Investing in a fleet management system results in an improvement in internal processes, which directly reflects the quality of the service provided to the end customer. 

A fleet management system is a fundamental tool in the planning and operational control of the logistics sector. By analyzing the set of vehicles available, the human resources, and the processes required for each delivery, it becomes easier to increase efficiency, agility, savings, and safety. 

This specialized platform helps to optimize the management of inputs and increase productivity and the accuracy of deliveries through routing functionalities. It also helps to reduce insurance costs by acting proactively against theft, robbery, and accidents, increasing the efficiency of preventive maintenance,e and reducing the investment of resources in the acquisition of parts and components. 

In practice, investing in a fleet management system results in an improvement in internal processes, which directly reflects on the quality of the service provided to the end customer. These advantages are sought both by organizations that assume the logistics responsibility of their business and by companies specialized in this type of operation. 

In the rest of this article, we will delve deeper into the advantages of how a fleet management system works and how to monitor it properly. 

How does a fleet management system work? 

A fleet management system is used to plan a business’s logistics based on an assessment of historical delivery data and to monitor the performance of each vehicle based on tracking technologies such as GPS and telemetry sensors. 

By combining data on deliveries, the performance and use of each vehicle, the performance and behavior of drivers, the maximum weight transported by vehicle, and driver availability, this tool allows each delivery to be structured and continuous reports to be made in search of more intelligent processes. 

The opportunities for improvement when using this system include: 

• Real-time location tracking of each vehicle; 

• Analysis of drivers’ behavior in relation to what was planned and what happened. 

• Route optimization, with a focus on reducing costs and improving deliveries to customers; 

• Monitoring vehicle performance, such as fuel consumption and usage time, optimizing preventive maintenance planning; 

• Respect for legislation regarding transport safety, drivers’ labor rules, the maximum weight of each vehicle, and cargo documentation issues, among other points. 

All in all, this tool helps automate fleet management, simplifying day-to-day operations and facilitating the creation of performance parameters for better decision-making by managers. 

The importance of indicators in fleet management systems 

Many businesses define clear parameters for managing vehicles and obtaining the advantages of these specialized systems, as we present in this specific article on fleet management, such as cost reduction and improved safety. 

  These indicators can have different objectives: 

• Productivity, evaluating the performance and efficiency of processes until delivery to the customer. 

• Quality, aiming to reconcile excellence and savings in favor of a good service provided. 

• Capacity, these metrics are essential for managers to analyze the operation and opportunities for improvement. 

• Strategic, with the purpose of simplifying the establishment of future scenarios. 

• Operational, which allows monitoring of the day-to-day running of the company, including the individual performance of people or vehicles. 

Some KPIs provide a clear view of the organization’s performance, whether in a simple numerical (quantitative) assessment, but also with a more in-depth look at qualitative data. The focus is on reducing subjectivity in decision-making and making the business smarter. 

Check out some important parameters to be monitored below: Some of them may vary between each vehicle, but at the same time, they allow you to know the costs in a comprehensive manner: 

1. Fuel consumption 

The system allows you to monitor the performance of the entire fleet and of each vehicle individually. It can be measured by average consumption per km driven or per hour, depending on the organization’s preference. Success in this parameter is a sign of greater efficiency and cost reduction in fleet management, in addition to more intelligent use of assets. 

2. Tire consumption 

This indicator provides maintenance and operational insights, with repercussions on productivity, costs, and fleet management safety. An increase in tire consumption indicates, for example, excessive use of a vehicle, which can have other negative consequences for the business. 

3. Maintenance costs 

In fleet management, maintenance is recurrent due to the continuous use of vehicles. But how do you know when to stop for a preventive stop? Or when it is time to purchase new vehicles? Maintenance indicators provide managers with insights, achieving success both in reducing expenses and in improving the allocation of resources for the sector. 

4. Vehicle Operating Cost 

The COV aims to calculate the cost per service, hour, or kilometer of a vehicle. This parameter puts prices more in line with reality, whether to seek to reduce them or even to make financial management more effective. 

5. Fines 

The incidence of fines is a parameter that helps evaluate drivers and their performance, in addition to providing indications about safety precautions and compliance with traffic laws. The recurrence of fines increases the costs of a business and may indicate the need for investment in training and qualification of professionals, especially if they are due to disregard for legislation. 

6. Claims management 

Thefts, robberies, and accidents are unfortunately part of the routine of logistics companies. Managing claims is a way of analyzing the safety and productivity of the fleet. A lower volume of incidents means that vehicles are available for operation for longer. And, depending on the reason, it becomes easier to act proactively to reduce these incidents. 

It is possible to separate these cases by general incidents and by driver, which will facilitate the adoption of measures related to prevention. 

7. Fleet productivity 

More than focusing on processes, the challenge is to understand the impact of these activities on delivery and customer satisfaction. Two of the most common measures are average delivery time and assessment of fleet vehicle capacity. 

These 7 KPIs mentioned above must be continuously monitored, providing insights into operations, costs and opportunities for improvement. This is possible through a fleet management system, which helps managers obtain reports on the different phases of a business and make smarter decisions. 

With the right fleet management system, your business will be more and more prepared to produce noteworthy outcomes. Speak with 3PL Links to maximize your fleet’s performance!