A fleet manager’s job is all about knowing what’s going on with drivers and vehicles, whether they’re across town or across the country. Fleet monitoring is the foundation of that activity.
But what exactly is fleet monitoring, why is it so important, and how can you make your fleet monitoring program more effective? You’ll learn the answers to those questions in this article.
Why Is Fleet Monitoring Important?
Fleet monitoring is a broad term that encompasses the what and the how of modern-day vehicle tracking.
The “what” refers to technology such as GPS, onboard diagnostic (ODB) hardware, telematics, fleet management software, and smart fuel cards that give you near real-time info about your fleet. These essential tools serve as the foundation for what comes next — the “how.”
How do you use the technology to maximize fleet activities? By following a set of best practices that make the most of all the data at your fingertips.
This combination of technology and best practices can help you manage your assets better, control costs, optimize routes, monitor driver behavior, schedule preventative and mandatory repairs, manage fuel consumption, and much more.
Without the insight that the practice and technology of fleet monitoring provide, your job would be much more difficult, take up much more time, and leave you with fewer opportunities to improve the way your business works.
In this article, we’re going to focus on how you can use technology to manage your fleet better (the best practices). To learn more about the specific technologies that make up fleet monitoring, check out these articles from the Coast blog:
- GPS Fleet Tracking: A Guide For Fleet Managers
- What Is Telematics? Everything Fleet Owners Need To Know
- How To Select The Right Fleet Management Software
- Fuel Cards For Business: 18 Features To Look For
Fleet Monitoring Best Practices
At its most basic, fleet monitoring is about using vehicle data to improve the way your business operates.
Once you have the hardware installed, the software up and running, and the numbers rolling in, how can you structure your fleet monitoring activities for the best effect? And what can you do with the information to make your business run better?
1) Track Everything
The power of fleet monitoring lies in the sheer scope of data available. That’s why we recommend tracking everything possible.
Telematics software may allow you to turn off variables that you think you don’t need. But, at some point, those variables may become important for the continued safe operation of the vehicle.
Some telematics programs will even allow you to customize how you look at the data while still recording everything in the background.
For example, you may only want to keep track of tire inflation and miles per gallon right now and not have to sift through engine rpm, brake wear, speed, and distance information to get to it.
With the right software, you can separate the tire inflation and miles per gallon variables for a less cluttered view but still keep the other data coming in case you need it later.
However you choose to look at the data, continue to track everything that the hardware and software allow even though you don’t necessarily pay attention to all of it all the time.
Keep An Eye On Other Relevant KPIs
With the right solutions in place, you should be able to refine your view of the incoming data to keep an eye on the key performance indicators (KPIs) that are most relevant to your fleet.
Depending on your goals, you may choose to track specific details such as budget adherence, vehicle replacement targets, day-to-day vehicle ETAs, and/or average vehicle downtime.
With a much more detailed view of the inner workings of your fleet, you’ll be better positioned to change the workflow so that the larger aspects of your business (e.g., fuel consumption, efficiency, productivity, etc.) improve along the way.
For more information on key performance indicators and how they apply to your fleet, take a few minutes to read this article from the Coast blog: 16 Crucial Fleet Management KPIs Managers Should Track.
Calculate Total Cost Of Ownership
One of the most important data points to track for your fleet is total cost of ownership (TCO).
The TCO variable gives you a snapshot of what it costs to operate a single vehicle for a specific period of time (e.g., a week, a month, six months, or a year) and provides insight for how to reduce costs throughout your fleet.
To calculate total cost of ownership for a single vehicle, use this formula:
Total Cost Of Ownership = Fixed Vehicle Costs + Variable Vehicle Costs
Fixed costs include things like insurance premiums, license and registration fees, permits, telematics hardware costs and subscriptions —- anything that occurs on a regular basis and that you can predict the cost of.
Variable costs include things like fuel purchases, fuel tax spending, and tolls —- anything that fluctuates based on vehicle activity level.
Once you have the TCO for a single vehicle, you can calculate the TCO for the rest of your vehicles and combine the results to show your TCO for the entire fleet.
For more information on this important fleet monitoring calculation, check out this article from the Coast blog: How To Calculate Your Fleet’s Total Cost Of Ownership.
Evaluate Total Cost Per Mile
Once you have the TCO for a specific vehicle, divide that number by the total miles driven to see the vehicle cost per mile (VCPM).
Here’s the formula:
Cost Per Mile = Total Cost Of Ownership / Total Miles Driven
As with the TCO calculation, once you see what costs are affecting your VCPM, you can make changes in order to bring the numbers down, save money, and streamline your fleet activities.
For specific strategies to help you reduce VCPM, take a few minutes to read this article from the Coast blog: How To Calculate Your Fleet’s Cost Per Mile.
Use Fleet Monitoring Data To Create Better Company Policies
The data you obtain from telematics, GPS, fleet management software, and smart fuel card software can help you create better company policies and improve the way your business operates.
For example, fleet management software can be used to monitor and control vehicle uptime and maintenance. Telematics can be used to track driver behavior and design training programs. And smart fuel cards can be used to set fleet spending rules and control total cost of ownership
2) Plan For The Long Term
One of the more important aspects of fleet monitoring is that it allows you to plan for the long-term operation of each vehicle.
Without the data that telematics provides, you’d have no way of knowing when a vehicle is approaching or beyond its useful life.
As a result, you’d have no way to prepare for the time when a vehicle needs to be retired or temporarily taken out of service. You’d just have to use your best judgment and react. While fleet managers did that before telematics, it wasn’t an accurate or efficient way to operate.
Some vehicles may have been retired while still having plenty of miles left in them, while other vehicles were kept on the road when they should have been taken out of service a long time ago.
Both scenarios can cause an increase in overall operating costs and make everyone’s job more difficult.
Fleet monitoring provides the numbers you need to create a long-term plan so that, when it is time to replace a vehicle, your business will be prepared and ready to make the switch.
Build Benchmarks To Motivate Positive Change
With fleet monitoring data from telematics, GPS, and smart fuel card software, you can build benchmarks to motivate positive changes in driving behavior.
For example, you may choose to use the data to implement an awards program for drivers who exhibit certain fuel-efficient driving techniques every month. Not only can this help you conserve fuel (and reduce fuel costs), but it can also help you boost your safety numbers fleet wide.
Consider Testing The Feasibility Of Electric Vehicles
After monitoring fleet activities for a while to establish a baseline with gas and diesel assets, consider adding an electric vehicle to the lineup to see how it affects spending, productivity, and the operation as a whole.
While an EV might not work for certain parts of your fleet right now — cross-country semis come to mind — you might be able to replace aging short-haul work vans, work trucks, SUVs, and cars with electric options to help you save money.
3) Educate Your Team On How Fleet Monitoring Works
Getting the most out of your fleet monitoring program means getting everyone on the same page, familiar with the technology, and with what it does.
At first, your drivers and mechanics may feel that installing telematics on company vehicles is an invasion of their privacy and shows that you don’t trust their skills, when, in fact, it can be a valuable tool for two-way communication.
That’s why it’s important to educate your team on how fleet monitoring works and why your business needs the insights to continue to grow.
Once your employees know how telematics works, what data you’re looking at, and that you’re not trying to micromanage their job, they’ll be more receptive and accepting of the new transparency.
Drivers may even find the information gained from telematics beneficial. It can help them spot patterns and behaviors they can improve upon and allow for more real-time communication when required.
4) Use Your Fleet To The Fullest
Fleet monitoring is all about getting the most out of the vehicles you have in service. That could be optimizing routes, preventing breakdowns, minimizing wear and tear, or a whole host of other variables.
One such variable that many fleet managers forget to examine is whether or not they’re using their fleet to the fullest.
For example, your business may have 10 vehicles in service but only use eight most of the time. The other two vehicles sometimes go days, or even weeks, between uses while you continue to pay the costs associated with their operation and upkeep.
Could your business get rid of one or both of those extra vehicles and operate effectively on the eight or nine that are left?
Use the data that fleet monitoring technology provides to help you answer that question and find ways to reduce costs, save money, and make your business run better.
Incorporate Geofencing
Geofencing is a unique feature of fleet monitoring software that allows you to create a virtual geographic boundary (a geofence) around a certain area.
If a vehicle crosses that boundary (either entering or exiting), the telematics software will notify the fleet manager and even remind the driver that they’ve taken the vehicle somewhere they shouldn’t.
For example, if you operate a fleet of long-haul semis that primarily travel on I-75, you could set a geofence around that corridor.
If a driver takes a vehicle outside of that area, you’ll both receive a message indicating that they’re outside their defined path of travel.
This can help you maintain organization in your fleet and keep drivers and vehicles on optimal routes that maximize fuel consumption and minimize vehicle wear and tear.
Experiment With Aerodynamics
Cutting costs and minimizing expenses should be at the heart of all your fleet monitoring efforts.
After tracking vehicle data to establish a baseline, consider experimenting with aerodynamic add-ons to see if they affect fuel usage for the better.
Even a relatively small modification — such as a roof fairing or trailer skirts — can have a big impact on vehicle miles per gallon and, ultimately, on what your business spends at the pump.
5) Encourage Good Driving Behavior
As we mentioned earlier, fleet maintenance technology records a wide variety of data — some of which can tell you a lot about driver behavior on the road. Armed with that information, you can then take steps to help drivers improve.
For example, telematics in one delivery van reveals that driver A tends to accelerate quickly, brake hard, and negotiate corners a bit too fast for the load they’re carrying.
The same telematics in the same delivery van then reveals that driver B accelerates at a lower rate, brakes more consistently over long distances, and negotiates corners at a speed that is more in line with the load they’re carrying.
Upon further analysis, you discover that the vehicle piloted to the same destination and back uses less gas and runs at a lower temperature when driver B is behind the wheel.
That’s better for the vehicle, the fleet, and your business. And now you have the numbers to prove it.
You can use the data to encourage good driving behaviors and practices throughout your fleet. You can also use the data to eliminate negative habits that your drivers may not even be aware they have.
6) Establish Preventative Maintenance Programs
Effective fleet monitoring and effective fleet management are two sides of the same coin — they both depend on the other for continued success.
The same is true for many of the tips on this list — they’re all intimately intertwined and depend on one another for the success of the whole.
Planning for the long term, for example, wouldn’t be possible without a preventative maintenance program to back it up.
Preventative maintenance is the theory and practice of monitoring the condition of a vehicle and making necessary repairs before an issue spreads to other systems (and becomes more expensive).
The data that telematics provides helps you create a custom maintenance program for each vehicle, which, in turn, extends the useful life of that asset.
No two vehicles operate and wear the same way. The engine of one may run a bit hotter. You may need to replace the brakes of one vehicle more often. And you may have to change the oil of one vehicle after every trip.
The telematics in each vehicle will reveal the best course to take.
Without fleet monitoring and regular repair, your vehicles are more susceptible to unforeseen breakdowns and the emergency maintenance that comes with them.
One of the best things you can do for your fleet is to analyze the data and use it to establish unique preventative maintenance programs for all your vehicles.
7) Cut Costs
Focus On Fuel Usage
One of the main benefits of fleet monitoring is that it gives you the ability to see just how much fuel your vehicles are using.
Armed with that information, you can take steps to cut costs in one of the largest expense categories your fleet will face.
Depending on the way your fleet operates, this may involve sticking to optimal routes, maximizing preventative maintenance, or building driver accountability.
For more tips to reduce fuel usage, check out this article from the Coast blog: 10 Tips For Improving Fleet Fuel Management.
Watch Out For Unnecessary Idling
Eliminating unnecessary idling is an easy way to make deep cuts into your fuel spending.
For example, telematics and smart fuel card data may reveal that one of your vehicles is idling for a long period of time and wasting four gallons, or $15-worth of fuel every day. If the vehicle operates five days a week for a full year, that’s around $4,000 down the drain.
And that’s just one vehicle!
By turning off vehicles when they’re not in motion and avoiding traffic jams whenever possible, your drivers can help you control fuel costs across the board.
Maintain Compliance
The rules for fleet compliance can change overnight. Is your fleet ready?
Fleet monitoring makes it easier to pivot when new policies come down from the DOT, the FMCSA, and other organizations.
For example, telematics can help you identify the safety issues for your vehicles that might push them out of compliance. That can help you avoid hefty fines or out-of-service orders that the DOT can impose on your fleet.
Prevent Fuel Theft
A fleet monitoring program that includes telematics, GPS, and smart fuel card software can help drivers and managers pinpoint where and when fuel theft — be it accidental or intentional — might occur.
In addition, that same data can suggest the most effective methods for preventing theft and fraud in the first place.
One of the best ways to do this is to add a smart fuel card with an EMV chip and pre-use card activation (like Coast) into your workflow.
Coast also allows you to set up notifications that alert you when a transaction is declined or looks suspicious. You can also turn off a card completely with the click of a button.
8) Integrate Fleet Monitoring Data With Other Aspects Of Your Business
Most fleets start with a combination of fleet management software, telematics, and smart fuel-card software to provide a 360-degree view of their operation.
For example, the Coast smart fuel card integrates with telematics services, such as Samsara, Verizon Connect, Lytx, Azuga, Geotab, and others.
Similarly, it also integrates with Fleetio fleet management software and Intuit Quickbooks accounting software to bridge the various aspects of your fleet operation.
Effective Fleet Monitoring And Operations With Coast
Telematics and GPS have made fleet monitoring easier than ever before. But the hardware you install in your vehicles can only tell you so much.
To get the full picture of how your fleet operates, you’ll need to add more layers of tracking.
Coast can help with controls and visibility that work for your business through a fleet card and expense management platform that empower you with real-time information related to your fleet.
For more information on how Coast can streamline your fleet management program, visit CoastPay.com today.
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