As a final note for this session, eliminating these and other labor intensive jobs, isn’t going to make the work go away. Someone, somewhere will be performing the work. The reported savings associated with the elimination of these positions will show up as an expense elsewhere, oftentimes a greater expense.
This is one of DTE’s favorite tricks. For example in 2005 there was an effort to take work away from Motor Transportation. (Mechanics) A lot of work was vended out to avoid paying the Mechanics overtime. The end result was that it usually cost more to have a vendor do it than for DTE Mechanics to do it. Sometimes it was vendored out to other DTE mechanics.
The upside was DTE showed a savings in the money pocket for mechanics. The downside was that it usually cost more from the money pocket for vendors. The process was then hailed a success using the savings from the Mechanics money pocket as the point of reference with never a mention to the higher costs associated with vending it out.
The excess labor costs usually was not the only negative monetary impact associated with vending the work. When the trucks are being sent to a vendor, whether internal or not, Stores personnel unloads the stock and tools to prevent theft while it’s away from the
. The truck is then towed at a cost of about $200.00+ to the vendor site. Cost is determined to some degree by distance but price is also affected by minimum fees. From Service Center Pontiac Service Centerto for example the costs runs about $225 for the tow one way. Warren Service Center
Often the vendor takes longer to complete the job than the internal mechanics, creating excessive downtime for what is sometimes critical equipment. Once completed another tow cost is incurred returning the vehicle to the
. Once back at the Service Center the tools and equipment have to be re-loaded onto the vehicle, each step incurring additional costs to the vendor process. Service Center
has a vehicle ready for pickup and another ready for delivery to the same vendor, the Mechanic isn’t allowed to drive one in and pick the other one up on overtime. If the mechanic were to drive to the vendor, make the exchange, do the paperwork and drive back and it took about 2-2 ˝ hours of overtime, the costs would be between $85-$110. The Company repeatedly chooses to spend $225 to have the vehicle out, towed back, and another $225 to send the other vehicle to the vendor. Service Center
There’s something inherently wrong with spending $450 out of one budget in order to save maybe as little as $85 out of another. Who loses? The ratepayers, the shareholders, the Company’s bottom line and obviously the underappreciated mechanic and his family. As I mentioned earlier DTE will spend dollars trying to save dimes then hold the dimes up as their shining example of what they’ve saved, never mentioning what it cost to get there.
The costs of towing alone would pay for a lot of overtime. For example, last year at
, $30,000.00 was spent on towing. That doesn’t include costs for the actual vendor repairs. Most vendors charge more per hour than the loaded cost of any mechanic we have. Even bigger are the safety and reliability issues associated with vending the work out. I hope someone will tackle the safety and reliability issues and bring their realities to the forefront. Pontiac Service Center
There appears to have been a twofold reason for this to have happened. One, it gives a skewed vision of what DTE Mechanics actually do, or should do, and given enough time it obscures what is challengeable through Attachment C. Second, by nature of the fact their true worth has been devalued by minimizing what Mechanics do, or has left to do after having their work taken away, gives the appearance reducing the Mechanics ranks or eliminating them is justified and is the fiscally responsible thing to do given the downtime they now have as a result of their work outsourced.
I believe a utility in
did the same thing and eliminated their Mechanics only to hire them back a year later after realizing all the problems associated with sending their trucks and equipment out for repair. Florida
I will be characterized by the Company as that of a disgruntled employee. Actually there are many disgruntled employees below the Executive Suites these days. As I stated at the beginning, I think concern more accurately describes my intent, but I do have to acknowledge a little discord may have slipped in from time to time which reveals the frustration level inherent in the workforce, regardless of our positions.
As other cost savings ideas come to the forefront, I will try to research and develop them for posting here, so watch for updates.
Thanks for taking the time.
This page originally uploaded 05/03/06. Last revised on 07/08/06