When PHH Vehicle Management Services benchmarked itself against its competitors in 1992, it received a nasty shock. The crushing charges against Britain's largest fleet management specialist included low staff morale, autocratic management style, poor communication, limited understanding of customers and poor customer ownership. It's a list on which PHH president John Cullum does not like to dwell. But bad news, he says, had a highly galvanising effect.
'As market leader, we had begun to feel complacent. We certainly didn't expect to hear what we did. Basically, our customers told us we were right in the middle of the pack and not differentiated at all. It came as a complete surprise to us all,' he admits. The report prompted a thorough review of the PHH philosophy and all its processes and practices. 'The benchmarking exercise was like a warning flag,' says Cullum. 'We had to take a good, hard look at ourselves.'
Founded in the US in 1946, PHH has operated in the UK for 25 years, offering a complete range of services for cars, vans and trucks, including leasing and contract hire, fuel management, and sale and leaseback. With turnover in excess of £1 billion, PHH has 200,000 vehicles under management, 16,000 corporate clients, 659,000 fuel cards in circulation and a weekly fuel purchase value of £19.5 million. From its offices in Swindon and Manchester, the company is expanding its portfolio of retail, insurance and consumer services.
From that good, hard look back in 1992, emerged the vision, goals and values which drive PHH forward today. The vision is simply to be the service company of choice. As Cullum explains: 'We believe that only delighted clients are loyal customers.' To support this vision, PHH has introduced Beyond the Year 2000 Goals. These are displayed throughout its offices to ensure all employees understand the company's focus for the future.
These goals include 100% customer retention, 100% customer satisfaction and 50% customer delight; employee satisfaction of at least 50% (75% in some specific areas); and meeting profit-related pay targets for all employees.
PHH's new goals have been supported by a culture change throughout the organisation. A company-wide set of values has been introduced, emphasising moral integrity, team spirit, dedication to quality, efficiency, initiative, a nurturing of openness and trust, respect for the individual and adaptability.
These values dovetail with a new company philosophy, introduced in 1993.
Called Driving For Excellence, it focuses on the customer; improving processes, people and their development; and market promotion. In the same year, PHH began rolling out Focus on the Customer, a six-week learning and development programme for all staff. Among its components are workshops, coaching meetings, reviews and action planning.
A further programme focusing on customer delight is being piloted this year.
'Driving For Excellence wasn't introduced as a TQM programme, slogan or quick fix,' Cullum stresses. 'Rather it is the philosophy which underpins everything we do.' By creating a culture in which employees may 'own' their customers, make a difference and are recognised for their efforts, PHH is laying the foundations for increasing customer delight.