Tell us about GE’s current focus.
Our focus continues to be with our customers. We want to make sure that each and every day we understand their needs and that we are delivering products and services that will meet those needs. As their businesses change, and as the industry changes, it is important for us to adapt and change with them to help make them successful and to help them service their customers.
What are fleets telling you about their concerns right now?
There continues to be several themes as we talk to our fleet customers. We interact with many of the largest fleets as well as many of the smallest fleets in the country. It is amazing how similar the themes are when you talk to the fleet managers and executives at those companies. Both are focused on cost savings especially as fuel prices have started to climb again.
There is also a big focus on safety and looking at different ways that fleets can manage safety either with onboard technologies, through third party solutions, or through driver education and training. Sustainability continues to be a key theme among our customer and potential customer base. Another topic that we are hearing more about, particularly among the service and delivery fleets, is driver productivity. We work closely with our customers to keep the driver on-road and as productive as possible.
What are some of the GE solutions to address these issues?
In terms of cost savings, we work very closely with our Fleet Management Solutions Team and our Strategic Consulting Teams to engage proactively with our customers to find out what they need to be doing today, but also what they need to do today to position them for success for tomorrow. We do a lot of benchmarking with our customers and then we work with them to help them design the fleets that they need to put on-road. So, designing and implementing holistic fleet strategies is one of the ways we address the cost savings piece of it.
From an accident or safety perspective, we are working with customers and partners to pilot new technologies that are coming into the industry. Vehicle selection is also an important part of the process. Many of the fleets that we work with have implemented minimum safety standards based on crash test ratings.
Sustainability continues to be addressed in terms of vehicle selection, driver behavior and driver coaching. From a productivity perspective, we have telematics and other solutions that help keep the driver as productive as possible.
Give us your thoughts on the role telematics is currently playing in the fleet sector.
Telematics is not a new technology but it is becoming more widely adopted in the commercial fleet segment. The tractor trailer carriers have had telematics solutions for quite some time. We are starting to see widespread versions of that technology specifically adapted to the smaller vehicles for service and delivery.
You will continue to see telematics play a more important role in the commercial fleet management space and also to some extent in the public and the government fleet management space over the next three to five years. What is an option now will become standard in the future. And the way we use data from the fuel cards and maintenance programs today; it will be very similar in terms of data coming off telematics devices feeding into programs to interact with and allow fine tuning of all aspects of fleet management.
How can we manage driver behavior more effectively?
Driver behavior is very important in terms of managing the overall fleet cost. If you think about it, there are decisions that drivers make on a day- to-day basis that impact up to 70 percent of the total fleet cost. A fleet manager may choose what vehicle to purchase or to put into the fleet but the driver takes care of that vehicle. If they are hard on that vehicle, if the seats get torn up, if they dent it, if it gets nicked, if they bump into things; that all impacts the cost of the fleet in a big way. How they care for the vehicle from a cosmetic and a structural prospective contributes in a material way to overall fleet costs. Where are they going to fuel and what kind of fuel are they going to put into the vehicle? Where do they go for maintenance and what kind of maintenance services are they procuring? Are they taking a standard tire or are they taking a top of the line tire? Are checks and balances in place using programs like our maintenance program to help control those things?
One of the best ways to work with drivers is to have programs that provide both an incentive for engaging in the right types of behaviors and consequences if behavior is against fleet policy. You want to incent them to do the right things and you also want to make sure from a compliance prospective you are monitoring and engaging where drivers are displaying inappropriate behavior. For example, if you are not managing over-the-tank capacity you may end up in fraud situations. A driver of a vehicle with a twenty gallon tank, for example, that has put 30 gallons into that tank needs to be contacted to determine what happened. Was it because there was a bad storm coming in and they were filling a five gallon tank or was it a fraud situation where they were filling a boat or a four wheeler?
Once drivers know that you are actively managing, they behave in appropriate ways. There are things that we do on the front-end with helping our customers in managing their fleet policy in terms of training, setting expectations and there are things that we do on the back-end in terms of monitoring policy compliance that help us and our customers engage with their drivers.
Drivers are not the problem, they are the solution and so our ability to drive change across the industry with GE’s customers and with our customer’s customers is to engage them, to educate them, to help them understand why we are doing what we are doing and to get their buy-in.
Let’s talk about sustainability.
Sustainability continues to be a key focus area for many public and commercial fleets across the country. As fuel prices climb that becomes center stage, again, but it has become a primary focus for many executives, both in terms of what they are doing with their fleets, but also in terms of how they manage their company’s public image. For example, in the past you may have had a utility or service fleet that pulls up with a medium or heavy truck in a residential neighborhood or even in a commercial neighborhood. That truck may idle all day long while repairs, maintenance, or new construction activities are being undertaken and nobody thought twice about it. Today if you pull up into a neighborhood or commercial district and leave that truck on all day somebody around you is going to be picking up a phone and calling that company and registering a complaint saying — I live here, I work here, I have been walking here and you have a truck that has been idling for eight hours and nobody is in it and that is not acceptable.
Companies need to manage sustainability initiatives not only because it is the right thing to do from an environmental prospective and from a cost perspective, but also from a brand perspective. The expectation in the commercial and retail marketplace is that companies are behaving in sustainable ways. They need to document, communicate and show that it is not just talk. There is an expectation for action and results.
We have several different types of initiatives that we have undertaken. We recognize that with over 17,000 vehicles, our internal GE customer fleet is one of the largest in the country so we need to be a leader in terms of how we manage our own fleet. We also need to be a leader in terms of being a fleet management company and bringing thought leadership and expertise to the market.
As you know, last year in May we opened our Vehicle Innovation Center and our Learning Center specifically designed to help companies learn about alternative fuel vehicles, electric vehicles and the different options that are available to them. At any given time we have 10 to 15 vehicles from a variety of domestic and international manufacturers available for our customers to drive in one location. It makes it quite convenient for them to come in and experience those technologies.
We are also working proactively with third party solution providers and our customers, to develop platforms that will enable their fleet on a case-by-case basis. And then lastly we have deployed technologies across our GE fleet like the Chevy Volt and the Ford C-Max.
What do you believe sets GE apart from its competitors?
GE is similar to our competitors in many ways but we are also very different. Our focus on the customer is number one and the experience our customers have when they are with GE is phenomenal. Our ability to rally around them, to help them solve and achieve their business goals is unsurpassed in the industry when we bring to bear the knowledge and experience of our sales team, the knowledge and experience of our Fleet Management Solutions team, the knowledge and experience of our Strategic Consulting team and the knowledge and experience of our remarketing team. We have a very strong value proposition that resonates with our customers and they like the fact that we have 17,000 vehicles with the GE brand on them. They like the fact that we have to solve problems for our own fleet and that we can leverage the solutions to those problems to help them manage their fleets more effectively.
Mark Smith is VP of Strategic Accounts at GE Capital Fleet Services. Since Mark joined GE in 2003, SCS has saved companies in a variety of industries over $450 million by creating and implementing fleet strategies, transforming fleet operations and improving fleet processes. Prior to joining GE, Mark was a Regional Operations Director for Electronic Data Systems, Solutions Consulting division. He has an MBA in Finance from Brigham Young University. His highly successful career includes positions in finance, operations and sales as well as international assignments in New Zealand and South Korea. Mark consults regularly with managers and executives at all levels to create and implement fleet strategies based on current macro-economic and fleet industry conditions.