LAS VEGAS, Nev. – It wasn’t all parts and products talk at the Heavy Duty Aftermarket Dialogue (HDAD) earlier this week. Lots of focus was actually placed on the role service plays in the industry.
“The replacement parts business is not a freestanding business,” said Stu MacKay, president of MacKay & Company. “Replacement parts demand is zero unless someone turns a wrench. Service controls parts.”
MacKay & Company conducts surveys on the market and in the most recent survey carried out in 2011, the total service labour market represented 495 million hours.
“It is hard to put a dollar amount on that because of varying labour rates, but if you assume $100 an hour for labour, that is a $50 billion opportunity,” he said.
To get a well-rounded look at how changing service patterns are affecting the aftermarket, HDAD put together a panel to discuss the hot button topics.
The panel was made up of Lori Coleman, fleet manager for Gordon Foods; Mike Delaney, president and CEO of WheelTime; and Brian Mulshine, director of parts and service technology systems of Rush Enterprises. Moderating the panel discussion was Gary Cummings, president and CEO of FleetNet America.
The quality issue
Cummings kicked off the discussion by asking Coleman if Gordon Foods was fleet-focused.
“Our core competency is not fleet maintenance at all,” she said. “IT resources go towards our warehousing group because our core competency is moving that product through the warehouse and getting it on the road. So for us we do not get the IT resources that we need because we are kind of the step-children.”
She went on to say that the big thing Gordon likes to focus its attention on is productivity.
“That is a huge thing for us…CSA scores are also very important to us and we monitor that very closely, our CSA score is 24 for maintenance. Our guys do a phenomenal job, it’s quality and throughput. We call ourselves a PM shop because we are not going to be handling any job that usually over four to five hours long – for that we will outsource.”
Coleman said that Gordon does nearly 85% of its maintenance in-house and only outsources to an external third-party 15% of the time, most of which is for warranty purposes. She also said Gordon technicians are well trained in that they are taught to find 10-15 things wrong with every truck that is brought in for maintenance.
“We’ve done more and more inside because the quality of service we receive from third-party vendors is the lowest quality we’ve ever seen,” she added. “I don’t have the statistics, but I’m going to guess that at least 60-70% of the time, we find errors.”
To address the bold statements about the lack of quality made by Coleman, Mulshine and Delaney explained what their companies do to help improve the quality of their service.
“At Rush, we just recently put $250,000 into a developing a technician tracking system, so we’re tracking every piece of training,” said Mulshine, who added that technicians at Rush average 60 hours of training per year.
“For us,” said Delaney, “quality was one of the initial founding elements of our network and we never want to compromise there. After that, it’s all about speed and communications.”
According to Delaney, WheelTime is working on a way to collaborate with customers to move service faster since 85% of the time units are in his shop, they are not getting fixed because they are either waiting for warranty approval or parts needs.
The technician shortage
It’s no surprise that a technician shortage is plaguing the service industry and all panelists agreed that treating and training service workers right is a way to keep the shortage from becoming extreme.
“We’ve gone through our recruiting practices and we’ve become very active with schools,” said Delaney. “One of the best things you can do to protect our workforce is to invest in them. Like invest in training – they seem to respond to that. We try to find out what interests them and give them opportunities to do that. We try to do a lot to make them feel like it’s a career not just a job.”
Mulshine says his company puts a lot of focus on recognizing its best technicians by sending them to different trade events to train others.
On the contrary, Gordon Foods doesn’t have issues finding technicians according to Coleman.
“We’ve done a lot of training,” she said. “A lot. And that has made a huge difference. Also, because we are a private company, we have a lot of different benefits, like their salary, different incentive programs and we also offer profit sharing.”
Coleman and Delaney added that management is a huge factor is keeping technicians around, too.
“People don’t leave jobs, they leave people,” said Delaney.
It’s obvious technology is taking over the trucking industry in more ways than one, and of course, telematics is a large part of that.
Both Delaney and Mulshine agreed that telematics is going to the change the game in terms of providing faster service to their customers.
“This is going to be a big deal,” said Delaney. “The fact that the trucks are starting to diagnose themselves means we can be ready when it rolls in to handle it. It’s going to happen, you’re starting to see OEs on it…and there’s no way this is going to stop – in my mind this is the future.”
Coleman agreed, but said system kinks still have to be ironed out if this is going to be the future.
“A big issue that needs to be rectified first is the fault codes,” she said. “I’m being fault-coded to death. It is like the boy who cried wolf. Every truck that comes in has fault codes. Every one of them. You get so you’re used to it and you ignore it. We need to figure out which fault codes are important and which ones are not.”