Driving ambition - Philip Morris International’s (PMI) global mobility strategy

12 June 2015

A vast fleet of cars underpins Philip Morris International’s (PMI) global mobility strategy. Global director environment, health and safety, Csaba Csiszko, explains how it is kept running smoothly, sustainably and cost-efficiently.

Finance Director Europe: How mature is PMI's mobility operating model, and how has it evolved over the years? How long has it taken to establish a world-class fleet and mobility function?

Csaba Csiszko: PMI has made significant efforts during the last couple of years to develop best-in-class fleet management systems. While a lot of progress has been made to reach a satisfying level, I believe that the more you know, the more you realise there is room for improvement. Originally, the model was driven by cost and efficiency, but increasingly the company has integrated more safety and sustainability aspects. PMI has two fleet management centres: one is focused on cost, efficiency and total cost of ownership (TCO), and the other manages fleet safety. Both groups are aligned in terms of strategy and programmes.

Why has PMI been so successful with its fleet operating model, especially regarding safety? What gave it the edge to win the Fleet Europe award, and how has that approach improved performance?

PMI works to ensure a consistent and balanced approach to fleet safety. To develop and deploy its strategy, a thorough analysis and benchmarking of the best practices available was undertaken, and this benefitted participating in organisations such as the Network of Employers for Traffic Safety (NETS). Those that best addressed the company's needs were selected and transformed into a set of actions that were well integrated into its business model, ranging from including safe driving in employees' annual work objectives, to business plans.

PMI recognises that fleet safety is a complex issue, and manages it as such, from safe car procurement to educating the organisation on safe driving. To achieve this, a working environment has been created that supports every aspect of the initiative, starting with sales force planning processes. PMI puts the same emphasis on minimum vehicle equipment levels and behavioural programmes. Of course, senior management support is also critical, which is why the senior management team hosts the PMI Fleet Award, which recognises affiliates with outstanding performance in this area.

How do you manage stakeholder relationships? To what extent does your fleet and mobility organisation have contact with finance?

Fleet is a significant cost driver, and therefore close collaboration with finance is vital from a cost management and resource allocation perspective. We have a cross-functional steering committee responsible for fleet management, and finance is part of this team. Finance understands the initiatives and contributes valuable input to planning.

To what extent has TCM taken over from TCO as the key metric?

This hasn't happened yet, but several initiatives are in place. The approach to fleet cost management combines global strategic direction with local decision-making and implementation. More specifically, the management centre that focuses on cost, efficiency and TCO provides the global guidelines on the best operating models and is in charge of centrally driven projects. In parallel, PMI's affiliates are given the flexibility to adapt the global strategies to their local environment and needs, and are ultimately responsible for deciding on the model that works best for them.

What consumes most of your time, and what are your current priorities?

PMI's fleet is expanding rapidly and has marked a 40% increase over the course of the last three to four years. My biggest challenge is to keep the expanding fleet management needs in focus, while aligning them with the dynamics of PMI's business and local specificities, wherever the company operates.

"My biggest challenge is to keep the expanding fleet management needs in focus, while aligning them with the dynamics of PMI’s business and local specificities, wherever the company operates."

Unlike the manufacturing floor, where the company has ultimate control over developing and implementing the best safety standards and practices, the streets are a much more unpredictable environment. Elements such as road infrastructure, or the driving culture, are beyond PMI's control, and these sorts of things must be taken into account when developing fleet safety programmes.

Current priorities include rolling out a new e-learning scheme that will enhance the suite of training offered to every company car driver, ranging from customised interactive e-learning sessions to practical driving programmes.

What does PMI's e-learning programme consist of, and how is it delivered?

The e-learning programme is implemented across more than 80 countries and in more than 40 languages. To develop it, PMI partnered with a company with global reach in this respect. PMI provides localised content (all videos and statistics are from the countries where drivers are logging in) in the relevant language; we don't want to show Swiss roads and driving situations to someone driving in Manila, or São Paolo. The programme is accessible on all types of computers, laptops, tablets or smartphones, or from an internet cafe, if the driver has no other access to a computer.

PMI has a substantial global fleet of vehicles: what types of vehicles does it consist of, and who are the main users?

PMI has more than 25,000 cars, the majority of which are used by the sales force. For them, the cars are tools with which to reach their business objectives. Benefit cars are the second biggest category, and the fleet also includes trucks, motorbikes, as well as utility cars, such as fire-trucks, in some countries.

How is your fleet managed?

PMI takes a practical approach that combines local and global management. More specifically, safety is managed at a global level where PMI defines the minimum safety equipment levels and corporate safety standards. Fleet management and costs are handled locally so that processes are managed in the most efficient way in the different business environments. The decision to lease, or own, cars, therefore, is always made locally.

How sustainable is the fleet?

PMI has several green initiatives, as well as an overarching fleet management optimisation project. After safety and cost, CO2 emission is a key pillar of this project. The carbon footprint of the fleet is measured, then steps are taken to reduce it by purchasing more fuel-efficient cars, and by focusing on driver behaviour. More specifically, CO2 emission caps are set for each vehicle category that are consistent across every country in which PMI operates. The training suite, meanwhile, includes modules on eco-driving, and driving aids based on telematics are available to support fleet safety.

Which are the major fleet safety technologies of the future?

Interactive and intelligent safety devices will play a greater role. Currently, a lot of built-in technology reduces the impact of potentially unsafe situations. In the future, sensors will warn drivers if their hands leave the wheel, or their eyes are not on the road. Some aids in development have the potential to take over the driving entirely, and this represents a very interesting opportunity.

Csaba Csiszko is Philip Morris International’s global director environment, health and safety. Previous roles include commercial director at Nestlé Waters and sales strategy director at Philip Morris Hungary. He lives in Lausanne, Switzerland.