What is fleet management? Everything you should know

What is fleet management? Everything you should know

What is fleet management? What is fleet management software? How do fleets benefit from a feature-rich fleet management solution?

These are some of the questions that many fleet owners ask at one stage or another.

In this blog post, we are going to take an in-depth look at fleet management, fleet management software, the benefits of fleet management systems, how to find the right fleet management solutions, and more.

Here is what we will discuss in this post:

What is fleet management?

Fleet management is the management of commercial vehicles and assets.

It refers to the processes and use of technology and software solutions to manage fleet operations, reduce operational costs, and increase profitability.

The most common processes involved in fleet management include vehicle tracking, asset utilization, vehicle maintenance, dispatch, driver management, improving driver safety, being compliant with different regulations, controlling costs, etc.

Because the responsibility of managing a fleet involves a lot of moving parts and variables, fleet managers need reliable fleet management software to assist them with their tasks.

What is fleet management software?

Fleet management software is a broad term for a centralized set of tools that help businesses track and manage a mobile workforce.

A business with commercial vehicles requires visibility into operations. A fleet management software serves that purpose by giving fleet managers the right tools and insights to manage their fleet effectively and efficiently.

Fleet management software is used by a wide range of industries to automate operations, reduce costs, improve performance, increase real-time visibility into operations, and even comply with government regulations.

How does fleet management software work?

Fleet management software uses a small telematics device that connects to a vehicle’s on-board diagnostics port. While installation methods differ, many solutions are “plug-and-play” and do not require a mechanic. The telematics device collects vehicle data such as real-time vehicle location, distance traveled, speed, vehicle fault codes, fuel usage, idling, harsh braking, rapid acceleration, etc.

This data is then sent to an online fleet management dashboard via a cellular connection — where it is organized into a set of tools and reports used to track and manage your business.

Additionally, leading solutions have a mobile application to facilitate driver productivity and efficiency tools. The telematics device sends data to the mobile device via Bluetooth, USB, or a cellular connection. A mobile solution allows fleet managers to manage fleet operations remotely.

Who uses fleet management software?

Fleet management software is used in a wide range of industries, such as trucking, field services, utilities, construction, oil and gas, mining, local delivery, governments, and passenger transit.

Any industry that uses commercial vehicles as part of a mobile workforce can benefit from fleet management software. Additionally, businesses of all sizes and types can use fleet management software — from small family-owned operations to large global enterprises.

Within these businesses, fleet management software is used by a wide range of job functions, including business owners, fleet managers, dispatchers, and safety managers.

However, fleet management systems are mostly used by fleet managers.

Benefits of a fleet management system

Most trucking companies use a fleet management system to improve their operations, increase visibility and efficiency, and aid them with DOT and FMCSA regulation compliance.

This may include proactively catching vehicle maintenance issues, automating IFTA calculation, streamlining dispatching, improving fleet safety, and more.

Here are some of the major benefits of using a fleet management system.

1. Improved customer service

The customer is king. According to Bain & Company, a 5 percent increase in customer retention produces a 25 percent increase in profits. Additionally, 86-95 percent of consumers read online reviews for local businesses before purchasing.

Fleet management software is increasingly being used to improve the customer experience. Here are a few ways it can help:

  • Route optimization and planning with location history data for on-time deliveries
  • Accurate ETAs for customers with real-time asset tracking

2. Automating manual tasks

In business, time is money. Fleet management software can automate many manual, repetitive tasks. As a result, it may reduce administrative burden, minimize operating costs, and allow you to focus more on business growth.

Here are a few examples of how fleet management solutions can help automate tasks by:

  • Eliminating the need to call drivers for ETAs or status updates and job details
  • Making it easier to locate assets, trucks, trailers, or equipment with real-time location tracking.
  • Collecting and centralizing paperwork such as proof of delivery, forms, and fuel receipts
  • Simplifying vehicle inspection reports, IFTA trip sheets and filings, and Hours of Service management

3. Increasing profitability

Many businesses with mobile workforces require high capital expenditures that can quickly spiral out of control if not managed closely. Fleet management software helps businesses reduce costs and increase profit margins by:

  • Reducing fuel wastage
  • Preventing vehicle breakdowns by catching potential maintenance issues early
  • Avoiding vehicle misuse and moonlighting/side jobs with real-time asset tracking
  • Optimizing and increasing asset utilization to do more jobs with fewer vehicles and employees

4. Improving safety

For vehicle-dependent businesses, accidents are always a risk. Beyond the duty to keep our roads safe, the financial implications are also significant.

According to the FMCSA, an average accident costs $91,000, and that number rises to $200,000 if there’s an injury.

Additionally, drivers are a moving billboard for your business. Dangerous driving behavior impacts your brand even when no accident occurs. Fleet management software can help you:

  • Identify your best- and worst-performing drivers
  • Simplify the process of driver coaching to immediately correct dangerous driving
  • Document past driving history to track their improvements
  • Protect your business from litigation and, with dash cam data, help with driver exoneration when they are not at fault.

What does a fleet manager do?

As we mentioned earlier, fleet management software is primarily used by fleet managers.

They perform a variety of tasks.

Fleet managers generally oversee company vehicles for transporting goods, work with other department managers to ensure on-time distributions and deliveries, and collaborate with drivers to ensure driver safety, Hours of Service compliance, and timely deliveries.

Here is a list of tasks that fleet managers often do on a day-to-day basis:

1. Fleet tracking

Fleet managers should know where each company vehicle is at all times to ensure driver safety and asset monitoring. While this may seem simple, keeping track of all vehicles and assets is a challenging task.

Fleet managers can make it easier and save time by automating fleet tracking via a real-time GPS tracking system and fleet management software.

Real-time fleet tracking gives managers better visibility of their assets and various fleet operations.

2. Fuel management

Fuel is a big expenditure for most fleets, which is why it requires careful management.

Fleet managers prevent fuel wastage by monitoring driver behavior and tracking vehicle idling. This can be done by using fleet management software that can automate idle tracking and provide detailed reports on vehicle utilization.

Fleet managers can improve fuel management by using the following tips:

  • Streamline the fuel purchasing and accounting process and reduce paperwork by using fleet management software.
  • Use fuel cards to have control over fuel purchases.
  • Coach drivers to minimize vehicle idle times and drive at an optimum speed for efficient fuel consumption.
  • Educate drivers about the importance of saving fuel and minimizing fuel wastage.
  • Identifying the best possible routes to help reduce total miles driven and fuel consumption.
  • Maintain vehicle efficiency by catching vehicle maintenance issues early and staying on top of vehicle health.

3. Comply with regulations

Most CMV drivers are now required to comply with the FMCSA ELD mandate by installing compliant Electronic Logging Devices.

ELDs automatically record Hours of Service and aim to replace paper logs and reduce traffic accidents caused by fatigued drivers. Fleets that do not comply with the ELD mandate when they must may face hefty fines and penalties.

Fleet managers need to ensure that their drivers are complying with the Hours of Service rules.

Apart from the ELD rule and Hours of Service regulations, there may be other regulations that a fleet and its drivers must comply with. With a centralized fleet management system, fleet managers can improve compliance with different regulations.

4. Driver safety

Using fleet management systems, fleet managers can help keep drivers safe

Managers gain more fleet visibility with fleet management systems that help them track vehicle diagnostic trouble codes and driver behavior, such as hard braking and speeding.

Doing so helps fleet managers refine driver training programs and ensures that drivers comply with different safety policies, reducing potential accidents and liabilities for the company.

Other tools fleet managers use, such as vehicle tracking systems and truck dash cams, give them real-time visibility into operations.

Fleet managers are also often responsible for analyzing dash cam footage to see what went wrong for drivers on the road. This video footage can also be used for driver exoneration and/or driver training programs.

5. Vehicle acquisition

To manage a fleet effectively, fleet managers need to forecast the number, type, and life cycles of necessary vehicles for efficient operations.

Purchasing new vehicles as the need arises is necessary at times, but fleet managers must understand and forecast fleet vehicle utilization to establish a solid vehicle acquisition strategy.

The longer you use and keep a vehicle, the more likely it is to break down and be expensive to repair.

Fleet managers establish vehicle acquisition strategies to gain optimum results for your business, such as when it is most beneficial to lease than purchase fleet vehicles and vice versa.

Fleet managers also manage the process of ensuring employee eligibility for specific vehicle classes, market timing for vehicle purchasing, and others.

6. Cost reduction

Reducing costs is one of the fleet managers’ priorities, whether through proper fuel management or lowering fleet operation expenses.

However, fuel, vehicle maintenance, operating costs, etc., can add up quickly, making it challenging for fleet managers to stay on budget and identify unnecessary expenses for efficient fleet operations.

Fleet managers must establish fuel efficiency programs regardless of fuel prices, track assets, and identify cost-saving solutions to increase productivity.

Fleet managers can reduce fleet fuel costs by:

  • Using the right vehicle. Using the right vehicles with the right specifications can have an impact on fuel consumption and expenditures. Selecting vehicle engines with either too little or too much power may lead to fuel economy inefficiencies.
  • Proactive maintenance planning. Fleet managers should deploy proactive vehicle maintenance to ensure vehicles operate more efficiently. This reduces instances of unplanned maintenance work that can cost thousands of dollars, saving your company money and fuel expenses.
  • Utilizing vehicle tracking. Fleet managers plan routes using GPS and vehicle location history to help drivers avoid traffic jams and shorten driving times. This helps reduce cost by lowering fuel consumption and potential vehicle wear and tear.

Vehicle tracking systems also encourage drivers to practice safer driving habits and exercise greater care when operating company vehicles, helping save fuel and minimize unsafe driving.

7. Vehicle maintenance

Maintaining safe and efficient vehicle performance and fleet operations are the central responsibilities of the fleet manager.

Fleet managers ensure maintenance schedules are followed to avoid vehicle failures that can lead to road accidents. It also includes the implementation of preventive vehicle maintenance programs, so your vehicles run in peak conditions.

8. Recordkeeping

With all the moving parts and various documentation requirements involved in fleet operations, record tracking can be a total nightmare.

Fleet managers ensure proper record keeping and organizing to avoid losing important documents that can lead to accounting issues, fines, and business losses.

Fleet managers keep records in check and coordinate with drivers to ensure they submit required documentation.

Managers also ensure their company complies with the different state laws and regulations, such as the International Fuel Tax Agreement (IFTA) and the Federal Motor Carrier Safety Administration’s (FMCSA) rules and regulations, and keep records of the corresponding documents.

Fleet management tips for fleet managers

We have discussed the various responsibilities of a fleet manager. Now, let’s take a look at how fleet managers can use fleet management software to fulfill these responsibilities.

In this section, you will find fleet management tips with numerous examples and use cases.

1. GPS tracking

GPS tracking is the central piece of a fleet management system. It allows a fleet manager to view the location of any vehicle, driver, trailer, or other assets in real-time:

How fleet managers can use GPS tracking for fleet management

Here are some examples of how fleets of all types and sizes can use GPS tracking to improve fleet management:

  • Eliminate phone calls. With real-time GPS tracking, you can view driver ETAs and send them to customers with ease. No phone calls necessary.
  • Faster response times. For urgent deliveries, real-time asset tracking makes it easy to locate the nearest available vehicle.
  • Identify vehicle misuse. Are your vehicles being driven after hours for personal use or side jobs? With location history, you can see exactly where your vehicles were and when to find out.
  • Reduce detention time. Reduce detention time and increase productivity with location-specific notifications and unlocking rich insights.
  • Timely deliveries. Use GPS data to prove timely deliveries if there is a dispute.

Also, learn how to use a GPS fleet management system to increase profits.

2. Vehicle diagnostics

Vehicle breakdowns are not only expensive, but they also disrupt operations and upset customers.

Leading fleet management solutions offer vehicle diagnostic functionality that fleet managers can use to continuously monitor vehicles for fault codes and display them in actionable reports:

actionable reports

How fleet managers can use vehicle diagnostics

Here are some use cases of how fleet managers can use vehicle diagnostics to improve vehicle health and fleet performance.

  • Proactively plan maintenance. Track vehicle usage for mileage-based maintenance.
  • Vehicle maintenance issues. Catch vehicle maintenance issues early with automated fault-code detection and real-time alerts.
  • Minimize unexpected breakdowns. Identify recurring issues, so you can minimize unexpected vehicle breakdowns.
  • Personalize your system. Define your own process and workflow by customizing driver vehicle inspection reports (DVIRs) and making vehicle inspections mandatory for drivers, as you see fit.

3. Vehicle & asset utilization

Fuel is usually one of the biggest expenses fleets have to deal with. By minimizing fuel wastage, any fleet can make a significant positive impact on the bottom line of the business.

Fleet management software can help you run a more cost-efficient business by making it easy to identify fuel waste and underutilized assets.

underutilized assets

How fleet managers can improve vehicle and asset utilization

  • Save fuel. A vehicle burns nearly one gallon of fuel for every hour spent idling. Use a fleet management system to identify drivers who idle for too long or too frequently and initiate driver coaching programs to rectify the problem.
  • Improve vehicle health. Idling one hour per day for a year is the equivalent of 64,000 miles of engine wear. By minimizing idling, you can improve vehicle health and performance.
  • Healthy competition. Discover vehicle utilization trends across the fleet or different terminals to promote healthy competition among drivers.
  • Incentivize. Recognize drivers with the highest utilization rates and offer performance-based drivers for improving driver happiness and driver retention rates.

4. Driver safety and exoneration

Safety tools are a critical part of fleet management software. Fleet managers can use these tools to improve driver safety and even help the company with driver exoneration in case of accidents.

Advanced fleet management solutions help identify at-risk drivers by monitoring driver behavior on the road, such as rapid acceleration, tailgating, hard cornering, speeding, etc.

Drivers can then be categorized by their safety scores, which makes it easier for fleet managers to identify drivers who need immediate coaching.

scorecards coaching

How fleet managers can improve driver safety using fleet management software

Here are some ideas and use cases on how fleet managers can use fleet management software and the data it provides to improve driver safety.

Even more importantly, leading fleet management solutions allow you to witness the critical event for yourself with HD video footage.

Use cases for Driver Scorecards and dash cams:

  • Identify at-risk drivers. Using the driver scorecards and safety data, identify at-risk drivers with poor safety scores.
  • Initiate driver coaching programs. Initiate driver coaching and training programs, based on the safety scores data, to help improve driver behavior and reduce the probability of collisions and road accidents.
  • Get full context. When a critical safety event is triggered, get complete context with the KeepTruckin DRIVE score that factors additional variables, such as location, weather, vehicle, etc.
  • Proactively prevent accidents. Get ahead of the curve and proactively prevent accidents by closely monitoring trends, safety scores, and dash cam footage.
  • Exonerate drivers. Commercial drivers aren’t always at fault. With dash cam footage and fleet management data, fleet managers can help exonerate innocent drivers and save thousands of dollars.

Case study: Read how KeepTruckin’s dash cam footage saved Nybll from a personal injury lawsuit that could have cost up to $500,000.

5. Driver communication

Fleet managers can also simplify communication with drivers through a centralized fleet management solution. This saves valuable time and minimizes distractions.

instant messaging

How fleet managers can simplify driver communication with fleet management software

Use cases for driver communication:

  • Company announcements. Do you have a company announcement or urgent update to share with your drivers? Send a broadcast message to all drivers or any group of drivers with fleet management software.
  • Increased transparency. Many fleet management solutions offer read receipts to increase transparency. Fleet managers can use this feature to know their messages have been delivered and read.
  • Minimize distractions. A connected fleet management system knows not to disturb drivers when they are driving. Messages are only available when drivers stop the vehicles. This helps minimize distraction and the probability of road accidents.
  • Real-time updates. Drivers can also send their current location in a message, if needed.
  • Share important documents. Apart from messages, fleet managers and drivers can also share images and other important documents.

6. Asset tracking and geofencing

Asset tracking and geofencing are crucial aspects of fleet management software. Fleet managers can improve productivity and increase efficiency by tracking assets in real-time and setting up location-based alerts with geofencing.

How fleet managers can use asset tracking and geofencing

  • Automation. Create a geofence around any location to get real-time alerts when vehicles arrive or exit that area.
  • Reduce detention time. Detention time can cost up to $1,280 per driver per year. With asset tracking and geofencing alerts, fleet managers can identify areas where vehicles are detained for too long.
  • Simplify invoicing. View detailed reports to see exactly how much time an asset spent at a location. This is especially useful for job site invoicing.
  • Increase dispatcher efficiency. Know exactly when a driver enters a specific location and dispatch a team to help load and unload the vehicle as the driver arrives.
  • Improve customer relations. Get accurate ETAs and improve customer relations by informing customers ahead of time.
  • Identify misuse. Identify vehicle misuse or personal use of vehicles by drivers by tracking vehicle location in real-time and setting up geofencing around yards and other downtime areas.
  • Prevent cargo theft. Fleet managers can also help prevent cargo theft with geofencing and real-time location tracking.

7. IFTA calculation

Calculating IFTA reports is a tedious and time-consuming process. Fleet managers can save dozens of hours in manual labor by automating IFTA calculation with fleet management software.

How fleet managers can use fleet management for IFTA

  • Reduce administrative burden. Some fleet management solutions can automatically calculate the distance traveled by jurisdictions by each vehicle. This reduces administrative burden by eliminating the need for calculating it manually.
  • Minimize operational costs. Fleet managers can minimize operational costs by automating the IFTA calculation.
  • Increase accuracy. Fleet managers can use fleet management software to increase accuracy and reduce audit risk.

How to find the right fleet management software for your fleet

Give due diligence to finding the right fleet management software since its impact on your business is massive. Consider these tips when looking for a fleet management software.

  • Visit trucking forums. You’ll never see trucking forums that don’t cover fleet management. The topic is that important to a trucking business. Study the users’ comments about what software they’re using and the things they like (and hate) about it.
  • Schedule a free demo. Most fleet management software providers have a free demo of their software. Sign up for the demo, so you have first-hand experience (somewhat) of the product. Be sure to ask the presenter of the demo if they can address your most pressing fleet management problems.
  • Studies. See if there are any independent third-party studies about fleet management software. For instance, according to an independent study, the KeepTruckin fleet management software is 50% easier to use than other leading providers and can help save up to 30% in driver training costs and up to $30,000 in administrative time.
  • Customer testimonials. Take a look at how the users of a fleet management system are benefiting from it. Read customer testimonials and case studies before making a final decision.

Case study: How Flying Star Transport saved up to $40,000 and increased efficiency by 10 to 15 percent with KeepTruckin.

In addition, look at the number of third-party integrations, user reviews, and customer support before finalizing.

How the KeepTruckin fleet management platform helps companies

With the right fleet management software, the sky’s the limit.

Here are just two examples of how the KeepTruckin fleet management system had a positive impact on these two companies.

1. Conner Logistics

For 13 years, Conner Logistics served as a courier in the Western Region with a 99% on-time delivery rate. However, they looked for a better system after their first fleet management system became expensive and unreliable.

The company’s biggest pain point was making fast deliveries while keeping drivers safe. However, they encountered the following problems with their fleet management system:

  • The system was difficult to install and use.
  • The system did not work properly and shut down.
  • Vehicles disappeared on the map.
  • The vehicle history had gaps.

These inconveniences resulted in several problems for the business.

Fleet owner Sean Conner said:

“[The safety managers] were adamant that we use KeepTruckin. They said it was easier and more convenient for our drivers. And I’ve been really happy since we’ve switched over.”

After comparing KeepTruckin and their old system, Conner Logistics found that the KeepTruckin system better matched their needs.

Aside from resolving past issues, the system’s AI-powered Smart Dashcam also helped them avoid a major lawsuit after a car collision.

Conner said, “A passenger vehicle swerved into our driver’s lane to avoid rear-ending the car in front of him. Our driver hit him, and the car spun around, but thankfully, no one was injured, and the impact wasn’t too severe.”

“I watched the video in slow motion and saw a child sitting in the back seat. I even saw the expression on the child’s face during the impact. The video saved us because if that child had been injured, they would’ve gone after us.”

Conner then sent the footage to the insurance company and had the truck fixed. Moving forward, Conner Logistics plans to install KeepTruckin dash cams in all of their trucks.

2. Alba Freight Lines Inc.

Alba Freight Lines is a small general freight company that aims to appreciate their drivers and provide a reliable and quality transportation service.

When Safety Manager Judi Catania joined Alba, she needed to improve their safety score and make it easy for the drivers.

Catania recommended KeepTruckin after a successful experience with the fleet management system in the past. The move was also in line with FMCSA’s suggestion for Alba to switch to a different ELD provider to improve their safety score.

After trying KeepTruckin, Alba’s safety score improved.

Additionally, Catania said, “I need to make it as simple as possible for my drivers, and I think KeepTruckin by far is the easiest.”

The new system removed the need to do paper logs in case of connectivity issues.

“It was a huge problem for us,” says Catania. “You didn’t know when it was going to go back on, and then there was this random part of Iowa where it was just done. So, I’d have the driver use the paper log at that point.”

Moreover, the responsive customer service made it easy for Catania and their drivers to troubleshoot any problems.

“I’m not relaying the message to a third-party all the time. If there’s a problem and I don’t know how to fix it, the driver can call KeepTruckin. I don’t have to call. And that’s what I love about it,” Catania said.

What is the best fleet management software?

There are plenty of options available on the market. The best fleet management software is reliable, easy-to-use, and offers the best value for money.

The KeepTruckin fleet management platform fulfills all these criteria and more.

If you are interested in learning more, request a free demo. Call 855-434-3564 if you have any questions.

Author


Austin Schmidt

Austin has been researching and writing about the impact of technology on transportation and supply chains since 2013. His current area of focus is helping small businesses better utilize the technology they already have to increase profits and compete.


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