Challenges and Opportunities
If there is one component critical to the overall success of refuse collection operations, it’s your trucks. Without those rearloaders, automateds, frontloaders, and rolloffs traveling the boulevards and back alleys of your jurisdiction, the garbage sits on the curb or in the bin, and there’s no practical way to get it from there to the disposal site. Customers, drivers, and elected officials all will be upset if the trucks aren’t able to run, and the outlook for your continued employment will become cloudy.
But keeping safe and functional trucks out on the road can be a challenge. Today’s equipment includes complex hydraulic systems, computer monitoring, and control systems. Combine that with a variety of regulations, from periodic vehicle safety inspections to environmental health monitoring and air-quality regulations, and the stakes go up. Add the challenge of finding qualified mechanics to work on the trucks and qualified drivers to operate them, and other professions might begin to look more rewarding and less frustrating.
When it comes to having enough trucks every morning for pickup, it takes a team approach. This team includes your mechanics who work through the day and night to ensure that the vehicles meet all the laws and regulations and are safe and roadworthy. It involves your drivers who perform daily inspections and whose operating habits can turn a $190,000 piece of equipment into junk. It involves your elected and administrative officials who must use Solomon’s wisdom to allocate resources among more police and fire crew and new refuse trucks and who only worry about garbage when it’s not being picked up. Finally, it involves the manufacturers and dealers of the trucks and components who, when building a vehicle, try to balance economic viability, a good reputation for reliability, and meeting market needs against making a profit and satisfying shareholders. You’re the captain of this team, and your choices mean the difference between a winning season and a trade to another team.
In this four-part series, MSW Management will look at some of the issues, challenges, and opportunities of refuse fleet management. In this part, we’ll take a look at what’s critical to success. In Part 2, we’ll get a “view from inside the garage.” In Part 3, we’ll explore the driver’s role and the field-operations effect on maintenance. Finally, in Part 4, we’ll examine the challenge of managing trucks as capital assets.
Investing Isn’t Just for Day Traders
If you went out and purchased a Rolls-Royce, more than likely you’d take incredibly good care of it. It would receive frequent washing and waxing, and the oil and fluids would be monitored regularly and changed when needed. At the first sign of trouble, the car would be turned over to a trained and qualified service technician for diagnosis and repair. The car would be garaged and watched over. You might even attend driver training programs at the dealership so that you understand all the intricacies of the vehicle’s operation.
When you realize that the current price of an automated refuse truck is similar to the price of a Rolls-Royce, the need to properly maintain, operate, and value the truck becomes clear. While we don’t use Rolls-Royces to collect garbage or recyclables, we should train all of our staff to realize the value of the truck we’ve acquired and placed into their collective hands to operate. These trucks pay everyone’s salary, and without them, they’re out of a job.
“I think the number one problem we see in public-sector fleet management is underinvestment in the fleet,” observes Randy Owen, a manager with DMG Maximus, a national consulting firm that focuses on municipal fleet issues. Owen’s background prior to joining DMG includes fleet operation manager for Los Angeles County and fleet manager for Charlotte, NC. “We see many old fleets that create a lot of maintenance challenges. As our vehicles age, they become less reliable and more expensive to maintain. Reliability is probably as equally important as – if not more important than – the maintenance cost, particularly for someone in an operation like solid waste where you have routes to serve. Lack of reliability creates upset customers, which can lead them to seek alternative service providers. Every solid waste manager knows that when you miss collections, people start making phone calls and that’s difficult to deal with. (So many of the cities and counties) we deal with have very aged fleets. Not enough money is being appropriated to keep up with a rational replacement schedule to keep vehicles relatively fresh and to maximize reliability.”
Critical to making vehicle replacement choices is having good information systems that provide a reliable history of costs and maintenance for each vehicle. The City of Minneapolis, MN, implemented a vehicle management information system that provides trends on each vehicle’s cost. “When we start seeing the costs go up, we can take a look during the annual inspection and determine whether or not to keep the vehicle,” explains Ray Wald, a foreman for equipment repair with the city’s Solid Waste and Recycling Division. “Eighty percent of them are going to do what they’re supposed to, but you might have one that is not. The cost will tell you that.”
By planning your vehicle replacement schedules and monitoring the costs, it then becomes possible to remove a truck from service and send it to auction before the truck fails and is reduced to junk value. “A few years ago, before Ray started his program, we’d blow a rod on an engine and say, OK, that one is going to go over to the equipment auction,'” recalls Susan Young, director of solid waste and recycling for Minneapolis. “We had to tow it over, and obviously that truck is not going to get us anything at auction. Now, with Ray’s testing, we say, ‘This is one of our older trucks and we’re starting to see some increased dollars going into it. Let’s send that one to auction.’ We’re going to get a better price on it because it’s still rolling stock. We’re going to avoid having somebody go down on the route because the engine blew, and we’re not going to be sinking a lot of money into it between now and then (unnecessarily).”
For most people, maintenance means taking in their vehicle for an oil and filter change. But a program designed to make sure that the trucks run every day starts in the wee hours of the morning. That’s when the driver walks out to his vehicle and performs the pretrip inspection. “A lot of people think the preventive maintenance program starts when it hits the shop,” notes Mark Harmon, utilities manager for the City of Claremont, CA. “We don’t go that route. We don’t have the luxury of excess trucks here. We’ve got eight sideloaders and roll six every day, so we don’t have a whole lot of backup. We’ve really focused, this last year, on the pretrip inspections. We’ve put a lot of time and effort and some funding into that program.”
Harmon hired a consultant to conduct an eight-hour training program for Claremont’s commercial drivers. Four hours were spent on classroom training on the requirements included in the daily inspection reports by the California Highway Patrol (CHP) and state and federal vehicle codes. “The second four hours were actually out in the yard with a refuse truck, having each person walk through a pretrip inspection,” he recalls. “We then went in and completely redid our daily inspection forms incorporating the CHP standards and a lot of other things that we felt were important. We came up with this 48-point checklist that each operator is responsible to go through every morning. That’s our first line of defense and critical to preventive maintenance.”
The second part of Claremont’s preventive maintenance program involves an inspection after 300 hours of operation. “We used to have an ‘A’ schedule in which we would do a cursory glance at the refuse truck,” describes Harmon. “Then we had a ‘B’ schedule in which we would do some of the fluid changes, and then a ‘C’ schedule in which we would crack the head and take a look inside. We did away with that. What we came up with was a 300-hour scheduled preventive maintenance for every refuse packer. We do an extensive, all-inclusive service every 300 hours. There’s about 73 different functions that we go through as part of this extensive service, which exceeds any manufacturer requirement. It does mean a little more downtime during the preventive maintenance, but what we have found is that we’re getting a lot less downtime on the repair end of it. We’re getting a lot fewer hose breaks.”
Selecting the right truck from the right vendor can also make or break your operation when it comes to keeping trucks on the road. There are systems, such as packers, arms, or the body on a refuse truck, that might not fall under the safety inspection requirements of the Highway Patrol. But if those systems are not built durably and maintained properly, they can lead to a truck being idle while a part is on back order or a major reconstruction can be completed.
Currently, many manufacturers offer a variety of warranty periods ranging from one year to five years on the chassis, engine, transmission, body, or packer systems. Warranties shift the responsibility for unexpected failures due to normal wear and tear from the purchaser to the manufacturer during this period. For example, if a truck is covered under a two-year warranty for the transmission, the manufacturer should repair, without cost to the customer, any component failures that are not the result of abuse.
The failure of one component, however, can lead to secondary damage that forces warranty claims into a finger-pointing duel between two manufacturers. In one case, the failure of a suspension component resulted in a one-year-old frontloader truck rolling over at the landfill when the body was raised. The truck sat damaged and idle for nearly two months while the chassis manufacturer haggled with the body manufacturer about whose responsibility it was. The problem was ultimately resolved, but for 60 days a $180,000 truck was not out on the street making money.
The continuing consolidation of equipment and component vendors, with domination in a few select areas by one or two manufacturers, creates some interesting challenges relating to customer service. Robert Donovan, sanitation supervisor with the City of Glendale, AZ, shares his experience dealing with one particular manufacturer’s local dealer. “In our city, I’m not exactly sure what customer service means to the vendor, but it certainly does not compute with what I would consider customer service. (The components) are expensive to maintain, and if they’re repaired under warranty, you’re not going to have to front that cost. But the fact is that you’re paying maximum markup on any parts not under warranty, and the truck might sit at our dealer for 30 days. I have to buy another truck to have an additional spare ratio to cover that (out-of-service time).”
The alternative to using a manufacturer’s dealer is to go with an independent, says Donovan. “If I go with Shop X that works on [these components], charges me less for parts, and gets the work done in my time frame and I don’t have to keep the additional spare ratio vehicles by type, that’s a real critical factor. Nobody would argue that [the manufacturer] probably makes the best (component), but the problem is (that it doesn’t) do a very good job of screening and managing the companies locally that represent its product. Maybe that’s the arrogance that comes with having about 100% market share.”
Parts inventory management is a challenge when trying to make sure you have the right quantity on hand. “Parts are always a problem in the fleet industry,” states Owen, “particularly with the push to go to just-in-time, which is not an absolute. It’s kind of a frame of mind. Nobody takes just-in-time to its illogical extreme of having absolutely no parts in inventory, although sometimes I think that finance people and materials management people force that on fleets. On the other hand, sometimes fleets do a really bad job by having a tremendous amount of obsolete parts in their inventory. Have enough vendor sources of supply to get you things quickly, yet have an appropriate amount of inventory on hand to provide a safety stock and provide for turning equipment out quickly. That’s always a balance. We’ll see people who have emptied their inventories but don’t have the relationships with vendors to cover them. Half of their equipment downtime is related to parts.”
If you examine how the private sector operates, the secret to successfully getting what it wants is through market volume. If a small city buying a dozen trucks asks for warranty considerations that exceed the manufacturer’s normal ones, the city is either told they’re not available or that the additional price is so costly that the city must accept less than what it wants. The arrogance of local vendors is often reminiscent of the old Henry Ford adage, “Give them any color they want as long as it’s black.” In a recent purchasing effort for a local southern California city, one dealer even went so far as to include a condescending letter with its submission, pointing out why the city’s spec was not what the city really wanted and that the dealer knew better.
Donovan suggests coordinating the purchases of several cities in order to leverage volume discounts and market share. “I’ve tried to organize a few of them here, and I think we’re getting fairly close. In Phoenix Metro, we have nine or 10 different cities with substantial refuse fleets. You’re talking 300, 400 trucks here pretty quickly. You’ve got multiple cities that operate in the same basic types of climatic conditions and everything else, so what drives price and willingness to comply with the bid spec? The number of trucks you’re buying. You can bet your life if Waste Management wanted a five-year warranty on a body, it would get it. We need to sit down and really try to work together to generate a homogeneous truck specification. Every city buys off that spec.”
Vendors need to focus on the total life cycle of a refuse truck, not just the up-front purchase price. “The first thing has to do with a reliability factor,” states J.T. Pratt, director of public works for the City of Kinston, NC. “Longevity is something we need. If you talk about keeping trucks 10 to 12 years, people kind of choke and sigh. There are major problems with fleet maintenance and costs as a result of keeping vehicles. I would want to find some way to link them to the life cycle of the equipment so that you could run them longer at a reasonable level of maintenance. That would make a big difference in operational costs.”
Explaining the nuances of refuse-collection fleet management is often challenging since, on the surface, refuse collection’s a simple process, according to your mayor and city council. The truck picks up the trash, recyclables, or greenwaste, and all you have to do is make sure the truck is there on the scheduled day. But as we all know, it’s more like choreography, where each member of the team must fulfill his or her role at exactly the right moment, otherwise everything collides together in a heap on center stage.
One way to help generate that understanding is to become a visible, knowledgeable expert, suggests Owen. “You want to be able to exert influence. You want the city council and the city manager to see you as a credible expert in your field. You don’t want the city manager to feel comfortable talking with anybody about a solid waste issue without you at the table, and it ultimately comes down to an issue of trust. If you can do the right things and earn the trust of the decision-makers [by proving] you are a credible expert who exercises sound business judgment in your field, then you will be more successful in getting the resources for your operation that you need. You’ll be more successful in countering some of the vendor’s sour grapes. The sour grapes are difficult to do away with entirely. The vendor will likely complain more if it thinks it has a chance of overturning the decision or, at least, making you cautious the next time you bid.”
To achieve that status requires visibility—something that most management staffs in municipal environments try to avoid. “What’s a little more difficult is what we tell fleet managers and I think it applies to anybody that to influence the agenda, you have to be visible,” advises Owen. “A lot of the manager’s attitude is, ‘Boy, if I just keep my head below the ridgeline, if nobody knows I’m out here, then no one’s going to bitch at me.’ That’s the wrong approach. Just make yourself do something to become a little more visible, even in an area that’s not directly related to your business, so that the city manager knows who the fleet manager is in a positive context. Often the only time a manager becomes visible is when a vehicle is in an accident and the driver says the brakes went out. Now the city manager knows the fleet manager’s name. You’ve got to find some ways to get some positive exposure.”
No one questions that refuse fleet management can be a challenge, especially on a cold winter morning when the trucks don’t want to run. But there are opportunities to improve the systems, and it takes all members of the team–from the mechanics to the operators to the vendors–in order to keep the system from freezing up.