Not Your Typical Garbagemen

February 1, 2000

14 Min Read
Not Your Typical Garbagemen

Randy Southerland

Popular belief used to be that the only thing a garbageman needed to know about business and finance was what his competitors were charging. While that idea might have served the garbagemen of the past century, the modern waste disposal company is an entirely different animal. With increased competition from new entrants into the market, and a merger and acquisition feeding frenzy by waste industry giants, companies today must be better managed than ever before.

Because today's waste managers - in both the public and private sectors - want to run their operations better by capturing and understanding information on costs, an obvious route to a more efficient business is through the technological innovations offered by computer software.

Running on versions of the Microsoft Windows operating system, modern software programs offer that ability for those who are willing to learn their intricacies.

Fanatical about Numbers This new breed includes companies such as Woodstock, Ga.-based All Cycle Sanitation, which has launched an aggressive effort to track every aspect of its business through the use of software.

"I've been in this business for 15 years and I used to be the typical garbageman," admits All Cycle's Anthony Grutadaurio.

No more. Now he and partner Barry Skolnick say they are obsessed with numbers and knowing exactly how every aspect of their company is performing everyday.

To obtain the kinds of information they need to make business decisions, they are using management software from Reno, Nevada-based WAM Software Inc.

"We started using software just for the basic billing portion of it," Grutadaurio says. "It gives us unbelievable breakdowns of what we're doing. We get to look at our company day-by-day, truck-by-truck, employee-by-employee [drivers] or any combination of those factors."

According to Grutadaurio, the company began using the new software last August to record customer information, manage routes and roll-off boxes, handle billing and track accounts. The software has been a prime factor in making the rapidly growing All Cycle more competitive and more profitable, he says.

"We've walked away from the jobs that haven't been as profitable because now they stand out clearly," he says.

The suburban Atlanta company services 9,000 residential accounts and has 40 roll-off boxes on the streets at any one time. They expect to double those numbers in 2000.

All Cycle fields a truck fleet of 13 roll-offs, two recycling vehicles and seven packers. Several more vehicles have been ordered that will boost the fleet to 30 within the next month.

"We view every vehicle as its own profit center," Skolnick says.

That means keeping close tabs on each vehicle's location. Using software, the dispatcher can determine which truck is in the best spot to answer a particular call and the most advantageous landfill destination based on the type of materials being carried.

Thanks to the new technology, their dispatcher now is handling 40 percent more call-ins, according to the partners.

"It's so much more profitable now that we don't have to go out and get another person to do the work," Grutadaurio says.

Previously, keeping up with the work and logging in each driver's tickets required them to work until 6:30 p.m. or later. Now, employees can stop taking phone calls at 5 p.m., and they're finished no later than 5:15 p.m.

The owners can view each truck and its contents. "We can look at an account and extract information about the types of materials we're collecting," Skolnick says. "We can profile a job site and determine what sizes of boxes should be placed there and at what time, depending on the kinds of wastes we'll be getting."

Smaller boxes might be dispatched to a job site early in the construction phase as heavier materials such as dirt, asphalt and concrete are being discarded by workers. As time passes and the kinds of waste become lighter - such as framing materials - larger boxes can be used.

"You need the software to make decisions about what your actual costs are, and that's vital to making a decision on pricing," Skolnick says.

The partners' philosophy is that it's easier to find $10,000 in savings within the operation than to attempt to increase profits to compensate for the $10,000 in lost revenues due to inefficiency.

With that in mind, both Skolnick and Grutadaurio were determined to seek out the best kinds of software for each particular aspect of their operation rather than buying a certain package.

For example, All Cycle also uses the FleetMaint 2000 software system developed by DP Solutions, Greensboro, N.C., to monitor vehicle maintenance and service. In addition, all parts - from tires and brake shoes to "10-cent screws" - are bar coded so that inventories can be easily tracked.

Mechanics use hand-held readers to record parts they use in servicing and repair. When the inventory reaches a certain level, the system automatically generates a reorder form and purchase order to replenish supplies.

The partners also have incorporated the Fuelman software program provided by Atlanta-based McPherson Oil Co. into their system to replace the gas credit cards their drivers formally had used.

"Each station has a separate card reader that requires drivers to log in their vehicles' mileage reading," Grutadaurio says.

This system tells them basic facts such as each vehicle's miles per gallon, which can provide an early warning of impending trouble. For example, a mileage drop can indicate problems ranging from impending mechanical breakdown to driver-related trouble such as fuel theft.

"This way the mechanic knows the truck has so many hours and so many miles indicating that it's time for an oil change, or its time to change the tires," Grutadaurio says. "We'd rather double our spending on preventative maintenance work to avoid breakdowns."

All Cycle also will begin using a Global Positioning Satellite system from ISR Corp., Baltimore, Md., in the first quarter of 2000. This system will allow the company to track all vehicles in real time on digital maps as they move between jobs, Grutadaurio says. The partners see it as one more step in professionally managing their solid waste business.

This attention to detail and to maintaining accurate data about the company produces a high degree of security. Grutadaurio maintains they "sleep really well now" because of the controls they have been able to create.

"We're able to detail our profit centers," Skolnick says. "That all goes back into the question of 'is our pricing right?' We want to make sure we're not a company that prices ourselves out of the market because we don't have the right information."

Centralizing an Operation After a series of mergers and acquisitions, Instashred Security Services, Burlingame, Calif., has leaped to the front of the document destruction business. With 300 employees in nine offices in the western United States, Florida, Washington, D.C., and Texas, the company quickly encountered the problem of how to consolidate its administrative functions of far-flung operations using vastly different systems.

"The challenges we faced as we looked at different software was to find a system that allowed us to use one database for both customer service - generating work orders, taking customer calls - and having that system feed right into our accounting system," says Tim Ranzetta, Instashred's vice president for marketing and business development. The company chose the Tower2001 operations management software system designed by Orange, Calif.-based TransComp Systems.

"[This system] meshed with how we do business in simple things such as repetitive pickups where our trucks are visiting a customer weekly, biweekly or monthly," Ranzetta says.

Instashred occupies a distinct niche in the waste industry. Catering to regional and national banks, hospitals, professional service organizations and any business that commits sensitive information to paper, they insure that documents don't just end up in the trash.

Each day Instashred trucks collect 64-gallon locked bins from businesses of all kinds. After pick-up, customers have two options. The paper can be taken back to a central processing plant where it is shredded and recycled. Or, for customers who personally want to see their documents destroyed, the company offers mobile shredding units that can perform that function at their place of business.

With nine locations spread throughout the United States, Instashred executives were faced with the problems of how to consolidate back office operations for formerly independent businesses. Until now, each local office sent invoices and collected revenues from its customers. Deposits were made to local banks, which then had to be transferred to the main account. These functions needed to be centralized at corporate headquarters in California.

"All the work orders and billing process still will be done locally because you need the ability to print work orders locally so you can service the customer," Ranzetta says. "But once they get those work orders back at the local office, that information will be batched over to Pomona [Calif.] daily or weekly allowing us to run a master invoice company-wide."

In the past, that data would have been entered at the local office and then keyed in again at the central office, a duplication of effort.

Ranzetta noted that most local offices tended to be thinly staffed. With the new system, personnel who had been handling billing functions now will be able to focus on other services.

"Our goal is that by pulling these functions out, we won't need to add staff as we grow," he says. "Now we can shift those resources toward customer service. We're freeing up someone's time so they can, for example, call our new accounts after a month to make sure their expectations are being met."

The software gives Instashred the ability to generate reports on profitability by routes or by individual truck. Now, each location can maximize profitability by focusing sales efforts. Managers can determine which routes are the most or least profitable.

"It might mean that trucks are driving long distances between customers so the sales force can concentrate on building business along that route," Ranzetta says.

An Arc Logistics software program also is integrated into the system allowing each office to assign customers to routes. Customer service can determine the nearest route for the client and tell him what day Instashred will be there, he says.

Ranzetta admits that, until now, Instashred has not been a company dedicated to technology. Along with the new software, the company plans to make a concerted move toward a high-tech, paperless world of bar codes, hand-held readers and online orders. Management software was the first step, but more is coming.

A Windowed Scale Approach Access and control of information also is vital when it comes to using scales. When Yancey LeCroix joined the DeKalb County, Ga., government as Microsystems Coordinator seven months ago, one of his tasks was to guide the Sanitation Department's transition from its aging DOS-based scales software system to one running on the Windows NT platform.

For the past five years, DeKalb's sanitation operation, which includes the county landfill and three transfer stations, had been operating on a VRS-7800 system from Cardinal Scales Manufacturing Co., Webb City, Mo. While state-of-the-art in its day, the system now needed to be replaced with a system compatible with the Windows NT system used by the rest of the county government.

The answer to this problem was found in another Cardinal Scales product - the updated Win-VRS vehicle recording system.

"The entire county was converting to Windows NT as its standard computer system," LeCroix says. "Not so much for Y2K, but just to bring the system up to speed. It's always a good idea to upgrade any kind of software just so that the next time you have to upgrade, it's not such a traumatic experience."

Using the Vehicle Recording System - which is hooked into inbound and outbound scales at each transfer station and landfill - the county can compile and consolidate information from all the sites into one central billing point. It also breaks down the data to help answer customer inquires or provide state-mandated reports.

"We can generate a materials list, for example," LeCroix says. "If someone wants to know how many tires were coming into a particular transfer station, we can provide it. Depending on how we set it up, we can specify how much of a particular type of material a truck hauled for the year or the quarter. They can pretty much design any report you might need."

Scale monitors and readouts at each facility also are Cardinal hardware, while most of DeKalb's scales are manufactured by Kansas City, Mo.-based Fairbanks Scales.

In this rapidly growing suburban county in the shadow of Atlanta, the sanitation department is faced with some urban-sized waste disposal challenges. Each year, the transfer stations and landfill receive nearly 450,000 tons of solid waste along with an additional 113,000 tons of yard trimmings that are deposited at a location adjacent to the landfill.

To meet that challenge, a modern software system is vital, and like many other operations, DeKalb is relying on the Microsoft Windows system.

LeCroix believes the new system will work well for the county. In addition to its flexibility, it takes advantage of the County's wide area network (WAN) link to supply the information to the Sanitation Department as well as to the Finance Department for billing.

All three organizations - private and public - are facing their challenges by using modern technology to help make sound business decisions. While not a new development for the larger business world, it may represent a giant leap in the way each waste management organization views and performs its operations.

Selecting the right software for your business can be a daunting task. Dealers hold out the promise of a system that can make your life easier and your bottom line more attractive through greater efficiency in data handling. Making the leap into 21st Century technology can come with a heavy price - both up front when you purchase the system and, worst of all, later if you discover it won't do the things your business needs.

Industry experts - both those who have purchased systems and the dealers who sell them - agree on several steps you can take to make your leap into software a more pleasant and rewarding one.

* Make a wish list of everything you need. Create a list of the functions you need your system to accomplish. For example, do you only need it to issue bills or do you require more detailed reports on customers, trucks and landfill fees? Make sure the system can perform the functions you need, either out of the box or through customization.

The manufacturer should be willing to provide a demo of the program to use on your system to see how it actually operates.

* Contact fellow buyers. How many other companies like yours are currently using the system? One private waste company owner observed that although he'd seen one system that appeared to be able to do everything he needed, the vendor only had six customers actually using it. A small number of customers may mean the product is so new all the bugs haven't been worked out.

* Get the support you need. If you can't fix a software problem, the manufacturer should help. That can come in the form of onsite training and service or, at the very least, telephone or Internet support. Know up front if support comes as part of the package or if you'll be paying a fee every time you call their help desk.

Find out if support is available 24-7 or only at certain times. It's also a good idea to call their help line yourself during busy times of the day just to see how easy it is to get through to a real person.

* Are you ready to upgrade? Examine your operation and its people. Are you ready for a new system or is the old one working just fine? Maybe you're not prepared - financially or emotionally - for the hassles inherent in an upgrade. Converting data from one system to another may not go smoothly. Perhaps if you wait, the right moment and the right program will come along.

* Buy the best you can afford. Ideally buy the state-of-the-art, and that means one system running the graphical user interface by Microsoft Windows 95, 95, NT and eventually 2000. The system should be scalable to meet your expanding needs. It should also be an "open architecture" program that can easily integrate with other software that performs other tasks such as logistics, accounting or fleet maintenance.

Buying software can be a difficult task, but knowing yourself, your needs, your company and your options will make the job as easy as possible. The benefits to your business and your bottom line can be substantial.

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