Equipment Type

The Value of a Professional Equipment Manager

March 22, 2012

Rod Sutton is editorial director of Construction Equipment magazine. He is in charge of editorial strategy and writes a monthly column for the magazine, The Sutton Report. He has more than 30 years in construction journalism, and has been with Construction Equipment since 2001.

Three large equipment fleets (you’d recognize them, although for reasons soon to become clear I won’t name them) axed their asset managers over the past month. I ran into two of them during AEMP’s Annual Conference.

All three of them have my full respect as best-in-class asset managers, based on years of interacting with them plus their contributions to AEMP.

I asked each what happened, and the answer was stunning: cost reductions. The organizations had, for varying reasons, decided it was better to let the fleets be managed by regional equipment managers than to have a centralized, corporate manager. There are valid arguments for a decentralized fleet, but these moves appear not to have been based on a change in equipment strategy.

Firing an asset manager to save costs is short-sighted.

Also short-sighted is slashing travel to meetings designed to improve business management skills. Public fleets have been suffering from this for four years. Instead of helping the person in charge of equipment dollars learn how to return the best from those dollars, it’s politically simpler to reduce travel.

What can an asset manager do to help their boss understand the value of their function? One manager of a city fleet simply has meeting attendance written into his contract. So far, that’s worked out well for him—and his employer, I will wager.

Others have a tougher road. The profession needs to continue to elevate itself beyond the misconception that equipment managers simply buy iron and perform preventive maintenance on time.

At the Annual Conference, a session on business planning offered a way to do that: writing a business plan lets your boss know what fleet does. So said Greg Morris, CEM and fleet manager for Sarasota Counties Fleet Services:

·      Describe the services you provide

·      Explain your strategic direction as a fleet

·      Provide short- and long-term plans

·      Validate the allocation of resources

Guy Gordon, CEM and director/asset management for Aegion, pointed out that a fleet manager must frame the issue in order to shift attention from fleet as cost center to fleet as asset management. “Too often, we’re looked at as a cost center, a necessary evil,” he said. “The most important part [of a business plan] is the value you provide for the organization.”

I’ve said this before, and I repeat it only because it’s a graphic example of how important the function of asset manager is to an equipment-owning organization. On average, 80 percent of capital assets are in iron, and the management of that investment warrants professional attention. Equipment management requires a professional asset manager.

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