Fleet owners and managers — The key to 2021 success lies in adopting a lean start-up approach
In a recent article, I wrote for the Australasian Fleet Management Association’s (AFMA) Fleet Drive, I briefly discussed how in light of today’s market and competition, businesses need to reassess, adapt and reset everything.
They need to go back to thinking like a start-up with a lean and agile mentality.
In this stage of post-pandemic economic recovery, how quickly your business can pivot, adapt and build around the changing market dynamics will dictate its survival.
Why function like a start-up again? By its very nature, start-ups are fluid and adaptable. They adopt the latest technology to drive their business practices efficiently via the most cost-effective methods available. They have no legacy practices tying them to old ways of working. And in the process, they can minimise the cost of doing business, and increase their ROI by being more competitive in a price-sensitive market.
As we emerge from 2020, adapting a start-up business approach can be crucial to your business's survival — no matter how old it is.
Let’s discuss the different ways fleet companies can adapt and benefit from this approach.
Technology investments
Technology investments in tools of the trade like fleet management systems, become essential because the post-COVID-19 world demands higher levels of compliance and monitoring to ensure the safety of both your fleet and its users.
With accurate data and actionable information readily available on these tech systems, you can not only monitor user safety but also understand the opportunity to save on expenses: labour; fuel; wear and tear — especially at-fault accidents.
Finding technology that is compatible with your assets
A common reason why many companies shun fleet management systems is that they have a mixed fleet of light passenger vehicles, vans, trucks, and even tools and machinery.
For example, a garden business may have newer, leased sedans for its sales team, a couple of 4WD’s for the landscape team and a few delivery trucks.
Traditionally, only newer vehicles with ‘OBDII’ ports (a bit like USB plugs, but for cars) would be compatible with a plug and play fleet management device. Requiring you to either — upgrade your fleet (expensive) or finding a solution that is compatible with all your fleet vehicles.
This space has evolved, and there are solutions available that can cater to mixed fleets, old and new, at a fraction of the cost of traditional fleet management systems.
Tracking vehicle use to get more, for less
Let us take an electronic vehicle booking system integrated into a fleet management system. It can track not only the vehicle’s use but also the journey, the driver — and offers more reliable and automated inputs over the manually updated and maintained counterparts, an exercise book, Outlook calendar or Excel worksheet.
For example, let’s say an employee books a car for three hours but completes their trip in only two hours. Under a conventional system, the vehicle is blocked out for three hours despite it sitting unused for an hour. Under a digital booking system, the asset is made available as soon as it returns, freeing up capacity. Cancelled bookings can also release vehicles for use instantly. Both examples reflect an increase in fleet utilisation. What would this save you over a year or the life of a vehicle?
A conventional system would fail to recognise and respond to these last-minute changes. But a digital system would show when an asset is in use, or if the system is being abused, ensuring that your fleet is used efficiently.
Technology to reduce compliance costs
With COVID-19 blurring the lines between personal and professional time, employees may have a greater need to use their company vehicle for personal errands.
Fringe Benefits Tax (FBT) is charged to businesses based on the provision and use of company cars or ‘grey’ fleet vehicles (a private car used for business travel).
Part of the FBT calculation is based on the percentage of company vs personal vehicle use. A digital fleet management system helps with Fringe Benefits Tax calculation, as it logs and also verifies whether the vehicle was used for work or leisure, through readily accessible accurate vehicle trip history, and easy allocation of trips to business or private use.
An ATO compliant report spells peace of mind.
Predictive technology
Smart fleet management systems can also predict events before they happen. Some fleet management solutions predict imminent battery failure 2–3 weeks before it occurs, saving on vehicle downtime and expensive callouts.
Of course, this philosophy extends into other areas of the vehicle, creating a service management tool that maximises vehicle use through on-time servicing, and an automated vehicle fault detection and notification system reporting back to the Fleet Manager or owner, as the fault occurs.
Managing safety, risk and compliance out of COVID-19
Telematics technology investments become essential because the post-COVID-19 world demands higher levels of compliance and monitoring to ensure the safety of both your assets and staff.
Fleet management systems can help you manage your employees better, reducing your exposure to the risk of fines or non-compliance. The system monitors driving behaviour by tracking driver acceleration; cornering; braking; and resultant impacts. If a driver’s behaviour is putting the vehicle, themselves or the public at risk, or creating excess wear and tear on the vehicle, they can be retrained. A report from the UK indicates that installing a telematics system reduces at-fault accidents by an average of 20%. That alone will cover the cost of the telematics solution.
In addition, utilising a plug and play fleet management system can further enhance this process by optimising your costs based on your rental agreement. For example, suppose there is an inclusive kilometre allowance per vehicle in your agreement. Your fleet management system will help you track that the inclusive component is exhausted by every vehicle, and pinpoint those with low kilometres or sitting idle.
Taking advantage of new technology can help you get more out of your fleet and help you steer through the impact of COVID-19 on your business.
Intelematics offers a competitive modular approach to telematics, where every customer only needs to pay for the components that they need. Allowing companies to purchase what they can afford and transition to more insightful services as the need arises and the business scales.
As you put down your plans for 2021, ensure you add technology to capital investment and not a cost centre, that is what start-ups do, invest in tech that helps them automate, scale and pivot quickly.
This start-up approach will allow you to move away from legacy practices, minimise costs, increase your bottom line and provide you with all the momentum you need to overcome your competitors.
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