'Clever' companies will retain a fleet manager

Who said fleet managers are a dying breed?

Not according to ex-leasing manager turned fleet manager Craig Watson.

“It’s a short-sighted company that doesn’t employ someone to manage their fleet,” he argues.

“It’s the second largest company cost – any company that doesn’t have someone to manage that cost, especially when it is such a fluid cost with changing fuel prices, vehicle maintenance and accidents, is making a mistake.”

The fleet manager at building maintenance services provider Integral adds: “Return on investment will be 4-5 times a fleet manager’s salary.

"Leasing companies have done a good job of outsourcing, but the clever companies will retain a fleet manager.

“Leasing companies need fleet managers to be beating the drum of the fleet everyday.

"A good fleet manager and a good account manager can get projects going and make real change.”

Watson predicts a resurgence in the position due to growing complexity from alternative fuels and the need to train staff on modern cars.

He also believes fleet managers should take on more than just cars and vans, becoming transport and travel solutions.

After five years working for leasing provider ING, Watson joined Integral in 2005 in his first fleet management role.

He has also worked for Interleasing and spent several years at Daewoo when the Korean carmaker first came to the UK running its own dealerships.

“It was a shrewd move by Integral to bring in a leasing company person.

"I know how dealerships work and how the leasing company works,” Watson says.

That knowledge has provided invaluable as he worked to bring standardisation to the Integral fleet of 1,480, divided equally between cars and vans.

When he joined, the operation was provided for separately across six organisations with no real structure or commonality.

“My initial remit was to ensure we had a fleet that was fit for purpose and cost effective,” Watson says.

Over a six-month period he tipped the policy upside down. Eight leasing providers were cut to just one; in contrast, the three-badge policy was extended to 15 manufacturers.

“I saw the benefits from my leasing experience of having just one leasing provider, especially as a large fleet,” says Watson.

“It gives all our drivers one point of contact with one phone number.

“Drivers are the bit that costs the most money so we try to give them as simple a life as possible. They call that one number for everything and the problem goes away.”

He adds: “As a buyer I can screw any supplier into the ground, but it’s undone if the driver doesn’t understand the process.

"Sole supply for contract hire, accidents and SMR gives us that. The only thing that is outside is fuel, via Arval.”

Integral appointed Venson last month on a three-year contract, replacing previous supplier ING after more than four years.

Although the deal is sole supply, Integral tenders for money on each vehicle every month via a basket of banks.

“We have a hybrid of tender supply and front-end sole supply,” says Watson. “That overcomes any issue on competitive benchmarking of costs.”

He also speaks directly with manufacturers to ensure Integral is getting the best prices.

Although expanding the vehicle options to 15 manufacturers gives employees more choice, in reality two brands – BMW and Audi – dominate, accounting for more than 80% of the car fleet.

Integral runs an open car policy: everything from convertibles to 4x4s is allowed. The company has no fixed policy on CO2 emissions, but Watson persuades staff into more efficient cars by guiding them through the taxation calculations.

“Most drivers don’t know how to calculate company car tax,” he says. “If you do it for them and inform them of the costs, they will choose a lower CO2 car – most people want to minimise tax.”

Fleet calculations are measured on a wholelife cost basis. Watson says it is the only way to properly manage a fleet.

“You can’t buy on cost alone. You have to build in insurance, Class 1A national insurance and fuel to make an informed decision,” he says.

“Price and discounts are the last thing I look at, not the first.”

Integral, like many other companies, took the decision to extend replacement cycles last year due to the rising prices. Its vehicles, largely on three- and four-year contracts, tend not to clock up heavy mileage so it was an easy decision to take.

Now the company is back buying again, but Watson has changed the policy.

“In the past we did long-term deals with manufacturers, but we aren’t now,” he says. “Due to the price volatility, we will do batch deals when we need the vehicles. We will go with the best deal at the time.”

After more than four years at Integral, Watson is ready for his next challenge. He leaves at the end of the month to join rival maintenance firm Morrison as its first ever fleet manager.

First up will be a review of fleet policy ensuring, as he did at Integral, that every vehicle is fit for purpose and chosen on a wholelife cost basis.

“Cars are my hobby and numbers are my best skill – they go hand-in-hand for fleet management,” he says. 

Telematics get green light after trial increases productivity by 10%

Integral’s big project this year will be installing telematics across its essential user vehicles.

Trials began last year with two products in tandem; Integral opted for the one supplied by Causeway which offered all-round capabilities on technical data and vehicle location.

“As a fleet manager, I didn’t want a tracker system – it’s very expensive,” says Craig Watson.

“But from the business point of view it improves productivity.

"For our helpdesk staff, being able to see where our vehicles are in relation to the buildings is where we are improving productivity. So far it’s improved by 10%.”

Half the fleet will be fitted by June, the rest will complete within two years. Every engineer was consulted and given the reasoning behind the decision.

“The key driver is not about measuring their performance, it’s about productivity,” Watson says.

“We do share all the driving data with the drivers, partly due to corporate manslaughter, but also because it is really interesting data.

“We send them a report on the hours driven versus hours worked, top speed and the percentage of time spent speeding.”

He adds: “We don’t just tackle exceptions, we give them the data – it’s about communication.”

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