Once seen as a necessary evil, lift truck maintenance costs prove ripe for efficiencies that save money and boost productivity.

Traditional thinking about lift truck maintenance is rapidly breaking down. In the face of readily available data and proven techniques for cutting waste from costs once assumed to be unavoidable, fleet managers and service providers are working to introduce discipline to fleet maintenance practices.

The transition is evident in the popularity of outsourced maintenance arrangements. According to Modern’s annual “2014 Lift Truck User Survey” (p. 30), only a third of fleet maintenance is handled by in-house staff, 42% is outsourced to lift truck dealers, and another 21% is outsourced to third-party contractors. The appeal of outsourcing includes the customer’s ability to focus on core competencies as opposed to managing its own parts, technician training and service events. But it’s not as simple as signing a contract and walking away.

“To wash your hands of fleet maintenance is to say you want to ignore waste,” says Mike McKean, fleet management sales and marketing manager for Toyota Material Handling USA. “You’ve got 40 other things to do that don’t involve what it takes to run a fleet. There are operations where they are so busy and so lean they are very grateful just to have a forklift or a technician to do repairs.”

Some companies with in-house technicians like knowing someone is on hand to address a forklift when it goes down. “These are the kind of companies who typically don’t track utilization in the first place,” says McKean, who adds that this approach is typically based on reactionary rather than planned maintenance (PM). “They think they have some sort of PM plan, but they probably tend to run equipment to death and repair as needed.”

The industry is moving to a point where data and well-coordinated service allows predictive maintenance. Jerry Sytsma, general manager at Rapidparts, an affiliate of Mitsubishi Caterpillar Forklift America, says the goal is to move from diagnostics to prognostics.

Quality of service, cost of service and downtime are the three key concerns, says Sytsma, adding that they are weighted fairly evenly. But while many fleet expenses are understood as little more than top-level budget lines, it is visibility into individual events that highlights the best opportunities for improvement.

Accounting for accountability
Outsourcing maintenance is not a guaranteed fix for a fleet’s maintenance shortcomings, nor is it a guaranteed cash cow for the dealer or third party. The structure of an agreement should promote accountability—and subsequent changes in behavior—for both stakeholders.

Sytsma offered the example of a large customer who regularly battled with its lift truck dealer over warranty claims related to transmission failures. After installing sensors that enabled remote monitoring, the dealer was able to collect data about each instance that a lift truck operator switched from forward to reverse without coming to a full stop. The system logged more than 2,000 events on an operator-by-operator basis each time they switched gears at 3 miles per hour or more. Within 30 days, Sytsma says, virtually all transmission failures halted.

This story illustrates how data can take the guesswork out of identifying costs and their root causes, in turn benefiting the customer and service provider. In years past, it was difficult to get a sense of the true cost of maintenance, if identifying that cost was even a priority. It was also a challenge to vet and verify the performance of a service provider. Although a lift truck dealer is most likely to have technicians with up-to-date training, these sorts of capabilities should not be assumed.

One of the best performance indicators, says Sytsma, is first-time repair rate, or the ratio of service events that are successfully resolved on the technician’s first visit. “It’s a great way to measure either the technician’s capabilities or the dealer’s commitment to parts inventory,” he says. “If a technician has to come back, between travel, setup and downtime, that can create 20% to 50% inefficiency right off the bat. One in five times is not bad, but if it takes two trips 75% of the time, that’s a problem.”

Pairing lift truck operators with a dedicated piece of equipment is an effective way of boosting accountability while addressing preventable damage, according to Russell Wells, senior national accounts manager at Kenco Fleet Services. Some fleet management technologies enable immediate coupling of service work orders with pre-shift checklists to track damage back to an individual. “Any fleet should rely on operators to keep a keen eye for torn seats, hydraulic leaks, bent forks, you name it,” says Wells. “This can drastically reduce abuse. We have seen sites reduce these costs by nearly 100%.”

To take accountability a step further, some who have outsourced lift truck maintenance, HVAC maintenance or other services are looking to unite all services and related metrics under a single third party. Pat DeSutter, director of fleet management for Hyster, notes a proliferation of third parties aimed at organizing service providers. “Large customers with many locations like working with a single partner who can provide a system solution to oversee all of these categories,” says DeSutter. “Available technology makes it possible to bring all the data together, and we’ve even seen previously specialized service providers working to manage it all.”

Buyer buy-in
An overarching third-party maintenance provider might also make life easier for purchasers, but just as with the connection between operators and technicians, purchasers can’t be too removed from the impacts of their decisions. “Often they make one decision for an asset and then they are no longer involved,” says Toyota’s McKean. “A customer might lease a forklift with a full maintenance plan and walk away. They enjoy locked-in payments with the only other expenses being variable and avoidable damage not covered in the contract. That’s old school. A better way to manage a fleet is through a PM program based on utilization. This will provide data to lean the fleet and understand peak or seasonal periods where short-term rentals make more sense than a long-term, under-utilized lease.”