Taken broadly, “fleet management” means managing all aspects of a company’s leased or owned vehicles. That could include everything from forklifts workers use in a warehouse to vehicles assigned to traveling sales staff.
In this post, however, we’re going to focus on the role fleet management plays in logistics and supply chain management. In other words, we’re going to talk about how effective fleet management helps get the right products to the right place at the right time.
Fleet management means making sure that an organization is using its vehicles as efficiently as possible. It also involves keeping an eye open for any changes that may affect that goal. Adding onboard telemetric and GPS devices, for example, has recently made a big impact. These devices eliminate a lot of paperwork. They also record a myriad of data points and extract important insights from them. And those insights help fleet managers make smart decisions about optimizing vehicle usage, routes, and so on.
Let’s take a look at some of the most important tasks that fall under fleet management.
The most important part of fleet management is to develop policies about trucks and drivers. Such policies usually address aspects like these:
Policy development helps fleet managers avoid making decisions on the fly. Documented policies also help protect the organization legally by showing proof of due diligence. Let’s say someone sues your organization over an accident, for example. If you have no documented proof of company policies, then you’re likely to be in a much weaker position in court.
Fleet managers purchase or lease the vehicles that workers use to get products from point A to point B. Managers consider a number of variables in this area:
A fleet manager also tracks the expenses associated with operating the fleet. Let’s tackle those one by one.
Fuel ranks second on the list of biggest expenses for transportation companies, and managing fuel consumption is a top priority. Fleet management professionals try to minimize fuel consumption by addressing the factors that waste fuel:
Fleet managers usually address these issues through policy and driver training. They can also emphasize their importance by including them in performance appraisals.
Fleet management systems also help control maintenance costs in several ways:
In addition, pre- and post-trip inspections are an important part of fleet management. Drivers should have a checklist to work through before and after every trip.
Remember all those tedious administrative tasks you hate dealing with for your car? Those fall into the lap of the fleet manager:
Fleet managers work hard to anticipate risks involving the organization’s fleet. They start by conducting an audit to find out whether stated or unstated company policies pose a risk (encouraging drivers to falsify logbooks and exceed their allowed hours, for example). Next, they determine how well employees comply with the policies. Finally, they take steps to correct the problem: revising existing policies, for instance, or retraining drivers who aren’t following the policies.
To sum it up, fleet managers have to think about all the things that could happen while their trucks are on the road and make sure the company’s doing everything it can to mitigate those possibilities.
An empty truck is a waste of money. The fleet manager has to figure out what to do with a truck after it’s delivered its load. If the warehouse or store has enough products to return to fill up the truck, that makes it easy. If not, the manager may look at other options. These include freight consolidation, which involves filling up a truck by adding partial loads from other companies.
Not too long ago, fleet management involved a lot of manual record keeping. Today, on-board telemetric devices capture much of that record keeping, and the data they produce drives real-time decisions. It’s a radical transformation that has, in turn, changed the job of fleet management.
Let’s take a look at some of the ways technology is helping fleet management deliver more value to the organization:
Technology is an investment. You accept an up-front cost, hoping you’ll see a return on investment down the road. Considering current trends, however, not incorporating technology in your fleet management program really isn’t an option anymore. The real question is how to go about it.
There’s no single best fleet management solution. You can keep it in-house with your own fleet of trucks, outsource it entirely, or find something in between.
If you’re considering buying a fleet management solution, it’s important to get the answers to some key questions:
These are strategic questions that the fleet manager should discuss with several people or departments, including IT, risk management, finance, and operations. Upper management will likely make the final decision with input from these departments.
Fleet management drives supply chain success. For any supply chain to be successful, it has to be able to deliver products on time and safely. And it has to do so in a way that’s both efficient and cost-effective. Effective fleet management makes that possible.
This post was written by Patti Podnar. Patti is a Copyblogger-certified content marketer experienced in writing for a variety of industries: logistics and supply chain, industrial internet of things, IoT, digital transformation, sourcing and procurement, retail, etc. The thing that enables her to write about such a wide variety of topics is a deep understanding of how content should drive business goals.