentation style and content, and look at technology, really look at their technology, what they can do with data – the integration, reporting capabilities, and strategic consultation. Focus more on that then a written RFP.
I also think the fleet manager needs to figure out where his company is going in the next two or three years and make sure he partners with an FMC that can grow with him and not stagnate.
What is your sense of the economy?
Good question. I am worried about what is happening: sequestration is slowing us down. I think there is uncertainty there. I thought we were over the hump but I think we seem to be decelerating again globally – US is around 1-2% GDP growth, Europe very slowly beginning to get back to health, China & Emerging Markets throttling back a bit.
Specifically, as it pertains to the US, Washington has to provide better fiscal leadership. Business needs certainty. Fleet managers need certainty, FMCs need certainty. I am not sure we have that right now. Is Washington going to push even harder on financial regulation? Reform our tax policy? Environmental legislation? Are our politicians capable of reaching across the aisle to get things done? What does our legislative future hold and what will be the impact on our industry?
The upcoming AFLA conference addresses this head on in Kipp Coddington’s session “Legislative Forecast: From Tailpipes to Taxes, the Business Environment for Fleets in the Year 2020.”
I learned long ago that you cannot control something that is largely out of your control – and I’m not a politician, but understanding the “tea leaves” better can make me develop a better plan of action.
BIO
Donlen President Tom Callahan is an accomplished executive who brings invaluable perspective and customer focus to Donlen. As president, Tom sets the strategic focus and drives execution of key initiatives for all business operations. His attention to employee satisfaction, customer retention, and corporate culture ensures that Donlen’s customers remain completely satisfied with our performance.
Tom has deep roots in the automotive and commercial fleet industries. He began his career at Ford Motor Company where he held various sales and management roles including field sales, merchandising, and operations. Additionally, Tom held 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.
In his role as President, Tom is a member of the Hertz Executive Committee. In addition, Tom currently serves as President of the Automotive Fleet & Leasing Association (AFLA), one of the fleet industry’s premiere organizations for networking, education, and standards. Tom is Black Belt certified in Six Sigma methodologies. He earned a BBA from the University of Notre Dame and a Master’s degree in Marketing from the University of Wisconsin-Madison.