As Earth Day 2011 approaches, Penske Truck Leasing,Penske Truck Rental and Penske Logistics encourage everyone in the transportation and logistics sectors to consider joining the EPA’s SmartWay Transport Partnership to help further reduce fuel consumption needs and emissions.
Fuel is one of the largest costs of doing business in our industry, and the emissions generated by burning fuel needed to deliver goods and keep our economy moving pose an important environmental and economic challenge. As anyone who runs a single truck or a fleet of trucks knows, diesel fuel and gasoline are once-again approaching record highs, leaving many transportation companies looking for solutions to help reduce costs.
In a recent interview with “Move Ahead” regarding the sharp run-up in diesel prices Bob Costello, chief economist and vice president for the American Trucking Associations, said: “diesel fuel is often the second-highest expense for many carriers, after driver wages, and depending on the type of operation, diesel can account for as much as 20 percent of operating expenses. This percentage can vary dramatically depending on the type of operation, the average length of haul, etc.”
One of the first simple steps any transportation company can take to help with fuel conservation is to join SmartWay, a unique public-private partnership, created by the U.S. Environmental Protection Agency (EPA). There is no cost to join and the benefits are numerous. Most useful are the quantification tools, guidance and assistance provided by the EPA to help truck fleets improve the efficiency of their operations.
These tools – designed with input from the freight industry – help to benchmark fuel consumption and emission rates for individual fleets (truckload, less-than-truckload, etc.) and truck improvement. Upon joining, you will be asked to complete the data assessment tool using basic operational data, such as fleet type, class and age, fuel use, idle times, number of miles traveled, payload, transportation modes and related information.
Once your data is inputted into SmartWay’s calculator tool, a series of calculations are run and a fleet is provided with an assessment that details fuel consumption patterns, CO2 and other air pollution outputs. The program also offers guidance on strategies for lowering fuel use and emissions, such as truck and equipment upgrades, modal shift alternatives, and others.
After completing the tool for the first time, fleets check in annually to update their operations data and check on the progress they are making to achieve their fuel-savings and environmental performance goals.
For companies that achieve their goals and contribute to other elements of the SmartWay program, the EPA offers opportunities to participate in various program development activities, webinars, and workshops. The agency also acknowledges and publicly recognizes the progress its partners are making on its website, at industry conferences and through other channels.
Already, more than 2,700 organizations participate in SmartWay, including many of our customers. For those that haven’t joined, Penske invites you to check out EPA’s SmartWay website to learn more about how you can start saving fuel, money and the environment.
Industry Recognition
Penske Truck Leasing, Penske Truck Rental and Penske Logistics have been active participants in the SmartWay program since 2008 as affiliate, carrier and shipper partners in the program. Penske Logistics currently has the program’s highest possible rating of 1.25 as a carrier and shipper partner.
In 2010, Penske was recognized as a Top 50 Green Supply Chain Partner by Inbound Logistics magazine. The magazine’s editors named Penske to the list for the approaches it takes to improve miles per gallon (MPG) performance and reduce emissions of its own truck fleet. Penske was also recognized for the strategies it applies in helping its own customers relative to fuel economy and also for its promotion and participation in EPA's SmartWay Transport Partnership with customers.
By Randy Ryerson
Penske Truck Leasing and Penske Logistics have been steadily growing and cultivating relationships with minority-owned and women-owned businesses for well over a decade. The effort is a part of an ongoing initiative to promote diversity and inclusion at both companies.
“We’re committed to growing and supporting our diverse supplier base companywide,” said Art Vallely, who leads Penske’s corporate procurement activities as senior vice president of rental and vehicle management.
In 2010, Penske Truck Leasing and Penske Logistics spent approximately $150 million with hundreds of minority-owned and women-owned businesses combined. This represented more than 13 percent of the total annual spend with suppliers. Even during the most-recent economic downturn, Penske continued to grow its base of diverse suppliers.
“We’ve made a concerted effort to identify and use diverse suppliers for a wide range of products and services,” said Paige Lightner, Penske’s director of sourcing. “Many of our diverse suppliers are small local businesses based within the communities where we have operations. We value the local supplier relationships as these help our businesses to reflect the communities we serve.”
Supporting minority-owned and women-owned businesses is good for the overall U.S. economy. According to the Department of Commerce’s Minority Business Development Agency, these firms collectively generate about $1 trillion in economic output to the U.S. economy and help create millions of jobs annually. (See related article from The Wall Street Journal.)
“We are always looking for reputable, high-quality diverse suppliers, and we encourage anyone interested in doing business with us to contact us,” Lightner added, photo on right. “Our supplier diversity efforts not only reinforce our commitment to diversity at the company, but we also see it adding value to our business from a competitive standpoint. We are aligning our diversity initiatives with those of our customers.”
Penske is a member of the National Minority Supplier Development Council (NMSDC), one of the country's leading business membership organizations, and has been active with the group since 1996.
“As members we allocate part of our dues to support the regional councils in Michigan and Pennsylvania, New Jersey, and Delaware due to the presence of operations we have within those areas. We seek to include diverse suppliers where we can,” indicated Lightner. “Once these suppliers are in our systems, it becomes easier for others within the organization to utilize their services.”
The NMSDC’s regional councils certify and match more than 16,000 minority-owned businesses with member corporations that want to purchase goods and services.
The range of services Penske Truck Leasing and Penske Logistics procure from minority-owned and women-owned businesses varies greatly and includes consulting services, third-party trucking carriers, installation, temporary staffing, janitorial, landscaping, building maintenance, telecommunications support, contracting, and more.
Qualified suppliers interested in registering with Penske Truck Leasing or Penske Logistics as a minority-owned, women-owned or small business should send an introductory e-mail, and a procurement department representative will contact you with the necessary forms and other background information.
By Randy Ryerson
This is part one of a two-part series. Please click here to read part two, a profile on Penske over-the-road coordinator Scott Brightbill.
Rain? No problem. Snow? Still here. Sleet and freezing rain? Bring it on. Sunshine? Let the phones ring. This is the commitment and dedication it takes to keep more than 200,000 vehicles up and running around the clock 365 days a year across North America.
“We never have down time – even when the sun is shining," said Julie Levering, director of maintenance services at Penske Truck Leasing. “Winter is definitely a challenge though. Someone else's snow day could be our busiest day of the year."
This Penske Truck Leasing 24/7 emergency roadside assistance operation, located at the company's global headquarters in Reading, Pa., will be there to take a call every time the phone rings.
When “ Move Ahead" visited recently, there was a constant buzz of chatter and ringing phones. This noise never goes away, and the longer one is immersed in this area, it eventually just becomes a part of the background noise.
As most of the U.S. was recently hit with some of the worst winter weather in decades, it was all in a day's work for Levering's team.
“We really have to work as a team to make this all possible for our customers, who always come first," she explained. “This job is definitely not for everyone. It takes a certain kind of person to be able to deal with the different stress levels every single day."
But Levering tries to keep the atmosphere as light as possible with pizza parties and really getting to know her staff. She tries to communicate with them and listen to what they have to say. “I feel like if my staff is happy, our customers will be happy, too," she noted.
Steve Reichert is one of four lead over-the-road coordinators. His job is to “run the floor" and make sure that calls are being answered and ultimately resolved.
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It's a tough job," Reichert stated, who has worked in the department for 13 years. “You really have to learn fast and act quickly on what the customer's needs are and what they want."
Reichert's main goal when he's “running the floor" is call resolution. “It's important for us to help the customer in the most positive way, and that's to resolve what their issue is as fast as we can," he said.
And issues include: locking the keys in the cab, running out of fuel, being stuck on the ice, overcharged batteries, requiring directions, and of course, accidents.
“They (accidents) are the tough ones, but you learn with experience how to handle and move on from those calls," Reichert said. With accidents, the goal is to make sure the driver is okay and to get them what they need quickly.
Reichert explained that one of the most rewarding aspects of his job is when new call center associates, who endure an intense four-week training program, no longer ask him questions. “That tells me that they have gained the confidence in what they are doing to help the customer on their own," said Reichert.
Kevin Zserai often wonders how customers manage after an accident. “I do think about them (drivers) and hope everything works out for them," said Zserai. “It's always important to keep moving and help the next customer."
So how does this department thrive day after day? Nearly one hundred emergency roadside assistance employees help keep Penske's
truck leasing and truck rental customers on the road and moving.
Missee Kahler, a workforce analyst, is responsible for forecasting the amount of staff needed based on nationwide weather conditions. Her office, which overlooks “the floor," includes a large flat-screen TV on the wall. It displays the weather for North America, singling out sections of the country that could potentially become weather issues.
“It's really difficult to research different weather patterns and forecast what's going to happen," Kahler explained. “I want to make sure that we have the right amount of people ready to handle the phone calls that will be coming in."
And when bad weather hits the Reading, Pa. region, staff members will actually stay the night. Each employee has the needed items required for an overnight stay.
Levering mentioned that supervisors will pick up staff members in an SUV to get them here if they can't make it on their own. “We really have the most willing and dedicated staff," exclaimed Levering.
Penske also uses service partners throughout different regions of the country.
“During this time of year our partners play a vital role, but they are critical to our success year round," explained Levering.
When a breakdown occurs, the company will use a Penske service location within 25 miles. Ideally, a Penske associate will always be at the scene, but sometimes they must defer to their partners for assistance. From small businesses to national dealers, both help with jump starts, tow-outs and other breakdown related issues.
Perhaps Reichert summed it up best about his position: “I love my job. I honestly work with the best group of people and everyone here wants to work and help our customers, and that's what it's all about."
By Kathleen Walter
Collaboration. Supply chain. The two concepts should only appear together in the same sentence if companies are prepared to fundamentally change their way of thinking.
Trusting the right partners, and selecting the right process for collaboration, is as critical as taking the needed time to define the right strategy at the right time.
Just as the supply chain is a complex web of pieces and parts, collaboration is equally complex.
In the world of logistics, collaboration is often defined as the strategic next step for optimizing the supply chain. While collaboration can significantly reduce costs, increase supply chain efficiency and improve customer service, it can easily fail if not implemented with the right motives.
Trends in the marketplace today include various levels of collaboration between companies. Each of these levels in turn has varying degrees of complexity and may or may not require a logistics partner to help unlock the synergies. Collaboration today is done frequently at a tactical level but it is becoming more strategic as green initiatives and globalization become more prevalent.
At Penske Logistics in Europe, collaboration is about more than just the decision to partner. It includes determining the elements for establishing how best to collaborate, selecting the right partner and choosing the tools necessary for collaboration to work optimally.
Elements for establishing supply chain and logistics collaboration
Aligning collaboration partners is a component necessary for success. This is dependent upon the company’s goals and can be based on financial objectives, risk assessment or value for the end customer.
It is vital for company leaders to allow collaboration to serve as a strategic goal, while structuring that alignment through all levels of the organization, from the C-suite to the warehouse.
Once alignment is achieved, both the company and the logistics provider must define and agree upon what level of collaboration should serve as the starting point. It’s not necessary for every process in the chain to be collaborative; a company must determine which processes will most benefit from collaboration and provide a value-enhanced process.
As the global landscape continues to change, it leads to new opportunities for collaboration. There are strategic concerns, such as exchange rate fluctuations, government restrictions and the managing of offshore facilities. There are also tactical concerns: transportation services tariff standards, planning across continents and time zones and Inco terms.
While challenges in business processes, language, and cultures can be overcome, these aspects must be considered prior to implementing global collaborative processes that have a global span.
A reliable partner with experience handling supply chains across multiple continents is essential.
Selecting and working with a supply chain and logistics partner
Selecting the right partner is instrumental in the success of collaboration. The partner must be the right fit with your company. The working relationship with that partner should be strong, the company goals should correspond, and most importantly, a cultural match should exist.
The framework of a collaborative relationship should establish a clear understanding of where in the process each partner’s responsibilities begin, and where it ends. The partner and the organization should work jointly to design the new working relationship.
Each party should have incentives for achieving success and be clear in what success looks like: a win-win for both. Many companies are focused on two contract areas that can work directly against establishing collaborative processes: transactional pricing and the expectation of short-term results.
Transactional pricing is deep-rooted in many companies as the buying strategy of choice to continuously enable negotiation on lower rates, whereas collaboration is about reductions driven throughout the supply chain, and not necessarily only in the rate-based area of the partner.
Short-term results are also a constant expectation in many companies, and more so in the current economic climate.
Collaborative processes can be put in place to enhance short-term results but collaboration should primarily be focused on long-term improvements, providing a company with a sustainable supply chain that will improve their competitive edge.
Here are a few more tips for driving successful collaboration:
People, process and technology
There are three main tools necessary for collaboration: people, process and technology. None of the tools alone make collaboration successful; it’s the use of all three and the know-how to tie them together that makes the difference. Process tools include key metrics that have targets for input, process and output measurements. Taking the primary measurements for cost and service, and then driving down to the underlying measurements of processes and inputs that drive those key performance indicators leads to a clear understanding of how well the process is working.
The metrics should be reviewed on regular basis, improvement plans should be put into place and lean tools need to be incorporated as needed, to continuously ensure that the targets are achieved and exceeded.
Technology tools must be in place to enable efficient data sharing. It’s essential for data transparency to exist between the companies. Information sharing is key to collaboration success, as without it, each company cannot effectively manage their piece of the process. The determination in how the data is transferred, when the data is transferred, and what data is necessary, are all areas of focus when designing the framework for collaboration.
Effective people relationship skills are often ignored, yet critical for successful collaboration. An investment in a strong collaboration team in both organizations should not be underestimated.
Being able to effectively manage technology communication tools, knowing the audience and when to use which method are equally important. Additionally, having strong problem solving skills, emotional intelligence and being creative are all imperative to a strong collaboration team.
Overall success of collaboration begins with trust. All of the above elements work towards establishing and reinforcing trust between the parties involved. As mentioned earlier, achieving cultural fit and shared goals are imperative when selecting a supply chain partner for a successful collaboration.
The true element of a successful collaboration is when the parties focus upon strategic future efforts to improve the supply chain, as opposed to only focusing on the operational aspects of the current collaboration. Each partner views the other as an extension of his or her own organization.
Supply chain collaboration is essential for companies to sustain efficient and effective supply chain management processes in the global marketplace. Collaboration is hard work and the work shouldn’t be underestimated, but the payback can be substantial towards strategic growth and longevity. With top management support, a focus on long term strategic fit and selection of the right partners, collaboration can make a marked difference to a company’s supply chain.
By Marla Piccolomini
Piccolomini is a logistics engineering director for Penske Logistics, and is based in The Netherlands. Need a supply chain partner in Europe or elsewhere around the world? Please contact us.
