By Matt Dyer, Commercial Director, LeasePlan UK Limited - An extract from the Managing your Company Cars book edited by Colin Tourick and produced in association with Fleet News
Please introduce yourself and your company
LeasePlan is a Dutch financial services company focused on fleet management. We have grown to become the world-leading provider of fleet management services and are now active in 30 countries. LeasePlan employs more than 6,000 dedicated people who deliver on the company’s client promise ‘It’s easier to leaseplan’.
LeasePlan UK was established in 1979 and now operates a UK fleet in excess of 125,000 vehicles (32,000 commercial vehicles). LeasePlan UK provides dedicated services to specific market segments through its four brands – LeasePlan, FleetLine, Network and Automotive Leasing. LeasePlan UK combines market-leading, innovative yet practical vehicle leasing solutions with operational efficiency and delivers total fleet cost management and market-leading customer service.
I have been with the LeasePlan Group for 15 years and worked in roles at a national, corporate and international level. In my current role as Commercial Director, I am responsible for the commercial strategy of LeasePlan UK and the associated account management and business development activities across all of our brands.
Why is fleet strategy important?
As the dust settles and the global economy stabilises, some companies have raised the question of whether it really is possible to have a long-term vision for fleet, or if fleet management is simply a case of navigating a path through the various issues and challenges that are presented by external forces, such as fiscal measures or the economic climate.
There is a growing realisation in many businesses that immediate commercial imperatives can converge with broader goals.
As fleets seek ways to reduce operating costs, they are finding a surprising compatibility with longer-term objectives associated with themes such as the green agenda. In turn, many are now resurrecting initiatives and resetting their objectives.
Indeed, short-term priorities are now being used by some fleets as a catalyst to accelerate long-desired change. Greener car policies have been implemented in the name of cost control.
Scarcity of credit has forced many fleets to look at contract extensions and therefore properly assess optimum replacement cycles.
Remuneration and employee benefits have been reappraised as the retention of talent takes on a new perspective – that of reducing the cost of keeping good people employed, rather than being forced to make them redundant.
What all of this demonstrates is that there is real value in clearly defining long-term aims for the company fleet in the context of wider business needs.
Undoubtedly, plotting a course to achieving those aims may not be as simple as drawing a straight line. There will always be short-term issues that require a flexible approach and even a temporary diversion.
However, if action can be taken within a longer-term context, it is often possible to kill two (or even more) birds with that one proverbial stone.
Ultimately, in whatever capacity, the raison d’être of any fleet is to be a tool of the business. Whether for the transport of goods, the sale of products and services, customer relationship management or the attraction and retention of talented people, the fleet exists only to service the business.
Therefore at LeasePlan we believe it is imperative that fleet strategy should always be driven by and be aligned with business strategy.
What defines fleet strategy?
Fleet strategy sets out the business purpose of the fleet and its different components, and guides the management of the fleet in the short, medium and long-term. LeasePlan’s approach is to examine and consider four key elements of fleet strategy:
- Fleet operations determines how the fleet is governed and managed. Decisions taken in this area dictate the total cost of running the fleet.
- Employee benefits defines the role the company car (or the cash alternative) plays as part of the overall remuneration package and assesses whether it achieves the set objectives.
- Regulation and risk management plays a significant role in managing the fleet, especially with duty of care now a major consideration for the company fleet and the ‘grey’ fleet.
- Environmental policy now needs to be considered by all companies, not only because of the focus on carbon emissions but also because of the cost savings associated with reducing the carbon footprint.
How should an organisation develop a fleet strategy?
There are some logical steps you can go through to develop a fleet strategy and implement a fleet policy.
- Establish objectives. What are the objectives of the business and how do these objectives translate into the mobility needs of its workforce?
- Get all stakeholders involved. Who within senior management needs to buy-in to the strategy and policy? Which suppliers will need to be involved in implementation? What do drivers think of the current situation – what is working well and what isn’t?
- Establish priorities for development. What must be done to improve the situation in the short term? What new solutions need to be developed over time to ensure fleet strategy is aligned to meet the longer-term needs of the business?
- Report and manage developments. These objectives and the overall strategy need to deliver valuable results, and if you report the “starting point” and give subsequent updates you will gain wider acceptance of any strategy.