Some key indicators of successful fleet management are budget adherence, staying on schedule, good driving practices, optimal vehicle replacement, and no empty miles driven.
Tracking the performance of your fleet is an essential part of quality fleet management. Key performance indicators (or KPIs) are data that should be included in your fleet management strategy, in order to help reach your goals. Furthermore, with the help of KPIs, managers can track the results of their strategic decisions, and identify areas of strength and lack. And as a result, fine-tune their business strategy to increase efficiency. Let’s take a look at the most important KPIs of fleet management.
The aim of KPIs is to set benchmarks for your fleet management strategy. Having clear milestones allows fleet managers to measure performance. KPIs also help identify the strengths and weaknesses of a fleet management plan and help in setting goals for future performance. Think of KPIs like a compass, helping you stay on the right path to successful fleet management.
With KPIs, you can choose to focus on specific elements of your business like budget controlling or maximizing efficiency. Or, use a combination of different KPIs to get a complete picture of your current fleet management standpoint.
Whatever fleet management strategy you choose after the KPI analysis, it’s important to communicate results and future goals with your team. This way, everyone is on board with the plan, and employees are all working towards the same common goals.
Here are 5 key indicators of successful fleet management.
One of the most important aspects of any business is managing costs. And the best way to plan future budgets is to take data from the past and build on it. Fleet management software gives real-time updates on costs and spending. It can help identify exactly where your money is going, and how much you are spending. This can also help identify where deviations lay between your planned budget and true costs, guiding your fleet management strategy to mitigate these losses in the future. Within cost analysis, you can consider aspects like:
Then, simply identify the areas where your company is lacking and target those. Or, it’s also possible to create general fleet management goals. For example, cutting costs by 8% in a year and using KPIs to consistently track progress towards that goal.
Good fleet management must always consider the safety of drivers, and others on the road. There are many indicators of a good driver. Some of the most important KPIs here include the number of harsh brakes and accelerations a driver makes, as well as their speeding habits (or hopefully lack thereof).
Tracking the average amount of these occurrences can help identify workers with poor driving practices, who would benefit from extra training. Since these habits will lead to the degradation of vehicles over time, it’s important for a fleet management plan to consider employee driving habits, and work on optimizing them if needed.
Making sure that vehicles are in good condition and on track with scheduled servicing is crucial to a successful fleet management strategy. Staying on top of maintenance needs limits vehicle downtime, ensuring that your fleet is of full use to your business.
Fleet management allows fleet managers to track individual vehicle performance. This way, if one or two vehicles are taking up a large share of repair costs, they can be singled out and properly serviced, or replaced if needed. Recurring issues can also indicate problems with the vehicles themselves, or the service they are getting. As a result fleet management should aim at following a preventative approach. Meaning they try to catch problems at their root rather than letting them compound into larger issues requiring downtime and large servicing fees.
Preventative fleet maintenance and optimized vehicle usage will keep your fleet running for many years. But keep in mind that there comes a time when even the best-performing vehicle needs to be replaced. When repair costs start outweighing the profit your vehicle brings in, replacement may be the best decision.
With the help of fleet management software, it is possible to identify replacement windows. These are the optimal times of replacement, where maintenance costs have not yet exceeded profits, but are soon likely to.
Data like this can help in setting fleet management targets around vehicle lifespan, such as a minimum age before replacement or an X percent increase in lifetime. Such targets will optimize vehicle usage, and ensure that no money is being wasted on unnecessary maintenance.
One of the biggest wastes of resources in the road freight business is empty miles. It means burning fuel for no reason and the money on that fuel essentially is going out the window. Not to mention drivers are also getting paid while not working to further business goals.
An important KPI of good fleet management is the limitation of empty miles to the bare minimum. Tracking idle driving and identifying wasteful routes can help set up an optimized driving plan.
Hopefully, we’ve given you a few ideas on KPIs to implement in your own business and fleet management plan. Keeping track of these indicators will help in bringing in profit, keeping costs low, and maximizing fuel consumption.
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