Fleet/service provider communication is a critical factor for repair order (RO) authorization and approval. In fact, industry studies have shown communication difficulties are a leading cause of unnecessary vehicle downtime.
In managing customer relations, truck maintenance service providers need to look beyond generic quality control models for guidance. For example, strategies that leverage the purchase order (PO) number and other key points of interaction/communication to promote mutual satisfaction with the service experience.
Recognizing the importance of repair order approval and authorization process, the Technology & Maintenance Council (TMC) challenged its S.16 Service Provider Study Group to develop recommended guidelines for service provider business practices. To date, the group has issued or nearly completed a dozen such recommended practices to improve fleet/service provider RO and PO authorization processes.
The Foundation
S.16 started tackling this issue by examining an existing recommended practice (RP) – TMC RP 535, Template for Establishing Fleet/Service Provider Relationships. It serves as a template for establishing a business relationship between a fleet and a third-party maintenance provider.
Building on RP 535, S.16 developed TMC RP 1602, Repair Order Authorization and Approval. It offers service providers industry-proven stages of service to follow for both fleet and service provider satisfaction.
Both RPs should be used together for maximum effectiveness.
RP 1602 delineates the RO approval and authorization process into five stages of service that include:
- The initial conversation.
- Continued dialogue with knowledge of service requirement.
- Task is complete and final charges are determined.
- The invoice from the service provider.
- Payment of the invoice by the fleet.
By defining these five stages, RP 1602 provides fleets and service providers with the tools to “sing off the same song sheet” and, thereby, promotes better understanding of what each party should expect in the repair process.
Stage 1: The Initial Conversation
A reference number is given to the service provider prior to beginning any work of any kind. If a service provider is unsure of the nature of the reference number, then the service provider should inquire of the fleet prior to agreeing to perform services.
The reference number never authorizes funds to be spent without specific authorization.
The fleet must communicate clearly its intent when giving the reference number, and the service provider must make sure that it is clear as to the intent of the fleet. Phrases fleet owners may use at this stage are: “Check and advise,” “I need an estimate” or "Repair as long as it is under warranty.”
Stage 2: Continued Dialogue with Knowledge of Service Requirement
The service provider requires authorization for spending on specific tasks. These tasks may include the dollar limit available or open PO; not to be confused with a closed PO, which is not recommended because the amount is unknown.
The fleet must also clearly communicate its intent when giving further approvals to the service provider. Phrases used can be: “I’ll agree to x number of hours but no more until you know the problem,” “Repair that problem and let me know if you find something else,” “Repair up to $x or let me know” or “Repair as long as it is under warranty.”
Stage 3: Task is Complete and Final Charges are Determined
Upon completion of the task, the service provider determines the final charges and communicates this to the fleet in a timely manner. Depending upon the fleet’s process, known by this stage, the service provider will understand how to invoice the fleet owner.
This can be done a couple of ways:
- Closed PO – issued by the fleet to a service provider for a specific task for a specific amount.
- Open PO – issued by the fleet for both the fleet and the service provider to use as a reference number for a specific task.
- Regardless of the type of PO, it’s required on the final invoice presented to the fleet.
Stage 4: The Invoice from the Service Provider
Upon receipt of the invoice from the service provider, the fleet should verify that the dollar amount on all closed POs exactly matches the invoice amount. Any variance should be communicated to the service provider with a clear indication that the fleet did not authorize the expenditure.
Upon receipt of the invoice from the service provider, the fleet should audit all open POs in a timely manner and communicate to the service provider any questions or concerns related to the invoice.
Stage 5: Payment of the Invoice by the Fleet Owner
Regardless of the type of PO, the service provider’s invoice should be paid in accordance with the terms discussed prior to the beginning of the service event or as documented with the service provider.
Additional Details
There are many other details involved in the discussion of service events that are not covered in RP 1602. Furthermore, the method and frequency of communication between fleets and service providers should be discussed and set up prior to the beginning of the service event to ensure a meaningful dialogue and resolution.
RP 1602 is just one of more than 450 TMC RPs that have been created for the purpose of improving maintenance efficiency and providing the industry with trucking solutions.
Kenneth Calhoun is vice president of customer relations for Truck Centers of Arkansas (www.truckcentersar.com), a full-service dealership with headquarters in North Little Rock, Ark. He currently serves as a service provider director-at-large on TMC’s board of directors. He is the immediate past chairman of TMC’s S.16 Service Provider Study Group. TMC is North America’s premier technical society for truck equipment technology and maintenance professionals (www.trucking.org/Technology_Council.aspx). It is a part of the American Trucking Associations (www.truckline.com), the largest national trade association for the trucking industry.
