July 2008, Government Fleet - Feature
Kern County Outsources Collision Management
By Mike Scott
The number of government agencies outsourcing accident management to third parties such as CEI is growing, according to Kathi Croze, national manager of government accounts for the Trevose, Pa.-based organization. One of the more recent is Kern County, Calif., which sought CEI’s services after learning about the success the City of Gainesville, Fla., experienced with "out-tasking" its collision repairs.
"We’ve been serving corporate fleets for 25 years, but third-party collision management is a new concept for government fleets," Croze said. "But once they get started, it doesn’t take long for them to see just how wide-ranging the benefits can be."
Out is the Way In
Collecting money in a case of subrogation is like pulling teeth, said Larry Werts, fleet services manager for Kern County, Calif. While the time it takes to pursue those funds internally can be extremely time-intensive and ultimately not worth the effort, outsourcing that service to an outside vendor could be valuable, Werts said.
"Our goal as a department is to get leaner and meaner," Werts said. He has also outsourced such services as fueling stations and the use of a rental car company in certain cases. "We used to do everything in-house, but labor and training costs make that extremely inefficient."
Werts began outsourcing accident management in May 2007 and is able to put damaged vehicles back on the road in the same or less amount of time it took to secure a bid for a major repair.
Less Time Spent Means More Money Saved
The reason is that CEI enables fleets to avoid the typically weeks-long competitive bidding process. Over the long run, this time savings can amount to triple-digit hours and more than $100,000 in recovered employee productivity.
Instead of seeking and reviewing bids, Werts and his staff receive an e-mail from CEI requiring approval for a repair estimate. They can log onto a secured account to provide their answer.
"We essentially can start the repair process online with a click of the mouse," Werts said. "It allows us to concentrate our time and efforts on other responsibilities such as basic vehicle maintenance and repairs."
Generating analytical reports on accident data is also streamlined, with reports created several times faster than internally produced versions.
This automated system allows governmental agencies to analyze department trends, including data on specific drivers, common or frequent types of accident repairs, and more. It also provides easier management of damaged vehicle photos and all the claim documents necessary in the pursuit of third-party damage claims.
"Outsourcing assures the recordkeeping is up-to-date and accurate," said Werts.
The biggest challenge to outsourcing accident management is getting approval from fleet management superiors, Werts said. Developing a logical plan demonstrates potential short and long-term cost savings will help convince a board to outsource.
"Our board realized accident management is very time- and labor-intensive, so if you can develop a solid request for proposal, it shouldn’t take much time to get them on your side," Werts said.