Finding the right partner
More than a year ago, the Garland, Texas, Fleet Services Department outsourced its parts division to increase efficiency. Since the department began working with a private contractor, it has enjoyed faster access to repair parts, allowing its mechanics to complete tasks more quickly.
Servicing and maintaining the city’s fleet of 1,700 vehicles and equipment is not a small task. The department includes 27 technicians in two maintenance shops, and its budget is about $5.5 million. “We outsource all major rebuild, [including] all our engines, transmissions and all of our paint and bodywork. Everything else we do in house,” says Robert Lawson, director of fleet services for Garland.
Before the department outsourced its parts management, it was having trouble maintaining the proper inventory. Parts that should have been in stock often were misplaced, and the department regularly ran out of critical items.
In October 2003, Garland decided to contract with Atlanta-based NAPA Auto Parts to provide and manage its parts services. “[The company] purchased our inventory, and that ran somewhere over $300,000,” Lawson says. “The department now has around $700,000 worth of parts available but does not pay for the parts until they are used.” The program was enacted in March 2004.
The vendor set up shop in Fleet Serv-ices, and it hired its own employees to run the parts room. However, no workers were displaced by the new system. “Luckily in our situation our department had eliminated their positions, and none of our employees wanted to go to work for the private company. But there was a department within the city that was starting back up, so we were able to transfer everyone who was displaced,” Lawson says. “All of them stayed with the city, and no one lost their jobs.”
Because the company handles hiring in the parts division, the city lost control over some of the hiring process. “We do have a strong final say. When they bring an employee in here that we feel is a problem they are very quick to respond as far as relocating him or dealing with the personnel issue,” Lawson says.
Although the system runs smoothly now, the initial phases of integrating the software between the city and private firm were problematic. “The private contractor had to issue a part from their software and then turn around and enter the part into our software. So they had to physically enter parts twice,” Lawson says. “When someone is manually doing these things you have a lot of errors, so we have to police that pretty steadily.”
Now the company keeps the inventory in its computer system until a part is distributed to Fleet Services. The city then enters the part into its records.
Although Fleet Services has not saved any money with the new system, Lawson nonetheless is pleased. “We have seen satisfaction and efficiency of the mechanics improve with this endeavor,” Lawson says. “This has been a big advantage to the city.”