Tracking performance metrics and comparing current data against past performance is a basic part of most business operations—and fleet management is no exception. Many fleet managers actively track performance metrics for their vehicle fleets.
The challenges that fleet managers face with managing mobile employees make it difficult to ensure that everything runs efficiently. That’s why it is important to closely monitor Key Performance Indicators (KPIs) as part of a financial management plan. Fleet managers can use driver performance KPIs to know how good their drivers truly are, rather than waiting until an accident happens and losses are incurred before taking action.
Why should you track fleet management key performance indicators? What are some key fleet management and driver performance KPIs that you should track? And, how can you track these metrics? Here’s a quick explanation of fleet management metrics to answer these questions.
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Why You Should Track Fleet Management Key Performance Indicators
Keeping an eye on your fleet management and driver performance KPIs can help you in several ways:
- Identifying Abnormal Vehicle Use. Is there an asset in the fleet that is consuming twice as much in fuel and maintenance expenses as similar vehicles? It may be getting used in abnormal ways (such as being driven “off the clock” for personal errands). Tracking maintenance and cost metrics can help fleet managers identify when a vehicle asset is falling outside of the normal use patterns. This, in turn, can help curtail the unauthorized or illicit use of company vehicles.
- Spotting Potential Safety Issues. Another benefit of tracking maintenance data and driver performance KPIs is that doing so can help identify potential safety problems in the fleet. For example, acceleration and deceleration information can reveal bad driving habits that increase the risk of a collision, while repair reports can identify consistent problems with certain vehicles (such as tires not being replaced frequently enough, brake systems wearing out faster than they should, and other safety-related issues).
- Creating Cost Efficiencies. Tracking fleet metrics on a large scale can help fleet managers find opportunities to reduce costs or rearrange vehicle maintenance and/or replacement to create new cost efficiencies. Tweaking the timing of vehicle asset maintenance to focus on prevention of issues rather than relying on a break-fix approach can be particularly effective at creating cost efficiencies. Additionally, tracking idle time and acceleration habits can help spot wasteful driving behaviors that consume excess fuel.
- Satisfying Customers. Whether your fleet conveys field workers to a specific jobsite or carries cargo to customers, it’s imperative that the vehicles and their contents arrive on time. Tracking fleet management key performance indicators can help ensure that drivers don’t take needless detours so that deliveries and service calls are completed on time (or as close to it as possible).
These are simply a few of the reasons why fleet managers need to track fleet KPIs. Now, which performance metrics should you track as a fleet manager?
Driver Performance KPIs You Should Track
KPI #1: Engine On/Off
Good engine start/stop times translate to efficiency and schedule adherence. When drivers start their vehicles too late, they may fall behind schedule and have to rush. This can lead to increased risks on the road as well as waste.
It is inadvisable to run an engine when in close proximity to flammable or other hazardous goods. Your drivers should be educated about these dangers to avoid potentially deadly situations. You could have a GPS tracking engine-monitoring system to monitor the engine when the loading or unloading of dangerous goods is taking place.
These aspects have a significant effect on service agreements.
KPI #2: Speeding
Driving speeds are another way to check driver safety and compliance. But, how can you monitor speeding habits remotely?
One way is to install devices that will alert you when your company’s vehicles go over a speed limit that you set. With the aid of GPS tracking, you will be able to match speeding for each driver with GPS data to a map database with information regarding speed limits. You would then compare GPS-recorded speed data to the speed limits. This would allow you to accurately track speeding infractions and help increase safe driving practices.
KPI #3: Acceleration and Hard Braking
You could monitor your drivers’ rapid acceleration or deceleration (braking) capability to determine whether he is careless and dangerous. Hard acceleration and braking can also contribute to vehicle wear and tear.
KPI #4: Idling
Some drivers leave vehicles idle for longer than expected. By reducing excessive idling, you can maximize fuel efficiency while reducing the carbon footprint from your company vehicles. Poor tracking of idle time, on the other hand, reduces your ROI.
KPI #5: Route Adherence
You should know whether your drivers stick to the designated routes. Comparing the route a driver takes with an optimized route helps you identify drivers who genuinely lose their way from those who intentionally deviated from the route.
With GPS tracking software, it will be easy for you to monitor the wastefulness of your drivers.
KPI #6: Road Safety Compliance
The fact that no one is watching may compel some drivers to disregard traffic rules. While the metrics mentioned above regard issues that might affect productivity directly, this one has a ripple effect on other aspects of your fleet and business.
If the drivers break traffic rules, they might cause the government to impose fines on the driver and the vehicle. Failure to adhere to road rules might also lead to crashes that could total the vehicle, or you might have to pay compensation to injury victims following an accident.
Tracking driver road safety compliance with GPS tracking solutions can save your company from financial disaster. A seemingly small mistake can negatively affect your business through accident, injury, and liability costs. In some cases, these breaches of compliance can cost you your entire business.
Although you may find it easy to calculate direct costs, including insurance payments and vehicle repair, you might struggle to do the same with indirect costs, such as crash reports or time and money spent on lawsuits.
The loss of business productivity is 3-5 times costlier than the vehicle repair and insurance premiums. According to the CDC:
"In a one-year period, the cost of medical care and productivity losses associated with injuries from motor vehicle crashes exceeded $80 billion."
Fleet Operational Efficiency KPIs
KPI #7: Vehicle Total Cost of Ownership (TCO)
This is an aggregate metric that combines the initial cost of a vehicle, its fuel consumption, its maintenance, and all other costs related to owning and fielding the vehicle (including taxes, licenses, storage fees, etc.) for the company over time. Tracking TCO for individual fleet assets and comparing them to the revenue they generate can be crucial for identifying opportunities to create cost efficiencies.
KPI #8: Vehicle Replacement Costs
Over time, even the best-maintained vehicles will eventually require replacement. Tracking how much is being spent on replacing vehicles each year is a must for creating a reliable and accurate fleet operations budget moving forward.
KPI #9: Vehicle Utilization
How much value does each vehicle generate for the organization? What is the uptime for each vehicle? Vehicle utilization is an important operations KPI for measuring the value each fleet asset brings to the organization as a whole. However, utilization may mean different things for different vehicles. For example, a semi-truck’s utilization may depend on total miles traveled, while a construction crane’s utilization may depend on how many loads it moves in a day.
KPI #10: Schedule Adherence
How well do drivers adhere to the driving schedules they’re given? Being able to track incidents where drivers go off their planned route or start their shifts late can help you avoid having operations fall behind schedule.
Fleet Maintenance KPIs
KPI #11: Total Vehicle Breakdowns
Vehicular breakdowns, wherein fleet vehicles suffer an unexpected failure and cannot continue to operate safely, should be avoided whenever possible. A high rate of vehicle breakdowns could be an indication that the current fleet maintenance plan is insufficient and needs to be modified. Fleet managers should track breakdown incidents and try to determine the cause so such disruptions can be prevented.
KPI #12: Vehicle Part Inventories
What parts are most frequently used during vehicle maintenance checks? Tracking parts inventories and use patterns in maintenance is crucial for ensuring fast, efficient, and consistent vehicle maintenance. By tracking parts inventory and use patterns, fleet managers can ensure they always have the right types and amounts of parts on hand to service their vehicles, and avoid having to make emergency orders that create delays and additional expenses.
KPI #13: Average Maintenance Downtime
How much time do vehicles spend “in the shop” for repairs? Whether you use in-house fleet maintenance crews or outsource repairs to a third party, it’s important to make sure that you can minimize the downtime for repairs. A vehicle sitting in the shop isn’t producing value for you!
KPI #14: Vehicle Diagnostic Codes Generated
Most vehicles made in the last 20 years have onboard diagnostic systems that can detect various issues with the vehicle and generate diagnostic codes to alert maintenance techs to those issues. Tracking the frequency of codes generated and which codes are generated can help fleet managers identify specific maintenance challenges with their current vehicle fleet.
Tracking the Fleet Performance KPIs That Matter Most with Rastrac
There are a lot of fleet performance metrics to track, and it isn’t always easy to gather the data that you need to get an accurate report for each metric. This is where vehicle fleet tracking solutions like Rastrac can help.
Rastrac fleet tracking software and GPS tracking devices help fleet managers gather critical information about their vehicular assets—such as start/stop times, driver behaviors, and current positions. This makes it easier to track your most important fleet management metrics so you can spend less time collating data and more time creating cost efficiencies.