By Mike Antich

One difference between commercial and public sector fleet managers is the degree of scrutiny given to their fleet operations. Commercial fleet managers are scrutinized by their management and drivers and have direct dealings with HR, purchasing, sourcing, and a multitude of other departments. However, it is rare for the actions of a commercial fleet manager to be discussed by the local media or be an agenda item at a legislative meeting.  

With the decline in tax revenues, public sector fleets are increasingly scrutinized under the public microscope by management, politicians, and taxpayers. More and more state and municipal fleet managers are finding themselves in the public spotlight.

Adjusting to Budgetary Shortfalls

Without a doubt, the number one issue confronting public sector fleet managers is the current economic downturn. This is prompting adjustments to cope with budgetary shortfalls due to sharp declines in tax revenues. The fleet budget, always a perennial issue, is especially problematic in 2009 and will become even more so in 2010. Deep budget cuts to compensate for revenue shortfalls are occurring at all levels of government. Expenditures are being frozen at all levels. This includes hiring freezes; travel restrictions; reductions in capital purchases, construction projects, and out-of-town training; and even layoffs.

The implications are enormous for fleet operations, since most fleet budgets are already operating at bare-bone levels. In a cost-cutting environment, brought on by tax revenue shortfalls, all expenditures are subject to challenge. In addition, user groups likewise are being confronted with reduced budgets, impacting fleet operations through reduced expenditures on transportation and equipment operations. The decline in tax revenues and the perception of fleet as an expense is prompting many taxpayer groups or politicians to zero in on fleet operations to slash costs. Some politicians advocate the need to privatize certain aspects of fleet operations to be competitive with the private sector.

Along with reduced funding come associated process reviews to maximize efficiencies such as vehicle utilization, fleet right-sizing, take-home vehicle monitoring, and enhanced fuel-use monitoring. Fleet managers are re-examining equipment lifecycles and utilization as politicians advocate extending lifecycles "one more year." Unlike commercial fleet managers, public sector fleet managers must deal with politicians, especially the newly elected "fleet expert" who assumes fleet operations is not run efficiently. A common (and ongoing) perception among public officials is that anyone can run a fleet -- no special talents or skills are involved. Fleet management is not viewed as a complicated and sophisticated profession, requiring expertise in a multitude of areas. Educating politicians about the intricacies and nuances of fleet management is an ongoing struggle.

Perception vs. Reality

Many senior managers and politicians think they understand fleet, but really don't. "After every election, my expertise and loyalty are questioned by a newly elected official who is going to 'fix' his or her misinterpreted belief that we're wasting tax revenue. After managing a public sector fleet for 20 years, I can plan that approximately every five years, I will need to spend hundreds of hours of labor proving we're fiscally responsible."

This same frustration was expressed by another fleet manager. "What I like least is pandering to people who have authority or influence, but don't have the knowledge to make sound recommendations or decisions. They deal only in perception."

The scrutiny on state and municipal fleet managers isn't just coming from elected officials and taxpayers; it is also internal user departments. In an era of declining revenues and the need for across-the-board budget cuts, there is growing competition for limited resources between user departments, with fleet in the middle. This competition for scarce resources promises only to increase next year as budgets tighten further. In this type of fiscal environment, the challenge for fleet managers is how to maintain and achieve customer service level objectives, while cutting costs.

Anonymity No Longer Exists

At one time, there was anonymity in being a public sector fleet manager - no more. Years ago, fleet was not high on the radar screen. However, as fuel costs, emission-reduction mandates, liability issues, new regulations, and escalated productivity demands, along with ongoing personnel, vehicle, and maintenance costs, senior management started to pay attention. In addition, computerization of fleet data has created easy accessibility to this data, which facilitates scrutiny of fleet operations. Considering the increased scrutiny, it is now harder than ever to be a public sector fleet manager.

Let me know if you agree.

mike.antich@bobit.com

 

Author

Mike Antich
Mike Antich

Editor and Associate Publisher

Mike Antich has covered fleet management and remarketing for more than 20 years and was inducted in the Fleet Hall of Fame in 2010.

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Mike Antich has covered fleet management and remarketing for more than 20 years and was inducted in the Fleet Hall of Fame in 2010.

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