Proactive cost control can help construction fleets considerably when it comes to staying competitive in the market, but the industry is grappling with the rising costs of materials and the challenge of retaining employees. While inflation poses an obstacle to accurate budgeting, fleets can strategically extend the lifecycles of their assets through optimized PM schedules to offset that. Similarly, investing in employee retention programs not only results in significant cost savings in the short term, it also forms the bedrock of long-term success.
EMPLOYEE TURNOVER CAUSES
Companies that nurture their employees financially and in terms of personal growth witness higher retention rates. Investing in your workforce not only mitigates expenses, it also cultivates a loyal and skilled team. But what are some of the underlying causes of high turnover? Typically, high turnover is the result of employee frustrations, either with the job itself, coworkers, bosses, or simply not having the right tools for the job.
Productivity loss can be extremely frustrating for many employees, especially when there isn’t clear communication about both the cause and solution. Extended asset downtime is one such cause. Being sidelined due to a frequently downed asset can send the message that employees must work with the bare minimum to do their jobs, and that really isn’t a sustainable method of business.
For employees who rely on their vehicle or a piece of equipment to perform their job, unexpected calls about taking their asset to the shop can negatively impact the workday. Lack of awareness about maintenance schedules and service locations hinders operational efficiency and can cause or exacerbate employee frustrations. Delayed invoice approvals, which contribute to prolonged wait times, can be yet another source of frustration among employees.
Understanding and acting on employee frustrations can help keep the workflow running smoothly and improve employee retention rates.
IMPROVING TCO
Total cost of ownership (TCO) is a comprehensive metric covering not only the initial purchase cost of an asset, but also service, fuel, insurance, and even employee-related costs of running that asset. TCO can be heavily impacted by maintenance and repair costs, as well as downtime and these factors, in turn, can drive down an asset’s ROI—as well as safety.
Many fleets are seeing valuable results in delegating some service tasks to third-party shops based on issue priority and available resources, which helps ensure assets get back on the road quickly. For fleets servicing their vehicles 100% in-house, having a well-stocked parts inventory can help reduce shop delays.
Creating a PM schedule that meets your assets’ needs and transitioning to proactive maintenance methods can cut both repair costs and unexpected downtime drastically. Extending an asset’s useful life through proactive, tailored maintenance can improve asset ROI and save you from having to recycle it for another two to three years.
UTILIZING SOFTWARE
Fleet management software (FMS) and other fleet solutions can help construction fleets evaluate employee engagement, streamline service workflows, and automate data collection, providing a comprehensive view of expenses so they can make data-driven decisions around cost control. Fleet solutions provide a means of categorizing and sorting data so you can easily see a breakdown of expenses at the fleet level, at the individual asset level, or even by vehicle group.
Using FMS, fleets can easily determine asset lifecycles, including when it’s time for replacement. “We use [fleet data] reports whenever we’re looking to phase out certain assets,” says Matt Milacki, transportation & fleet analyst, Newpark Mats. “Really looking at the mileage, if there’s been any existing issues, and then that all kind of ties together with the historical maintenance.” Using this data to ensure assets are being replaced at the optimal time helps inform your employees that their safety is a priority.
Fleets can also use FMS and other solutions to calculate and manage unscheduled downtime. “I try to run about 25-percent down at any given time with my ebikes—just because they’re a little more intense. But with the UTVs, I try to run about 15 percent that can be down at any given time,” says Kade Haney, fleet manager, Kualoa Ranch. “We go over that, we go into overtime. [The downed percentages are] numbers I created because of [FMS], because I can see what’s up, what’s active, what’s down, what’s outsourced, [and those percentages] are purely unscheduled downtime.” This can help immensely when it comes to creating a breakdown plan to minimize lost productivity.
FMS can prove a valuable tool when it comes to improving service workflows—whether for in-house, outsourced, or mixed maintenance fleets—to minimize downtime and lost productivity. Digital work orders allow in-house technicians to clock in and out of a job, add parts from their inventory, and communicate within a specific task for improved transparency.
Fleets outsourcing service can take advantage of an FMS’s Outsourced Maintenance Automation (OMA) feature to set auto-approvals based on dollar amount or service type so employees can get in and out of the shop quickly. Michael Farr, fleet maintenance manager, Wildfire Defense Systems, explains: “When it comes to our chassis, we actually rely on the [OMA] feature pretty heavily to go with in-network providers. It makes things so much easier for the operators because they don’t have to call in with an estimate or anything like that. It gets sent directly to me or to my technicians. We get to vet it right away, we get to make sure the pricing’s all in line, we get to make sure it’s due.”
CLOSING THOUGHT
Understanding the underlying causes of cost inflation in your fleet can help you better control cost and more accurately create future budgets. Construction fleets can use FMS and other fleet solutions to drive down two of the biggest cost concerns, employee turnover and asset service, and hone in on and address other areas of inflated spend.
About the Author:
Rachael Plant is a content marketing specialist for Fleetio, a fleet management software company that helps organizations track, analyze, and improve fleet operations. For more, visit www.fleetio.com.
Modern Contractor Solutions, January 2024
Did you enjoy this article?
Subscribe to the FREE Digital Edition of Modern Contractor Solutions magazine.
