Empowering People

Aug. 1, 2000
PETERBOROUGH, England - Imagine placing an engine order, tracking the engine's progress online and checking, by the hour, the status of your engine before

PETERBOROUGH, England - Imagine placing an engine order, tracking the engine's progress online and checking, by the hour, the status of your engine before it leaves the factory. Impossible? Not so, says Richard Case, managing director of the industrial power business unit of Perkins Engines.

"Paradoxically, as technology starts to make our products easier to maintain, we must meet the increasingly sophisticated service needs of our customers," Case told RER at the Perkins manufacturing plant 70 miles north of London.

"The future of customer service is simple. It will be about providing total customer support, in engine design, manufacturing, supply and quality. Then once the engine is in use, we aim to help the [original equipment manufacturers] support their customers throughout the life of their machine. In other words, a cradle-to-grave support system."

Technology is bound to play a critical role in designing the engines of the future, Case says, but product support can now be done anywhere, anytime by a "virtual technician."

"Alternatively, if the machine needs attention rather than a specific part, the end-user could plug the machine into his laptop and, through what amounts to a phone call, link with his local service contact number," Case explains. "The service center accesses the user and machine history, 'looks' electronically into the engine and starts the diagnostic process."

The core of this system will be a database that stores information from each individual engine and the machine to which it connects. When something goes awry with the machine, the user could consult an electronic service guide that employs animation to describe the required repair work. If a user needs replacement parts, he or she could simply access an electronic parts finder. All these services will be available in the future over a secured Internet or extranet connection.

As the industry embraces technology, Case predicts Perkins will develop partnerships with OEMs. This would entail a "highly sophisticated system of tracking the equipment," such as radio frequency identification tagging, which is more advanced than the current bar coding system.

During a tour of the Peterborough plant - one of three state-of-the-art facilities in Europe at which Perkins manufactures more than 300,000 engines from 5 to 2,600 horsepower - Case also touched on the synergy between Perkins and Peoria, Ill.-based Caterpillar, which acquired Perkins in 1998. Case said one of the most significant impacts of the partnership has been the creation of an "IPBU," or industrial power business unit.

"The two brands will remain completely separate and will be handled by separate sales and customer teams," Case said. "This is important to ensure strict customer confidentiality is maintained on all projects. What the industrial power business unit does is give customers access to the wealth of experience and resources, which the two companies working in partnership can provide. So far, response to the unit has been very positive, and our customers have welcomed the move."

Mike Reinhart, Perkins' rental sector manager, talked to RER about empowering the American rental scene:

What is your strategy for catering to the rental market? A significant portion of our engines is sold to [original equipment manufacturers] who sell to rental companies. The majority of the products utilized by the rental industry require low- to midrange diesel power, and that's precisely where Perkins' focus is.

The rental market is a rapidly evolving arena. Most rental firms are professionally managed businesses run by either large investor firms or enthusiastic entrepreneurs. The key to a successful rental operation is the ability to have the right equipment available and to maximize uptime. It makes sense for the rental yard to specify dependable diesel-powered equipment and to have the ability to perform its own service work whenever possible. From an engine manufacturer's perspective, a solid dealer network must be in place to ensure that the rental customer has easy access to parts when required. We've worked diligently over the past three years to add authorized dealers where needed. Currently, Perkins has more than 1,100 locations in North America.

Has consolidation affected the diesel engine industry? Rental industry consolidation has not had a major impact to date. There is some shifting in business among equipment OEMs. It's important to stay abreast of OEMs' sales success to the rental industry so that we properly support their efforts with major customers and the industry as a whole. We know that rental firms have the capability to specify engines in certain categories of equipment. At the end of the day, it's all about the service and support provided by OEMs and their diesel engine partners. All rental companies, whether they are in RER's top 100 or the other 14,000-plus, need exceptional customer support. Diesel engine manufacturers who have the capability to provide comprehensive parts and service support will prevail.

How is the diesel engine industry expected to change in the next five to 10 years? The next five to 10 years will see the diesel engine companies focus on delivering certified engines that meet U.S. Tier 2 and Tier 3 emission requirements. Starting January 1, 2003, 100- to 175-horsepower engines will be affected, and on January 1, 2004, 25- to 100-horsepower engines will be required to meet more stringent nitrous oxide, hydrocarbon and particulate levels.

Tier 3 standards are expected to be in effect in 2006 and 2007. While meeting emission requirements are of paramount importance, the challenge for Perkins and others is to deliver engines that not only meet legislative standards but also deliver improvements in noise, fuel economy, power, torque and longer oil change intervals. OEMs, rental firms and end-users will all benefit. Engine manufacturers will need to step beyond the traditional product and supply other innovative solutions in overall customer service and product support. That's good news for rental in terms of customer satisfaction and the bottom line.