Fleet Management. What is it?

What exactly is a fleet management system?

| Jan. 2023 |.

Fleet Management or fleet management is a broad term that encompasses the many actions and processes that must take place to keep a fleet of five or more vehicles running on time, on budget and with maximum efficiency. Millions of vehicles around the world are managed using a digital, centralized software platform. 75% of fleet managers rely on this fleet management software or vehicle telematics to support their daily operations.

Every organization that needs commercial vehicles to function engages in some form of fleet management and fleet operations. The purpose of fleet management is to oversee all fleet performance and fleet maintenance to increase productivity and keep a business running as smoothly as possible: vehicle maintenance, monitoring fuel consumption and fuel costs, driver management, asset utilization, route planning and implementation of programs that increase company productivity, improve customer service and reduce instances of waste.

Fleet management required:

-People: a fleet manager or fleet management company

-Technology: fleet management software, vehicle dashboard cameras, vehicle sensors, telematics and GPS

-Data: information collected by the hardware and transmitted to the online fleet software, such as engine diagnostics and driving behavior

Why do companies find fleet management software indispensable?

When you buy or lease a vehicle, you must also consider the many costs associated with ownership. This includes storage, insurance, gas prices, registration, title and maintenance. Now imagine being responsible for all those components for an entire fleet of vehicles. With a fleet management solution, companies can view data on all of these expenses in one app, which can save vehicle management a lot of headaches.

Modern fleet management software goes beyond tracking locations by providing insight into vehicle performance and efficiency and presenting data in a way that companies can easily understand.

Fleet management software can help you obtain objective driver safety information, highlight dangerous practices such as speeding or hard braking, and identify drivers who need more coaching. It is also integral to ensuring that your fleet continues to comply with federal and state laws.

Technology can also help support proactive maintenance efforts, allowing fleet managers to get the most out of their assets by implementing preventive maintenance schedules. Many companies also use mobile apps that enable instant data transfer and accessibility, allowing them to quickly identify issues that may have gone undiscovered or grown into larger problems.

Here we give you the top 5 KPIs for fleet managers and how fleet management software can help track them. See the results below.

TOP KPI for fleet managers

What are the benefits of fleet management?

Managing a fleet of vehicles can be challenging, no matter the size of the fleet. That's why more than 75 percent of fleet managers rely on fleet management software or vehicle telematics to support daily operations in at least some of their vehicles.

Because consumers often expect instant gratification and next-day delivery, implementing fleet management is absolutely essential for businesses to maximize their resources and drive growth. Here are some of the key benefits of fleet management:

- Lower labor and gas costs

- Stay in compliance with state and federal regulations

- Locate and track fleet vehicles

- Vehicle maintenance management

- Improve fleet and driver safety

- Optimize cost savings

Fleet management software can help fleet managers gain real-time visibility into their operations while increasing driver satisfaction and reducing fuel consumption through predictive analytics and accurate reporting. Read more about this in our blog "Challenges for Fleet Managers.

How does a fleet management software work?

Fleet management software is an essential central database that helps fleet managers control, organize and coordinate vehicles. It also gives managers a complete picture of their fleet and its activities.

The software can be integrated with third-party tools such as maintenance providers, fuel cards, accounting and more. When connected to sensors, GPS tracking and telematics devices, the software tracks information related to vehicle diagnostics, driving behavior, maintenance needs, fuel expenses and more. Here are some features of fleet management software:

-Accounting: monitor and verify expenses to identify fraud and manage budgets

-Fuel consumption: vehicle sensors can detect excessive idling to reduce excessive fuel consumption

-Maintenance: the software can track maintenance history and send service reminders

-Real-time alerts: drivers can be notified of unsafe driving behavior via in-cab alerts

-Hours of Service Recording: Drivers can keep track of duty hours with built-in electronic logging devices (ELDs)

-Security: managers can detect where vehicles are and if they have been driven outside business hours

What is the job of a fleet manager?

Companies hire fleet managers to oversee the life cycle of commercial vehicles. Fleet management can be an in-house role, if the fleet is large enough to warrant that position, or it can be outsourced to a company that specializes in providing this service.

Either way, a fleet manager is appointed to organize and carry out day-to-day operations and to control costs. Duties include overseeing the purchase and maintenance of vehicles, managing drivers, route planning and safety. A fleet manager is thus responsible for all fleet services, with the following duties:

1. Ensuring driver safety

The big challenge for companies with fleets is ensuring that drivers (can) drive safely. Ensuring safe driving can be difficult, especially since fleet coordinators are hundreds of miles away from the driving vehicles. That's why there are useful tools fleet managers can use, such as dashcams or vehicle tracking systems, that provide real-time insight into a more distant vehicle and provide evidence or material to implement driver training.

2. Retention of drivers

- Driver shortages are a growing problem in the transportation industry. Stabilizing and increasing driver retention is something fleet managers should always strive for. By establishing mentoring programs, improving workplace conditions or simply building stronger trust between driver and fleet manager, fleet managers can ensure that drivers enjoy staying on the job.

3. Track, analyze and maintain an overview of the fleet

- To ensure driver safety, fleet managers need to know exactly where individual vehicles are at any given time. While this may seem simple enough, tracking vehicle location can be challenging, whether a fleet consists of 5 or 5,000 vehicles. Fleet managers then rely on GPS technology and other GPS tracking systems to know where their vehicles are, as well as to increase the visibility of their fleet operations and vehicle safety.

- Fleet management software helps monitor and analyze key metrics for optimal performance.

4. Total cost reduction

Whether managing fuel or reducing operating costs, auto fleet managers are expected to identify and eliminate unnecessary expenses to help create more cost-friendly and efficient fleet operations. Operational, fuel and maintenance costs can add up quickly. Whether it is establishing fuel efficiency programs (whether fuel prices are high or low) or asset tracking, it is the responsibility of the fleet coordinator to determine cost-saving solutions and help a company increase productivity.

5. Vehicle maintenance and acquisition

A fleet manager ensures that all vehicles are fully operational, coordinates routine maintenance and organizes repair services. To best manage a fleet, a fleet manager must be able to predict how many and what type of vehicles a fleet needs to operate efficiently. It may seem simple to purchase new vehicles when needed, but correctly understanding and forecasting fleet usage is paramount in correctly determining a purchasing strategy. An employee's suitability for a vehicle class, the life cycle of a vehicle and even market timing are all important factors that contribute to a sound vehicle acquisition strategy.

The most frequently asked questions about Fleet Management Software

Find answers to frequently asked questions about fleet management in our blog"FAQ fleet management software.

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