Historically, the purpose of fleet management was operational efficiency, which was also the main driver of the fleet management software development. However, as the technology matured, it became apparent that its advantages extend beyond the original economic considerations. The following article explores the benefits of digital fleet maintenance solutions and their social implications.
What Is Fleet Management?
Fleet management refers to the activities aimed at optimizing the use of vehicles used for commercial purposes. In most cases, the term “fleet” refers to conventional motor vehicles such as cars and trucks. However, depending on the business segment, it can be comprised of other types of machinery:
- Combine harvesters
- Trains and rail cars
- Shipping containers and other non-powered assets
The concept covers all activities essential for the cost-efficient operation of the fleet, from the acquisition of units and equipment to repair and maintenance to disposal. It also involves issues such as regulatory compliance and accident management.
Common Challenges in the Field
Understandably, with such a broad scope of responsibilities, fleet managers are expected to deal with numerous challenges:
With multiple destination points and differences in vehicle capacity, navigating the optimal route should consider road conditions and traffic.
Fuel-related expenses are among the largest factors contributing to the total cost of fleet ownership, which can be further aggravated by the fluctuations in the oil cost.
With environmental regulations getting more stringent, transportation companies need to find ways to comply.
Allocating the workforce, communicating with customers, and invoicing adds to a significant proportion of working hours.
Communication with Drivers
Each vehicle is operated by the driver, who often has to make decisions on the fly and make route adjustments, all of which rely on efficient messaging.
In many cases, customers expect delivery at a specific time, which may correspond to busy hours on roads, with every delay harming business.
Safety and Security
Tasks that range from monitoring the state of vehicles and regularity of maintenance to minimizing accidents and encouraging safe behaviors.
As can be seen, most of the challenges above can be addressed through a tightly integrated system that can process large volumes of data and react to emerging issues on time. For this reason, fleet management software development is gaining in popularity as digitalization offers new solutions or improves upon existing ones.
The Solution: Enterprise Fleet Management Software
At its core, car fleet management software is not a new idea. As a subset of digital enterprise management solutions, it has been used to collect, process, and report data for some time. However, the emergence of technologies such as the Internet of Things has greatly expanded its effectiveness and the range of tasks it can accomplish. In fact, recent estimates by PwC suggest that digitization of fleet management is expected to reduce logistics costs by 47% in ten years. The report also projects a 40 percent improvement in delivery lead times and an overall optimization in asset usage.
Of course, the implementation of such solutions is not an easy process and requires substantial resource allocation. Nevertheless, once the process is complete, the organization can enjoy a range of benefits:
- Optimized performance
- Reduced expenses
- Improved driver and vehicle safety
- Higher customer satisfaction
- Streamlined reporting
- Real-time insights
- Better talent management
- Greater autonomy
In this light, allocating resources on equipment upgrades, educating the staff, and integrating fleet management software into its ecosystem can be viewed as an investment into the organization’s strategic development. As a matter of fact, many companies from different market segments have already demonstrated the feasibility of this move either directly (by improving their own performance) or indirectly (by contributing to adjacent domains).
Efficient Maintenance with Fleet Management Software from Singapore
Innogy SE, one of Germany’s major utility companies, was facing challenges of maintaining its 2000-unit fleet. In addition to operational expenses, the company had to deal with a high volume of administrative paperwork. The decision to deploy a digital solution that would help drivers find the best destination for servicing their vehicles was made to optimize performance.
The final product was a fleet management application that would direct users to a nearby service station, arrange an appointment, and rate the quality of services. By deploying the service, the company reduced the time and effort spent on maintenance while also improving compliance with Germany’s safety regulations. On top of that, the feedback feature fostered an exceptional employee experience.
Improving Road Safety
While fleet management software’s main purpose is operational efficiency, it often has unintended beneficial outcomes that exceed its original intended scope. That was the case for John Mitchell Haulage, a logistics operator from Scotland. The smart fleet tracking solution implemented by the company was initially intended to reduce fuel consumption. However, it soon became apparent that it could also encourage safe driving behaviors by rewarding drivers with bonuses.
A similar effect was observed with JTI-Macdonald, who used their driver excellence program to detect preventable accidents. As a result, they could reduce the accident rate by 64 percent and reduce the claim costs by 50% in two years.
Contributing to Smart City Planning
City planning is an elaborate and complex process. One of the main challenges it poses is the sheer number of factors that need to be considered. Traffic management is one such factor, requiring an immense volume of data to make decisions. From this perspective, fleet tracking offers interesting potential.
One way to address the issue is vehicle-to-everything technology – a communication system that facilitates data exchange between a vehicle and all entities affected by it. On the one hand, it can improve traffic safety on a case-per-case basis. On the other hand, the data accumulated over time will help develop urban infrastructure to optimize throughput.
Going Beyond Efficiency
Fleet management software is indispensable for optimizing supply chains’ performance and improving the financial performance of businesses. However, as the technology gets more advanced, the benefits it offers reach far beyond its intended scope. From customer satisfaction to public safety to better urban environments – the potential is enormous. There are still challenges along the way, yet the advantages of successful implementation are certainly worth the effort.