Fleet Risk Management & Solutions
Every day, many companies dedicate their time to mitigate the risks of their fleet-vehicles & the drivers are most likely to face. Fleet managers come up with custom solutions that meet their specific needs of their business and employee’s well-being.
Every human life endeavor comes with risk. Wherein managing the risk is a challenging factor for every organization, especially for the transportation business. In some cases, mechanical failure and natural disasters might befall the transportation industry into some consequences and loss of human life.
Running a fleet of vehicles in a company is all about managing risk and it is the major problem that fleet managers are facing. At times, the pressure seems to be insurmountable.
Risk management is a part of the operational planning process for transportation companies. Effective fleet management assumes all the issues that occur onemployees’ safetyand equipment problems. This helps the companies to take steps proactively and protect themselves from adverse events such as employee issues, regulatory action, and natural disasters.
The transportation industry is completely at risk when fleet management services don't offer activesolutions. Servicing the customers pre-emptive will help to reduce the issues such as accidents & driver’s fault.
Fleet management helpsto monitor compliance paperwork to find out the emerging problem areas &keep them postedeasily.
Life is something risky for everyone, so keeping solutions for all the problems is one of the best ways to survive, Isn’t it?
Whereas the corporate risk management is one of the important survival tool for everyone, especially for transportation companies.
Now, let’s get into the fleet risk management and solutions that we should consider predominantly.
Managing Risk in Fleet
Safety and efficiency are the keys to business success. It is one of the top challenges faced by fleet managers. It concerns the safety measures of both driver & vehicle that are a perennial challenging task. To enhance operational efficiencies, fleet managers aim to promote driver & vehicles well-being.
As a result, 75% of fleet managers rely on vehicle telematics or fleet management software solutions to support their day-day operations. Safety continues to be an important concern and Fleet management plays a primary role here.
The annual accident rate of commercial fleet vehicles is around 20% and even higher. The only reason behind the high frequency of accidents is the number of miles that the fleet drivers drive per year.
Fleet vehicle accidents are the most expensive injury that claims for business. The average cost of fleet accidents are quite expensive, it will be twice the cost of workplace injury. Besides property or equipment damage, fleet crashes result in loss of productivity.
Currently, fleet safety management is on the “radar - detection system” due to the liability of exposure & resulting from preventable accidents. Thus, the litigation has made the fleet service management into more sensitive and they need to enforce their employee’s compliance to the fleet safety policies.
Managing Risk in Pandemic
The Covid-19 pandemic has changed many aspects of fleet management. In the wake of the pandemic, everyone adopts to work from home and concerned drivers have become deconditioned to their daily driving routine.
One obvious impact of the pandemic lockdown measures is that it has changed the fleet-decision makers. It means they can manage risk by providing in-person training and conducting meetings, but in most cases, it is no longer possible or practical anymore.
This situation occurs due to social distancing rules, and the fleets are struggling to manage the safety measures of the drivers. So, fleet managers have to embrace with the latest technologies and enable employees to have online meetings.Operate remotely by interacting with drivers through a web-based fleet system,using digital technologies helps a fleet decision-maker to manage the risk remotely.
Evolution of Fleet Management
The rapid pace and exponential change in fleet vehicle management have been a constant trend, over two decades & expected to continue for many years. Routine success in fleet management contains excitement, challenges, and adaptability. The evolution of fleet manager’s role and responsibility has morphed into a corporate role.
Now the technology is dominating personal and business cultures. In this fleet world, the advent of telematics & logging devices helps to improve productivity & cost control. Exploiting the data coming from the device results in beneficial action.
On the other hand, the shortage of quality drivers with experience has recurred. The economy has given a positive statement that the continued pressure on school students enables them to pursue higher education rather than skilled employment. In this case, the pressure on wages caused by full-employment exacerbates the driver shortage.
Many fleet-related changes & cost increases emerge from external sources over which the fleet operator or owner has no control.
Data driven-future of fleet risk management
With the proper fleet management, the managers can easily monitor the driver, tools, compliance & other safety precautions simultaneously. This access to the information leads the fleet managers to the significant improvement in lowering risk & better compliance. Therefore, data management plays a vital role behind the scenes.
The data can include the information of the individual employee, such as License, Medical certificates, Training, & Competencies. In addition to that, details such as Vehicles and Equipment, Road regulations, Accidental histories, and Internal policies are also among the data.
Point to remember: Fleet safety, risk, & compliance data has to be accessible to your fleet managers. If the driver or vehicle has some issues, it has to be monitored by the manager.
Road Safety Measures
Generally, in Saudi Arabia, speed limits are specified & very seriously enforced. The speed limit ranges from 60kmph to 80kmph for the urban areas. Where in, for highways it ranges between 100kmph to 120kmph & 40kmph for residential areas. If not, the drivers have to pay fine based on the severity of the violation.
For instance: If the fleet drivers have crossed their speed limits, a fine of around AED 2000 and a vehicle confiscation for 30days will be enforced. Similarly, a fine would be applied for reckless driving and deliberately racing.
Metrics that Every Fleet Managers Should Track
Tracking fleet metrics is one the best decisions for your fleet operations. Having a central location for fleet metrics helps to provide a comprehensive vision to ensure success.
Analyzing Fleet Metrics
Fleet managers should have a lot of data at their fingertips regarding the vehicle drivers and assets. Managing a spreadsheet log will help the fleet managers to track information like Maintenance tasks, Cost per mile, Maintenance cost, PM schedules, and Vehicle specs. Leveraging the data determines the success of your fleet.
Inspection Results in Maintenance Metrics
A daily fleet vehicle inspection keeps the fleet driver’s complaint or vehicle issues. Instead of choosing fleet management software, check the patterns of issues that occurs on your fleet maintenance which helps to improve preventive maintenance strategies & decrease downtime.
Fuel Management in Cost Metrics
Fuel is one of the ongoing fleet expenses. It is crucial to track the usage and consumption of fuel. So, having a system to monitor & calculate the fuel cost and consumption can benefit your fleet management process.
Vehicle replacement is one of the daunting tasks for fleet managers. Whereas, tracking your fleet-metrics with the help of odometer readings, TCO, and service history helps in deciding whether the vehicle should be replaced or not.
Telematics data provides you valuable fleet visibility & insight into asset healthy. Integrating telematics devices into fleet management software helps to increase the value of your data. It enables you to take a deeper dive of your assets.
Accidents & Safety
Every fleet managers should take a proactive stance for their fleet safety measures that ensures the safe and security of your drivers & avoid unnecessary expenses. Implementing safety procedures in your driver management system helps to maintain compliance. Tracking your driver’s behavior & DIVR results in decreasing liability and avoiding costly fines & accidents.
Taking a proactive standpoint on your fleet vehicles safety management ensures the well-being of your drivers, assets, & decreases unnecessary expenses.
Fleet managers have the primary role to track & manage their drivers instead of focusing on assets. A driver management system should ensure the productivity & safety of drivers. Integrating telematics and fuel cards allows to track driver productivity and get a comprehensive view of their location, spending time, and habits.
Best Practices on Fleet Safety & Risk Management
Many companies in Saudi Arabia rely on transportation to make their business work. There are several businesses that manage fleet vehicles that are designed to move goods from place to place. (For instance: Food & Beverage Distributors)
A fleet management program can minimize or avoid the risk that are associated with driver safety, fleet-vehicle investment, transportation cost, and more.
Fleet Management Liability
According to the National highway traffic safety administration (NHTSA), the leading cause of industrial loss stems from fleets & their mismanagement. The employee’s cost is substantial, with an average liability for a driver accident over $15,000. In case the accident produced an injury; the cost rises around $70,000.
Navigate your Fleet
Failing to take the importance of fleet management to your business could result in loss of reputation, onerous legal fees, & unmanageable increases in insurance premiums. There are a number of steps that employees can take to reduce their fleet management risks.
There is the best way to deal with the liability issue is to get out with a risk management approach. The underlying idea behind this fleet risk management is to create an awareness and control liability. This helps to minimize the negative outcomes in the future and reduce the risk that your driver faces on roads.
If the company fails to take account into the economic & safety implications of fleet management, it results in their own peril.
Meeting compliance with responsibilities & regulatory requirements tends to improve vehicle & driver safety measures. By following fleet risk management, you can reduce the risk & lower the cost for accidents and fines.
Never underestimate the possibility of unforeseen circumstances.
Having a fleet risk management plan for fleet safety operations is one of the best ways to protect a company. Contact a safety specialist at Fraikin Commercial Vehicle Service Company for an assessment.
Simply ensuring the drives hold a valid license or the vehicles are roadworthy is not sufficient anymore. Transportation Companies that cater to a fleet vehicle or commercial vehicle service must strive to promote a culture of safety among the employees. This step ensures an understanding of & adherence to compliance policies.
Your fleet operations can be released on choosing the right tools, programs, lasting improvement to risk profile, and compliances.
Finding out which employee drivers require remedial assistance is something important to deal with liabilities. Tracking the safety profiles of your drivers, especially new recruits, & tracking the record of fleet vehicles that are at risk – Can help you reach the employee driver performance benchmarks.