Since establishing its “green” initiative in 2007, Novo Nordisk has made significant progress in achieving specific target goals, including downsizing to four-cylinder engines and adding hybrid-electric and diesel options.
The company decreased its fleet’s average CO2 per mile by 8.8 percent and increased fuel efficiency by 10 percent from 2006 to 2011, all without sacrificing the provision of family-sized (seven-passenger) vehicles to its drivers.
“Given that Novo Nordisk operates under a Triple Bottom Line philosophy, one of which is environmental responsibility, our commitment to sustainability will never go away,” said Donna Bibbo, CAFM, manager, Fleet & Travel, for Novo Nordisk.
Bibbo manages all facets of Novo Nordisk’s fleet and travel programs, from strategic planning and implementing new initiatives to overseeing the day-to-day transactional activities in each area. She also oversees a staff of four, including Senior Fleet Associate Jennifer Cole, an outsourced fleet administrator, and two executive travel agents located at the Novo Nordisk headquarters in Princeton, N.J.
The company’s five-year goal targeted a 0.5-1 mpg increase in average vehicle fuel economy each year, producing a 5-percent annual decrease in average per-vehicle CO2 emissions.
To achieve these goals, Bibbo continuously re-evaluates the fleet selector, provides eco-driving training and driver incentives for eco-smart driving or fuel-efficient vehicle choices, and partners with suppliers.
Forming Key Partnerships to Achieve Target Goals
Key internal fleet partnerships include departments that the company’s sales and medical drivers report to, as well as human resources, legal and risk management, finance, strategic sourcing, and executive management.
“We see all of them as invaluable partners in running a successful fleet operation for Novo Nordisk,” Bibbo stated.
Externally, the fleet team relies heavily on its partnerships with its fleet management company, Wheels, and accident management company, Fleet Response.
“With almost 4,000 vehicles in our fleet in the U.S. and Canada and [the equivalent of] only 1.5 full-time internal employees dedicated to fleet management, we have forged close working relationships with both companies and outsourced many of our day-to-day operations to them,” Bibbo said.
The team has also forged close relationships with its insurance company (XL), claims handlers (Gallagher-Bassett), brokers (Aon), and driver training company (ADTS), all of which are instrumental in the safety program Bibbo is currently setting up.
“I also find my relationship with other fleet managers, especially those in the pharmaceutical industry, to be invaluable,” she added. “We share information and discuss how to handle special problems all the time, as well as other benchmarking, and they have been instrumental in my development as a fleet manager.”[PAGEBREAK]Fleet Sustainability Philosophy Continues Evolving
Novo Nordisk’s green program focuses on keeping a close eye on the most practical path to sustainability. Currently, the fleet department uses the most fuel-efficient options in the vehicle classes company drivers need to do their jobs.
Most vehicles are driven by sales reps and medical liaisons in the scope of their job duties while calling on the medical community. Clinical research associates also have vehicles, as well as executives, expatriates in North America on job rotations, and regional field trainers.
Bibbo and her team continually examine how drivers can be more efficient by changing their processes (e.g., vehicle cargo). Of the fleet’s almost 4,000 vehicles, 125 are diesel-powered, 456 use flex-fuel, and 24 are hybrid. Makes and models of these green vehicles include:
• Diesel: Audi A3 TDI and Volkswagen Passat TDI.
• Flex fuel: Chevrolet Equinox, Chrysler 300, Chrysler Town & Country, Dodge Grand Caravan, Dodge Journey, and GMC Terrain.
• Hybrid: Ford Escape Hybrid and Toyota Camry hybrid.
Implementing full-electric and other alternative-fuel vehicles into the company’s fleet isn’t workable at this time, according to Bibbo.
“Right now, electric is not feasible. My drivers travel an average of 2,100 miles per month. This does not lend itself to using an electric vehicle that only gets 45 miles or so on a charge,” she pointed out. “Alternative-fuel vehicles aren’t a good fit either until there is a national infrastructure to be able to easily refuel those vehicles.”
Balancing Driver Needs with Sustainability Goals
Novo Nordisk looks at everything it does from a sustainability perspective, while still considering the wants and needs of fleet drivers and their job responsibilities. The company remains committed to reducing the carbon footprint of its vehicles and setting annual goals that are reported back to its headquarters in Denmark for inclusion in the company’s annual report.
“We walk a fine line to balance our drivers’ wants and needs while still achieving our sustainability goals,” Bibbo said. “To that end, we analyze possible vehicles to use in our selectors, make sure we choose the most fuel-efficient vehicles in each class of vehicle offered (e.g., SUV, sedan), and review those vehicles twice a year and tweak as necessary before the spring order cycle.”
The fleet also uses four-cylinder engines in the majority of its vehicles, taking advantage of new technologies, such as Ford’s EcoBoost and GM’s eAssist. Other initiatives include:
• Supplying more desirable contents in the more fuel-efficient vehicles to incentivize driver selection.
• Providing flex-fuel vehicles wherever offered to try to take advantage of more fuel-efficient E-85 fuel, where available.
• Offering diesel-powered vehicles with great success over the past year. (The fleet’s Volkswagen Passat TDIs are averaging 35 mpg.)
• Offering hybrids, where available and suitable.
• Continuing to make sustainability an annual goal and investigating what else can be done to improve fuel efficiency.
“Through prudent and effective negotiations with both the auto manufacturers and our fleet management company, we have been able to keep our costs in line with expectations,” Bibbo explained. “Additionally, as Novo Nordisk management is highly supportive of our sustainability efforts, we are given the leeway to incur the necessary costs, within reason, to continue our efforts in this area.”
And, when it comes to obtaining buy-in at all levels for the fleet team’s sustainability efforts, Bibbo said it’s been an easy sale thanks to a corporate culture supporting effective sustainability initiatives.
Leveraging Strengths & Best Practices
In addition to the company’s sustainability initiatives, the fleet team’s strengths include experienced associates and management that includes almost three decades of fleet experience. The team’s expertise includes fleet management, customer service, strategic sourcing, financial experience, and project management.
“We show understanding and expertise, regardless of the task we are asked to undertake or who is asking,” Bibbo said. “We clearly see what is needed from the smallest task-oriented level up to the broader strategic level and also bring a clear view of how excellent fleet management can be an asset to Novo Nordisk.”
Some of the team’s best practices include:
• Thorough total cost of ownership (TCO) analysis of all vehicles when deciding what to offer drivers.
• MVR checks of all authorized drivers of company vehicles at least once each year, as well as checks on prospective new hires.
• MVR results combined with accident data to assign a risk level to all drivers.
• Used-vehicle sales program offered to all employees at fair market wholesale prices.
• Annual performance goals set with Wheels and reviewed and adjusted quarterly. Major fleet projects discussed annually, along with any project contributions from Wheels.
• Dashboard of pertinent fleet operations/cost data updated monthly for Bibbo’s direct management.
“Unlike other companies that have limited their offering of larger ‘work-life balance’ vehicles to their drivers (e.g., minivans and seven-passenger SUVs), we still offer these vehicles as a choice,” Bibbo said. “In order to compensate for the additional costs of these larger vehicles, we charge a higher personal-use fee for them.”
The fleet team also does a lot of management by exception. For example, Bibbo receives reports on people who purchase a fuel amount exceeding their company vehicle’s fuel tank capacity. She also receives a regular report on fuel economy under 18 mpg so she can follow up with the driver about why this might be happening.
“Obviously, once a few drivers have been contacted about these issues, word spreads that we are watching, and we have fewer exceptions,” Bibbo stated.
The fleet’s replacement policy is 36 months or 70,000 miles, whichever comes first. However, policy clearly states that fleet operations has the final say on when to replace a vehicle, which allows the company to short-sell when advantageous or make any other changes necessary to meet the business climate.
“We order vehicles twice each year (in the fall and spring) to match the highest resale markets,” Bibbo added.[PAGEBREAK]Utilizing Technology to Cut Costs and Boost Productivity
Bibbo is also a huge proponent of technology, and she uses it in the management of the Novo Nordisk fleet wherever possible. The fleet went paperless and no longer has any hard-copy vehicle files —
everything is housed in server files either at Wheels, Fleet Response, or Novo Nordisk.
Fleet offers systems to order vehicles and check on their status and to report vehicle mileage both monthly and for annual tax compliance. Also, most information drivers need to know and answers to their questions are on the fleet operations intranet site.
Within the past year, Bibbo has also introduced several mobile apps from Wheels that allow drivers to report mileage, check new vehicle status, find a repair facility, and find a fuel station on their smartphones.
“I expect that more apps will be coming. As our employees not only have smartphones, but soon will have iPads, they will appreciate these apps,” Bibbo said.
Most of the in-vehicle technology provided to drivers has to do with safety, including blind-spot indicators, parking assistance, back-up cameras, etc. Although the Novo Nordisk fleet policy recommends not using a cell phone while operating a company vehicle, Bluetooth technology is also provided where available, so if drivers feel the need to use their phone while driving, they will be doing so hands free.
Unveiling Large Fleet Initiatives
The Novo Nordisk fleet implemented three major changes in 2012, including changing accident management companies to Fleet Response, outsourcing fleet administration to Wheels, and expanding its fleet by 750 vehicles.
The accident management switch came about as a result of a strategic sourcing requirement to bid out all services within certain time frames. It was also time to review the fleet’s accident management program, so Bibbo’s team conducted a thorough RFP process and decided to switch vendors.
“The roll-out went very smoothly with an announcement to all drivers and information sent home, along with a flashlight with the phone number to keep in our company vehicles,” Bibbo said. “Our drivers love little gifts, so this helped them notice the change. Fleet Response has made everything easy for us.”
The change to Fleet Response reduced accident costs and associated management costs by 5 percent.
The year also saw an addition of 750 sales associates. With the additional vehicles added to the fleet, yet no increase in fleet personnel, the decision was made to outsource fleet administration to Wheels.
“Implementing this program allowed us to handle the expansion seamlessly,” Bibbo explained. “We have freed up Jennifer Cole, our senior fleet associate, to take on more analysis tasks along with gaining supervision experience, and I am afforded more time for strategic activities in the fleet and travel areas. In addition, Aaron Eichhorst (our outsourced fleet administrator) has fit in perfectly with the Novo Nordisk culture and is extremely effective.”
The fleet team’s big initiative for 2013 includes implementing a complete driver safety training program. While the team has implemented pieces of a safety program in the past (MVR checks, risk assessments, online training modules, and an online safety newsletter), it has not had the time or resources to put together a comprehensive end-to-end solution for all drivers.
Bibbo also plans to look at new ways to communicate safety, maintenance, and vehicle information to drivers. “I will be looking at social media and how I can use it most effectively in my communication efforts,” she explained.
Additionally, Bibbo will assess some sort of “gamification” for her drivers. “They are nothing if not competitive, and I am looking to change their behavior by offering a competition to be better,” she added.
For example, fleet might do a competition among the diabetes sales regions to get better fuel economy and reward the region that does the best with gift certificates or perk points.
“Wheels has introduced a new online platform, called ‘Change Driver,’ that will allow us to do this very visibly online with everyone being able to see their real-time results,” Bibbo explained. “I think that this will really appeal to my drivers, and now that our expansion is over, I am looking to pilot this initiative in 2013.”
The company is also currently exploring the idea of charging personal use based on the fuel efficiency of the vehicle being driven, and taking the monies collected and donating them to an environmental cause.
Bibbo believes the fleet team will continually be called upon to find new and better ways to keep drivers productive — introducing new technology and keeping up with the needs of all the different generations represented in Novo Nordisk’s employment base.
“I foresee that we will continue to grow, and we will need to meet rising demand with new ideas of how to streamline and simplify our processes,” Bibbo concluded. “I look forward to tackling these challenges and staying in the forefront of fleet management for years to come.”[PAGEBREAK]About Novo Nordisk
● Industry: Healthcare, specializing in
● Headquarters: Bagsvaerd, Denmark
(outside of Copenhagen). The U.S. head-
quarters is located in Princeton, N.J.
● Total Employees: More than 32,000
employees in 75 countries, with
nearly 5,000 employees in the U.S.
● Products and Services: Broad
diabetes product portfolio, including
insulin delivery systems, in addition
to therapeutic areas such as hemostasis
management, growth hormone
therapy, and hormone therapy for women.
● Fleet Manager: Donna Bibbo.
● Total Fleet Vehicles: Almost 4,000.
● Replacement Policy: 36 months/
● Trivia: The Novo Nordisk logo is the
Apis bull, one of the sacred animals
of ancient Egypt. The choice of the logo
follows an old European chemist’s
tradition of identifying pharmacies
by an animal symbol.