Face to Face with Berendsen and Unilever: “It’s all about data on four wheels”
For the latest in our ‘Face to Face’ series, we brought together two international fleet managers based in the UK. Despite different fleet types, they are both aiming for the same results in terms of optimisation and future trends.
The meeting took place in London, between Marylebone and Baker Street. Quite a setting, for a number of reasons. Firstly, London is a trend-setter in terms of the environment and cars – its famous ‘congestion charge’ has been looked at by many other cities as a way of improving urban life. A topic not to be under-estimated by our fleet manager pairing… Secondly, Baker Street has several claims to fame in its own right. It was the home of Arthur Conan Doyle’s infamous detective Sherlock Holmes; it was for decades the headquarters location of iconic British retailer Marks & Spencer; and it was of course also eternalized in a song by Gerry Rafferty. It was here, in the heart of one of the busiest cities in the world, that Lee Warner of Unilever and Robert Hitchcock of Berendsen, mulled over successful vehicle fleet policies across Europe and the world.
STRATEGY AND POLICY
Do you have a true international fleet policy?
Not yet. We have continued with a system which is localised, but together with HR we are working on building up an international fleet policy from the base upwards. Aspects such as safety are obviously present in each market, sometimes with very good policies – but now we will draw these together with minimum basic requirements and develop a strategy driven by centralised guidelines.
We now have an international framework in place. But it took time and effort. We saw the benefit of having a centralized structure that gives guidance for local entities about key elements like eligibility, supplier recommendations, CO2 and safety. We did not have a truly international fleet policy in place, so we brought this to the attention of senior management and really started driving it through. We had to get buy-in at this level and then communicate this to the local markets. Then we had to align local policies with the global policy which was quite an exercise. We started the roll out with our key markets and our most difficult ones.
What has been the biggest obstacle you have faced, and how did you overcome it?
Gaining information and the lack of available data about our fleet when I joined. It was not a green field area but not a mature area at all. We had to pull in information from each market, even basic date up to the level of number of fleet vehicles. Today we have a good view, although there is still progress to be made. Another issue was not engaging key stakeholders early enough in the process of change can cause substantial delays to the delivery date of the project.
For me, getting agreement for the international policy and also pulling together data, which was fragmented data and had to come from the local markets. We worked on a data gathering project to have a central consolidated view, which we now have. Overcoming these and implementation problems has to be done by having the most senior buy-in possible in divisions like procurement, HR, finance, so that the local managers know it is a company policy.
What have you been most proud of over the past year or two?
A major success is the implementation of telematics and cameras in the commercial fleet. We started in the UK. We have seen a massive and consistent improvement in the number of incidents and accidents between 60 and 70%, fuel efficiency improved, we saved 2,000 tonnes of CO2, while speeding dropped almost to zero. If you can measure it, you can improve it. We will move this out from the UK to other countries, we are trialing in Germany at the moment. It’s essential you communicate telematics as an improvement tool and not use it as a Big Brother.
For me the success story is about the implementation of a centralized system to really track costs – especially vehicle capex – in each market, especially the emerging markets, where this was not easy before. This is now in a central location and business cases have to be presented and assessed before spend. This took about six months to roll out, but we now have a good view and control on fleet spend. Also here, it’s crucial to underline the benefits for a successful roll-out. You can’t just come in with ‘this is what you need to do cause we from international are saying so’.
Staying with telematics, how do you ensure that the suppliers’ fine words are translated into reality, and gain acceptance in the fleet?
We trialed everything first on a small number of vehicles. We used the first weeks of testing to set the baseline. Important is to know which type of data to present to the different audiences within the company, so they can see what interests them. Towards the drivers, I went personally to them in order to explain the system and its benefits. Correct driving backed up by a camera system helps clear up cases quickly. If you have a large commercial fleet, I even see telematics as a must. And I mean this in a positive way.
We don’t have telematics, it’s to say we only have in a few remote markets, and in Russia and Poland. This is driven via our local safety teams, and they report in the global safety team. But in the FMCG industry telematics is seen as Big Brother. It’s not on our radar at the moment.
How do you gather the data you need, and what extra data would you like?
What I would really like is a full contract management system, so I can see exactly where we are with the cars and their operation. It’s all about having lease cost trackers, to see whether it’s rising or falling. We need to see which KPI is causing a trend.
We outsource the data we receive from our suppliers to a third party, which compiles it for us on a quarterly basis. A third party has no bias, so the data is neutral. What we most need to track is those elements which are outside the pure lease cost who tend to stay fixed unless you change contracts – business and private mileage and so on, those elements which move, we have to keep on top of that. And then for contracts the markets that are early terminating or recalculating vehicles, do they know where they are heading to and what this will cost.
What is the next big value-creator in your sights?
There are many opportunities, and alternative fuels figure in this. And anything you can do to reduce the number of vehicles or improve driver behaviour and reduce amount of fuel used is cost saving. But also right-sizing and optimizing vehicles are vital issues.
We completed the OEM and lease tender, now we also have to look at fuel. We have started to consult on fuel procurement and usage in our key markets. We will start new tenders probably early next year.
GREEN AND MOBILITY
What green fleet initiatives have you developed?
It is our international policy to have a carbon emissions reduction policy in place. So our first step was to roll out an international policy to cap emissions, at 120 grams for work cars and 140 grams for benefit vehicles. Our next project is to be 100% EV/hybrid by 2030. We need to profile drivers to get the best vehicle fit. We want a further CO2-cap reduction of about 30%.
We are also rolling out a CO2 cap, and working hard on driver behaviour. We are also seeking EV and hybrid solutions, although this is difficult for CV’s. Another important factor is to make sure drivers actually plug hybrids in and use them correctly.
How do you see the company car evolving over the coming years?
People are no longer going to be satisfied with just a company car for 5 or 6 years. They will want to be more flexible, be able to take a train when their app tells them the traffic is crazy. Everything is technology now. And it will not be only a company car anymore. A mobility budget is likely to be the way things go.
The market will decline unless large companies adapt their policies to alternative fuels and so on – in line with local regulations. Cash alternatives to the car might look more attractive in certain markets. We have to see where the tax situation is going to. It’s moving every day. It’s a difficult one to navigate through. The more complex it will get, the easier it will be for the younger generation to take the cash and sort things out for themselves, but also within a framework. You don’t want to have your people select Ferrari’s or used and unsafe cars.
With alternatives such as ‘cash for car’, how do you deal with safety and compliance?
We have a cash policy in place which restrict the age of the car, and obliges the employee to make a choice within certain limits. The data is checked every year. Accident data has to be reported, even in a car you have bought yourself.
It is important to ensure that the local teams understand why certain rules are important, especially in terms of safety. We also have rules which say you can’t use a ‘cash car’ for certain types of travel – you have to take an approved rental car.
Is there one element of mobility which you believe is the most important for you?
I think potentially that car-sharing and car-pooling are the way ahead. For those who buy their own car, this is a way of getting some money back. And technology gives them the flexibility to adapt. We have some mobility pilots in the Netherlands, also with regard to the mobility budget.
I can’t pick out one thing, as it depends on employees’ geographical location and financial circumstances. Car-sharing may work in urban areas, but many of our plants are of course not in city centres… Therefore we tend to test new ideas in the Netherlands. What’s important is that you can built flexibility in.
In the light of all this, how do you see the future of the role of fleet manager?
The whole domain is going to become more and more data driven, which will require more skills to understand. But the personal side of things will still be necessary, relationships. But the way things are going, fleet management will become mobility or even information management.
There are going to be different solutions developed in different markets, and this is going to make it harder to see a single way forward. Safety, sustainability and employee retention will still need to be key however, despite all the data-driven policies. Fleet is going to come into the travel department.
- Company activity: Textile, hygiene and safety solutions
- Function: Group Procurement Category Manager - Mobility
- In post for: 1 year
- Number of vehicles: 1,400 cars, 700 CV’s
- Countries: 16
- Main funding method: Operational leasing
- Reports to: Director of Procurement
- Company activity: Consumer goods
- Function: Global Fleet Manager
- In post for: 2 years (11 years with Unilever)
- Number of vehicles: 13,500 globally (7,000 in Europe)
- Main funding method: Operational leasing
- Reports to: Global Travel Director
Authored by Tim Harrup & Steven Schoefs