Turning the change of Globalisation into an Opportunity

Understand reality then make reality better

Did you know?• The world’s fastest car is nearly impossible to

park ?

• One nation tops everyone’s list as the home of the world’s worst drivers ?

Why Italy ?If you have experienced driving in other countries, which nationality do you consider to be the worst drivers?

Agenda

• How is Globalisation affecting fleet ?

• What are the benefits for the customer ?

• How do you approach the challenge ?

• What are the stepping stones for success ?

• Questions and Comments

Fleet Managementis a global opportunity

The Big Picture #1There is a Global Trend towards outsourcingand category management

The Big Picture #2• Rapidly increasing attention to corporate

social responsibility on a global level

• This is directly linked to global fleet policies and monitoring of performance:

People: risk management / driver safety

Planet: global CO2 fleet footprint reduction

Profit: linking these both to TCO where possible

The Big Picture #3• As the drive to recruit and retain talent

increases, a company vehicle is the top rated employee benefit

What are the client benefitsof globalisation infleet management?

Using the leverage of scale and scope

The benefits of scale and scope

Customers use leverage to:

• Increase awareness, control and quality

• Reduce supplier numbers & supplier risk

• Reduce the price: improve the overall deal

• Continually pursue cost savings

• Take advantage of increased outsourcing

• Improve the top line (M&A, driver productivity)

Examples of SuccessClient Case Study 1Implementation

• International approach started in 1998: from 542 vehicles then to 5,133 now.

• Vision: an outsourced and close working relationship between one leasing partner, the central purchasing team and the country teams.

• A global car policy with flexibility to make local adaptations where required

Results

• 10% reduction in global TCO.• Advanced level of process outsourcing.• Active internal fleet and procurement community to

share best practices and innovate.

Examples of successClient Case Study 2Implementation

• International approach started in 2001: from 1,869 vehicles then to 10,118 now.

• Vision: Drive to explore supplier reduction and benefits from outsourcing though each country judged international approach for themselves.

• Emphasis on reducing cost and optimising processes.

Results

• Commitment to improve pricing and TCO for 16 company countries by $6.8 mill over 3 years.

• Results in 2006 alone: $3.9 mill from TCO alone.

• Now in a position to further exploit scale especially with vehicle manufacturers.

Examples of successClient Case Study 3Implementation

• International approach started in 2004: from 476 vehicles then to 14,717 now.

• Vision: Assess and improve the environmental impact of the company car fleet.

• Implement reduction initiatives in a TCO optimal manner.

Results

• Map global carbon footprint for fleet: identified 81,853 tons CO2 per year across 14,344 vehicles.

• Implement solution in global fleet strategy - driver training, carbon offsetting, improved vehicle efficiency in car policy.

How can you move from a national approach and take advantage of these benefits ?

• You may know the broad overview buttoo little of the detail.

• You need to bring definition; what is the current situation ?

• You need to gain clarity; how does our situation compare ?

• You need to bring colour; what could be the opportunity ?

Car fleet distribution

US and European Car Fleet

Car fleet distribution

US and European Car Fleet

Car fleet acquisition

Car fleet acquisition

Car fleet acquisition

Car fleet acquisition

Global and Local Visibility• Understand and build the reality

• Use the expertise and knowledge in the market to build the business case and achieve necessary senior level support.

• Set the strategy and objectives for a category management approach.

• Outline and understand the international initiatives that will bring improvements to the current approach.

Building the Business Case

It is about a partnership betweeninternational and national on both sides: client and supplier.

This will require you to go from a global view to:

• Involve key country representatives to truly define requirements.

• Understand specific national situations and the detail of national opportunites.

• Build national support and buy-in to the opportunities that exist.

• The success of an international approach has its foundations on local success.

Global and Local Improvements

Once we know the reality, how do we improve it using a true global and local partnership ?

The Stepping Stones

You need to get the price right

• Global RFP

• Linked Regional RFP’s

• Negotiate a core international deal and then go country by country

• Introduce one global supplier to get awareness and control and then roll-out

The Stepping StonesWork on a collaborative basis with suppliers:

– Rigorous Implementation

– Managing Out Suppliers

– Clear Governance & Escalation

– Consoidated reporting

– Strategic and national reviews

– International DMU Satisfaction Survey

– National DMU Satisfaction Survey

– Driver Surveys

The Stepping StonesEnsure a Supplier Commitment to:

– International terms take precedent

– Key Performance Indicators

– Cost Savings Targets and Approach

– Global support for OEM negotiations

– Full Process Outsourcing

– Green and Safe Driving Policy

– Global Fleet team approach

– Benchmarking for clear success tracking

Fleet Cost Index

New Car Prices

Residual Value

Interest

Fuel

other....

Maintenance, tyres & repair costs

CLIENT DATAClient TCO reporting

New Car Prices

Resale Performance

Interest

Fuel

other....

Price development on cost elements

MARKET DATA•External sources

COMPETITIVE

BENCHMARK

REPORTING

It is a challenge but it is possible ..… attitude is an opportunity !!