The Challenges of Today s Fleet Management

The Challenges of Today s Fleet Management

In the not too distant past, fleet management concerns were about the nuts and bolts around maintenance. While those issues are still relevant today, there are now more  advanced technological issues to address. Against this backdrop Creamer Media and Standard Bank recently co-hosted a Fleet Management Forum at the Melrose Arch Hotel in Johannesburg, which was attended by a selection of fleet management professionals.

Kenneth Creamer, CEO at Creamer Media, welcomed all to the forum, while Guy Lundy from Future Insight Consulting was tasked with the facilitation. The forum was established in order to obtain industry feedback on the challenges facing today s fleet manager/operator and how these can be addressed. The main issues for debate surfaced as: real time technologies and industry trends including e-tolling; rising fuel and input costs; carbon emissions; driver safety and advancing technology.

Concerns exist over the monitor-ing and accuracy of e-tolling billing which was thought to be a challenge to effective and efficient fleet management. In the past, instances of fleet card fraud at service stations and toll booths were detected through checking fuel and tolling receipts.

 The problem with e-tolling as one delegate involved in retail logistics commented  is that there is no paper trail, so how does a company ascertain the accuracy of the monthly statement? How are the correct discounts for frequent usage monitored?

The extensive access and use of fleet and petrol cards, paperless and electronic transactions, and the knowledge required to com-bat abuse as technology makes fleet management an almost seamless activity, produce their own user and monitoring issues. However, solutions have already been developed to address this.

David Molapo, Head of Fleet Management in the Vehicle and Asset Finance division at Standard Bank commented:  At any given point in time, our systems already allow fleet managers themselves to directly access real time and in-depth information on their fleet, includ-ing any purchases, fleet card usage and transactions declined, via the Internet.

 In the case of e-tolling, Fleet Card issuers have been con-ducting trials using their own platforms for testing purposes. We have spent considerable time ensuring that the technologies we use are able to process e-toll transactions, and will give the customer the confidence that all fleet transactions are accurately recorded, and any discounts and frequent user concessions processed are recorded and reported on.

George Allen, Head of Fleet Operations at Standard Bank, said that Standard Bank has practical tools within their fleet management systems to conveniently manage fleet card transactions and to flag any potential abuse or misuse of cards.

 For example with fuel purchases, a fleet card transaction can be declined if a vehicle re-fuels within a specified time parameter. Card expenditure patterns can also be analysed. The benefit of this real-time monitoring is the quickness within which abuse and fraudulent activity can be identified and preventative measures implemented. So while there are genuine concerns being raised, they are not insurmountable with the technology that Standard Bank has made available to fleet operations. One marries the input data with the registered and transactional data; any activity outside of these para-meters will either be declined at a point-of-sale terminal or be investigated.

 From a Standard Bank perspective we see this as a supplement to the current magnetic strip fleet card offering and not a replacement. Our transaction authorisation capability of declining invalid transactions at point-of-sale is robust and continuously evolves to prevent irregularities, abuse and fraud.

Allen added that chip and PIN enabled fleet cards will support cross-border transactions in those countries where the card could be accepted as means of payment at point-of-sale. Once chip and PIN is available in the market, a practical consideration for fleet managers is where multiple drivers are using the same vehicle, and that these drivers and fleet personnel would each need to have individualised fleet cards to transact as the PIN number always should be unique and confidential to one single authorised user.

The forum commented on how continued rising fuel and input costs have highlighted the need to monitor driving patterns and fuel efficiencies/inefficiencies. Budgeting is becoming difficult due to continuous fuel and industry price hikes. Standard Bank figures showed that the average fuel transaction in 2010 was some R515, and in 2012 that figure had risen by 62% to R833 per transaction. How do fleet managers deal with rising fuel costs and what technologies can be used to assist in ensuring that fuel expenditure is managed optimally?

One suggestion by Standard Bank was that fuel increases take place on the first Wednesday of the month, and by the previous Friday,manufacturers and Double sided PET industry tape Products suppliers Directory. most are aware of the looming price increase (or decrease).  It would make sense for companies to notify fleet drivers to re-fuel on the days preceding the fuel price increase. This would maximise fuel operational costs at the lower rate, said Allen.

There are other input costs to consider. Standard Bank s predictive modelling software assists fleet operators by recording past data related to fleet costs, for future budgeting purposes. It allows for operators to input anticipated fuel and other input price increases/decreases. The predictive model-ling software will then be able to calculate operational data related to a fleet, including future fuel costs, and maintenance costs.

Transactions authorisation is another way in which costs can be monitored. For example, the very nature of the medical laboratory business requires that most fleet vehicles refuel as often as twice daily. Rejecting invalid transactions at point-of-sale means that any fraudulent activity is highlighted timeously.

The forum expressed a view that the ideal technology required for monitoring fleet expenses, should be a technology based on one common platform to make the compilation of all fleet management statistics a more streamlined function. The chal-lenge facing many fleet oper-ations was to obtain online real-time kilometre usage per vehicle. All information could then be married from one source and an accurate cost-per-kilometre can be established.

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