Management – Page 5 – Utility Fleet Professional

Sharing Knowledge: The Value of Joining a Utility Fleet Organization

Written by Curtis Marquardt Jr. on February 19, 2015. Posted in Special Focus.

Have you ever heard of the Homebrew Computer Club (HCC)? How about Apple, the technology company? The odds are that all of you are familiar with Apple – with its ubiquitous iPhones and iPads – but very few of you have heard of the HCC. But did you know that without the HCC’s existence, Apple might never have existed? In fact, some credit the club as the birthplace of the personal computer revolution.

To give you some background, the HCC was created in 1975 to bring together like-minded electronics enthusiasts in order to talk shop and share ideas. It was during an HCC meeting that one of its members, Steve Wozniak, found inspiration to design a new kind of personal computer – the seed from which the Apple empire grew.

At this point you may be thinking, what does any of this have to do with utility fleet professionals? The answer is that belonging to an organized group of like-minded professionals – whether they’re focused on electronics or fleets – can have an incredible impact on personal success as well as the success of an industry.

To help illustrate this point, UFP sat down with three officers who help direct the Upper Midwest Utility Fleet Council (UMUFC), an organization that brings together leading utility fleet minds in the region. Our roundtable includes:
• Bernie Kolnberger, utility services manager at Dakota Electric Association, which is the second-largest electric cooperative in Minnesota and ranked among the 25 largest electric distribution cooperatives in the nation.
• Jeff Bickler, fleet manager at CenterPoint Energy, a domestic energy delivery company that includes electric transmission and distribution, natural gas distribution and energy services operations. The company serves more than 5 million metered customers in several states. Bickler operates out of Minnesota, where CenterPoint is the largest gas distribution company in the state.
• Mike Donahue, transportation and construction equipment manager at Omaha Public Power District (OPPD), the 12th-largest public power utility in the U.S., which provides electricity to nearly 800,000 customers in Nebraska.

The three men provided some insight about their respective fleet operations and revealed just how valuable and important their involvement with the UMUFC has been.

UFP: Let’s start off by getting an idea about the size and scope of your fleet operation. How many vehicles, pieces of equipment and facilities do you oversee?

Kolnberger: We’re fortunate enough to have all of our vehicles and equipment come back to one maintenance facility. We have 17 aerial trucks; 74 light-duty vehicles; six digger derricks; 42 pieces of power equipment; 36 trailers; and nine utility trucks. We have one shop superintendent, four full-time mechanics and one part-time helper working at our maintenance facility.

Donahue: At OPPD, we manage 430 light-duty vehicles; 63 cargo/dump/underground trucks; seven semis; 49 digger derricks; 87 bucket trucks; seven specialty trucks; 366 trailers; 394 pieces of construction equipment, from trenchers and backhoes to loaders and generators; one locomotive; and seven coal dozers. We have a team of approximately 50 people divided up among four facilities, including field supervisors, managers, crew leaders, parts specialists, clerks and so on.

Bickler: Our fleet structure is unique. In the state of Minnesota, where I’m located, I manage a fleet of about 1,200 vehicles and pieces of equipment, and this fleet is used to provide gas distribution service to the state. We also have about 3,000 vehicles and pieces of equipment located in Oklahoma, Arkansas, Louisiana, Mississippi and Texas that are used for CenterPoint’s gas distribution service. I co-manage the other states’ gas distribution fleet, where we use a third party for the maintenance of those vehicles. For the Minnesota fleet, we have two garages and a staff of 13 technicians. In addition to this, we have fleet garages and support in Houston, which support the 2,500 vehicles and equipment on the electric side of our business as well as support the gas distribution fleet.

UFP: It’s insightful to learn how someone made their way up the ladder to the position they’re in today. How did each of you evolve and grow into your current fleet leadership position?

Kolnberger: I’ve worked in the utility industry ever since I graduated from college. I worked my way up the ladder, working in inventory planning and serving a couple different roles as a buyer/planner. Nearly 30 years of experience with utilities have given me such great perspective and insight and have really helped prepare me for my current role as the utility services manager.

Bickler: I started with CenterPoint Energy as a technician and was promoted to fleet supervisor shortly after that. I believe my past experiences in the fleet and automotive industry, as well as my experience owning my own business, were key factors in getting promoted to the position so quickly. As fleet supervisor, I had the opportunity to manage multiple projects across multiple states, and that experience was so valuable in preparing me for my current role as fleet manager.

Donahue: I was in the process of completing my mechanical engineering degree at Iowa State University when I obtained a co-op position at OPPD in the transportation department. After graduation, I was able to join OPPD full time as a specification engineer and made sure to put work into learning everything I could about the vehicles, equipment, applications, operators, scheduling, purchasing and so on. I also put time into developing relationships with employees, customers, vendors, managers and peers.

UFP: It sounds like being involved in utility fleets is something you knew you wanted to do very early on in your career.

Donahue: It was. I even joined NAFA so I could learn more about the many additional aspects of fleet management, and I completed my Certified Automotive Fleet Manager certification. That education played an important role in my development.

After about 10 years, I was promoted to supervisor over engineering, administration and parts. In this role, I learned more detail about the roles of others within the department and the demands of supervision. About five or six years ago I was promoted to manager of transportation and construction equipment, and the learning and fun continues.

UFP: All of your organizations and responsibilities have a lot of differences. However, one thing all of you have in common is that you serve as an officer for and sit on the board of directors of the UMUFC. Can you tell me how you got involved with the organization and how it continues to be a rewarding experience for you?

Bickler: The UMUFC has been a great group to be a part of. Sharing knowledge with your peers in the industry has been a second-to-none resource to me. I’m always amazed by the wealth of experience and insight that all of our members bring to the table.

UFP: I imagine without having a group like UMUFC to be involved with, it would be pretty difficult to find so many experienced and knowledgeable fleet minds from which to learn.

Bickler: You hit the nail right on the head. It’s such a tremendous resource, and the council has continued to grow because it’s just such a valuable experience. UMUFC has a very bright future and I’m excited to be a part of it.

Kolnberger: I have been involved with the UMUFC ever since I took on my first fleet manager position back in 2001, and I have been attending meetings ever since. It is an excellent group of people with whom to share thoughts and ideas. The camaraderie is second to none. It’s amazing to me that we all have similar pains and challenges no matter the size of the operation. The larger operations fight many of the same battles as the smaller ones – they just do so on a larger and broader scale. There are times when I go into a meeting with a new issue I’m dealing with, and it’s funny to see how many people in the room are also dealing with it, and some who have already dealt with it have shared great information and tips about that process. Of course, each organization has its own unique atmosphere, so sometimes the solutions they’ve implemented aren’t going to be your solution. But more times than not, you end up using a part of or several parts of that solution to create your own.

UFP: What about you, Mike?

Donahue: I love the variety of perspective that the UMUFC brings. You get people who are managers, technicians, operators, vendors and so on who participate, and that creates conversations that cover a broad scope of information. Another great thing about the UMUFC is that it’s small enough that everyone has a chance to participate. Everybody has a voice. And we try to encourage that by creating agendas that purposefully cover a wide variety of topics, as well as soliciting topic discussions prior to meetings so we can integrate those topics into the meeting.

UFP: It sounds like there is a lot of effort put into providing a fulfilling experience to as many members as possible.

Donahue: Yes, I feel like the group is genuine in their approach. We understand the value of staying focused on the needs of the members. In turn, we’ve had excellent response rates when members have specific questions that they want posed to the group.

UFP: How would each of you describe your personal fleet management strategy? In other words, in what areas do you excel and how do you bring the most value to your organization? What have you learned over time from your fleet management experience?

Kolnberger: For me, it’s all about being organized. You can’t get bogged down in micromanaging the day-to-day fixes and problems. Instead, I make sure there are processes and procedures put in place to ensure that the operation continues to run efficiently. Ten years ago, when I started the fleet manager position, our shop didn’t have a maintenance computer application in place, and that was one of the first areas I addressed. This built automation into the process, which has reduced wasting time and increased work quality.

One area where organization is crucial is the specification process. I put a lot of effort into making sure we are purchasing and disposing of vehicles in an organized, planned out manner that helps us avoid those spikes in the budget from year to year and allows us to more accurately forecast budget needs for upcoming years.

Bickler: Bernie brought up a great point about implementing technology. As an owner of a computer services company, I think it’s important to not only understand how we can look to technology as part of the fleet management process, but also be open to adopting it when it improves the operation. That’s a big part of my strategy. Another part of my strategy comes from my experience working for more than a decade on the OEM side of the automotive industry. Having that insight and experience helps mold your processes.

Donahue: I feel like one of the main things I have learned over time is that almost nothing stays the same in fleet. So, our strategy is one of continual improvement. We need to use as much input as we can to recognize where we need to improve, do so, and then repeat. I don’t feel like our organization can afford to ever be stagnant. As part of implementing this strategy, our team went through lean training.

UFP: By “lean training,” you’re referring to the waste reduction, efficiency and quality improvement strategies that many say were mostly created by Toyota.

Donahue: Exactly. It is amazing how going through that process and committing to it can help change the environment and culture of a group. We also implemented 5S training, which taught our staff about standardization of processes and how to create a workspace that is both efficient and effective. We are nowhere near perfect, but the constant improvement part of lean strategies and those 5S events laid a foundation that everyone involved continues to use to this day.

UFP: What are some of the unique fleet challenges that each of you face that others at this table – as well as our readers – may not have to battle?

Bickler: One of our unique challenges has been supporting folks in different states. You have to take account of the differences there are in each region while at the same time standardize the processes for efficiencies, and do it all without affecting the operation and the clients you support.

Kolnberger: Like I had mentioned earlier, being a part of the UMUFC really does reveal just how similar one utility fleet is to the next. The similarities far outweigh the differences. Of course, we all have our own unique cultures we deal with within the organization. But at the end of the day, we are all facing challenges with budgets, idling and so on. More times than not, the differences between one fleet to another come down to how those issues are prioritized. An issue for one utility fleet may be priority No. 1, and for the next, the same issue falls lower on the priority scale.

Donahue: Our main challenges are keeping the mechanics trained on the wide variety of vehicles and equipment they need to maintain and repair; keeping tools and diagnostic equipment up to date; long-term direction on fuels; and adjusting the workplace culture to improve engagement, safety and accountability. In addition, I have heard of the increased incidence of trouble finding qualified mechanics. We have not experienced that particular one yet; however, with some upcoming retirements, we had better be prepared for that potential.

UFP: The utility fleet manager has been a position that hasn’t been recognized as much as it should. The millions of dollars and moving pieces that many fleet managers have to oversee is a pretty daunting yet vital role in an organization. With that said, what do you celebrate about your job? What do you most enjoy about what you do?

Bickler: First and foremost for me is that I love working in this industry. A couple of things that bring me a lot of joy are doing a great job serving our clients and continuing to bring new standards and technology solutions to the table. I also enjoy working with the great staff we have here. When they see ways we can improve our processes, they are so awesome at sharing those ideas with me.

Donahue: Like Jeff, one of the best parts of my job is getting the opportunity to work with the people I get to work with every day, from the folks in our department to the leadership up the chain. I also enjoy facing the challenges the fleet faces every day and finding the solutions that work.

Kolnberger: Well, I hate to repeat what these two guys said, but I too find that working with the people here is so rewarding. They’re a great bunch and that motivates me that much more to find solutions that not only make the fleet more efficient, but also make their jobs better. For example, when we first implemented the shop software, it was something that I knew would create a better environment for everybody. Don’t get me wrong – it did take some work to get everybody to fully buy in. But then that moment comes where the solution just clicks with everybody, and you’re seeing the positive business and human performance results from that. And that’s the kind of thing that makes me proud.

UFP: Many of our readers are in fleet management and leadership positions like the three of you, and others are striving to grow and advance into fleet leadership positions. What advice would you give to them?

Donahue: My advice to someone who may want to become a fleet manager would be to look for an opportunity to get involved in an internship or co-op within the community and find out through experience if it looks like an area that they find interesting and stimulating. I’d also recommend that they find ways to grow their knowledge about the profession. NAFA offers some great educational programs that really worked well for me. Become active in fleet management communities and groups as well so you can learn from experienced fleet leaders.

Kolnberger: To add on to Mike’s great suggestions, I think one should also learn about general management skills. Being a fleet leader is something that requires one to have patience, strategy development and people management skills. For example, there are times when there are a daunting number of challenges to face, and sometimes the best decision in those instances is building morale by first going after some of the smaller victories before tackling the challenging ones.

UFP: That’s an interesting point. It must be an intimidating part of the process to not only understand the big moving pieces, but to also grasp the little things and know how to respond.

Kolnberger: One thing I did that has made a world of difference is implementing effective specification procedures and documenting our operating procedures. When you go through that entire process and break it all down, you really learn what is going on in the trenches and it really helps you better understand where to spend your time and energy. And, when you nail down a great process that works, you don’t have to give it as much focus as you would if there wasn’t good process, which frees you up to focus on other areas of need.

UFP: Thanks to all of you for your time. One last question: For those who are located in the Upper Midwest region, where should they go to learn more about the UMUFC?

Bickler: I’ll take that one. If you want to learn more about the council, visit our website at www.umufc.org. We’d be happy to have you join us. And for those of you who aren’t in our region, I urge you to look for regional utility fleet groups in your area. If there isn’t one available, think about starting one yourself. It’s well worth the effort.

The Final 3

Written by Curtis Marquardt Jr. on February 19, 2015. Posted in The Final 3.

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

This issue’s Final 3 participant is Matt Gilliland, fleet manager for Nebraska Public Power District. NPPD is Nebraska’s largest electric utility, delivering power to about 600,000 Nebraskans. The utility’s fleet department provides direct life-cycle oversight for nearly 1,200 fleet assets in 41 locations within the state. In addition to his role as fleet manager, Gilliland serves as president of the Upper Midwest Utility Fleet Council, is a member of the UFP editorial advisory board and holds a master’s degree in business.

Tip 1: Communicate, Communicate, Communicate
“It is so important to push information out as it becomes available as well as listen for, then act upon, the voice of the customer. One thing we do to accomplish this is through a monthly newsletter that is sent to every equipment operator and any supervisor or manager that has an equipment operator in their department. The newsletter offers a method of feedback and suggestions while communicating recalls, best practices, equipment replacement projections and progress, and other important information.”

Tip 2: Surround Yourself with Great People
“When you surround yourself with people who take pride in what they do, it creates an atmosphere of accomplishment. I owe my professional success largely to the members of my team. One would be hard-pressed to find a more dedicated, hardworking and expert level of people anywhere in the fleet industry.”

Tip 3: Create a Better You
“One of the best investments a person can make is an investment in themselves. Seeking professional certification, training, networking connections and education are tremendous ways to invest in yourself and foster professional success.”

How Engaged Are Your Employees?

Written by Curtis Marquardt Jr. on February 19, 2015. Posted in Management.

Across the globe, there is a shortage of a very important resource that is reaching epidemic proportions. What’s worse, it’s a resource that is vital to your fleet operation and has a substantial impact on your bottom line.

This increasingly rare commodity is the engaged employee.

So, what is an engaged employee and why are they the most important asset your fleet operation can have? Generally speaking, an engaged employee is one who is psychologically invested in the organization and committed to getting the most out of his or her abilities and efforts for the sake of advancing the growth and success of the organization.

Research shows that the enthusiasm, positivity and proactive effort that engaged workers bring to the job have a real, measurable impact on the success of an organization. That’s because engaged employees miss fewer days of work, are more productive and are less likely to leave the company.

On the flip side, a disengaged employee can put a drain on your bottom line. This impact comes in many forms: increased demand on managers’ time, poor work quality, higher accident and theft rates, and more missed workdays.

Ultimately, the more engaged employees you have working within your fleet operation, the more successful it, you and your entire organization will be. Here are the top four things you can do to ensure you’re acquiring, developing and retaining engaged employees.

1. Measure Your Engagement Levels and Make a Plan
The best way to know how engaged your employees are is to ask them through a survey. An Internet search of the phrase “employee engagement survey” will return a number of resources and employee engagement templates to help you build a survey that is unique to your fleet operation. The primary goal is to get anonymous responses that measure whether or not your employees feel proud of where they work, are inspired by their management, trust the organization, feel valued and so on. The results will pinpoint the areas that are your organization’s engagement strengths and weaknesses. From there, you can build a strategy that improves upon each.

2. R-E-S-P-E-C-T, Find Out What it Means to Your Employees
Leadership expert Peter Economy recently reported for Inc. magazine that employees give their best to the company when you create an environment that makes them partners in the process. This means treating your employees as valuable members of the team by increasing your trust in their decision-making skills, letting them in on the big picture so they understand the company’s plan and strategy, and inviting them to participate in other areas of the company where their expertise can contribute to the success of the organization.

Employees also increase their engagement when their personal lives are respected. This can be accomplished by taking time to have conversations with employees that touch upon personal topics and implementing policies that respect work-life balance, such as providing flexible work hours.

3. Improve Leadership and Management Effectiveness
A Dale Carnegie Training study revealed that 80 percent of employees who were very dissatisfied with their immediate supervisor were also disengaged. That’s why it is so vital to hire and promote the best people for management positions and also ensure they receive training that empowers them to effectively engage their teams.

But proper hiring and training only get you so far. Your organization must also measure employee engagement and hold managers accountable for poor results. In other words, employee engagement must be made a formal responsibility for anyone who manages people.

4. Communicate and Show Appreciation
As with most people-management solutions, engaging employees begins with communication. Employees are more likely to be engaged when management and leadership not only clearly communicate goals and available job growth opportunities, but provide an environment in which employees can communicate their opinions and ideas.

Engagement levels also grow when employees are recognized for making contributions to the success of the organization. Whether it’s through personally thanking employees, providing monetary rewards or making acknowledgements in the company newsletter, it’s important to implement ways to show that you notice their accomplishments and appreciate their efforts.

15 Tips for Improving Your Inventory Control

Written by John Dolce on October 6, 2014. Posted in Management.

For some, the term “inventory control” may seem more like an oxymoron than a management practice. If you feel like your inventory is anything but controllable, here are 15 tips to help you better manage the process, thereby creating added success and profitability for your fleet.

Tip 1: Implement and Enforce an Inventory Control System
Every parts operation needs an inventory control system of some sort, which should incorporate the following key elements:
• It must warn parts personnel far in advance that a part is being depleted from stock.
• It must list a part’s historical purchase price so that if the price changes, the
manager will be able look into the issue and ascertain whether this change is a price increase or due to incorrect billing.
• It should list vendors that offer the best prices.
• It should give past usage rates so that the manager can determine proper inventory
levels.
• It should require as little writing as possible, particularly by mechanics.

Tip 2: Know Your True Total Demand
Total demand is a complete record of all filled orders and actual parts delivered to customers regardless of the source. In addition to filled orders, a complete and total record of all lost sales – those sales that never occurred due to lack of inventory – must be kept.

A total demand record helps to reveal the changing and flexible nature of the marketplace and aids you in stocking the right parts in the right quantities at the right time.

Tip 3: Define Your Economic Order Quantity
The economic order quantity equation helps define the optimum inventory order amounts by factoring in the cost and demand of that inventory. Your goal should be to make as few orders as possible while also maintaining the proper inventory.

The cost of writing a purchase order and of paying the bill varies between approximately $35 and $50 per transaction. Considering this high cost, a target minimum of $500 of inventory per month should be purchased from each vendor. Placing an order for a smaller amount of merchandise creates a disproportionate and uneconomical clerical expense. If only a small amount of stock is ordered each month, good prices for those items will not offset the cost of paperwork.

Tip 4: Reduce Your Carrying Costs
The carrying costs of inventory can be between 30 and 40 percent of the total inventory value. You should have an ongoing strategy for reducing the costs of:
• Rent or proportionate building depreciation; building maintenance and repair; utilities; and labor costs for janitorial staff and security guards.
• Inventory storage and material-handling equipment.
• Taxes.
• Insurance.
• Inventory personnel salary and benefits.
• Damaged and nonreturnable parts, pilferage, warranty claim time and returning parts.
• Lack of return on inventory and control investments that might otherwise produce income.

Tip 5: Establish a Formal Warranty Program
Each premature component failure due to a supplier vendor providing poor workmanship, poor materials, and/or any latent defects should be flagged by fleet management and inspected by the vendor. Once inspected, the vendor can make a decision about the fleet’s claims about the component. The vendor should provide a monthly inspection that includes an agreed-upon settlement and a credit to the fleet. These parts failures have costs, and it is important that you set your ceiling for recovery at 5 percent of the dollars spent with that vendor. Should reclamation be more than 5 percent, begin exploring alternative vendor solutions.

Tip 6: Start with Big-Ticket Inventory Items
In evaluating big-ticket items or items with an aggregate targeted shelf inventory value of at least $5,000, limit your inventory to the amount needed for a 90-day period. If these items can be purchased locally within one or two days, it may not be necessary to stock them at all, especially if the repair requires one or several days of preparation work before the part is needed.

Make sure you weigh the cost of keeping big-ticket items in stock against the cost of customer out-of-service times. You may find that limited out-of-service times are more economically sound than maintaining inventory of relatively expensive items.

Tip 7: Invest in Your Brain Power
If a large inventory is your only solution to create a high level of vehicle availability, you will be hard-pressed to find ways to reduce inventory costs. The reality is that you must be consistently vigilant at keeping your inventory as lean as possible. The more you learn about the parts inventory business model, best principles and practices, successful analysis and applied corrective strategies, the better you will be at effectively planning a successful inventory strategy.

Tip 8: Don’t Confuse Price with Cost
Too often, price and cost are used interchangeably and in error. Price is what you pay in dollars to acquire a product or service. Cost takes into consideration all the factors that add up to return on investment. Ease of installation, frequency of service, labor required and safety are only a few of the considerations in determining cost. In essence, if you are to justify the high initial price of a product, you will have to do so based on cost. Make sure you analyze and understand all of the costs of your operations prior to beginning any inventory strategy.

Tip 9: Require Vendor Guarantee of On-Time Delivery
Don’t resort to expensive stockpiling of key materials in order to avoid inventory shortfalls
caused by late delivery of parts by suppliers. Instead, put the burden of responsibility for
prompt delivery on suppliers – where it belongs. One way to do this is to guarantee the vendor a minimum monthly purchase in exchange for the vendor promising both on-time delivery as well as a penalty payment if you have to purchase materials on the spot market to fill a gap when a delivery is late. The penalty payment should be equal to the cost you expended to obtain the materials.

Tip 10: Negotiate, Negotiate, Negotiate
When mounting an effort against waste in inventory handling, a manager should first consider the company’s purchasing policies and past experience with parts suppliers. Are the prices the lowest possible? If lower prices can be negotiated elsewhere based on volume, will service and delivery remain acceptable? It is futile to negotiate with no idea of realistic costs or possible price reductions. Therefore, purchasing guidelines must be established early in negotiations by someone familiar with parts-pricing discounts.

Tip 11: Brand Loyalty Doesn’t Pay
Negotiations should not be brought to a standstill by a fleet manager’s insistence on one
and only one brand of a part. In virtually every area, there are competitive lines available. This
can be a negotiation advantage. For example, if one line is not available at a jobber price – which is usually between the MSRP and warehouse distributor price – perhaps a competitive brand would be. Flexibility in this aspect can be profitable.

Tip 12: Don’t Overlook the Small-Ticket Items
Bolts, nuts and other similarly sized shop supplies constitute an often-neglected expense that can be significantly reduced. A common mistake on the part of managers is thinking that nuts and bolts are small-ticket items. In fact, such supplies will generally account for around 8 percent of the total parts bill each month. Much of this expense is waste attributable to poor purchasing habits. For instance, if you purchase these expendables from a salesperson who offers free bolt bins and other inducements to buy, you might be paying two to five times more than you should for these supplies. Even though they may be easy to overlook, it’s important to be aware of the cost of these materials.

Tip 13: Do Your Pricing Homework
If you don’t have an ongoing method for checking parts prices, you’ll have a hard time creating inventory efficiency. You should always have the latest price sheets from all the vendors with whom you do business.

As merchandise is received and volume changes, the prices on several items should be spot-checked to make certain the proper discounts are in effect. Without this monitoring, you will miss pricing and discount mistakes made by the vendor. To reduce any confusion over agreed-upon pricing, deal with one designated representative from each vendor whenever possible.

Tip 14: Plan Ahead for Hard-to-Get Parts
Availability of hard-to-get parts can obviously present problems, but longer delivery times shouldn’t necessarily preclude the use of a particular vendor. For instance, a part might be available locally at a cost of 20 percent greater than an out-of-town vendor would charge. If the part is ordered from the local vendor, delivery would require only a few days while the other supplier would need two weeks to deliver the part. However, given the substantial cost savings, it would be better to use the out-of-town vendor and simply stock an extra two weeks’ supply of the part.

Tip 15: Keep the Old Inventory Cycle Going
Simply put, old inventory needs to be removed from the parts room. A formal inventory should be taken every six months. Items that have not been used in those six months should be taken off the shelves, assuming that a system of cycle counting – frequent, random sampling of inventory line items – is not being used.

About the Author: John Dolce is a fleet facility and maintenance specialist employed by Wendel Companies, an architectural and engineering firm. He is an active consultant, instructor and fleet manager with more than 40 years of experience in the public and private sectors. Dolce has written three fleet-related textbooks and teaches fleet management courses at the University of Wisconsin’s Milwaukee and Madison campuses. He can be contacted at johnedolce@yahoo.com.

Reducing Costs

Written by Seth Skydel on October 6, 2014. Posted in Fleet Profiles.

While independent electric grids power each of the Hawaiian Islands, servicing all of those grids is the responsibility of the Hawaiian Electric Co., which serves 95 percent of the state’s 1.4 million residents. Hawaiian Electric’s subsidiary Hawai‘i Electric Light serves more than 80,000 customers on Hawai‘i Island, the chain’s biggest island at more than 4,000 square miles.

The challenges that Hawai‘i Electric Light face are unique, said Kelvin Kohatsu, fleet administrator. “Our terrain ranges from tropical growth on the east side, to desert-like conditions on the west side, to freezing temperatures atop Mauna Kea mountain,” he said. “To serve the people who live and work in that vast and diverse terrain, we have a distribution system comprised of more than 3,300 miles of overhead distribution lines, more than 780 miles of underground distribution lines and 641 miles of overhead transmission lines.

“We operate a wide range of more than 300 vehicles and pieces of equipment,” Kohatsu said. “Due to our location, we focus very closely on uptime and product support, along with traditional metrics like life-cycle costs, and on safety and ergonomics. Every week, we generate a report on uptime percentage, costs for fuel, tires, repairs, maintenance and inspections, and damage and accident costs. With this information, we can determine the best equipment to purchase for longevity, not to mention operator acceptance and safety.”

Employee Safety
The large service area, diverse terrain, and variable weather make maintaining infrastructure and reliability a challenge, but safety is Hawai‘i Electric Light’s top priority. Drivers log 1.7 million miles on the road annually. Crews can work in distant, remote areas, and some employees work alone.

Proven Support
The equipment and vehicles used by Hawai‘i Electric Light have the best product support in Hawai‘i, which keeps the fleet’s uptime consistently between 96 and 98 percent, according to Kohatsu. Major suppliers include Kenworth for Class 7 T370 and Class 8 T800 trucks, Dodge for Class 3 and 5 trucks equipped with service bodies, and Altec aerial devices and digger derricks. Also in the fleet are a mix of Nissan, Toyota, Dodge and Ford sedans, pickups, vans and SUVs, along with trailers, forklifts, golf carts, sweepers and stationary equipment.

All diesel-fueled vehicles at Hawai‘i Electric Light run on biodiesel; nearly all use B20 with the rest on B100. The fleet also includes light hybrid vehicles, electric-powered Nissan LEAFs, plug-in hybrid electric Toyota Priuses and a Class 7 Kenworth T370 diesel-electric hybrid truck, the first of its kind in the state. Spec’d as well are Altec JEMS 48 AT37G aerial units.

“We’ve standardized in many cases to enhance the ability to maintain equipment and streamline product support,” Kohatsu said. “While we’ve ascertained that the systems we have in place work very well for us, we continue to evaluate new systems and components and ask other fleets about their experiences.

“At the vehicle and equipment level, we’ve been fortunate that manufacturers have involved us in some of their product development and in the testing and evaluation stages before production release,” Kohatsu said. “For example, we added a new Altec HiLine AH151 Model aerial on a Kenworth T800, along with a digger derrick with a rear-mounted spool handler that can be driven loaded.”

Key Focus
Fuel economy is key to improving the efficiency of the Hawai‘i Electric Light fleet. “After installing a telematics system in 2008, we reduced our diesel fuel consumption by more than 22,000 gallons in the first six months compared to the same time period one year earlier,” Kohatsu said. “We were essentially traveling the same number of miles, but we were seeing a huge reduction in fuel use from better routing and less idling.”

By 2009, telematics systems were installed on all trucks in the fleet. In 2012, the company switched to Zonar’s telematics system and also began using its electronic vehicle inspection reporting (EVIR) application. “After the Zonar telematics equipment was installed, we realized a further reduction in diesel fuel consumption of about 18,000 gallons,” Kohatsu said. “Combined with the 22,000-gallon reduction from 2008 to 2009, fuel savings totaled more than 40,000 gallons even though the fleet’s annual mileage stayed constant at about 1.7 million miles annually.”

Telematics also is helping Hawai‘i Electric Light improve safety. “With telematics, we can better monitor equipment – a feature that is critical for the safety of employees who work alone in remote locations,” Kohatsu said. “Telematics also results in safer driving practices because it gives us a much higher degree of transparency in our fleet operations.

“We can now monitor behaviors and correct those that are costly,” Kohatsu said. “For example, drivers aren’t driving as fast, and when they stop at company offices or job sites, they turn off the engine instead of leaving it idling. It’s clear to me that telematics strongly influences driver behavior. You can’t hold drivers accountable and change their behaviors without an objective way to measure their performance.”

Effective Tool
Zonar’s EVIR system has also proven to be an effective tool for Hawai‘i Electric Light’s maintenance operation.

Kohatsu believes drivers must complete pre- and post-inspection reports fully and consistently to effectively limit downtime and keep costs low. “Zonar’s EVIR holds drivers accountable since it tracks when they did their inspections and how long it took them,” he said.

Using Zonar’s EVIR inspection tool, Hawai‘i Electric Light’s drivers conduct inspections by placing a reader within inches of radio-frequency identification tags that are placed on equipment in critical inspection zones. The tags contain information about their location on the unit, the components to be inspected, and the identity of the vehicle or piece of equipment.

Using the reader, drivers indicate the condition of the components within each zone. When a defect is discovered, the driver selects a description from a predefined list and indicates whether the equipment is safe to operate. When the inspection is complete, drivers place the hand-held unit into the EVIR mount inside the cab. Zonar’s telematics platform then wirelessly transmits inspection data and remote diagnostic information to a Web-based ground traffic control data management application.

Ensuring Compliance
At Hawai‘i Electric Light, the Zonar data is integrated into FleetFocus, a maintenance management system supplied by AssetWorks. This integration generates service requests automatically and transmits them by email through the FleetFocus portal to Hawai‘i Electric Light’s maintenance vendors, Kohatsu said. Once repairs are performed and marked complete in FleetFocus, they are automatically uploaded to the Web-based management application, indicating to dispatchers that the vehicle is in full compliance for operation and can return to service.

“The integration of Zonar and AssetWorks has made the generation of work orders resulting from driver-identified defects or vehicle sensors seamless,” Kohatsu said. “As a result, along with effective specifications, our uptime has increased and our life-cycle costs have dropped. Most important, we have a safer fleet operation.”

Hawai‘i Electric Light Class 7 and 8 Truck Specifications
Models: Kenworth T370 and T800
Engine: PACCAR
Transmissions: Allison; Eaton UltraShift PLUS
Front Axle: Dana Spicer
Power Steering: TRW
Rear Axle and Suspension: Dana Spicer; Reyco; Chalmers
Brakes: Bendix air disc
Wheels: Alcoa aluminum; Accuride steel
Tires: Michelin

About the Author: Seth Skydel has more than 29 years of truck- and automotive-related publication experience. In his career, he has held editorial roles at numerous national business-to-business publications focusing on fleet and transportation management, vehicle and information technology, and industry trends and issues.

Train for Efficiency

Written by Tom Gelinas on October 6, 2014. Posted in Maintenance.

Today’s trucks and automobiles have hundreds of programmable features that can be used to customize these vehicles for a fleet, and today’s technicians need to understand how to program these parameters as well as how to utilize the many diagnostic modes in modern vehicles. Since technological change is one of the few constants in our industry, such demands make ongoing training critical to keep technicians efficient.

Darry Stuart, president and CEO of DWS Fleet Management Services (www.darrystuart.com), echoed such sentiments. “Ongoing training for technicians is critical,” he said. “The advent of electronics has made the truck a very sophisticated machine. While it incorporates sophisticated control systems, it contains even more sophisticated diagnostic systems, which have taken a good portion of the guesswork out of troubleshooting. As a result, fleet technicians need regular training to keep up with these changes.”

Most employees – and certainly those with a desire to succeed – seek as much training as possible so they can better perform their jobs, qualify for monetary rewards and elevate their positions. And knowledgeable fleet professionals understand that staff training will help their companies gain operational efficiencies. On the other hand, it’s important to understand that you may have someone who is satisfied with what he or she is doing and really doesn’t want to progress. You may have to find a place for such a person if you want to keep him or her on your staff.

New Hires
When fleets need to make additions to their shop staff, most fleet professionals prefer to hire technicians with some practical experience, but all too often such personnel are not available. While trade schools are a source of young people who have been exposed to some of the basics, vocational school graduates generally still need a good amount of support before they’re ready to handle assignments on their own.

New hires, without a few years of practical experience, are usually assigned tasks such as cleaning parts, fueling and lubricating vehicles, and driving vehicles into and out of the shop. Beginners are then promoted as they gain knowledge and experience and as vacancies become available. These workers advance to increasingly difficult jobs as they prove their ability and competence. During this time they are often assigned to work under a more senior technician on engines and other systems such as brakes, transmissions and electrical systems.

Sometimes, however, fleet managers are faced with a lack of ample training time for new hires, or simply do not set aside the appropriate amount of time. “The most important activity in any shop is preventive maintenance,” Stuart said, “but it seems very difficult for a fleet manager to take a new technician, sit him down in the break room and let him review the fleet’s PM procedures, which, of course, should be available for review. A new hire, even one with experience, should have two or three hours every day for at least a week to go through established procedures. Too often, a new technician is put to work immediately.”

Determine Training Needs
Stuart suggests you practice management by walking around the shop floor. If you establish an atmosphere of open communication, technicians won’t hesitate to tell you their problems and potential training needs as you wander by. In your wanderings, you can also check scrapped components to see if they really need to be replaced.

Vehicle OEMs and major component manufacturers can supply you with standard repair times for many of their products. Compare these times with those needed in your shop for particular jobs and you might find that you need an evening in the break room with pizza and vendor training for your staff. If you require staff members to attend these types of sessions, be sure they are on the clock.

Our industry is fortunate to have suppliers who consider aftermarket training as part of their cost of doing business. Most have personnel in the field who can conduct training at fleet locations to ensure their products continue to perform satisfactorily, but it’s up to you to make sure that what’s being presented is in line with your policies. Remember, vendors want to sell parts; fleets want to avoid buying parts unnecessarily.

What’s the best training for shop technicians? “Some classroom training is fine, but training by an older mentor is best,” Stuart said. “Too often, though, a mentor simply shows the trainee how to do something, and the young tech never gets a chance to put his hands on the work. The mentor should do some awareness training, then let the young man do the work using the five-minute rule. If you can’t figure what’s wrong or need help after five minutes, ask the question.”

Whether it’s to familiarize technicians with new technology or to reduce the purchases of high-cost maintenance items, ongoing training is a necessity. You’re going to part with some money to get that training, but if you’ve done your homework and scheduled the proper training, the money will likely come back to you in improved efficiency, making it an investment – not an expense.

About the Author: Tom Gelinas is a U.S. Army veteran who spent nearly a decade as a physicist before joining Irving-Cloud Publishing Co. While at Irving-Cloud, he worked in various editorial capacities for several trade publications including Fleet Equipment, Heavy Duty Equipment Maintenance and Transport Technology Today. Gelinas is a founding member of Truck Writers of North America, a professional association, and a contributing writer for Utility Fleet Professional.

Getting Involved

Written by Seth Skydel on October 6, 2014. Posted in Editor's Perspective.

Regulatory issues continue to dominate legislative agendas. In his annual regulatory and legislative update during this year’s Electric Utility Fleet Managers Conference, Pat O’Connor, legislative counsel for the NAFA Fleet Management Association, covered a range of topics for fleet executives to consider.

“Phase 2 greenhouse gas emissions and fuel economy standards for work trucks are an opportunity to get involved,” O’Connor said. “That includes while EPA and NHTSA are drafting proposed rules, during the comment period and as Congress exercises its oversight authority. A notice of proposed rulemaking is now expected by March 2015, and a final rule should be in place by March 2016.

“As EPA sets GHG standards, it needs data for finer segmentation of the vocational vehicle market,” O’Connor continued. “There is a lack of data on segments where there is significant idle time, and how best to define categories of idle time on a time- or fuel-consumed basis.”

Another opportunity to offer input is in regard to new clean car and fuel standards issued by the EPA. Starting in 2017, the Tier 3 new vehicle emissions standards will lower the sulfur content of gasoline, considering the vehicle and its fuel as an integrated system. Tier 3 will reduce volatile organic compounds and nitrogen oxide tailpipe standards by 80 percent over today’s fleet, establish a 70 percent tighter particulate matter standard and reduce fuel vapor emissions to zero level.

Safety is also on legislative agendas. “For example,” O’Connor reported, “the National Transportation Safety Board studied the safety record of single-unit trucks in an attempt to identify appropriate countermeasures for these vehicles. In response to the findings of the study, the NTSB made nine recommendations to NHTSA and four recommendations to the Federal Motor Carrier Safety Administration.

“However,” O’Connor said, “while FMCSA has little credible data with respect to the safety performance of managed fleets that include single-unit trucks, in the future it will be exploring options for setting different regulatory requirements for medium- and heavy-duty trucks. One option mentioned was to make a distinction for mandated fleets in the federal motor vehicle safety regulations.”

On March 31 of this year, O’Connor also told EUFMC attendees, NHTSA issued a final rule that, by May 2018, all new vehicles under 10,000 pounds GVWR must be equipped with rear-visibility technology. Approved systems will expand the field of view to enable the driver to detect areas behind the vehicle in an effort to reduce deaths and injuries resulting from backing incidents. Manufacturers have petitioned to allow cameras as an option to the conventional side-view and rearview mirrors.

For utility fleets, according to O’Connor, getting involved in these issues can help avoid having technology forced upon them when new standards are implemented, and can help legislators and regulators consider incentives that will lead to true fuel-saving and safety solutions. By bringing data into the decision-making process, including information on diverse and unique vehicle duty cycles, fleets will also be better positioned to address life-cycle and capital budget challenges and serve as a more valuable resource to senior management.

“Public policy includes legislation, regulations, implementation and enforcement activity, and administrative actions,” O’Connor said. “Engagement by fleet managers can inform and influence public policy.”

Seth Skydel
Editor

Fix That Money Drip

Written by John Dolce on August 7, 2014. Posted in Management.

Fleet managers who develop objective, fact-based, data-driven decision-making processes often are successful because they don’t let emotions, irrational estimations or surface-level perceptions factor into their decisions.

Unfortunately, when it comes to properly staffing a fleet’s maintenance and repair teams, some managers waste valuable budget dollars by making shoot-from-the-hip decisions without taking time to drill down into the data to uncover facts that can help steer them toward more financially efficient, prudent paths.

This mistake can have a serious impact on the bottom line because, on average, maintenance and repair expenses can account for as much as 25 percent of annual fleet costs. This is why it is so important that you make sure you allocate every maintenance- and repair-staffing dollar wisely.

Needs Analysis as a Starting Point
On average, fleet professionals perform approximately 500 different maintenance and repair tasks on their vehicle and equipment fleet. When considering adding staff to your maintenance and repair team, you will have to determine whether or not you want new employees to have the skill sets needed to complete some or all of those tasks.

Look at the costs associated with hiring industry workers with varying degrees of skill sets. Salary amounts can range depending on what skills you want your employee to have, whether or not he or she has a professional certification, experience level and where you are located within the U.S. When you research salaries, you also are likely to discover the size of the talent pool you have to recruit from in your area.

True Productive Time and Its Impact on Value
Another mistake some fleet managers make is believing that hiring a full-time maintenance and repair worker who works eight hours a day, five days a week for 52 weeks a year will provide a value of 2,080 total hours of productive work.

A value investor does not make decisions based on this type of surface data; you must dig deeper to find the true value. First, factor in holidays, sick leave, vacation hours, jury duty, outside training and personal days, all of which is time not spent on maintenance and repair tasks. On average, these days away from the bay add up to about 580 hours per year. So, the actual work time is now down to 1,500 hours.

Next, add in on-the-job, at-work, indirect time. This is a term for the nonproductive time when staff members are engaged in administrative work and other tasks that remove them from their bays, such as ordering parts, completing paperwork and pre- and post-trip reports, taking coffee breaks and attending meetings. It’s non-wrench-turning time, and it typically accounts for 500 hours a year, which brings the total down to 1,000 hours a year of wrench-in-hand productivity.

Now dive deeper into those 1,000 hours to establish their true productive work time value. Of the 500 tasks that the maintenance and repair staff performs, only 5 percent are performed on a repetitive, continual basis. This 5 percent makes up an estimated 30 percent of their workload and consists of tasks like replacing batteries, changing oil and so on.

The good news is that these are the tasks from which you’re truly going to get one hour of productive work out of a one-hour job. That’s because workers benefit from the repetition – it increases their task efficiency and skills. In other words, the more they perform the tasks, the better they get at them. So, of the 1,000 hours, there will be 300 hours of high-value, productive work.

But this means that the other potential tasks will take up 70 percent – or 700 hours – of their workload. These tasks can slow productivity because they are more challenging and haven’t been retained in employees’ muscle memory. As a result, a one-hour task could take double, triple or even quadruple the time to complete.

On average, this drop in productivity reduces the 700 hours to about 400 hours of high-value, productive work time. Now we see that a full-time employee is going to give us a total of approximately 700 hours of maintenance and repair value – 300 hours performing repetitive tasks and 400 hours engaging in tasks that are less frequently performed.

Let’s do the math. Seven hundred productive hours is about a third of 2,080 full-time hours. That means that in the case of a $20-per-hour employee, you really are paying $60 for each productive hour.

When you add in benefits at an estimated $8 per hour, and also add in facility costs – including amortization of the floor space, heat, electricity, clerical times and everything else in that category – the actual figure gets close to $95 to $100 per hour.

Doing this calculation not only shows the value you are getting from your existing maintenance and repair staff, but also provides more revealing data about what it costs to hire new staff. How do these numbers stack up against the available outsourcing options? And where can you find other sources of value in your in-house staff that will help you lower that $95- to $100-per-hour cost?

You certainly can look at your existing staff and assess some of the intrinsic value in them, such as the efficiency and quality of work that is a result of their experience. You can also look at the cost of replacement for those workers. Finding a new worker to replace a good, reliable employee that you’ve properly trained can become a very time- and dollar-consuming task.

If you keep these concepts in mind when you make investment decisions, you’ll be much better equipped to put your organization in the best position possible to minimize its vehicle and equipment maintenance and repair outlays, maximize its vehicle availability, minimize your fleet size and maximize your fleet utilization – which adds up to lowering your fleet’s overall billable costs without reducing productivity.

About the Author: John Dolce is a fleet facility and maintenance specialist employed by Wendel Companies, an architectural and engineering firm. He is an active consultant, instructor and fleet manager with more than 40 years of experience in the public and private sector. Dolce has written three fleet-related textbooks and teaches fleet management courses at the University of Wisconsin’s Milwaukee and Madison campuses. He can be contacted at johnedolce@yahoo.com.

Five-Point Checklist for Selecting the Right Service Van for the Job

Written by Sean M. Lyden on August 4, 2014. Posted in Equipment.

The cargo van landscape has undergone an extreme makeover the last few years, providing more options than ever for utility fleet managers to consider when purchasing new vans.

In 2008, there was only one small van available in the U.S. – the Ram C/V Tradesman, a stripped-down version of the Dodge Caravan. But then came the Ford Transit Connect in 2009, with the Nissan NV200, Chevrolet City Express and Ram ProMaster City (expected 2015 model year) also entering the fray.

The full-size van market has also experienced a major transformation since 2008, when there were only three players: GM (Chevrolet Express/GMC Savana), Ford (E-Series) and Freightliner/Mercedes (Sprinter).

Today, there are five automakers in this segment, offering a much wider range of configurations and capabilities. Ram (formerly Dodge) recently re-entered the full-size segment with its ProMaster. Nissan launched its NV full-size van in 2011. And Ford is phasing out its traditional E-Series van in favor of the new high-roof, Euro-style Transit.

So, how do you sort through all the new options to select the right van for your fleet operations? Use this five-point checklist as your guide.

1. Payload Capacity
What equipment, parts, tools and products will the van be hauling? How much will that cargo weigh at maximum load? Your answer to the weight question will help you determine what size van you need (see “Van Classifications” sidebar).

As fuel costs continue to escalate, a growing number of fleets have been considering whether to move out of full-size vans and into more fuel-efficient compacts, like the Ford Transit Connect and Nissan NV200. But before you downsize, make sure that the actual payload is in line with the smaller van’s capabilities, cautioned Mike DeCesare, regional truck manager for ARI (www.arifleet.com), a full-service fleet management firm.

“Although very fuel-efficient, mini cargo vans are extremely easy to overload,” DeCesare said. “Where the fit is right, there could be tens of thousands of dollars in fuel savings, but companies would be wise to make sure that the van they select can actually do the job. Otherwise, a less expensive, more fuel-efficient van could end up being a very costly mistake if it’s not up to the task.”

2. Trailer Capacity
Will the van pull a trailer on a regular basis? If so, what will be the total weight of the trailer and its cargo at maximum load?

This is an important consideration because van manufacturer and engine selection are impacted depending on how much weight the van needs to pull.

Take one-ton vans, for example. The Chevrolet Express 3500 offers maximum trailer capacities of 7,400 pounds with a 4.8-liter V-8 gas engine, and 10,000 pounds with the 6.6-liter V-8 Duramax diesel engine, whereas the Ram ProMaster 3500 is limited to 5,100 pounds towing.

Both are one-ton vans, but there’s a wide gap in their towing capabilities. And even with the Chevrolet Express 3500, engine selection alone can make the difference of more than 2,500 pounds in trailer capacity. So, check the trailering guidelines for any of the vans you’re considering to confirm they can do the job.

3. Van Length/Wheelbase Options
How much space do you need inside the cargo area at maximum load?

If you’re considering a full-size van, you’ll have multiple wheelbase options to consider that impact cargo volume. For applications that require hauling pipe, conduit and other long materials inside the van, the extended wheelbase options give you that flexibility.

4. Roof Height Options
Will your drivers spend a lot of time working inside the cargo area of the van?

If so, the Euro-style full-size vans – such as the Ford Transit, Ram ProMaster, Freightliner Sprinter and Nissan NV – offer high-roof options, with cargo area heights above 6 feet, in some cases, that make it easier and safer for drivers to work inside the van without having to strain or bend down.

5. Gas vs. Diesel
Most full-size vans offer the option for gas or diesel. But with an upfront premium of $7,000 to $10,000 for diesel, how do you determine which is the best engine for the job – and your budget?

One factor to consider is the projected annual miles for the vehicle. “Since diesel tends to be more fuel-efficient than gas, the vehicle needs to travel about 40,000 miles per year to recoup the upfront investment in diesel through fuel cost savings within a reasonable time period,” said Don Scare, manager of truck excellence for fleet management firm PHH Arval (www.phharval.com), now part of Element Financial Corp.

In addition to better fuel economy, diesel also offers higher torque for towing and driving on mountainous terrain.

“The key question is, what’s the ROI? Because at the end of the day, you’re looking at about a several-thousand-dollar investment to go to diesel. The application needs to justify that higher investment,” Scare said.

Keep TCO in Mind
When it comes to proper van selection, “always keep total cost of ownership in mind,” advised Marcin Michno, business consultant, enterprise consulting and analytics for PHH Arval. “If you have a van that’s not spec’d correctly, then you risk driving up operating expenses [in terms of excessive repair and fuel costs] while diminishing resale value due to excessive wear and tear. In the end, choosing the right van with the right specification makes a huge difference in the total cost of ownership of that vehicle.”

About the Author: Sean M. Lyden is a nationally recognized journalist and feature writer for a wide range of automotive and trucking trade publications, covering fleet management strategies, light- and medium-duty trucks, truck bodies and equipment, and green fuel technologies. He blogs at Strategy + Writing (www.seanmlyden.com).

Van Classifications
Consider the four van classifications below and their corresponding payload capacities as you evaluate the optimal van size for your requirements.

Compact
Examples: Ford Transit Connect, Nissan NV200
Payload Capacity: 1,500-1,700 pounds

Half-Ton
Examples: Chevrolet Express 1500, Nissan NV1500
Payload Capacity: 2,300-2,500 pounds

Three-Quarter-Ton
Examples: Ford Transit-250, GMC Savana 2500
Payload Capacity: 3,000-3,300 pounds

One-Ton
Examples: Ram ProMaster 3500, Ford Transit-350
Payload Capacity: 4,000-4,600 pounds

Note: Although terms like “half-ton” and “one-ton” historically corresponded with actual payload capacity, today – as you can tell – that’s not the case. However, the industry has retained those terms as standard classifications for trucks and vans.

Effectively Meeting Needs

Written by Seth Skydel on August 4, 2014. Posted in Fleet Profiles.

“NV Energy is unlike many other utilities our size because we have two metropolitan areas in Reno and Las Vegas, and the rest of the service territory is spread out across nearly 60,000 square miles,” said Joe Pellissier, the company’s process improvement manager. “The terrain ranges from lower desert areas to the alpine forest of Lake Tahoe, with temperatures from over 110 degrees in the summer in Las Vegas to below zero in many areas in northern Nevada.”

NV Energy supplies electricity across its whole service territory, in addition to gas in northern Nevada. “The fleet department must provide vehicles to meet these conditions as well as provide maintenance and repair support,” Pellissier explained. “Attempting to standardize our fleet is very challenging given the different geographical areas and conditions. Additionally, drivers with similar job titles have differing job functions due to operational differences in metropolitan and rural areas, and that also drives differences in vehicle and equipment needs.”

Currently, the NV Energy fleet includes approximately 1,500 vehicles, trailers and pieces of equipment. To accommodate the varying terrains, NV Energy has standardized the chassis and drivetrains of many vehicle types. Most heavy-duty trucks are equipped with 425-horsepower Cummins engines, Allison transmissions and 6×6 drive axle configurations. Recently, the company relaxed the drivetrain requirement in Las Vegas, allowing some vehicles to have a 6×4 configuration. Most of the heavy truck fleet is made up of Internationals as well as a few Freightliner, Peterbilt and Mack units.

The majority of the Class 3-5 fleet at NV Energy is supplied by Ford, along with some Ram trucks, and most light-duty pickups, vans and SUVs are GM models. Since 2005, digger derricks and aerials have been supplied mainly by Altec, although several larger specialty units have been supplied by Terex. Most of the Class 3-5 service bodies and flatbeds have been Knapheide units from local high-quality suppliers.

“We don’t have preferred suppliers,” Pellissier related. “We develop specs and any manufacturer can bid on our business. When evaluating bids, specification compliance is the first issue considered. If a vendor doesn’t meet the specs, we dive deeper into why, how important are the deviations, and whether we can accept them. After that, the second consideration is quality, but that is becoming less of an issue as we weed out suppliers that don’t meet our quality expectations.

“While we do very little evaluation of new systems and components,” Pellissier added, “when we find something that will make the user more effective or reduce our costs, we incorporate the new components into our specifications. We require suppliers to be in compliance with our specs. This allows us to reduce spare parts for many components as well as minimizes the knowledge base necessary for repairs. On some occasions, we discover new technologies or features that we incorporate into the specifications for testing development. If the tests successfully meet the desired outcome, these become standard items, which subsequent vendors are required to meet.”

Passing Hurdles
“After passing the first two hurdles in the bid evaluation, in most cases the low bidder gets the order,” Pellissier continued. “We do factor in standardization of similar units, because if we have similar vehicles and historically they have not been a problem, we look more favorably at them. We also consider life cost, including depreciation, in our purchase decisions, but generally that is addressed upfront, prior to the bid.”

As the depreciation rate has changed a few times over the years, Pellissier explained further, users are sometimes reluctant to accept new vehicles if the expense is too high. Fleet explains to users that operating costs will rise significantly as vehicles age and will meet or exceed the higher costs due to depreciation. NV Energy has been leasing vehicles since 2005, and the depreciation issue went away, Pellissier also related, but as the utility has gone back to purchasing, depreciation again becomes a bigger issue.

“Recently NVE has worked on improving reliability of vehicles and equipment, addressing the impact of extended idle time on engine wear, and reducing operational costs due to additional maintenance and fuel,” Pellissier said, “We are focused on the reduction in idle time and the increased engine life and reliability. We evaluate idle time on most vehicles and its effect on fuel costs and maintenance.

“Our specifications now require options for minimizing idle time by using various types of plug-in electric hybrid systems on any unit with a service or larger utility body,” Pellissier continued. “We use GPS data from the existing vehicle, look at historical idle time and fuel cost, and project that to the new vehicle to determine if selecting and paying for anti-idle technology is justified. If so, we add the hybrid system to the vehicle price and determine if the payback is achievable within the life cycle of the vehicle.”

NV Energy uses two methods to calculate the payback on hybrid systems, Pellissier explained. “First,” he related, “we use actual historical idle time and, secondly, idle time as a percentage of 1,600 work hours per year. We use 1 gallon of fuel use per hour of idle time and the actual cost of fuel. For a fuel use payback calculation, the company uses actual mileage and gallons used in the previous year, as well as fuel cost per gallon.”

Promoting Development
NV Energy was one of the first early adopters of Altec’s JEMS system and has been very active in promoting development of hybrid solutions. During NV Energy’s first few years of hybrid system adoption, the focus was on vehicles with hydraulically powered equipment. More recently however, the focus has shifted to hybrid technology to support anti-idle and power requirements for 12-volt truck chassis systems and 110-volt systems for external power.

In addition to trouble trucks with 38-foot lifts, NV Energy has deployed hybrid systems on other vehicles to eliminate idle time. One example is a gas crew truck that utilizes an Odyne system to power an under-chassis air compressor and electric gas pipe fusing equipment. The company also recently added four Altec JEMS systems to vehicles without any hydraulic systems. The hybrid system manages the 12- and 110-volt truck and tool load while minimizing idle time.

“We recently ordered two more gas crew trucks and a vacuum gas valve maintenance truck with the next-generation Odyne system,” Pellissier related. “The only alternative fuel we utilize today is electricity, so we’re pushing to get electric-powered vehicles, including plug-in hybrid technology, into the fleet.”

NV Energy’s hybrid-electric plan includes an expanded focus on light-duty OEM vehicles when the make, model and type of unit meet the fleet’s needs. Included are extended-range electric trucks and the ability to utilize plug-in technology while taking into consideration the challenge posed by a limited infrastructure for plugging in vehicles.

The company is also now requiring options for anti-idle technology on work trucks. “If we have vehicles with a history of long idle time, we are likely to require anti-idle/hybrid technology on the new vehicle,” Pellissier said. “NV Energy’s anti-idle system requirements include systems that power supplemental cab air conditioning and heating, as well as provide exportable power for generators, inverters and other tools.

“Altec and Terex have done a good job with their anti-idle systems,” Pellissier continued. “However, we need to extend this to other vehicle types. Our relationships with Altec, Terex and Odyne are part of our sustainability commitment to deploy alternative vehicle technologies that promote reduction of emissions and fuel consumption in appropriate work task applications.”

First Hybrid
After deploying several Altec JEMS systems, NV Energy looked for other opportunities and fielded its first truck with a hybrid system for use in the utility’s gas operation. The truck was ordered under the U.S. Department of Energy/South Coast Air Quality Management District EPRI grant awarded to Odyne to deploy 120 vehicles throughout North America.

For the next round of vehicles in the new EPRI program, the company ordered three more trucks. Two of the trucks are crew cab International models similar to the first unit, with hybrid systems to power a Vanair under-chassis air compressor and to supply power for 12- and 110-volt electrical needs. The other vehicle is a Class 7 standard cab International with a hybrid system that will power a vacuum unit, a high-pressure washer, an air compressor and a grease pump for gas valve maintenance work.

Odyne’s plug-in hybrid systems interface with Allison 3000 automatic transmissions to help save fuel during drive cycles and to provide 10,000 watts of power for stationary operations at work sites. The systems, which consist of 14.2-kWh or 28.4-kWh Johnson Controls’ lithium-ion battery packs and Remy HVH250 electric motors, are installed by Odyne and shipped to final stage manufacturers such as Altec and Terex.

Recently, Pellissier participated with EEI and other utility fleet leaders to draft a white paper making the case for utilities to increase their support of electric plug-in hybrid vehicles and systems. This paper was delivered to attendees at the EEI Annual Convention held in Las Vegas in June.

Managing the Fleet
As a former fleet manager and now a manager of process improvement, a relatively new role, Pellissier supports the NV Energy fleet on behalf of the company’s vice president of electric delivery. Victor Figueredo, director of transmission and distribution support services, oversees direct management of the fleet. Reporting to Figueredo are four fleet supervisors – Jeff McKenzie and Tom Rich in northern Nevada and Todd Seibert and Randy Koss in southern Nevada. The management team also includes a fleet administrator and a coordinator.

“We have two shops in Las Vegas, one in Reno, and five mechanics assigned to shops in small towns or at power plants,” Pellissier said. “There are also mechanics with mobile maintenance trucks who work in the field or at one of several unmanned shops. We constantly have crews assigned to work on long-term construction projects, so that too presents a challenge for the fleet department. When these projects start, we usually have a mechanic on-site for the duration of the project to ensure all vehicles and equipment are performing as expected.

“With vehicles spread out across such a large territory, it can be difficult to keep up with maintenance and compliance,” Pellissier continued, “but we have a zero tolerance for compliance items beyond the due date. Much of our repair work is outsourced due to staffing limitations, so it’s very important that we do the best maintenance we can to minimize repairs to the greatest extent possible.

“When it comes to preventive maintenance, the fleet department is challenged with getting vehicles ready for service,” Pellissier explained further. “Without the mandatory compliance issue, it is difficult to get vehicles serviced before they are considered overdue, but we have set up reporting to monitor compliance and maintenance scheduling.

“We have a complex vehicle fleet in order to meet NV Energy’s operational needs in a wide-ranging and diverse service area,” Pellissier concluded. “In addition to maintaining the fleet effectively, we continue to monitor and evaluate emerging and maturing technologies and new vehicle options, and introduce technology when it is cost-effective and applicable to the needs of NV Energy.”

About NV Energy: NV Energy Inc. provides a wide range of energy services to 1.3 million customers throughout Nevada and nearly 40 million tourists annually. NV Energy is a holding company whose principal subsidiaries, Nevada Power Co. and Sierra Pacific Power Co., do business as NV Energy. The company is headquartered in Las Vegas.

About the Author: Seth Skydel has more than 28 years of truck- and automotive-related publication experience. In his career, he has held editorial roles at numerous national business-to-business publications focusing on fleet and transportation management, vehicle and information technology, and industry trends and issues.

Tag: Management