A Look Back at FSMP: Problems Develop

Note: It was 10 years ago this month that brought an end to the Full Service Moving Project, commonly known as FSMP. In a series of guest posts by Daycos founder John Day, we take a look back at the FSMP program. On Monday, we examined the start of the program, today we will explore the problems that developed, and  Friday we will review what can be learned from the FSMP program. 

FSMP shipments began moving on January 5, 2001, with the normal slow volume associated with the winter making it fairly easy to initiate the new program. Shipments increased as the year progressed, with volume peaking during June, as usual. Problems arose fairly quickly, in several distinct areas.

Lack of Standardization: The new move managers all had distinct operating, rating, and communication systems. There was no requirement to follow a standardized system, other than to award shipments using the agreed distribution metrics and to use PowerTrack to make payments. Several of these new systems were still being implemented well after the startup date of the program. Some, apparently, could not keep up with the workload thrust upon them by the time the summer season came and fell even further behind.

Inexperienced Personnel: The move manager personnel were new to that organization. In some cases, personnel who had worked at the T.O.’s office at that base went to work for the move manager, but many did not, so they were staffed with lots of people who had almost no background in DoD moving. In some cases, temporary staffing agencies were employed to provide bodies to fill slots; some were still living with Mom and Dad and had never moved! As the year wore on, some of the experienced people just left, leaving an even larger void.

It became quickly evident to the carrier community that they could work better with those move managers that were a division of a carrier, then those who were general relocation companies. The former had a military background to draw upon for both systems design and personnel training. They understood the language and the requirements of DoD moving.

Communications: Communications between the parties became an issue. Just trying to reach someone to follow up on details, whether for a pre-approval, to change a date, to get a rating change, or to have a general “what’s going on there” discussion, became next to impossible.

Daycos sent requests by mail, by FAX, by phone, and by email, but as the volume increased, communications effectiveness dropped markedly. We sent thousands of such communications daily.We can only imagine what happened to the Service Member’s contacts with move managers as the situation deteriorated. Some Service Members called us to find out who they could call.

Increased Costs: The previously anticipated “roll it into your rates” for premium service had changed by April/May to “your rates are too high; you need to resubmit them lower.” The services quickly saw their cost for moving members increase substantially. There were two requests for lower rates in Summer, 2001.

The increased cost had several reasons, we think. The rates were higher, as required for premium services desired. Also, some shipments were being awarded to carriers at very high rates, way above what we would have expected. The carriers involved often said that they would never have expected to receive any traffic at that rate and had just filed a rate to satisfy the requirement for filing for that channel. We can only speculate that mistakes were being made in awarding shipments.

Payment Delays: Payments for services to carriers were slow. The Matching Model system of PowerTrack required that each side submit a rated CBL, in order to be matched and paid. The rating systems of some move managers apparently were still in beta when the program began, and they were many problems in just getting an move manager’s CBL into PowerTrack , rated correctly or not.

At Daycos, we invoiced on behalf of about half of the carriers involved in FSMP. We ramped up our status information reports to handle all the new requirements for getting an invoice paid. In the DFAS model we worked with GBLs, we had 5 different status codes that reflected their path to payment. In FSMP they increased to thirteen. CBLs took longer and longer to be paid, with a considerable portion sitting in PowerTrack waiting for attention –the move manager’s CBL had not been entered or there was a need to change an incorrect rating on a CBL that had.

Fortunately for our customers, there was a provision for carriers to just agree to the move manager’s CBL and get paid immediately. In some cases, the carrier elected to lose money, rather than allowing a relatively small disputed amount to hold up a large invoice. Of course, it also worked the other way and the carrier took a higher amount than they had billed for, which GSA took back later.

Our invoicing status report that we sent to FSMP headquarters each week eventually reached 150+ pages of invoices that had not been paid! It wasn’t hard for us to see that our greatest problems centered around a relatively few move managers, but they controlled the largest amount of shipment awards.

Our company’s personnel that were tasked with getting CBLs paid after they had been submitted grew into a department of over ten people, versus the three that handled the far more numerous GBL invoices we handle, a 50 to 1 ratio.

Far after the end of the FSMP program, we continued to work on getting our customers’ invoices paid, with the last invoice being submitted in December 2004 for carriers that were bewildered with trying to invoice on their own and had been referred to us by DoD. Payment pursuit ran even later, since many move managers had shut down leaving no one behind to process our invoices. Thanks to DoD, we finally got those carriers paid.

Because of these problems, the FSMP program ceased in October 2001. Our final article in this series will examine what lessons can be learned from the failure of FSMP. Please return on Wednesday to view the article, or click here to register to be notified via email when new articles are posted.

For those that were involved in FSMP, were there other problems that were not listed above? If so, please use the comments below to share your opinion.

Related Posts

1. A Look Back at FSMP: What Can Be Learned - October 28th, 2011
2. A Look Back at FSMP: How It All Started - October 24th, 2011
3. Back-to-Back Champions - February 7th, 2007