The Who, What and Why of Asset Management
An effective approach to asset management leads to measurable improvements in operational efficiency, lower costs, higher vehicle and equipment uptime when it comes to your fleet …not to mention employee and customer satisfaction.
As a Fleet Manager, reducing downtime should be at the top of your list of goals and objectives – the reason being that when vehicles or equipment are not available, customer service suffers, costs increase, revenue growth stalls and employee and driver satisfaction plummets.
But driven by the ability to make data-based decisions about everything from acquisitions and maintenance to remarketing of vehicles and equipment, best practices in asset management can make a real difference.
Ultimately, effective asset management leads to a productive, cost-effective fleet, and an operation that meets its efficiency goals lowers costs, reduces administrative burdens and has higher levels of compliance and risk management.
So where do you start?
Exploring the value of asset management plans is a good way to kick-start any improvement process:
What is Asset Management?
Asset management is a relatively new concept in the transportation industry and can mean different things to different types of organizations. Universally, though, it describes a solid foundation of programs that you can use to optimize the efficiency, productivity and cost-effectiveness of your transportation assets.
Regardless of the definition, your focus should primarily be on asset performance.
At its core, asset management is a strategic and systematic business process that targets well-defined objectives. This is typically achieved by employing better decision-making practices based on high-quality, actionable information.
But what’s the underlying objective?
In due course, an asset management plan is typically used to assess resource allocation, utilization, acquisition, maintenance and other practices to provide greater value and drive up overall satisfaction for your organization’s end user.
Do you need Asset Management?
If you have a transportation asset base for your operations, you should consider asset management a key component of your operational strategy.
…that includes all types of on-highway and vocational fleets in a wide range of disciplines and with a range of vehicles and equipment, whether they are purchased, leased, rented or employee-owned.
With asset management capabilities, making decisions based on information gives you a higher level of accountability when managing the acquisition, allocation, maintenance and disposal of assets.
It’s that simple!
Why do you need Asset Management?
Asset management directly addresses your goal of maintaining a high level of service, vehicle and equipment productivity…which leads to positive results in revenue generation, cost reduction and profitability.
Some of the core principles of asset management include:
Resource allocation decisions based on a well-defined set of goals and objectives
Objectives translated into system performance measures that are used for both day-to-day and strategic management
Decisions on how to allocate funds within and across different types of investments, based on an analysis of how different allocations will impact achievements and foster improvement
Decisions based on quality information with respect to goals and objectives that are made using credible and current data
Monitoring and reporting of performance results for accountability and feedback about impacts and effectiveness
Implementing an Asset Management plan
As a data-driven approach, asset management provides you with a fact-based dialogue about vehicles and equipment with users and other stakeholders.
As a fleet manager charged with overseeing day-to-day operations, you can use relevant, objective and credible information which is accessible to all participants in the decision-making process.
The information underlying your effective asset management approach should include raw data as well as data generated by conducting focused and targeted analyses.
At the end of the day, an effective asset management plan will improve your understanding of tradeoffs, return on investment and potential value when you are making decisions regarding available resources based on current system condition, performance and estimates of future performance.
What are the capabilities of a Fleet-focused enterprise Asset Management software?
Over the years, a number of systems have been adopted by transportation operations to address their asset management needs. Some of those information management systems provide key data and analysis capabilities, but they do not always specifically address your needs as a transportation asset manager.
The distinguishing feature of effective asset management systems for fleets is their focus on asset condition and performance. They are aimed at helping you achieve defined performance goals and result in:
Faster return on investment
Measurable improvement in operational efficiency
Reduced administrative burdens
Higher levels of compliance
Better risk management
While information is central to any asset management approach, the system you choose must also simplify every part of fleet, asset and workforce management – from the financial overview of vehicles and equipment to policy, monitoring of drivers, technicians and shops.
These systems also address the complete lifecycle of assets, from acquisition to disposal, and incorporate all your fixed costs and variable operating expenses, as well as details of utilization, maintenance and compliance.
Advanced fleet management software systems continue to become increasingly complex as asset management needs require new insights and tools to help you make decisions that result in improved efficiency, lower costs, higher vehicle and equipment uptime, and employee and customer satisfaction.