Episode 205: The 3Ws of Fleet: Right-Sizing Your Team, Tools, and Tech for Long-Term Success

Hey, welcome back to the Fleet Success Show. I'm your host, Mark Canton. Today we'll be talking with Tony Yankovich. That's right, Weird Al's cousin, about all things fleet, including the interconnectivity of rightsizing, replacement planning, workforce management, workload management, and workplace management. That is a mouthful. Come back and listen for more. Let's get right into it.

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Hello everyone, and welcome back to another episode of the Fleet Success Show. I am Mark Canton, your host for today. Most of you know me by now, but I am the VP of Product and Consulting here at RTA Fleet, the Fleet Success Company. And I am joined by my good friend and colleague, and consulting mentor and fleet manager extraordinaire, Tony Yankovich. How you doing, Tony?

Mark, I'm doing great. You know, it's good to be back on the podcast. It's been a while, so happy to be part of it again. Looking forward to our discussion today.

All right, man. It's, it's, it's great to talk to you. So some folks who know us better will know that there was a period for about 5 years there where I talked to Tony on the phone more than I talked to anybody else I knew. And, uh, more, much more so than my wife. And the Google, to this day, now our roles have changed and, you know, we still talk, of course, but not every day, multiple times a day like we used to. But we talked so much then that, uh, the Google algorithm still has you in my top 5 contacts and you're still above my wife. Uh, you just recently went down to number 5 below some of the other folks we're working with here all the time. But, uh, we'll see. We'll see how that goes. I think you're gonna stay in the Google top for a long time.

Well, we did travel quite a bit together as well. So it's, it's been a good roll.

It's been a good roll, my friend. All right. So I thank you for taking some time to be on with me today. I wanted to just bring you on for a boatload of stuff, you know, just various topics. I was just kind of hoping to shoot the breeze with you on and pick your brain. And I really kind of wanted to start with like, I really loved your session this year at Connect. You had people in the audience talking about a masterclass, you know, which I thought was appropriate, because you really tie together concepts that people kind of sort of struggle to see how the dots connect there. And one of the things you and I used to talk a lot about when, when we were in front of clients and whatnot was how fleets kind of like a matrix or like a spider web. You know, it's not like you got these individual pieces, they're all very much connected. And if you pull a little bit on the string over here, it's going to have this other impact over there. And you did a really great job of that, you know, in talking about really— it was fascinating how you brought it up. You talked about right-sizing, but, but you were talking about really the 3 W's. So like, what— just give us sort of the, you know, the couple-minute overview on sort of your theory around right-sizing and around the 3 W's and, and what that looks like for the folks out there. Josh and I, by the way, we're talking about it on another recording too. So I just said, oh, we got to get him on and maybe dig into it a little bit.

Nice, nice. Well, I think it all started, Mark, many years ago when, you know, this whole concept of what is fleet management came up. And people have, including myself back then, had a difficult time trying to put our arms around it and explain what fleet management really is to other people that are outside of fleet organization. And so, you know, there's more business disciplines involved in managing and maintaining a fleet than just about any other operation within an organization. So one of the things that I tried to do is is to put it in a framework that was simple, easy to understand, something that people could focus on and not be distracted by all the other minutia and all the other little things that are involved in managing a fleet. So came up the idea of workload, workforce, and workplace, the three W's, W cube. Don't have a great name for it yet. I've been working on that for a long time, but it's really a way to identify The workload, which is the maintenance burden of the fleet. You know, what is required to manage and maintain the fleet? How is that integrated with the workforce? The workforce are the people that are charged with managing and maintaining the fleet. So it's everything from, you know, the fleet manager, the FMIS analyst, the administrators, the accounting clerk, the technicians, the parts people, service writers. So anybody that's involved in managing and maintaining the fleet. And then the third W is the workplace. The workplace is where that work is accomplished. So it's not only the shop if you have an in-house operation, but it's also the administrative areas, it's the employee amenity areas, it's the shop support areas. So it's everything that's involved with that. And then the one piece that a lot of people forget about when they talk about the workplace is the exterior areas, you know, because, um, the, the number of deadline bays, the number of ready line stalls, the, the— where are employees are going to park, where you're going to have employee or official vehicle staging. All of that impacts the site requirements as well. So, you know, what we're trying to do with the 3 W's is getting around the idea of how do we measure this, how do we manage it, and how do we discuss it with other people?

Right.

It's a great point in a way that folks outside of fleet can understand as well as folks inside a fleet, right? And kind of get your arms around it because it is big, right? Like, again, that spiderweb example, you know, people will ask you, well, I have 100 assets in my fleet to make a number, 500 assets. How many techs do I need? And you'll look at them, well, I need more info. And that's when you get into AEUs, right? Asset Equivalent Units. There's your fleet, you know, you got 500 school buses, 500 sedans, 500 plow trucks, or a whole freaking mix of everything in between, right? So, and you use that to kind of get at, all right, well, what's the maintenance burden going to be by looking at the composition of the fleet a little bit? And then that impacts everything else, right? So you say, well, that will impact what the workload is. And, you know, one of the things we talk about a lot, like we— you have the ideal and then you have the reality and you do a really good job. So for example, well, I got this many techs, then how many bays do I need? And again, you might— well, in a standard, assuming all things equal, maybe it's, you know, 8 to 10. But well, do you have two shifts? You know, what kind of equipment are you working on? Do you need drive-through bays? You know, talk a little bit about that, you know, and also how much work can I— and how it's a two-way street because, you know, okay, well, your mechanic should be able to do 1,500 hours, right? Let's just say. But man, if they don't got the right bays and the right tools, the right equipment, they're going to struggle to hit that number. Right. So there's that interconnectivity that's difficult to explain. And you do a really good job of, you know, you know, kind of like putting it in chunks that people can swallow is the best way that I can describe it.

You have to understand that these three essential elements of any fleet organization have to be balanced. You know, if one of them's off, then the operation is not going to be as efficient as it could be. And so it really kind of started a long, long, long, long time ago when we were doing fleet rightsizing studies. You know, when, when we did a right-sizing study, we're trying to identify the optimal number of vehicles and pieces of equipment in an organization's fleet, and that's kind of where we stopped. But then what I started realizing and doing all these studies is that, you know, if we're gonna, you know, increase the size of the fleet, we're going to decrease the size of the fleet, we're going to change the composition of the fleet, that has other impact. That's going to impact your, your workforce requirements. How many technicians do we need? Might impact the, uh, the parts room. You know, if all of a sudden now we're We're adding street sweepers, you know, the curb brooms are massive. They take up a lot of room in the parts room. So we have to identify not only the workload, but the impact of the workload changing in size and composition. And the other thing that we look at is the workforce. And again, we always throw out these numbers, 1,500 direct labor hours per year per tech. We throw out numbers like, you know, 1.5 bays per tech for a maintenance shop. And I hate doing that because these general rules of thumb, once you, you know, once you throw them on the wall, they stick. And people, people won't hear that. They don't hear all the other stuff. So I always try to tell people, you really need to look at it in context. So, you know, um, the, the direct labor hour, or what I call the technician tolerance level— how many hours can a technician generally be, uh, you know, uh, working in a year Generally, like a government fleet, somewhere between 1,450 and 1,500, 1,600 hours a year would be optimal. But there's other things to consider. One of the things is we talk a lot about the technician shortage and the lack of skilled technicians. So if you have a technician workforce that is not very skilled, you have to account for that. And so their productivity, yeah, they might be turning wrenches and they might be logging hours on that work, work order. But are they really efficient? Probably not, because they're just not skilled and trained and experienced yet. And then same way with the shop, you know, when we're looking at the workplace, you know, we work with organizations that are in remote areas, and maybe they do need an alignment bay for an alignment machine. But if you're in a major metropolitan area, you probably don't need that unless you're doing several alignments a day. So all of that kind of stuff really impacts the— or right-sizing not only the number of vehicles you have, but you're right-sizing the workforce and your right size in the workplace, right?

And the whole thing comes again. It's, and it's interesting because the analysis you're talking about, there is a lot of devil in that detail, right? Getting that right, to your point, helps. And yet when you're done with it, you can package it in a way where the people who don't need to understand the detail don't need to understand the detail, right? They can get, okay, this is how much work we have to do, uh, and this is how much we can get done given the other independent variables like this is, this is, this is the facility we have today. And in lieu of doing some sort of major renovation or getting a new facility, right, you know, we, we can't do that. And from there you're able to take it anywhere you want. This is how much outsourcing you should do. You can look at that and suggest what type of work should be outsourced versus not, you know, and so forth and so on. And really, if you need to or if, you know, you can really fine-tune it to, to that balance point that you're talking about.

Um, absolutely. And I think, you know, some of the other things that, um, you know, like you said, the devil's in the detail. Um, you know, it's things like, uh, do you have a union shop or not? You know, do you have paid breaks? How much time do you give the technicians at the end of the day to clean up the shop area? All of that impacts their technician tolerance level or their productivity level. So, you know, we really have to understand all of that. And then I think, like you said, the way we present that use case to our leadership when we're fighting for positions, let's say. It's very important that they understand that there is some math behind this. There is some data-driven decision-making behind this process, and that if they want to know the details, they want to understand the nuts and bolts of it, we have that. We have that information there. And once we can demonstrate that and show the transparency and show the assumptions, then all of a sudden our chance of increasing staff, maybe getting a new shop or a renovation to our shop, uh, has a much higher level of, of approval ratings.

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So message there is you got to really look at all three of these together, right? You certainly got to start with what the workload is, but then you make it and you kind of start with, okay, let me walk through, through sort of the ideal or the perfect state. And then you go back and you make adjustments based on the variables that you can't control or you can't edit, you can't optimize. I can't optimize my space right now. So in turn, okay, this is what we can do instead, right? Maybe it's another shift. We can't get the right amount of bays. The bays aren't big enough. A certain amount of outsourcing, but you can kind of tweak it from there. So what's interesting in going back again to pulling that spiderweb string, right? Well, so Josh and I were just really, really loved your talk. And then we thought to ourselves, well, you know, at the same time, Steve and I gave a talk about the importance of replacement planning. And we argued, and I think you agree, you can tell me if you disagree, that, you know, if you, if you, if you hit the nail on the head with your replacement program, you're going to mitigate most of, you know, the other issues, right? And so the thought came up— I mean, you might remember, we've had more than one, but there's one that jumps out to me in the Northeast where they just had like insane labor rates, insane working conditions. You know, it would rain, they were indoors, but somehow it still rained on them. It was just so much to fix in the maintenance and repair program. And we suggested to the client, Well, go fix your replacement. And they looked at us like, hey, we asked you to come in here and tell us how to fix maintenance and repair. And we kind of had to break the news to them, like, your maintenance repair is so broken, it may not be worth fixing, or at least just yet. Start by eliminating the need for it, so to speak, right? Or minimizing the need. And so you don't have enough technicians, and we can, we can do that study. But you could also, in many cases, to your point about rightsizing the fleet and the assets, replacement planning will— could potentially help you get to the correct technician account too. And you and I have found as well that, man, rightsizing and replacement are so interconnected. You know, how many times we're having an interview with a client and I need that truck, but you haven't— you've driven it 4 miles in the last 6 years. No, I need it. Well, what is it used for? Well, we use it to do work orders over here. How many work orders have you done with it? 3. Over how long? 3 years. You know, you really don't need it, you really don't use it. And I'm making fun, but you know, when you get down to it, well, why do you really need it? Well, it's because my other unit spends so much time in the shop, and this other unit, and it's down so much that essentially they're scared to not have the spares that they need, um, because they're accountable to get their work done. And that's understandable, right? Like, you, you can totally get that. And we'll make deals with people, right? We'll say, well, how about this? Let's just pretend that I can get these other two replaced for you on time, brand new ones here in the next two years. Would you then let go of number three? And we're almost always get a yes, right? So replacement planning is directly related. When you have a poor replacement program, you're going to get fleet creep almost inevitably. You know, there's some other options like more commercial rental or something like that, but almost inevitably you're going to get a bigger, more bloated fleet. So then how do we take that and merge that into the matrix that you've got with the 3 W's? What is it? The W cubed?

Yeah, we're not really sure yet, but the W cubed.

We're figuring it out.

Right. We're figuring that out. No, and Mark, you're right. And you talk a lot about the feeder metrics. So, you know, obviously the granddaddy of them all is fleet availability. And if we're at 95% and we base our workload analysis and workforce analysis and workplace analysis based on a 94% 95% availability rate, that's one thing. But in reality, if we have an old fleet and we all know that an old fleet requires more maintenance and repair and it's going to have more downtime, so then maybe we have to adjust that. We have to adjust to the reality that we're only going to have, you know, 75% availability. And like you said, that's going to impact the number of units in the fleet because we have to have spares. Now, depending on the type of organization, you know, if you're a transit organization, you expect a 20% spare ratio. You know, if you're a school bus operation, you're expecting about a 10% spare ratio. But if that fleet availability drops and we don't have the vehicles to meet rollout in the morning, then that spare ratio is going to increase. So now we need a 25% spare ratio in a transit fleet, and that's going to increase our workload. And guess what? That's going to increase the requirement for technicians, and it's going to increase the requirement for Mays. And so it really is all interrelated. And I think even the exterior, I mean, if we have a 95% availability, 5% downtime at any given time, we can adjust the number of deadline bays outside for vehicles that are parked ready to come into the shop. But if we have a 75% availability rate, the number of deadline parking stalls outside is going to have to be doubled or tripled in some cases. So it really does impact everything. And one of the— Mark, we work together so long that we understand the importance of a good replacement program that can mitigate so many of the issues that organizations have. And it's just trying to convince leadership or the budget or the finance folks that, yes, we do need this money. We do need the CapEx spend to renew the fleet because we have a renewed fleet. You know, not only do we have the latest technology in our vehicles and the safest vehicles, they're more fuel efficient. Now we're going to have lower maintenance burden. The newer vehicles don't require as much. And what they do need is hopefully going to be covered under warranty in a lot of cases.

Right. And so you have smaller fleet, right? Again, to work backwards.

Absolutely.

Because they're down less, so you need less spares and so forth and so on. And so with that in mind, I'm going to ask you a question Josh asked me. And we gave multiple answers here. I'll give you that warning. And we looked at it from a few pieces. So the question was, which one would you prioritize first? Because he had gotten that question from one fleet. So, you know, hey, you know, someone in the audience came up to me and said, hey, Mark and Steve talked about replacement planning. Tony gave us this masterclass on, you know, the W³. I got all of that, right? Which you can relate to, right? You know, I got all of that. Which one do I tackle first? And, you know, we answer that in multiple ways. One way I don't think will surprise you, which is Well, first, kind of know your audience and understand where there's appetite. If there's no appetite at all for CapEx, maybe work on that later and fix your team first. And, you know, that sort of a thing. But sort of in a vacuum, we kind of gave two other answers. I'm curious what you would think, like which would, which would you prioritize? What, you know, if you could only tackle one, what would be the priority? You know, sort of a thing. How would you go about that?

Well, I think fleet replacement would probably be my number one priority. You know, the younger fleet has so many advantages over an old fleet, that I think that's where I would start. But like you said, reality has to be considered. And if our organization just doesn't have the money or won't make the commitment to replace vehicles, then we can start adjusting some of the other parts of the equation. And I think once we do that, then we can say, okay, well, we're just going to have to understand that our fleet's going to be old, therefore we're going to have a higher maintenance burden. Therefore, we're going to have to have more technicians and more space.

Man, we really have been working together long. I swear, folks, we do not agree on everything. You can find things if you know us well enough and you dig deep enough. But boy, do we absolutely agree on that. But in the end, we also— we ultimately cheated again and gave another answer, which— and I'm curious what your thought about this is. My suggestion was, hey, try to do them all together if you can, because of that interconnectivity. And also thinking in terms of Managing up, managing your stakeholders, giving, you know, I mean, we both have been employees and we both have been bosses, let's say supervisors, managers, whatever you want to call it, leaders, right? And, you know, the truth of the matter is when you go to leadership or you go to finance and you say, hey, this is the only way to solve this problem, give me a lot more money, right? It's a tough pill to swallow, no matter how accurate or true or how much you can back it up by data. But by looking at all 3 or all 4 together or 5 or whatever we're talking about here right now, you can kind of model scenarios. Hey guys, we'd really like to replace the equipment faster and this would be the impact to you, like you said earlier, on our techs, on our bays and so forth. But we understand you may not be able to raise that much capital. You might be averse to debt or something like that. If we do half of it, this is what that mix looks like. And this is the impact on technicians and the bays and, you know, and kind of show a mix. And now when you're going to leadership, you're giving them options. Hey, pick your variety here, pick your fruit, fruit of the week. And this is sort of the impact and the trickle-down effect, you know, of that. I'm curious of your thoughts of that. Is that— do you agree with that? Is that something you've seen to be effective for folks? What have you seen to be effective or what might you recommend?

Yeah, I think whenever you have multiple options for consideration, you're going to be much more well received. And you mentioned Connect. One of my breakout sessions at Connect was focused specifically on technician staffing levels. And one of the things that I discussed was how do you present this to leadership? And I think the one piece that a lot of— so everyone's now trying to add data into the decision-making process, show them how we're calculating direct labor hours and how we're calculating technician tolerance. That's great. That, that's a great first step. But I think what, what else we have to do is start identifying the impact to others if we don't do this. So, you know, if you don't give us the CapEx funds, this is going to be what's going to happen. We're going to have an increased fleet size, we're going to have an increased maintenance workload, and guess what? Our fleet availability will decrease. And I actually show some examples of that, you know, based on our need was 10 technicians in the sample example that we used, and at 10 technicians, we were at 95% availability. However, if I'm only going to have the 8 technicians that I currently am approved for, then we can assume that our max fleet availability is going to be at 85%. And so when you start showing that and then you demonstrate, well, that means that this department is not going to have as many vehicles at their disposal to perform the missions that they're charged with, that's when you start getting the, the ears to perk up.

You can then leverage those stakeholders to be advocates for what it is you, you want to do, right?

That's a great point.

Absolutely. All right, so one more piece on this. It's kind of a little bit deeper into the weeds here, but I think it's an important part, that point that, um, kind of gets lost in the shuffle and people don't understand it. And, and it's, it, I think it's so important. Um, talk a little bit about the difference because one of the things you point out well in these analyses is sort of the difference between— I'll say it my way— the difference between FTs and FTEs.

Right, right.

So, you know, full-timers versus full-time equivalents and how that impacts the math so much. Um, talk a little bit about that, if you don't mind.

Yeah, that's a great point, Mark, because, you know, um, most organizations, uh, identify personnel by headcount or by FTEs, full-time equivalents. And so What we have to do as a fleet organization is we have to be able to talk in their language but use it to our advantage. So what I like to do is take a fleet roster. And this is one of the things that— first things that we do in a fleet assessment is we identify the fleet roster. And then what we do is that's the count. So I have 10 technicians. So I have a count of 10 technician positions authorized in my budget. But then what I want to do is I want to go to each one of those technicians and find out how they spend their day. Are they turning wrenches all day? Are they working in the parts room, you know, 2 hours a day because the parts clerk is running parts? You know, are they managing the fuel system? Are they ordering fuel? You know, are they doing other things? You know, one of the things that I always bring up as an example is because it's a perfect example. When I was back working in the city, our welder was so good that every other department wanted to use him. He was fantastic. So they would always borrow him. So we had really, even though we had a count of a full-time welder, the FTE for the fleet organization was about 0.5. So we only had him about half the time. So what we do is we calculate the number of technicians that we have in terms of count or FTs, as you mentioned. And then what we do is determine how much of that time is available to actually turn wrenches and perform maintenance and repair. So often what you'll find is because they're doing all these other things, whether it's mowing, mowing the yard, whether it's putting a plow on the pickup truck and plowing the parking lot, you know, when it snows, there are a lot of organizations that the technicians are doing so much stuff and a lot of it is with outside of the shop, you know, outside of the bay. And so when we identify that and identify where their time is being spent, and then we realize that those those 10 FTs actually result in about 8 point— let's say 8.5 FTEs. Now when we say, you know, our need is 10 technicians and budget says, well, you have authorized 10 technicians in the budget, go look, and then we can identify, well, we don't have 10 FTEs, we have 8.5 FTEs, and here's why. And so I think that's another piece of the puzzle that a lot of people are missing But again, once you are able to identify that, have something to back it up, and then be able to share that with the decision makers, much better chance of getting what you need.

Yeah, absolutely. I think that's, that's a great point. And, and I would actually recommend to folks, you know, if you're not, if you're not sure where to start or some of this sounds above your head, maybe you're intimidated by it, which, by the way, you shouldn't be. Everything Tony is talking about, it's math you can do, I promise. But, but I would say start there. Start with identifying What is my ratio? I'm, you know, what is my ratio of full-time mechanics to actual full-time equivalents? Because of all of that, because we have never— I don't— I have never come across a shop— I shouldn't say never, I have rarely come across a shop where the headcount of mechanics matches the FTE count, right? Where it's always less, like you always lose like maybe 1.5 mechanics per 10 mechanics sort of a thing. To other things. Oftentimes it's parts. There's no parts person or like you said, running or some other activity. I mean, we've seen mechanics delivering mail, which just, you know, breaks my heart. But you get the idea, right? The goal is to get that mechanic turning wrenches and keeping them there as much as you possibly can. You're paying for a highly specialized skill. Use them at that skill. But if you start there just figuring out, hey, man, wow, I thought I had 10 mechanics. I have 7. I mean, we've seen it. We've seen it bad. 6.5. When you thought you had 10, that's a great starting point for that conversation. Even before you can do the rest of it, it usually can move the needle for you a little bit and at least get some eyebrows, eyebrows raised and some, like you say, ears percolating.

And that's right. Without a doubt. Yeah, without a doubt.

Cool. So I think with that, we'll wrap it up and we'll say, hey, folks, if you have any more questions or any other ideas where you want to talk about, let us know. Email us at podcast at @RTAFleet, and we'll be sure to take your ideas and talk about more topics. Tony, thank you so much for joining us. Can't wait to talk to you again soon.

Absolutely.

Yeah, man, have a good one. Take care, everybody.

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