Fleet management is the use of a set of vehicles in order to provide services to a third-party, or to perform a task for an organization, in the most efficient and productive manner with a determined level of service and cost.
Fleet management is a key aspect to the general strategy development in an organization, and for this reason it has to be designed and implemented based on its guidelines, and the characteristics and goals of said organization.
For some organizations, their vehicle fleet management is the main activity in their value chain, and represents its major asset to provide a service. This would be the case for passenger transportation companies, ground shipping, car rentals, renting companies, taxicabs, mail services, or cleaning and trash collection services provided by city councils.
For other organizations, it’s a support activity to their main one, or a bonus such as a car, given to their executives for their personal use. This would be the case for companies with sales representatives (pharmaceutical industry, IT services, etc), airports, supermarkets, and non-governmental organizations (NGOs).
There are three vehicle fleet categories, and are the following: The ones that perform in planned routes, the ones that have an aleatory demand of vehicles, and the ones that have assigned a vehicle to one driver/user or to a permanent activity.
Each category has different operative strategies and characteristics. In the same way, there are several variables and factors involved in the management of a fleet, making each fleet unique and different, just like their best management solution.
The goal of this document is to propose a methodology and provide a global vision for vehicle fleet management through its key factors and all the involved activities. (Graph 1).
Graph 1: vehicle fleet management activities. Own source.
1st Designing and implementing policies that should include the guidelines for vehicle fleet management.
2nd Calculating the optimal number of vehicles, their capacity, and routes if available.
3rd Choosing the vehicle’s type, brand, equipment, and how to acquire them.
4th Vehicles’ operation such as maintenance management, traffic accidents, etc.
5th Designing policies for the disposal/replacement of vehicles and their sales options.
These five activities have three support activities.
1st Control and track to know the vehicles’ status, where they are and who is using them.
2nd Dashboard, data analysis and report chart, because during acquisition, operation and disposal activities is generated relevant information that must be analyzed in order to make decisions, know the status and the evolution of how the fleet is managed.
3rd The auxiliary services that must be done in order to comply with any current laws and regulations in the country where the fleet operates such as traffic lines, technical inspection of the vehicles, accidents, etc.
Aside from the already mentioned activities, fleet management is made by the necessary processes, organizational structure, personnel, facilities, software and hardware.
This document is an introduction to vehicle fleet management, and each described activity can be developed and extended deeper. In the same way, each fleet is different and unique, and the methodology proposed in this document has to be adapted to the characteristics, operational and goals of each fleet.
Activities with the highest value in vehicle fleet management are: designing policies for vehicle fleet management, calculating the optimal size of the fleet, vehicles operation, scoreboard, data analysis and report chart. For the same reason, in this document these activities are more developed than the others.
In the following chapters, each activity shown in the graph 1 will be explained in detail, as well as the principle key aspects of vehicle fleet management in the most efficient and productive manner fulfilling a determined level of service and cost.