Fleet Management is yet another example of how digital solutions, and Big Data in particular, can improve every component of business operations, turning what used to be costs or management issues into opportunities to grow your business.
On the other hand, digital transformation is much more than a reality: it is a real necessity, marking a point of no return for organizations in every field who want to be competitive and, above all, who want to evolve their business with a long-term perspective.
Among other things, as we’ll see, the case of Fleet Management is particularly interesting since it also shows how “immaterial” solutions such as digital can be perfectly integrated with the management of decidedly material assets, such as the company fleet. Moreover, it shows how these same solutions are extremely versatile and enable the use of a variety of applications with excellent results in terms of efficiency and cost reduction.
What is Fleet Management?
Before explaining the main advantages of using Big Data, it is important to understand exactly what is meant by Fleet Management.
Fleet Management is the set of management activities related to the vehicle fleet (cars, buses, trucks) of a company. Sometimes the term is also extended to means of transportation other than road transport, for example to the management of a naval or air fleet.
It is clear, therefore, that this is an important activity, if only because it has a considerable impact in terms of costs, especially for companies that rely on vehicles for their business and must cover certain geographical areas.
Given such a broad definition, it’s interesting to get into the specifics, since in practice, Fleet Management translates into many very specific tasks. For example, Fleet Management includes every activity that concerns logistics, i.e. the location of vehicles, their movements and assignments, and the authorization of drivers. In addition, there is also maintenance, which includes ordinary interventions linked to the seasonality or general maintenance activities, and extraordinary interventions following damage or intense use. Fleet Management also includes the management of costs, such as road taxes, insurance, and everyday expenses like fuel cards, fines, telepass, paid parking, etc. Finally, the management of the company fleet also includes the organization of how vehicles are used, from their distribution to employees, up to the sale of the vehicle when they have finished their “working life.
All of these tasks distinguish Fleet Management from long-term car rental. Although the services offered may be the same, in reality Fleet Management does not include either car rental or vehicle financing, and furthermore, it refers to a large total of operational vehicles that in theory could have a very long usage cycle, exceeding 10 years, and therefore with a duration that rental cannot reach.
Fleet Management requires a Fleet Manager
Many companies prefer this formula, especially because it allows them to internalize many of the management and control processes. To do this, of course, a professional is needed, namely the Fleet Manager, who must concentrate on certain functions and activities related to managing the company fleet of vehicles.
Among other things, this professional role is provided for in Decree 179 of 1998 on sustainable mobility, which requires every company with more than 300 employees to have one with the following responsibilities:
- Manage the home to work travel of all employees in such a way as to make transportation faster and more efficient;
- Organize private and company transportation, promoting the use of collective transportation;
- Coordinate private transport with any public programs in place with local authorities;
- Use the funds made available by the State with the goal of reducing pollution.
Already from this short list you can easily understand how all these activities are not easy to perform for a single person and indeed require special support to make their management smooth, seamless, and above all “convenient” for the company (and not only). And it is precisely at this point that Big Data comes into play.
A treasure to be put to good use
Big Data is “data that contains greater variety, arriving in increasing volumes and with greater velocity” (Source: Oracle). Put another way, these are larger, more complex data sets, primarily from new data sources. These datasets are so voluminous that traditional data processing software cannot handle them”, and can be used to address various kinds of business problems that cover different domains and sectors.
In a certain sense, Big Data is a great resource that every organization has at its disposal, a real treasure that, if correctly employed, can say a lot about the company and provide the most important indications to foresee possible critical issues and improve the most sensitive phases. And when it comes to Fleet Management, this potential can be expressed in many different ways, all impacting on the sustainability and growth of the organization.
More Big Data means better insights
As mentioned above, the first great advantage of using Big Data in the context of Fleet Management is that of being able to know the operations that are carried out daily, better and faster. For example, you can track the ordinary use of each vehicle in order to know the level of wear and tear and therefore its average life of the vehicle with precision.
In this way, the Fleet Manager will be able to have a precise and detailed overview of his fleet at any time in order to know what kind of interventions may be needed and especially if and when it will be necessary to integrate the fleet or replace any vehicles within it.
Among other things, this same overview allows managers to check that their vehicles are always in compliance with the legal provisions and requirements so that no deadline is missed and no penalties are incurred.
Big Data improves management of the human element
People drive company cars and this aspect cannot be overlooked when you want to efficiently manage a company’s fleet of vehicles. Big Data can help in this regard, too, as it allows you to monitor the behaviors of drivers both while driving and during stops: any speeding, sudden braking, prolonged stops with the engine running, passing in high-risk conditions, and more.
By doing so, managers can take immediate action with additional training to make sure that the vehicles are used in the best possible way to benefit not only the safety of the vehicle but also the safety of the employee and other drivers. This, among other things, enables the company to reduce the likelihood of incurring unexpected costs in the form of claims and higher insurance premiums that would be payable in the event of an accident.
In a sense, Big Data gives you the ability to better manage the assets at your disposal, but also to prevent certain costs and issues.
With more Big Data, predict and provide
And prevention is precisely one of the most interesting aspects that Big Data can grant a Fleet Management team.
By knowing the behaviors of its drivers and constantly monitoring the condition of each vehicle, you can prevent some issues related to the normal wear and tear of the same vehicles. For example, if information on vehicle status and diagnostics (such as mileage, engine age, etc.) is collected and combined correctly, Fleet Managers can intervene proactively, even before an actual problem manifests, anticipating replacements, divestments, or scheduling overhauls and different uses to keep as many cars in the best possible condition for as long as possible.
Similarly, by building on what you’ve learned from previous experience, you can make more targeted investments in the type and size of cars to be purchased in order to maximize your investment.
With Big Data, you can change routes
Remaining in the area of forecasting and planning, another way that Big Data can improve Fleet Management is to make the routes chosen for different tasks more efficient.
In fact, when you have to cover a certain territory, it’s essential to know the best roads to use, but this isn’t always easy. Certain roads have recurring problems, others are functional only at certain times of day and for certain directions. Also, unexpected events can happen during a trip that changes the travel time and, therefore, the preferred route. All of these aspects can emerge thanks to the timely analysis of Big Data.
For example, starting from the data collected during trips, you can estimate travel times and assign specific routes according to the destinations and stages to be reached. In addition, with information that is constantly updated, you can also detect any changes in the planned route in real time. This gives the Fleet Manager the opportunity to inform the driver so that they can change their route in order to avoid unnecessary delays.
Among other things, this possibility provided by Big Data allows companies to make their fleet management more sustainable.
Choosing the best route and identifying timings that reduce travel time and fuel consumption also reduces the impact that the company itself has on the environment in terms of pollution over the medium term.
We have already talked about the importance of sustainability for companies and the great attention that customers have regarding environmental issues. Implementing Big Data in Fleet Management ensures a further step forward in this sense, which has value as an activity of corporate social responsibility and as an aspect of the business to be used in communication as a competitive lever.
Big Data improves customer service
Another significant benefit of using Big Data in the context of Fleet Management is that it improves customer service, especially when it comes to car rental companies.
Through Big Data, you can collect more information on the aspects that customers like and dislike during the service. In this way, companies can move in advance to meet consumers’ expectations and modify the available offers accordingly. For example, they can identify the most suitable car based on the characteristics of the customer or the type of trip he/she is planning to make, basing their choices on the information collected from the rentals of previous customers.
In the same way, they can provide customers with specific indications based on the type of vehicle they have chosen (e.g. how to manage fuel consumption, the preferred routes, etc.).
It also includes interventions in real time. Every rental company can take advantage of Big Data to constantly know the condition of the vehicle and any unforeseen events that occur along the way so as to be able to alert the customer and move proactively to solve the problem.
What is necessary for making Big Data and Fleet Management integration possible?
In light of the above, the benefits of using Big Data in Fleet Management are unquestionable, but how it can be achieved is not so obvious.
In this sense, we need to go back to the beginning of this post: you can’t integrate your big data without having first implemented a digital transformation, since the solutions to be implemented require full digitization. For example, Artificial Intelligence plays a key role, and machine learning in particular, to collect, organize, and analyze large amounts of data and support both managers and drivers in making the most efficient decisions before and while driving.
Another very useful tool is the IoT (acronym for Internet of Things) that makes it possible to build an interconnection system between the “home base” and the vehicles in motion so as to make communication more fluid, immediate, and constant and to reduce the reaction time in case of unexpected issues. And that’s not all.
IoT also gives companies the ability to turn every single automobile into a tool for collecting information on so many variables that affect the performance of tasks (road conditions, driving style, engine performance, etc.). In this way, each trip becomes one more opportunity for the company to increase its wealth of information to be used in the future.
This is not to mention the fact that IoT also makes it possible to identify any vehicle malfunctions, which can promptly communicate the anomaly, thus allowing precise and targeted interventions once the driver has returned to company headquarters.