General Services Academy V Competitive Fleet Services

1. General Services Academy VCompetitive Fleet Services September 19, 2007 JOHN CLEMENTS, FLEET MANAGER SAN DIEGO COUNTY

2. “Without Continual Growth and Progress, Such Words as Improvement, Achievement, and Success Have No Meaning”Benjamin Franklin

3. WHAT ARE WE GOING TO TALK ABOUT? • WHO WE ARE • HOW DID SAN DIEGO COUNTY FIND THE SPIRIT OF COMPETITON? • WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE? • WHAT DOES THE COMPETITION LOOK FOR? • CAN COMPETITION BE GOOD? • CAN COMPETITION BE BAD? • FINAL THOUGHTS

4. SAN DIEGO COUNTY HAS IT ALL • 3 MILLION POPULATION • 4,260 SQUARE MILES • 17,000 COUNTY EMPLOYEES/35 DEPARTMENTS • BEACHES, FOOTHILLS, MOUNTAINS, DESERTS • SUN TAX – HIGHEST COST OF JUST ABOUT EVERYTHING

5. FLEET MANAGEMENT WHO? • 3,850 VEHICLES • 8 MAINTENANCE FACILITIES • 21 REFUELING STATIONS • 58 FLEET POSITIONS • BUDGETS: • MAINTENANCE - $9 MILLION • FUEL - $10 MILLION • EQUIPMENT ACQUISITION - $14 MILLION

6. SAN DIEGO COUNTY FLEET MANAGEMENT VISION: We will be recognized by our customers as a valuable partner and as their preferred service provider MISSION: To exceed our customer’s expectations in providing complete vehicle services in a safe, responsive, efficient, environmentally sound, innovative and cost-effective manner GOALS: To be the Vendor of Choice for our customers, the Employer of Choice for our employees and an Industry Leader to our peers VALUES: *Pride – In the work we do*Honesty – In all of our transactions*Integrity – In our business, customer and personal relationships*Focus – On our mission and vision*Respect – For ourselves. fellow employees and customers*Safety – In our work practices*Quality – Our ultimate product will be the best*Creativity – Always seeking ways to improve*Professionalism – Know our business well*Communication – To provide information accurately and timely *Environmentally Sensitive – Continuous steps to protect and preserve our environment

7. OUR STORYWHERE WE WERE • 2 SEPARATE FLEETS – GENERAL SERVICES AND PUBLIC WORKS • DUPLICATE FLEET ADMINISTRATIONS • SEPARATE BUDGETS – GENERAL FUND AND STATE GAS TAX • SHARED FLEET MANAGEMENT INFORMATION SYSTEM AND AUTOMATED FUEL SYSTEM • DUPLICATE PARTS SYSTEMS SUPPORTED BY CENTRALIZED PURCHASING DEPARTMENT • “NOT THE BEST” CUSTOMER SERVICE

8. OUR STORY…WHERE WE ARE TODAY • CENTRALIZED FLEET MANAGEMENT BY GENERAL SERVICES • MAINTENANCE PROVIDED BY MANAGED COMPETITION BUSINESS UNIT • SINGLE REFUELING INFRASTRUCTURE • PARTS SYSTEM ADMINISTERED BY NAPA • CENTRALIZED BUDGET UNIT • IDENTICAL CHARGING AND BILLING STRUCTURE • STANDARDIZED VEHICLE ACQUISITION PROGRAM WITH FORD MOTOR COMPANY • STRONG CUSTOMER SERVICE PROGRAM

9. OUR STORY…SAN DIEGO COUNTY MANAGED COMPETITION PROGRAM • OFFICE OF MANAGED COMPETITION AND REENGINEERING ESTABLISHED IN 1998 • MANAGED COMPETITION CRITERIA • SIZE OF PROGRAM – STAFF AND BUDGET • PRIVATE SECTOR COMPETITION – “YELLOW PAGES TEST” • POTENTIAL FOR SAVINGS • LEGALITY OF CONTRACTING • FORMAL PROCESS FOR BIDDING, EVALUATION, AND AWARD OF CONTRACT ESTABLISHED

10. OUR STORY…SAN DIEGO COUNTY MANAGED COMPETITION PROGRAM HOW DID WE WIN? WE ANSWERED ONE QUESTION… IF WE WERE TO START THE FLEET MAINTENANCE UNIT TODAY – HOW WOULD WE DO IT?

11. OUR STORY…FLEET BIDDING STRATEGIES • RUN FLEET MAINTENANCE LIKE A PRIVATE BUSINESS – NOT A GOVERNMENT • IDENTIFY “TRUE COST” OF DOING BUSINESS • INCENTIVIZED WORKFORCE • FULL UTILIZATION OF ALL FLEET MAINTENANCE FACILITIES • STAFF FOR NON-PEAK WORKLOAD • PUBLIC/PRIVATE PARTNERSHIPS • SHIFT OF MAINTENANCE EFFORT FROM REPAIR TO PREVENTIVE MAINTENANCE • REDUCED OVERHEAD

12. OUR STORY…A NEW WAY OF DOING BUSINESS! • REDUCED STAFF FROM 79 TO 60 BY ZERO BASING WORKLOADS, INCREASING PRODUCTIVITY, NOT STAFFING FOR PEAK WORKLOADS, AND REDUCING PARTS STAFF • CONSOLIDATED FLEET MAINTENANCE FACILITIES FROM 10 TO 8 • PART-TIME STAFFING FOR 2 OTHER MAINTENANCE FACILITIES • PRIVATIZED AUTOMOTIVE PARTS SUPPLY – NAPA • RECLASSIFIED MAINTENANCE POSITIONS WITH ASE CERTIFICATION REQUIREMENT • SERVICE LEVEL AGREEMENTS WITH CUSTOMER DEPARTMENTS • STANDARDS OF MAINTENANCE

13. OUR STORY…NEW BUSINESS CONCEPTS INTRODUCED IN THE COUNTY • CLASSIFYING VEHICLE MAINTENANCE BY RESPONSIBILITY – TARGET (PREDICTABLE) VS. NON-TARGET (UN-PREDICTABLE) • GUARANTEED MAXIMUM PRICE CONTRACT FOR VEHICLE MAINTENANCE • PAY FOR PERFORMANCE AT THE EMPLOYEE LEVEL • GAINSHARE AND INCENTIVE PAYMENTS AND/OR DEDUCTIONS • DIRECT BILLING FOR VEHICLE MAINTENANCE SERVICES

14. OUR STORY…NEW BUSINESS CONCEPTS INTRODUCED IN THE COUNTY… • PREVENTIVE MAINTENANCE • 95% OF ALL PM SERVICES COMPLETED WITHIN 30 DAYS OF SCHEDULE • VEHICLE DOWNTIME • 5% - LAW ENFORCEMENT • 5% - LIGHT DUTY VEHICLES • 8% - HEAVY DUTY VEHICLES • 12% - CONSTRUCTION EQUIPMENT • REPAIR TURNAROUND TIME • 70% OF ALL TARGET REPAIRS COMPLETED WITHIN ONE DAY OR LESS • 90% OF ALL TARGET REPAIRS COMPLETED WITHIN 3 DAYS OR LESS CONTRACT PERFORMANCE STANDARDS

15. OUR STORY…HOW ARE WE DOING OPERATIONALLY? • SUCCESSFULLY IMPLEMENTED MANAGED COMPETITION BUSINESS PLAN • CHALLENGE AWARD - CALIFORNIA STATE ASSOCIATION OF COUNTIES (CSAC) • 100 BEST FLEETS AWARD –GOVERNMENT FLEET MAGAZINE (TOP 5 2005 & 2006) • BEST PRACTICES AWARDS - CALIFORNIA FLEET NEWS • ALL MANAGED COMPETITION PERFORMANCE STANDARDS BEING MET OR EXCEEDED • QUALITY FIRST PAYOUTS AVERAGING 3.75% (4% MAXIMUM)

16. OUR STORY…HOW ARE WE DOING FINANCIALLY?

17. OUR STORY…HOW ARE WE DOING WITH OUR CUSTOMERS? • CURRENT CUSTOMER SATISFACTION RATING OF 4.7 (5 POINT SCALE) • CUSTOMER SATISFACTION MEASURED BY: • FORMAL SURVEYS • INFORMAL SURVEYS – MIRROR HANGERS • MYSTERY SHOPPERS • CUSTOMER SERVICE PROGRAMS • FMIS ACCESS • QUARTERLY MEETINGS • FOCUS GROUPS

18. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE? • TRUE COST • ORGANIZATIONAL PROCESSES • CUSTOMER SERVICE • POLITICAL ENVIRONMENT “COMPETITIVE SERVICES” ARE A BALANCE OF:

19. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE? • BEST VALUE FOR THE TAXPAYERS • BALANCE BETWEEN PRIVATE AND PUBLIC SECTOR SERVICE PROVIDERS • WELL MANAGED • CONSISTENTLY REVIEWED AGAINIST BEST MANAGEMENT PRACTICES WHAT DO COMPETITIVE FLEET SERVICES HAVE IN COMMON?

20. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? ADMINISTRATION “THAT BE YOU!” • ARE FLEET SERVICES PART OF THE BIGGER PICTURE? • ARE FLEET SERVICES CENTRALIZED OR DE-CENTRALIZED? • DO YOU MARKET YOUR ORGANIZATION? • DO YOU ESTABLISH ANNUAL GOALS – ORGANIZATIONAL & PERSONAL? • DO YOU HAVE A FLEET MANAGER’S TOOL KIT? (BUSINESS PLAN, SERVICE LEVEL AGREEMENTS, STANDARDS OF MAINTENANCE, POLICIES AND PROCEDURES, OPERATIONAL INFORMATION, VISION-MISSION-GOALS- VALUES STATEMENT) • DOES YOUR ORGANIZATION HAVE PERFORMANCE MEASURES? • TODAY, WHAT IS THE PERCEPTION OF YOUR ORGANIZATION?

21. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU KNOW THAT PROCESS DRIVES COST? • DO YOU KNOW YOUR “TRUE COST” OF FLEET SERVICES? • DOES YOUR ORGANIZATION CHARGE THE CUSTOMER FOR SERVICES? • DO YOU HAVE A KISS RATE STRUCTURE? • DO YOU HAVE COMPETITIVE RATES? • DO YOU HAVE HIDDEN COST SAVINGS? COST MANAGEMENT “SHOW ME THE MONEY!”

22. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU CARE FOR YOUR STAFF? • DO YOU HAVE PRODUCTIVITY STANDARDS? • DO YOU TRAIN YOUR STAFF? • HOW DO YOU KEEP GOOD STAFF? • DO YOU RECOGNIZE AND REWARD STAFF? • DO YOU KNOW, IT’S ABOUT SAVING STAFF? • DOES YOUR STAFF WORK AS A TEAM? • DO YOU HAVE A (GOOD) SAFETY PROGRAM? STAFF “STILL YOUR MOST IMPORTANT RESOURCE!”

23. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? VEHICLE MAINTENANCE “NOT ALL MAINTENANCE PROGRAMS ARE CREATED EQUAL!” • DO YOU HAVE STANDARDS OF MAINTENANCE? • DO YOU HAVE A COMPREHENSIVE PREVENTIVE MAINTENANCE PROGRAM? • DO YOUR CUSTOMERS AND TECHNICIANS KNOW YOU HAVE A PM PROGRAM? • ARE YOU A “DO IT ALL” FLEET? • DOES YOUR MAINTENANCE OPERATIONS OFFER A WARRANTY? • DO YOU PURCHASE EXTENDED MAINTENANCE WARRANTIES? • IS PREDICTABLE MAINTENANCE PART OF YOUR PROGRAM?

24. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • WHO SUPPLIES YOUR PARTS? • HOW LONG DOES YOUR INVENTORY SIT ON THE SHELF? • DO YOU KNOW THE QUALITY OF YOUR PARTS? • HOW LONG DO YOUR TECHNICIANS WAIT FOR PARTS? • WHAT IS THE WARRANTY BEHIND YOUR PARTS? • WHO PICKS UP YOUR PARTS? VEHICLE PARTS “PARTS ARE NOT ALWAYS PARTS!”

25. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • SHOULD YOU BE IN THE POOL VEHICLE BUSINESS? • WHO SHOULD SUPPLY SUPPLEMENTAL TRANSPORTATION? • WHAT ARE YOUR POOL FLEET NEEDS? • HOW DO YOU CONTROL MY POOL FLEET? POOL FLEETS “RENT A WRECK!”

26. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU HAVE A VEHICLE REPLACEMENT PROGRAM? • DO YOU MANAGE VEHICLE ACQUISITION OR DOES IT MANAGE YOU? • WHAT IS YOUR REPLACEMENT SCHEDULE? • WHAT ARE YOUR PURCHASE PRACTICES? • IS PURCHASING YOUR FRIEND OR FOE? • WHAT TYPES OF VEHICLES DO YOU ACQUIRE? • DO YOU STANDARDIZE YOUR FLEET VEHICLES? EQUIPMENT ACQUISITION “IT’S NOT (ALL) ABOUT LOW BID”

27. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • WHAT IS YOUR SOURCE OF FUEL? • HOW DO YOU PURCHASE FUEL? • WHAT ABOUT THOSE FUEL TYPES? • DO YOU MANAGE FUEL CONSUMPTION? • ARE REGULATIONS GETTING THE BEST OF YOU? VEHICLE REFUELING “TODAYS GAS PRICE = ARM, LEG, FIRST BORN…”

28. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU HAVE GOOD FLEET INFORMATION? • HOW DO YOU CAPTURE FLEET INFORMATION? • DO YOU USE FLEET INFORMATION? • DO YOU PROVIDE FLEET INFORMATION TO YOUR CUSTOMERS? • DO YOUR TECHNICIANS HAVE I.T. ACCESS ON THE SHOP FLOOR? • IS YOUR FLEET INFORMATION SYSTEM THE SYSTEM OF RECORD? • CAN YOU FUNCTION WITHOUT I.T.? INFORMATION TECHNOLOGY “I.T. R US”

29. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU HAVE A SYSTEM FOR REPORTING ACCIDENTS/ABUSE? • DO YOU HAVE ACCIDENT REVIEW COMMITTEES? • HOW DO YOU FUND ACCIDENT REPAIRS? • WHO PROVIDES ACCIDENT ADMINISTRATION? • CAN TECHNOLOGY REDUCE ACCIDENTS? VEHICLE ACCIDENT/ABUSE MANAGEMENT “THINGS THAT GO BUMP IN THE NIGHT”

30. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOU HAVE AN ACTIVE ROLE IN VEHICLE ASSIGNMENTS AND USE? • ARE UNDERUTILIZED VEHICLES TRACKED AND REPORTED? • WHO MONITORS TAKE-HOME VEHICLES? VEHICLE USAGE “USE IT OR LOSE IT!”

31. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • DO YOUR FACILITIES MATCH YOUR WORKLOAD? • ARE YOUR FACILITIES CLEAN, ORGANIZED AND SAFE? • ARE YOUR FACILITIES FULLY UTILIZED? • ARE YOU A FACILITIES MANAGER? FACILITIES “HOME IMPROVEMENT”

32. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? • WILL THE BIG ONE BE THE BIG ONE? • DO YOU HAVE AN EMERGENCY PLAN? • IS YOUR PREVENTIVE MAINTENANCE AND VEHICLE ACQUISITION PROGRAMS PART OF YOUR EMERGENCY PLAN? • IS YOUR STAFF TRAINED FOR AN EMERGENCY? • ARE “YOU” READY FOR AN EMERGENCY? • ARE YOU READY FOR FEMA? EMERGENCY PLANNING “THE BIG ONE WILL COME!”

33. WHAT DO COMPETITIVE FLEET SERVICES LOOK LIKE…? CUSTOMER SERVICE “LAST BUT DEFINITELY NOT LEAST!” • DO YOU KNOW WHO YOUR CUSTOMERS ARE? • DOES YOUR STAFF KNOW WHO YOUR CUSTOMERS ARE? • DO YOU ASK YOUR CUSTOMERS WHAT THEY WANT? • HOW DO YOU TRACK CUSTOMER SERVICE?

34. WHAT DOES THE COMPETITION LOOK FOR? • HIGH COST OF FLEET SERVICES • POOR MANAGEMENT • LACK OF DATA • POOR CUSTOMER SERVICE • QUALITY OF SERVICE • ORGANIZATIONAL STRENGTH • EMPLOYEE DEDICATION AND COMPETENCE • PERCEPTION CAN BE EVERYTHING

35. CAN COMPETITION BE GOOD? • IT CHALLENGES YOU TO BE COMPETITIVE • IT ALLOWS YOU TO MAKE CHANGES YOU NEVER THOUGHT POSSIBLE • THERE IS THE POSSIBILITY OF ORGANIZATIONAL AND/OR EMPLOYEE INCENTIVES ABSOLUTELY YES! BUT –

36. CAN COMPETITION BE BAD? • THERE IS THE POSSIBILITY OF LIMITING CAREER LADDERS AND SUCCESSION PLANNING • IT IS CHALLENGING TO TRACK CONTRACT PERFORMANCE STANDARDS • THERE IS A GOOD POSSIBILITY YOU MAY BE ALONE ABSOLUTELY YES! BUT -

37. COMPETITION CAN BE CHALLENGING! • DO YOU HAVE ORGANIZATIONAL BUY-IN? • DO YOU HAVE A SYNDROME KNOWN AS “THIS IS THE WAY WE HAVE ALWAYS DONE IT” ? • IF WE BID WHAT WE’RE DOING TODAY WILL WE WIN A COMPETITION? • CAN PRIVATE SECTOR PRACTICES SURVIVE IN A GOVERNMENT BUREAUCRACY? • HOW DO WE HANDLE CHANGE MANAGEMENT?

38. FINAL THOUGHTS • IT STARTS WITH YOU, BUT NOT ABOUT YOU! • IT IS THE LITTLE THINGS THAT WILL GET YOU • KNOW THAT COMPETITION EXISTS • KNOW WHERE YOU WANT TO TAKE YOUR ORGANIZATION AND HOW TO GET THERE • NEVER, EVER LOSE YOUR FOCUS ON CUSTOMER SERVICE • YOU CAN NEVER OVER COMMUNICATE • USE PRIVATE SECTOR EXPERTISE TO YOUR ADVANTAGE • DON’T FEAR MANAGED COMPETITION

39. IF YOU WERE TO COMPETE WITH THE PRIVATE SECTOR TODAY… WOULD YOU WIN?

40. COUNTY OF SAN DIEGO DEPARTMENT OF GENERAL SERVICES FLEET MANAGEMENT DIVISION JOHN A. CLEMENTS, FLEET MANAGER 858-694-2878 JOHN.CLEMENTS@SDCOUNTY.CA.GOV