With today’s high volume of upfits due to strong economic activity, fleet managers will need to add flexibility to their scheduling metrics to address elongating order-to-delivery (OTD) times. Today, many upfitters are operating at capacity, necessitating fleets be extra attentive to upfit specifications because any engineering change will even further delay OTD.
It is times like today that reinforces the value of advance planning and the creation of fleet metrics to measure progress (or lack of progress) relative to a goal in the upfit process. The most powerful metrics are those that directly measure a desired business outcome that have numbers associated with it, allowing the outcome to be quantified.
However, formulating the right metrics to monitor and identify the root causes of good or poor performance is not as easy as it seems. Theoretically, you could measure anything and everything. But if you are tracking metrics just to maintain data, then you are measuring the wrong things. To be truly effective, the metrics must track the integral parts of the upfitting process.
The metrics used to track, monitor, and assess the success or deficiencies in the upfitting processes typically focus on three outcomes from an upfitter:
- Production of a road-ready product that meets safety, quality, and compliance criteria
- On-time delivery of units
- Units produced within budget
When executed correctly, metrics can provide a fleet and the upfitter with clear expectations of performance and results. Below are key considerations in developing measurement metrics that will ensure the upfitting process is a true partnership between yourself and the upfitter.
Tips to Cultivating an Upfitter Partnership
Maintain an open, two-way dialogue: A successful partnership with an upfitter must be based on an ongoing, open, two-way dialogue that defines what is important to each party. This dialogue will illuminate what should be focused on during the upfit process. Developing metrics in collaboration with an upfitter will clearly define what is important to the fleet and the areas of focus by the upfitter.
Strive to develop metrics that are fair: Metrics should be structured to be fair to both parties. Avoid one-sided stipulations or metrics that are difficult to measure. One-sided requirements will lead to a contentious and challenging business relationship between the fleet and the upfitter who may focus on simply meeting the minimum expectations and not exceeding expectations. Fairness is critical to ensuring a long-term, successful business relationship between both parties.
Metrics should only cover what is controllable: In the spirit of fairness, metrics should not cover variables that cannot be controlled by the upfitter. The best metrics focus on those processes and activities that are within the upfitter’s control, such as throughput (units produced per time period) and unit upfit quality.
Mutual agreement on the definition of metrics: Both parties must agree to the same definition of key metrics. For instance, what is exactly meant when a fleet end-user specifies “production of a quality product”? There should be a mutual understanding of the definition of quality, delivery, and cost (as well as service), and the joint development of key performance indicators (KPI) that support the desired outcomes.
Metrics should focus on only the most important objectives: Sometimes metrics are codified in more detail in a written service level agreement (SLA). However, it is recommended that an SLA should be kept fairly simple and limited to only the most important metrics and objectives.
Base metrics on achievable standards: Upfitter metrics should be based on standards that can be met or exceeded and should focus on standards that will impact customer service expectations if not adhered.
Consistent status reports: The upfitter should provide status reports on the upfit progress throughout the build and delivery process. Metrics should be used to regulate the upfitter’s status reporting process to ensure it is timely.
Desire to do the Right Thing
High-quality upfitters and service providers focus on performing well for their clients, and they tend to do what is needed to be successful. They communicate often and clearly, execute consistently, and deliver results that almost always meet and often exceed the client’s expectations. Most business partners want a successful and long-term partnership, and they will usually do whatever is necessary to ensure the client has a positive experience, even when things go wrong. The most successful upfitting relationships invariably ensue when both the fleet customer and the upfitter view themselves as long-term partners.
Let me know what you think.
Originally posted on Automotive Fleet
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