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Letter to the Editor
This article originally appeared in the September 2009 Issue of INSIGHT
©2009 Collision Repair Industry INSIGHT All Rights Reserved
Solera Holdings Posts 4Q Profit
John S. Quinn to Join LKQ Corporation as Executive Vice President and CFO
Mitchell’s UltraMate 7 Now Able to Generate Estimates in Spanish
Caliber Collision Centers Appoints Steve Grimshaw CEO
PPG Appoints Robert J. Dellinger Senior Vice President, Finance and CFO
R.L. O’Connor & Associates Pledges Continued Support to AMI
DEG Has Now Processed More Than 1,600 Inquiries
I-CAR Serves Up Mostly Positive Economic Forecast for 30th Anniversary
Glen Funk’s Spirit of Giving Lives On After His Death
CIC Committee Eyes Inconsistency in DRP Procedure Requirements
Automotive Disciplines Launches New Communication Enhancements to Production Plus
INDUSTRY UPDATE
Solera Holdings Inc., which provides software and services for the auto insurance claims industry, has posted a fiscal fourth quarter profit, as revenue gains in the company's automotive recycling unit offset declines in other areas.
The company earned $11.8 million, or 17 cents per share, compared with a loss of $21.6 million, or 34 cents per share, a year ago.
Revenue fell slightly to $144.1 million from $145.5 million in the fiscal 2008 fourth quarter.
Revenue from automotive recycling and other customers was $20.5 million for the fourth quarter, a 34 percent increase from a year earlier.
For the full fiscal year, Solera's profit climbed to $57.8 million, or 85 cents per share, compared with $598,000, or a penny per share, in fiscal 2008.
Revenue rose to $557.7 million, from $539.9 million in the prior fiscal year.
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John S. Quinn will join LKQ Corporatio as Executive Vice President and Chief Financial Officer in the fourth quarter of 2009.
Joseph Holsten, LKQ's Pres-ident and Chief Executive Officer, commented, "John has extensive financial experience in managing large multi location businesses. John comes with solid international experience that includes businesses in Europe and Asia. He brings a unique blend of skills that include experience in financings, accounting, tax systems, and an operational perspective, that makes him an ideal financial leader for our company."
Quinn most recently was Senior Vice President, Chief Financial Officer and Treas-urer of Casella Waste Systems Inc. beginning in January 2009. Previously he served eight years with Allied Waste Industries, Inc., a company with annual revenue of approximately $6 billion, where he held various positions of increasing responsibility that included Senior Vice President of Finance and Chief Accounting Officer.
From 1997 through 2000 John served with Waste Management International plc that included the Chief Accounting Officer role. During 1997, Waste Management International plc had annual revenue of approximately $1.8 billion and was publicly traded on the NYSE and the London stock exchange until late 1998.
LKQ Corporation is the largest nationwide provider of aftermarket collision replacement products, recycled OEM products, and refurbished OEM collision replacement products. LKQ operates approximately 280 facilities.
Mitchell International, Inc., a provider of information, workflow and performance management solutions to the Property & Casualty claims and Collision Repair industries, has announced that UltraMate(R) 7, the estimating software for both insurers and collision repairers, can now generate estimate printouts in Spanish,thereby improving the collision repair experience for the significant number of Spanish-speaking customers.
According to a 2007 study conducted by the U.S. Census Bureau, there are currently 35 million residents in the United States that speak Spanish in the home. In the southwestern states of California, Arizona, New Mexico, and Texas alone, approximately one-in-five persons speak Spanish as their primary language. The prevalent use of the Spanish language can present challenges to many shop owners, insurance staff, and independent appraisers who currently spend a great deal of time explaining estimates written in English to Spanish speaking customers—a process that UltraMate 7 now has the ability to vastly improve.
Miguel Garcia, estimator for Hourglass Collision in Tulsa, Oklahoma, who has a significant amount of experience with Spanish-speaking customers commented, "This functionality will save me approximately 20 minutes per estimate, which is a pretty great deal of time considering the amount of estimates that come through Hourglass on a weekly basis. Now that I can provide a print out in Spanish, I don't have to go over the estimate line by line translating what each part and operation is. It allows me to provide a more positive experience to many of our customers—a number one priority for the entire Hourglass team."
UltraMate 7 now helps facilitate customer communication by offering all administrative headings and part names in Spanish. Provided as a free value added option, the ability to generate print copies of Spanish language estimates helps further Mitchell's fundamental goal of improving cycle time and increasing customer satisfaction among the substantial Spanish-speaking customer base.
"Many collision repair facilities and insurers across the U.S. have a large number of customers whose primary language is Spanish. To maintain a high level of customer satisfaction and business performance these facilities and insurance providers must be able to clearly and concisely communicate with their customers. By providing accurate and easy to understand estimates in both English and Spanish, UltraMate 7 now performs better than any other estimating solution in the market," said Jesse Herrera, Senior Vice President of Marketing and Product Management for Mitchell International.
UltraMate helps create estimates that are accurate, verifiable, and readily accepted throughout the industry. UltraMate combines database accuracy with automated calculations and repair procedure pages that virtually eliminate errors. Multi-user capability on Microsoft(R) Windows(R) networks further boost productivity. UltraMate's advanced features, such as parts lookup, parts graphics printouts, and itemized totals, help to streamline the estimating process and assist in avoiding errors.
Caliber Collision Centers has appointed Steve Grimshaw to serve as Chief Executive Officer of the company. Grimshaw has more than twenty years of experience operating multi-store retail locations, and has demonstrated the ability to consistently drive both top and bottom line results.
Most recently, Grimshaw worked at Safety-Kleen Systems, Inc. where he was Executive Vice President in charge of the western half of Safety Kleen's U.S. operations, with over $1 billion of revenue.
“I’m thrilled with the opportunity to lead Caliber in the next stage of its growth” said Grimshaw. “Alongside some of the most talented people in the collision industry, we will continue to build upon the operational excellence that Caliber stands for and look to accelerate our new store growth over the coming years.”
Earlier this year, John Hovis, current President and CEO, approached the Board of Directors and suggested the company needed additional resources in order to grow its number of locations or geographic markets more rapidly, and would benefit from a new leader that could facilitate this growth while maintaining the company's focus on continuous operational improvement. Together, Hovis and ONCAP Management Partners L.P. began a search for a new leader for Caliber that would fit this profile. Caliber’s Board of Directors oversaw the search for a new CEO.
“The search process was rigorous and when we met Steve the entire Board unanimously agreed that we’d found the right leader for our company,” said Michael Lay, Managing Partner of ONCAP. “His proven operational skills and demonstrated financial results complement the strong team we have in place at Caliber. We are confident he will prove to be a very successful leader of our management team in the years ahead.”
Speaking on behalf of Caliber's Board of Directors, Lay said, "John’s contributions as President and CEO of Caliber have been exemplary. In addition to the growth of the company during his tenure, there are three key areas that will mark his legacy to Caliber -- his passionate commitment to safety, operational excellence, and values-based leadership."
Founded in 1997, with headquarters in Irvine, California, Caliber currently owns and operates 68 collision repair facilities in California and Texas.
Robert J. Dellinger will be joining PPG Industries as senior vice president, finance, and will also officially assume the responsibilities of chief financial officer on Oct. 15, 2009.
Dellinger began his career with General Electric Co. (GE). Over a 19-year tenure with GE, Dellinger served in various positions in financial management. Dellinger was appointed president and chief executive officer of GE Property and Casualty Reinsurance, Europe and Asia, and president and CEO of GE Frankona Re, based in Munich, Germany, in 2000.
Dellinger left GE in 2002 to become executive vice president and CFO for Sprint Corp., and most recently spent three years as executive vice president and CFO for Delphi Corp.
“Bob comes to us well-qualified to lead PPG’s financial operations and will add great depth of international experience and expertise to our senior management team,” said Charles E. Bunch, PPG chairman and CEO. “His international assignments and perspectives will prove valuable as we continue our global transformation.”
William H. Hernandez will continue as PPG’s CFO until Oct. 15. PPG announced in May that Hernandez would transition his responsibilities by the end of 2009.
The R. L. O’Connor & Associates, Inc. pledged an additional $25,000 to the Automotive Management Institute’s (AMI) resource development effort – EXCEL.
The commitment to AMI will be used to develop additional self-study programs and webinars in order to make management education for the automotive service industry more accessible and affordable.
Located in Federal Way, Washington, R. L. O’Connor & Associates, Inc. has been a recognized leader in training, consulting and products for the automotive service industry since 1985. Robert “Bob” O’Connor, president and founder of R. L. O’Connor & Associates, Inc., is part of AMI’s faculty and was the first AMI instructor to make a pledge to EXCEL, giving the company a 20-year history with the Institute.
“We are proud to be a supporter of AMI,” said O’Connor. “Both organizations share a focus in the automotive service industry on enhancing business practices through management education and increasing professionalism is the industry.”
“We are pleased to have O’Connor, one of the Institute’s premier instructors and partners, continue his support with this new and generous pledge,” said AMI Chairman George Witt, AAM. This kind of support demonstrates his long-term commitment to the educational needs of the automotive service professional.”
“O’Connor has a long and distinguished reputation in educating and assisting the automotive service and repair industry,” said AMI Executive Director Toni Slaton, AAM. “Despite a business climate characterized by economic instability, O’Connor has demonstrated his continued support for management education. I express sincere appreciation to O’Connor for providing the industry with a model for education support.”
AMI was established in 1989 to answer the demand for continuing education tailored specifically for the business needs of the automotive service industry. The Institute offers the Accredited Automotive Manager (AAM) designation, the first business management accreditation exclusively for the automotive service professional. To date, AMI programs have attracted more than 184,000 enrollments throughout North America. AMI is a not-for-profit educational foundation to which tax-deductible contributions can be made.
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The Database Enhancement Gateway (DEG) has now processed more than 1,600 inquiries. The DEG initiative continues to be a tremendous success as it nears its second full year in existence.
“The DEG has proven to be an invaluable asset to the collision repair industry as a whole”, commented Barry Dorn DEG Joint Operating Commit-tee member. “The DEG continues to prove its ability to successfully assist collision repair estimating end users in their quest for accurate collision repair data. The DEG provides a standardized, quick and easy forum for the collision repair industry to communicate with each of the three major information providers to process data related inquiries.”
“When the three major collision repair trade associations, ASA, AASP, and SCRS joined together to create the DEG, which was an extension of March Taylor’s efforts prior to the creation of the DEG, we envisioned a service that would inspire collision repair professionals around the country to step up and get involved in the solution.” said Lou DiLisio. “There is still a lot of work to be done but the fact that the DEG has received more than 1,600 database inquiries to date is a very clear sign the collision repair industry has embraced the DEG and the results speak for themselves.”
“I’ve been impressed by the level of commitment I’ve seen from each of the information providers: Audatex, CCC, Motor, and Mitchell. There is a very clear message of commitment toward improving the accuracy of the data each of them provide” stated Bud Center Jr., DEG Administra-tion. “I have seen example after example of the information providers taking the feedback provided in the DEG Inquiries and then working diligently to provide a timely response with accurate data being the common end goal.”
“The success of the DEG relies heavily on the support of the collision repair industry” said Darrell Amberson, another DEG Joint Operating Commit-tee member. “In order for the DEG to grow and continue to provide this invaluable service to the collision repair industry we all need to ensure we are doing our part. We need to make sure we are submitting an inquiry to the DEG any time we see inaccurate data in any of the collision estimating databases. In addition, we need to spread the word to all of our collision industry peers about the tremendous progress we are making with the assistance of the DEG.”
In keeping with tradition, the DEG and the Joint Operating Committee have recognized two individuals who have shown their commitment to improving the accuracy of collision repair data through their continued submission of inquiries: Michael Ferrucci, Appraiser, Ray’s Carstar Auto Body in Bristol, Connecticut; and John Ritter, General Manager, Highland AutoStar Collision Center in St.Paul, Minnesota.
The Database Enhancement Gateway is an initiative which enables those who use collision repair estimating databases to provide feedback to the information providers in an effort to promote data accuracy. DEG resources include an easy-to-use website and inquiry form, dedicated administration for the processing of inquiries, and a current database of both pending and resolved data inquiries submitted to the three major information providers.
The DEG is created, equally funded, and maintained by the Automotive Service Association (ASA), the Alliance of Automotive Service Providers (AASP) and the Society of Collision Repair Specialists (SCRS) along with sponsorships and donations from industry corporations, companies and individuals.
I-CAR kicked off its 30th anniversary conference in late July in Washington, D.C., with a largely upbeat economic forecast from Dr. Martin Regalia, chief economist for the U.S. Chamber of Commerce.
“In short, we’ve got an economy that is past the worst and is improving for a variety of reasons,” Regalia said. “We’re likely to get an economic recovery that starts in the next month or two, but it’s going to be slow by historical standards, and it’s not going to be quick enough to generate rapid declines in the unemployment rate. So we’re still going to be dealing with some economic problems even as we improve.”
In response to a question from I-CAR CEO John Edelen, Regalia said training and education can be a key to the gains in productivity that are a fundamental measure of growing economies.
That plug for training was no doubt welcomed by organizers of the I-CAR’s 30th anniversary conference, especially given the tough times and financial losses reported at the two previous I-CAR annual meetings. While 2009 is far from shaping up as a banner year for the training organization, Edelen was focusing on the positive. He said that as of mid-year, I-CAR's revenue was only about two percent below budget despite a largely anticipated fifteen percent drop in student count compared to the first six months of last year.
But staffing cuts and "judicious management of expenses" over the past year have I-CAR "scaled appropriately," Edelen said.
"The short-hand version of what I reported to the board earlier this week is that revenues are down, profits are up," he said. "We do need a very strong finish to the year. But my view is we have more and better product going into the marketplace."
That “product” will include six new classes a year, I-CAR has said. In addition to new classes on waterborne paint and cycle time introduced earlier this year, I-CAR is also shifting toward offering more automaker-specific training. Its two newest classes, introduced at the conference in Washington, cover specific repair procedures for seven of the highest-selling vehicles, and new technology and trends on 2010 vehicles. (A similar course covering the upcoming year's vehicle models will be developed each year).
Jason Bartanen, technical director for I-CAR, said that at this year’s International Autobody Congress and Exposition (NACE) in Las Vegas in November, I-CAR will introduce a new damage analysis course on advanced vehicle systems such as electronic stability control and blind-spot collision warning systems.
As part of its effort to be more responsive to industry needs, I-CAR is seeking more input from all industry segments, and is measuring everything it does, according to Jeff Peevy, director of field operations for the organization. As an example, he showed survey findings that show instructor approval ratings and overall student satisfaction with I-CAR classes is improving, and that a lower percentage of students are saying course material is outdated. Still, there has been some decline in students’ overall impression of I-CAR, something the organization is working to address, Peevy said.
He said I-CAR also is developing a matrix showing job-specific training path recommendations, and has been rolling out a "Training Manager" system to help companies track what I-CAR training employees have completed and may need.
“It allows a shop owner or manager to have visibility into their employees’ student records,” Peevy said, saying the system is first being implemented for I-CAR Gold Class shops. “Businesses and individuals will have the ability also to affiliate themselves with various programs in which they are involved in, or with those they have some sort of business relationship with, so that those program managers have visibility (into training records) as well.”
At the recent Collision Industry Conference (CIC) meeting held in Washington, D.C., word circulated that long-time industry personality Glen Funk had passed away, with his family by his side.
For two years Glen had battled a disease that remains unknown to this day, a battle that ended on the afternoon of July 29, 2009. He had been to specialists at the Mayo Clinic, the Cleveland Clinic, and the University of California at San Francisco. Medical professionals could not determine what caused his continued nerve deterioration, or how it should be treated.
Glen was an employee of Motor Information Systems for over twenty years, and a long time participant in the Collision Industry Conference (CIC) and the National Auto Body Council (NABC). Yet he was much more than the sum of his experience.
“He was an extraordinary human being,” commented NABC Executive Director Chuck Sulkala. “Glen had a fun-loving nature and a great sense of humor that he combined with a compassion for those less fortunate and an unyielding sense of purpose to help.”
Glen’s spirit of giving was never more evident than in his relationship with Camp Mak-A-Dream, a recreational camp for children undergoing active cancer treatment.
“It moved him like no other place moved him,” continued Sulkala, “going back to the first time he performed volunteer work there with his grandson. It wasn’t unusual for tears to well up in his eyes as he recalled a profound experience he had witnessed at the camp. Those tears very often proved contagious.”
Based upon his strong attachment to Camp Mak-A-Dream, Glen became an active advocate on its behalf. When the camp was in dire need of a new, reliable bus to transport campers, Glen’s passionate appeals to the NABC board and his refusal to accept the status quo helped ensure a new bus would be bought.
The continued success of the camp has resulted in the need for a second bus, and Glen—or more precisely, Glen’s legacy—will once again help drive the purchase. After discussions among his son-in-law, Kerry Hughes, Chairman of the Collision Industry Foundation Jeanne Silver, Sulkala, and Camp Make-A-Dream leadership, it was decided to secure another bus in Glen’s name, through the Collision Industry Foundation (CIF). Those wishing to help with the purchase of the second bus may also do so in the memory of someone special in their own lives.
“Glen lived completely and he loved completely, too," stated Sulkala. “His giving spirit will live on not only in his contributions to Camp Mak-A-Dream, but in the memories and good will cherished by those who knew him.”
The family requests that all donations for the vehicle be sent to:
Collision Industry Foundation
P.O. Box 3007
Mechanicsville, VA 23116
Donations can also be made online at www.collisionindustryfoundation.org. Those wishing to leave a personal message to the family can do so at www.chiles-lamanfh.com.
Camp Mak-A-Dream's core belief is that “one week can change a lifetime.” Its mission, in pursuit of that conviction, is “to provide a medically supervised, cost-free Montana experience, in an intimate community setting, for children, young adults and families affected by cancer.” To learn more about the camp, please visit www.campdream.org.
After facing industry criticism at two Collision Industry Conference (CIC) meetings in a row this year, CCC Information Services announced at CIC in Washington, D.C., in late July that it was making one of the asked-for changes to its controversial “bumper refinish prompt.”
Lou DiLisio, chairman of the CIC Database Committee, said he learned just prior to the meeting that CCC will adjust its printed estimates to indicate on the sheet how the estimator answered the “bumper refinish prompt.”
If activated, the prompt asks the user if a plastic bumper is being refinished in a “continuous process” with other parts of the vehicle. If the estimator indicates that it is, Pathways automatically deducts overlap from the clearcoat refinish time for the bumper, and the clearcoat time for the bumper is also reduced.
This latest change, announced with few details, answered one of several concerns that the CIC committee and other groups had voiced about the bumper prompt: that those receiving CCC estimates might not be able to tell whether the prompt had been used in preparing the estimate, allowing an inappropriate overlap deduction depending on how the shop actually refinishes the bumper.
CCC said the decision to add notification about the bumper prompt on its printed estimates was the first to come out of its new "Repair Advisory Panel," which the company formed this year to discuss and review changes to CCC's estimating products.
The change will be part of CCC's roll-out of its new "CCC One" system, the replacement for its Pathways estimating system which it will begin rolling out later this year and next.
The company, however, did not make it through the Washington meeting without facing at least one critical question from a CIC participant. Dan Bailey of CARSTAR asked why only two of the new CCC panel's members represent collision repair shops. CCC's Jack Rozint, who chairs the new panel, said its first meeting also included two insurers, three auto manufacturers, and representatives from the paint companies, I-CAR, and Motor Information Systems.
"As we move forward, we do plan on increasing the number of repairers involved," Rozint said. "The agenda items are going to vary from meeting to meeting, and so will the attendees."
If there are issues related more to multi-shop operators, he said for example, more representatives from that type of business will be included.
In other estimating-related news at CIC, "Estimating Best Practices," a document crafted over the past two years by the CIC Insurance Relations Committee, was ratified by the CIC body. The 14-page document, available on the CIC website (www.CIClink.com) spells out suggested guidelines related to vehicle inspection, photo documentation, parts replacement options, and other estimating steps. Committee chairman Jeff Hendler said that as with all CIC-developed documents, the guidelines can be revisited and amended as needed at any time CIC chooses to do so.
Arthur B. Dahm, President of Automotive Disciplines, Inc. (ADI) has announced the release of the newest enhancement to his company’s body shop production management software solution Production Plus(TM) version 8.0.
“The heart of Production Plus is its ability to proactively manage a body shops day to day production processes to include parts management and all sales activities. Our latest enhancement to Production Plus is Customer Status Link,” explained Dahm, President of ADI. “Customer Status Link simplifies the way shops communicate repair status updates with the vehicle owners/customers, insurers, and car rental companies. This enhancement helps reduce both incoming and outgoing phone calls as well as increasing the accuracy and timeliness of those repair status updates. The need for this appears to be a growing trend in our industry.”
Dahm continued, “The accurate tracking of the repair process and keeping staff members, customers, insurers, and rental car companies up to date on each vehicle’s location, primary and secondary status and targeted delivery date in a reliable and uniform manner is essential to today’s body shop operators. Production Plus is designed to automatically send updates to www.statuslink.net throughout the day where the information is available 24/7. In addition to status updates, individual text messages can be communicated by the shop staff. The customer will also have the ability to text the shop directly from this site 24/7. Customer Status Link also has an automated email feature.”
Timely customer repair status updating is a function that many insurance companies are requiring for participating in their direct repair programs today. According to an ADI press release, Customer Status Link can help shops meet that requirement without breaking the bank. Each shop can set its own update parameters to best meet its individual needs.
When asked to give an overview of Production Plus, Dahm said, “Production Plus was designed by Automotive Disciplines with software architecture engineered by I/O Technologies Inc. I thought it was time we start to re-think the way we go about managing our repair process and start to remove the chaos and confusion normally associated with it. Production Plus is a software solution that helps new car dealers and select independent body shops improve the way they proactively manage vehicles through the repair process from point of sale to delivery.”
Production Plus was designed with several things in mind:
- New car dealer body shops wanted to track customer sales and repairs day to day in a basic and uniform manner on their current network without adding additional hardware.
- It needed to work parallel to the Dealer’s DMS, not replace it.
- Give shops an easy way of updating the vehicle owner and insurance company of the repair status through out the day.
- It needed to be affordable.
“We believe we have hit the mark on all counts,” concluded Dahm. “I continue to believe that shop owners and managers need to become more proficient in the area of organizational structure and process development as well as the implementation of those processes to become more productive and competitive in today’s market. Shops that accomplish this with products like Production Plus will be the ones that survive and prosper.”
Automotive Disciplines, Inc. is a consulting/software company serving the Collision Repair Industry, privately owned by Arthur B. Dahm.
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