TERRITORY SCOPE / RESPONSIBILITY

1,300 UNITS

3 Mechanics

4 Mechanics

5 Standby’sUMASS

Amherst2 Standby’s

NOTE: Standby Mechanics not available for regular callbacks due to contract requirements

Revenue Margin Vs. Overhead Cost

1990 2002 2014

Revenue Margin

Overhead Costs

UNSUSTAINABLE!

CONTRIBUTING FACTORS• Directed to push revenue margin as #1 priority

• Preventative Maintenance lowest priority• Upselling and “selling your way out of repair obligations” top priority

• Reduced allotment of labor hours per unit (reduced number of available mechanics), reduced material spending budget for repairs

• Account managers signing on new contracts that are immediately unprofitable (underpriced)• Larger than average mix of old and obsolete units increase complexity of repairs• Mechanic Talent pool issues; reliant on talent provided from local union hall, cannot hire from

outside or violate “seniority” rules when hiring• No Adjustor level mechanics directly available for troubleshooting most complex repair issues.

Reliant on “borrowing” from other supervisors when available.• Steady increase in number of units per maintenance route (continuous increase in Unit-to-

Mechanic ratio)• Geographical challenge – reduced density of units and poor unit-to-mechanic ratio over large

territory directly affects response time to repair callbacks. Significant risk when dealing with elevator entrapments or large/high priority customers that demand quick response time.

Bottom Line: low prioritization of preventative maintenance >>>>> increase in callbacks >>>>> less time available for preventative maintenance >>>>>> vicious cycle >>>>>> unhappy customers >>>>>> cancelation of contracts