Everything you need to know about Fleet Management
– A proper fleet management process has enabled Central Hudson Gas & Electric to make savings of $500,000 and increase productivity by 8%
Fleet management is the processes that fleet managers utilise to manage all fleet and asset information, from acquisition through to disposal. This enables companies to reduce costs, improve efficiency and ensure compliance across an entire fleet operation.
In this blog:
What is the Purpose of Fleet Management?
The Role of the Fleet Manager
What is Fleet Management Software?
Learn how Central Hudson Gas & Electric made savings of $500,000 and increased productivity by 8%
Managing a pool of commercial vehicles can be a challenge at the best of times. Add to this external influences that a fleet manager faces but has little control over such as legislation changes, car market uncertainty and spiralling costs and the task can soon become overwhelming. the relevant software can play an enormous part in coordinating fleet management activities.
So, what is the purpose of fleet management, what role does fleet management software have to play and how does it support the role of the fleet manager?
What is the purpose of fleet management?
Any organisations that incorporates vehicles for use within the business requires some form of professional fleet management. The purpose of such is to control the entire lifecycle of commercial vehicles alongside reducing associated risk, improving efficiency, increasing productivity and ensuring compliance with legislation. Private vehicles used for work purposes, known as they grey fleet, should also be included in this process.
See our free downloadable fleet management software guides below:
Companies with fleets are extensive. Hauliers, couriers, sales, service, utilities, public transport and the emergency services all have fleets that need managing. Having a grasp of the processes required to run a fleet enables company to control associated costs, remain competitive in the market place and help deliver on customer service expectations.
What are the challenges faced by fleet managers?
Similar to the level of responsibilities of an asset manager, a fleet manager is accountable for five key areas of fleet – vehicle acquisition, fuel management, vehicle maintenance, health and safety and compliance. We take at look at each of them in turn.
1. Vehicle acquisition
Evaluating changes to vehicle legislation such as WLTP and RDE2, determining purpose and suitability of vehicles, negotiating deals with vehicle manufacturers all sit with the fleet manager. Fuel consumption, tax and insurance costs in addition to employee expectations need to be considered too when selecting the right fleet vehicles. Add to this a consideration towards end of life and vehicle resell value and it soon becomes clear why the role can be such a challenge. Budget allocations need to be met and savings are always there to be made.
2. Fuel Management.
Probably one of the biggest cost saving challenges for a fleet manager is the ever increasing rise in fuel costs. Fluctuations in market price and the external factors that influence prices are beyond the control of a fleet manager but there are options to help reduce fuel consumption and costs.
Once the fuel of choice, the popularity in diesel vehicles is in decline following the Volkswagen emissions scandal and well publicised negativity on harmful NOx emissions. The government response of adding a surcharge to tax has understandably had an impact on sales. Despite this, an effective fleet manager needs to evaluate the options to see if they still deliver the greatest cost savings. Petrol remains the market leader but margin is decreasing due to the growing popularity of electric and hybrid vehicles.
See our free downloadable fuel guides below:
Fleet managers can carry out a cost benefit analysis on fuel options as a way of determining the most suitable for the vehicles in their charge. Considerations should go to a higher purchase price of electric and plug-in hybrid vehicles against lower running costs and performance to determine suitability.
Fuel card choice is paramount to any fleet by selecting the best value deal to meet needs. Alongside this, telematics can play its part in remotely observing driver behaviour and the effect on fuel management in addition to an ability to track vehicles and determine the most cost effective routes.
3. Vehicle maintenance
Overseeing the maintenance programme of vehicles within the fleet can be internally resourced through own resources or outsourced depending on the size of the cost benefit analysis. Fleet manager responsibility is to ensure that vehicle checks are carried out to comply with legislation. This includes driver daily walk round checks, pre-purchase vehicle inspections, regular maintenance checks and to ensure that reported defects have been rectified.
4. Health and safety
Should the unfortunate occur and a driver has an accident, the responsibility of the fleet manager is to ensure that this is actioned accordingly. Robust reporting procedures need to be in place to enable drivers to deal with an accident by following insurance reporting procedures correctly so that claims can be handled quickly and efficiently with the necessary repair work carried out.
Needless to say, a fleet manager will be responsible for both the development and implementation of the health and safety policy in addition to making sure that driver training records are up to date to minimise the risk of accidents occurring within the fleet in the first place.
5. Meeting compliance requirements
Daily checks, inspection sheets, driver checks, defect, reporting, MOT’s, insurance…the list goes on. Compliance and fleet risk management is an essential part of the role and all aspects need to not only be carried out but also documented. This ensures that a full trail of information is available for each vehicle for both auditing purposes and in the event of an accident should a claim or investigation need to be made.
Vehicle legislation is changing apace, particularly with the move to the WLTP vehicle testing structure. This means that it is imperative that fleet managers are aware of changes to legislation that could have a direct impact on their operation and act accordingly.
6. Controlling costs
Controlling and reducing costs is always a priority for any business and fleet management is no exception. Fleet Managers are required to analyse the relevant information about their fleet and realise the areas that can be improved. This can include reducing vehicle purchase costs, reviewing fuel consumption and analysing driver behaviour – achieving more for less.
7. Avoiding information overload
Fleets generate a lot of data that a fleet manager can review, some of which may be useful but a lot of it probably not so. Trawling through such vast amounts of information is time consuming and runs the risk of missing important, relevant information. Updating such information has administrative time and money implications too. Fleet management software can help sort through the unnecessary information and generate reports on only the areas that you need or having the information but not knowing what to do with it or analysing it correctly.
8. Expanding role of the fleet manager
The role of technology is evolving apace which will lead to expansion of a fleet manager’s role too. Mobility management, asset management and the a level of responsibility for measuring and controlling the environmental impact of a business will begin to fall under the remit of the fleet manager. Incorporating fleet management software will become paramount in helping to deliver this.
What is fleet management software?
Fleet Management software allows a fleet manager to have relevant information on the performance of their fleet at their fingertips. In effect, it is a sophisticated database with numerous applications that enables the recording and reporting of the key attributes that can help improve efficiencies and drive down costs. They do this by reducing downtime and improving productivity.
In summary, incorporating a software system into fleet management improves the management of:
Vehicles, assets and equipment
Maintenance and repair
Fuel and emissions
Drivers including driver licence checks
Workshops and scheduling – inspections, defect reporting and audits
parts and inventory
Accident and risk management
Regulatory and legal compliance
Budget and forecasting
…and much more.
Fleet management solutions integrate with almost any third-party data provider or software application to streamline processes such as ordering. arranging delivery and making payments autonomously. Such integrations remove the lengthy administration processes and improve employee time management too. And the addition of supporting mobile apps to carry out the tasks and input relevant data within the field further enhances the benefits of implementing such a system.