By Ben Reiland
December 19, 2023
Your company is ready to part ways with its current vehicle program. Maybe you’ve outgrown it, maybe you’ve held onto it for too long. Regardless, you’re ready to move on. So what comes next? What does transitioning vehicle programs look like? What are the steps your company should be taking? Let’s get into it.
The first step should be simple: solidify your why. What’s going on in your current vehicle program that your company wants to move on from? Maybe you’ve had 10 meetings about this and going over it feels redundant, but it’s helpful to be on the same page as your peers about this as you take further steps away from your current program. Here are a few reasons you may be ready to leave your old program behind.
Maybe it’s the fuel and insurance and maintenance costs of fleet vehicles. Maybe it’s the tax waste of a car allowance. Or maybe it’s the suspected mileage fraud in a traditional cents-per-mile program. Whatever the case, figure out what those costs are, compile them in spreadsheets and have them on hand. They’ll be useful later on.
Have concerns over non-compliance in your program? Mileage logs that don’t include the IRS-required information can expose companies to audit. A lack of mileage logs can have a similar consequence. Concerned about employees exposing the company to risk by driving fleet vehicles for personal-use? These are strong reasons for companies to decide it’s time to transition to a new program.
It could be that recording mileage manually is taking up a lot of driving employees’ time. It could also be that administrators face considerable challenges sorting through mileage logs and keeping track of them for reimbursement. Whether time is wasted inside the car or the office, companies with programs that place administrative burden on employees often look to alternatives.
Where are they driving? What’s going on out there? Companies don’t need to keep track of every move their mobile workers make. But when mileage logs record staggeringly different distances, insight can clear a lot up. When a vehicle program can’t provide anything about driving patterns or behavior, companies may start looking for a new program.
So you know why you’re leaving the old program behind. Great! Now, do you know what you’re looking for in a new program? It might be as simple as the inverse of the challenge your company was facing. It might also be an opportunity to explore other benefits that could be available in a new option. Here are a few goals companies hope to achieve when transitioning vehicle programs.
We talked about the many ways a vehicle program can exceed the expenses it should. The ideal new program wouldn’t have the same vulnerabilities, sure. But it could also have more of an impact than the money you were spending. Think about program flexibility. Take a car allowance for example.
A company providing driving employees with a monthly stipend has their budget set for the year. Except, suddenly gas prices skyrocket. That stipend no longer covers the costs driving employees incur from business travel. What should a company do in this situation? Adjusting the stipend is a logical next step. Some companies provide fuel cards. Neither option is ideal. Ideal is a program that can adjust with economic pressures, helping your company control costs.
Whatever risk looks like for your company’s current program, mitigation should be a high priority. As with cost control, that can and should go beyond correcting issues with the previous program. Compliance should be the standard. But companies can also do more to address driver safety. What does that look like?
It’s fairly standard for employers to run a Motor Vehicle Records (MVR) check on an employee during the hiring process, especially if they’re being brought in to drive for the company. This is a great way to ensure that, at least a few months or years prior to hiring, the employee appears to be a safe choice. But, if less than a year later that employee receives multiple citations before being involved in an accident, employers have no way of know of the events leading up to the crash. Staying on top of warning signs is a big reason companies use Continuous MVR monitoring.
Depending on the program you’re moving away from, your company is likely either looking to significantly improve productivity or minimize administrative burden. Businesses may fear that employees shifting from programs that didn’t require any measure of accountability will have a hard time. They’re looking for an easy, admin-free option. Businesses shifting from manually recorded mileage are looking for something along those same lines. But there’s more productivity benefits to be shared.
Time wasted on small tasks isn’t limited to driving employees. Administrators can spend countless hours sorting through mileage logs and reimbursement information. The right vehicle program vendor makes the process of sorting through approvals as seamless as automated mileage recording.
Any number of companies currently have vehicle programs that don’t give them so much as a peak into their mobile workforce. Gaining insights into how employees are driving in their role opens the door to exciting possibilities: route optimization, improvements to region assignment, best practice tips from top performers and more. These insights can create opportunities for teams ready to make them.
You’ve fully evaluated your current program. You’ve figured out why you’re done with your current program, and you know what you want in a new program. Now it’s time to find the next program. Here are some things to think through as you go program shopping.
There are four main vehicle programs: car allowance, cents per mile, fixed and variable rate reimbursement and fleet. At this stage, you’re likely abandoning one of these and ready to learn all about the others. Now’s the time to do just that. Check out our guide to vehicle programs. Remember what you’re leaving behind in your current program and what you’re looking for in your next. Learn the costs, both upfront and hidden. Learn about liability and compliance issues. Understand that your company may need more than one vehicle program to support its driving needs. Take assessments, check out demos, get your hands on everything you can. Take your time and get it right. You don’t want to be back here in a couple years because you rushed into the nearest option available.
As you research which vehicle program is best for your company, you’ll also see any number of vehicle program vendors (like us). The next step is making your choice, not just of which vehicle program (or programs) but also of which vendor. This can be a difficult process. How do you know which one is the right choice for your company? Sure, we could just tell you it’s us. But it’s more helpful to have a series of questions to ask. Questions around reimbursement schedules and customer support, things that you might not think about immediately when considering a vehicle program but will ultimately impact both the company and your mobile workforce. Find satisfactory answers to those questions and you’re onto the next part: communication.
Technically this is part of the implementation process itself, but I’ve separated it to emphasize the importance. Before implementing the new program, you need to communicate it to those most affected by it: your mobile workforce. Change management can be a real challenge. Clear and open communication works wonders when introducing a big change to employees. They’re going to have questions, and you might not even have all the answers. Work with your vendor to make sure your mobile workforce knows exactly what their future with the new program looks like.
This is the actual roll out of the vehicle program. Your old program is a thing of the past, your driving employees have been educated and are in the new system. What that actually looks like is going to vary by the vendor you’re using and the program (or programs) you’re moving to. From here on out, any concerns or questions you have will be directed to customer support or account management (depending on how your vendor operates). Congratulations on the new program! Hope it works out well for all involved.
Changing vehicle programs can be a difficult process, but hopefully, by laying out the process we’ve dispelled some of the mystery. As you go through the process of selecting a new program and vendor, remember why you’re moving on from the old one and what you’re looking for in the new one. The first shouldn’t change, but the second might.
Ready to learn more about your vehicle program options? Check out our post Vehicle Programs: the Guide to Vehicle Programs.
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