In a simpler time, the career path from shop floor technician to construction-equipment manager was well defined. Going from wrench-turner to the manager's swivel chair carried familiar responsibilities, namely, to keep the equipment operating and to keep downtime to a minimum, plus making sure preventive maintenance was done on a timely schedule.
But roughly 10 to 15 years ago, two things dramatically and permanently changed that route to success. First, the available pool of qualified shop technicians from which many equipment managers were drawn began to dry up. Today, it's down to a trickle. Second, at the opposite end of that evaporating pool, advancements in both equipment and managerial technology washed over the industry like the aftermath of a storm.
The impact of both developments caused a shift in the nature of the equipment manager's job. No longer was it enough to focus on the mechanical aspect of fleet operations. More fleet managers had to be versed in asset-management skills such as finances and long-range planning, having the ability to look ahead for several years to determine equipment lifecycles and equipment-replacement schedules. They also had to comprehend the use of computer technology for diagnostic purposes and even in negotiations to make sure they purchased the right equipment at the right price.
Today, it has become increasingly obvious that professional equipment managers are not born. They must be trained.
Yet Mike Vorster, professor of construction engineering at Virginia Tech and author of Construction Equipment's "Equipment Executive" column, doesn't describe the movement as a general shift. "It depends on the company and how the company is structured," he says. "It depends on whether the company sees the fleet as a corporate asset or just as a tool to get the job done."
If a company views its lead person in the equipment-management group as someone who looks after the shop and the yard, background skills and training as a mechanic are necessary and, in many cases, sufficient to fulfill the function, he says.
"On the other hand," Vorster says, "if the company sets up its fleet management so that the equipment manager is a member of the executive team — involved with assets, asset management and return on investment — that shop experience as lead mechanic is important, but there are many, many skills that the equipment manager needs to find some other way."
Vorster teaches his management strategies in the Construction Equipment Institute.
With the equipment manager as part of the executive team, top management expects the department to be managed as tightly and as efficiently as any other well-run business.
"It's not something you can come in right off the street and do, even if you're a good manager," says Warren Laing, field service manager for the City of Peoria, Ariz. "It's a completely different animal, especially with a government agency. There are steps and procedures you sometimes have to follow to meet city, state or county guidelines. You can't just go off and do something."
Anyone coming into the public sector from the private sector will find that "this is probably the most frustrating piece of the equation — getting through the bureaucracy," he says.
Laing recently applied for a grant to help establish an ethanol fuel program. "We have a new ethanol plant going in about 30 miles down the road, so we have a local source," he says. "We have enough vehicles, especially our police cruisers that use a lot of fuel, to make it a good program to start with."
Had he been in the private sector, he probably would have received approval within a couple of days. But, he says, in order to endorse the request, the City Council had to pass a resolution saying they agreed with it. Despite the fact that fast response was critical because other municipalities were competing for the same grant, it took about two months to move through the bureaucracy and apply for the grant, Laing says.
Laing sees a shortage of equipment managers. "I serve on the board of directors for the Rocky Mountain Fleet Association," he says. "We have about 1,000 fleet-manager members and another 200 to 300 associate members from our vendors. When I look around the table, everyone — as we classify ourselves — is a grey beard. You see very few young people wanting to get into this field."
The same holds true for the private sector, says Dennis Sullivan, corporate equipment manager for Sunland Construction. He says the technician shortage has reached a critical stage, but "I'm not sure there is a shortage of equipment managers.
"There is an abundance of people who call themselves equipment managers, and I don't want to minimize their responsibilities. But equipment managers who can handle finance, maintenance, policy and procedures, buying and selling equipment, and keeping track of multiple shop locations — those managers are few and far between."
Even if an employee "is a good maintenance guy and the owner has faith in him," he won't be able to grow into the equipment manager's position if he doesn't know anything about accounting or finance or multiple shops, he says.
"Somebody has to train him in those areas or he's going to be left behind," Sullivan says. "He doesn't need to know everything about accounting, because somewhere in that company is an accounting department that can keep him on the straight and narrow. But if a new piece of equipment is purchased, he has to know how long to depreciate it. He should have a policy for that. The equipment manager should be involved in the creation of that policy, and he should take it and run with it from then on."
Managers must also handle acquisition strategy. "You have to make decisions on equipment purchases or leases," Sullivan says. "If you decide to work with a leasing company, the manager has to know how they work. A lot of that is accounting."
Vorster says the need for managerial skills among equipment managers has been there all along, but until now it lacked definition and championing. He breaks the management side of managing equipment into four dimensions. One is people management, "where you get into leadership aspects." A second is administrative, "things like keeping the paperwork straight." The third is the finance side: budget control and financial decisions. "I distinguish between these three, particularly leadership and personnel, which is not unique and specific to the equipment business," Vorster says.
The fourth and most important dimension is the statutory dimension. "This includes learning how to comply with EPA regulations, OSHA regulations, and EEOC regulations," Vorster says. "There is a very, very real need for training in how to stay out of trouble with EPA, OSHA and the EEOC."
Dave Venrick, equipment manager for Rinker Materials, says the need has been there for an extremely long time, "but in the past 10 years the asset management part really came into focus due to costs, machine availability, and commodities such as tires."
"It's a tough business, and it's getting tougher due to costs," he says. "Four years ago, we didn't worry about what a gallon of diesel fuel cost. We didn't wake up in the middle of the night in a cold sweat wondering if we would have enough tires. The whole system has turned upside down, and I don't see any light at the end of the tunnel."
Even with those concerns, Venrick says anyone coming into an equipment-manager's slot still needs a mechanical background. "People are coming out of four-year colleges and directly into the equipment-manager position," Venrick says. "I guess that's a good way to build a manager, but if you don't have the basic background of knowing a water pump from a turbo, or a 9/16th wrench from a 3/4-inch wrench, I think those folks are at a real disadvantage until they — for lack of a better term — start making some major mistakes that they learn from."
Although the shortage of equipment managers can be traced, in part, to the dwindling number of technicians, that's only part of the problem, says Laing. Today, what has to be overcome is a stigma attached to entering the equipment business.
"Back in the mid-'60s, many schools taught auto shop as a scheduled class, not as an elective," he says. "If you wanted to go that way, you could. There were very good instructors. If you had a friend who was in auto shop, you wanted to keep in touch with him. If you were working on your car over the weekend, it was good to have someone around who really knew what he was doing. If you were in auto shop you were not looked down on."
Laing has done, and continues to do, a lot of recruiting from high schools, he says, but what he sees now "is a stigma attached to that. If a teacher or an administrator feels a kid is not college material, they put him into auto shop. Very few kids go into that on a voluntary basis."
To demonstrate how serious the situation has become, the Rocky Mountain Fleet Association has four $1,000 scholarships to give away to students each year who want to go into the technician field. "We can't get anybody to take them," he says. "We go to every high school in the state and students just aren't interested."
So who's to blame? Sullivan blames parents. "They want their children to be doctors, lawyers and engineers," he says. "But by doing that, they are steering kids away from the hands-on part of the business. And the hands-on portion of the construction industry is much bigger than the clean-hands portion."
One of the things young people should realize, he says, "is that, even two years ago, the starting pay for technicians coming out of a four-year school was higher than the professional pay." Laing agrees. "Our PR is not very good," he says. "Although part of a technician's job is grimy, being a technician is a good job that has good compensation. It is not the bottom of the earth. If you are at the top of your field and go to work for a dealership, for example, the environment in there is almost spotless. There are guys making more than $100,000 a year, but that's never publicized."
The shortage of technicians has made the traditional career path from shop floor to equipment manager, "a thing of the past," he says. "They can come from the shop floor, but many of the guys don't want to get the education and training necessary to be an asset manager. I have a couple of guys who are excellent technicians, but they won't get certified by ASE. They're sitting there, and they are going to be left behind."
There could be another reason for that, as well, if Vorster is correct. He splits the equipment business into the "oil-and-grease side" and the "dollars-and-cents side." The oil-and-grease side of the business is well understood, and people who come up through the ranks have several sources for training. "But the dollars-and-cents side has been a stepchild for a long time," he says. "I don't think there is anyone out there who is doing a good job in training people for the dollars-and-cents side."
Asked if that will change in the future, Vorster says, "I hope so. I've spent an awful lot of time trying to create that change."
Gender Barrier Crashes Down
It's hard enough to come up through the ranks from shop technician to equipment manager, but Theresa F. Anderson, corporate equipment manager for Parsons, a national engineering firm in Pasadena, Calif., had additional hurdles to overcome.
She had to prove herself repeatedly in the male-dominated construction industry. She did precisely that, however, becoming the first woman to qualify for the Association of Equipment Management Professional's Certified Equipment Manager designation in 2002, and by becoming certified in a number of other areas, including electrical work, certified crane instructor and certified rigging instructor.
When Parsons bought three large construction companies and the fleets that came with them, it hired Anderson's boss, Robert Andrade, as vice president equipment/asset management. Andrade, in turn, talked Anderson into moving with him from Chicago as corporate equipment manager.
"When I was working my way up through the ranks," Anderson says, "he mentored me and embedded one thing in my brain — training. Becoming the first female CEM was a lot of hard work, a lot of studying and courses and hands-on technical training, but I did it."
Anderson, who started in the business 10 years ago, is a firm believer in training. "It's mandatory for each service technician or manager here to take at least three types of training each year," she says. "What we prefer to do is get that training directly from the OEMs. I went through Caterpillar training, John Deere training, Grove training, and others. I went to a lot of NAFA classes, administration classes, and a lot of AEMP technical training classes."
Although becoming an equipment manager is an achievement for which she is proud, she still likes to put her boots on and get in the field. "I enjoy it," she says. "I find it very rewarding, for instance, to inspect cranes. I love learning and tearing a machine apart and helping out my mechanics. I love getting dirty. All this helps me learn the asset-management part of the job. It helps me understand why the budget is what it is. It gives you a good handle for everything. You're not just a bean counter who looks at figures every day."
Anderson is helping others grow in their careers. I send them to a lot of technical training schools. I work hand-in-hand with them, and I try to teach them some of what I know. I have my mechanics going to factories for training. Actually, I have a factory representative coming here. We are paying a little extra money for that, but it's very valuable for our people to get hands-on training from OEMs."
Succeeding in a male-dominated industry, Anderson admits, is tough for a woman. "If you do not have a strong mentor, like I had, I don't think a woman has a chance," she says. "To this day, guys question my ability, even with the credentials I have. It's just a fact of being female. They are very leery about that. If I red tag a machine, I still need the backup of the vice president, at times."
Although her job can be frustrating, she still loves it, she says. "My mentor is still teaching me. What he may be teaching me, now, for example, is how to approach the operators next time in a different way so I don't get as much resistance."
Anderson constantly seeks more training and serves as chair of one AEMP's committees. "I try to keep active and try to keep involved with all my peers," she says. As for her future, she has nailed that down pretty well, too.
"I think I will become one of the best in the business. If I'm not there now, I soon will be."
Theresa Anderson had to prove herself, but she says training helped her most in succeeding as corporate equipment manager for Parsons.
One Road to Success
If you feel like the ice pond of your career is breaking behind you and you're skating as fast as you can to reach shore, you might be better off than you think.
Consider Steven Ricke, division manager for equipment and construction services for Hubbard Construction. He started out in the oil-exploration business, working in the west, midwest and southwest. When drilling fell off in the 1980s, he took his mechanical background and began working with heavy equipment in the coal strip mining industry in the northeast.
"I got with a start-up company called RAM Equipment and began marketing service and product support for equipment," Ricke says. Soon came double-digit interest rates and double-digit inflation, and he went to Florida where things seemed to be a little more booming.
"I was actually working for an equipment company, and Hubbard Construction was a customer," he says. "They needed some help and I agreed to come on board. I thought it was going to be a temporary position, maybe for about a year. And, lo and behold, 20 years later, I'm still here."
What he brought to the company, he says, was not only his mechanical background and his expertise with equipment, but also his managerial knowledge. "There are two major assets any construction company has," Ricke says. "One is its people, which are probably the biggest asset, although you can't put a dollar figure on it. The second is the iron they work, their equipment. My job is to make sure we are keeping the cost of that equipment as low as possible so we can keep a competitive edge.
"Because of that, two things are important to me," he says. "One is cost per hour, which has to be very low, and the other is uptime, which needs to be very high."
Ricke says his career has been, and continues to be, rewarding because every day is unique. "I face a different challenge every day," he says. "It's not like building widgets and every day is repetitive. There is a lot of interaction between our divisions (we have asphalt, construction and landfill) so everybody has unique challenges in regards to equipment."
Nor is it boring, he says, because there are about 110 people in the division, including 65 mechanics, "and there's always something to learn there. There's always a challenge."
Ricke credits "a little bit of mentoring and a little bit of training" for preparing him for his job. Both mentors were at Hubbard, and they prepared him to take over the position he now has. "They kept me on a path," he says. "I was also fortunate enough to get a lot of training at Virginia Tech, including a two-week Equipment Executive class that was held in Atlanta. It's been an on-going thing."
Ricke has "definitely" seen a shift in the equipment manager's job from mechanical focus to asset management. "Every equipment manager should take some type of a business class," he says. "You have to be able to understand a spread sheet, be able to look at a balance sheet, and understand your cost. The biggest challenge that I face today is still getting good information. You have to have a good record-keeping system and a good way of tracking equipment. Getting good, clear accurate information is critical."
Although a good equipment manager is more than being a good mechanic, he says, "you have to have a mechanical aptitude. When your shop mechanic comes in and explains why he is going to spend $40,000 on a bulldozer, you know why he's doing it. Otherwise, you're relying on that fellow to manage your assets."
Ricke also advises business savvy for negotiating. "You have to be a long-term thinker. For some people, long-term thinking is what they will have for lunch that day. But in this position, you have to think in terms of seven or eight years."
When it comes to gaining the skills necessary to become a good equipment manager, Ricke says he doesn't know of any "real school, except Virginia Tech. The Association of Equipment Management Professionals also is good because it provides a forum to bounce ideas around."
Ricke says equipment managers also need to think outside the box, "and a lot of that stuff — business classes, computer classes, working with different computer programs — you have to go out after yourself. The guy who was wrenching a year or two ago now has to be computer literate. Our whole industry has changed."
But that change has been for the better, he says. "It's important for us to get out there and change the perception of people in our industry. They think of mechanics and superintendents and equipment managers as grease jockeys. But that's not who we are any more. Today our mechanics have to be computer literate, have to make a huge investment in tools and have good analytical minds."
Business savvy enables Steve Ricke to perform the corporate functions required in his position.
Pressures of a Middle Man