Centralize Management of the Fleet
Controlling costs of fleet management is one of the most crucial issues facing fleets of all sizes today. In the past few years, state and local government and utility budgets have been caught in a financial squeeze. That’s no surprise to anyone managing fleets.
What may be a surprise, however, is what government and utility fleet managers are doing about it, according to Michael E. Corbett, Publisher, California Fleet News, a fleet industry newsletter.
Some cities have resolved fiscal problems by privatization of fleet maintenance in order to obtain substantial savings.
In other cities and counties, executives are questioning the logic of two fleet organizations such as a general county fleet organization and a sheriff’s fleet organization. A Southern California county studies the consolidation of its fleets with the potential for modernization and annual savings in the millions, according to Corbett. Over time, some jurisdictions have gained substantial savings through modernizing and consolidating fleets. Another means of savings is to question the practices that remain part of the status quo, or the “because we’ve always done it that way” justification, Corbett said.
Too many units of government is an obvious item in this protected category. Numerous transportation, water quality, and growth control agencies complicate the ability to face problems squarely, let alone be efficient with the taxpayer’s dollar, according to Corbett.
What is occurring is the “sacred cows” are headed for the chopping block. The theory is that essential services needn’t be sacrificed if the “sacred cows” are questioned and tackled first.
Continued decentralized law enforcement, fire, public works, airport and other fleet services departments within the same jurisdiction keep fleet management costs escalating at a time when centralization of the fleet function is one of the most promising actions a jurisdiction can take to cut long term costs, according to Corbett. Duplication of services and administrative functions also drains budgets.
A general trend has slowly emerged for the past fifteen years to centralize the fleet and manage it as a business operation using internal service or “revolving funds,”according to Corbett. By doing so, price-competitive models can be developed for easy comparison of costs with the private sector.
Centralized fleet management has long been viewed as a means of getting economies of scale in jurisdictions that have relatively small fleets, Corbett reported. The best benefit of the approach is decreased total cost for the jurisdiction’s fleet function combined with a more coordinated asset management and vehicle purchasing policy.
Jurisdictions have found that concentration of effort in one organization can result in improved management, in successful specialization, in uniform policies, in more complete inventories and in cost-justified, specialized repair facilities and services, according to Fleet News. Results suggest that centralization can be an enormous help to government and utility organizations in streamlining fleet management and making substantial savings.
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