Keeping the fleet sweet

FROM THE MM&D JULY/AUGUST 2011 PRINT EDITION:

There’s no shortage of industries and areas within logistics that require the management of fleet vehicles. Here are just a few examples:

Distribution centres or manufacturing plants using forklifts and lift trucks;
Personnel handling and ground support equipment at an airport;
A rental car fleet or company auto fleet for an organization supplying vehicles to their sales representatives;
A rental fleet for trailers or containers; and
A transportation fleet of tractors and trailers.

The list goes on, with fleet sizes ranging from a few units to thousands, and users including both suppliers or their customers. The environments in which fleets operate can also range from facilities (for fleets such as forklifts) to continent-wide operations for rental cars and transportation companies.

In this column, we’ll look at internally operating fleet software, as well as a few application differences for software used in the transportation industry. With such a variety of scope and scale, it’s unlikely that one size is going to fit all. We should therefore identify the most important features and functions for various applications.

Probably one of the most significant differences between internal and external applications is the need for track and trace technology. You should also consider which system controls this function. While there are some industrial applications with crossover potential (such as vehicle management in an underground mine) most applications can be differentiated.

But let’s step back and consider some of the software applications for a vehicle management system. These include:

Tracking and operational (for example, dispatch) management functions. These can include driver and fleet unit applications such as driver access control, possible driver incentive pay based on actual work performed, vehicle utilization, deployment, vehicle inventory and performance information and specialty applications like vehicle telematics (positioning using GPS) and vehicle diagnostics;
Vehicle safety administration and maintenance. This includes elements like licensing, insurance, technical inspections, maintenance administration and inspection (like tire tracking, temperature recording and other speciality applications);
Vehicle lifecycle management including fleet right-sizing, purchase and disposition and related elements, such as driver requirements;
Vehicle expense management for fueling, repairs and maintenance;
For firms involved in revenue generation (equipment rental companies, for example) there’s no shortage of specialty revenue and expense reports and accounting specific to the application; and
There’s an increasing number of safety and security functions that allow only certified drivers to handle specific pieces of equipment—sometimes called lockout/tagout. This allows dispatchers to disable trucks remotely in case of a security or safety incident.

With such a broad range of functions, one of the key issues organizations should first determine is: which of these functions do you wish to be carried on each of the software systems? Obviously, avoiding duplication by selecting which system functionalities should reside on is an important decision.

Focusing on material handling applications, the key vehicle management system interface is with the WMS system. This is where careful selection of a supplier is important and it’s critical to consider the following:

Will the VMS work with the lift truck supplier’s onboard diagnostic equipment;
Even some systems you would not normally think of as having interface and data exchange considerations can be important. For example, a swipecard/timecard and access control system for which you want your operators to use the same cards when they sign onto their vehicles;
Does the VMS work with all truck types and manufacturers? This can help avoid getting locked into one fleet type; and,
Does the vendor have permission to use their software with other software and are they a certified supplier?

A VMS system can provide insight into equipment utilization and performance. Most warehouse equipment is only active a small percentage of the time. It’s common for a piece of equipment to operate only four hours or less in an eight-hour shift.

As warehouses have become larger, the historic control of “management by walking around” has almost disappeared. A VMS system can provide insight into what’s happening on the floor and offer opportunities to take action in the event of problems.

Compared to your lift truck expenses, the purchase price for a VMS is typically less than a quarter of the total cost of a forktruck fleet. Optimizing the operational costs and performance can pay big dividends.

Dave Luton (dluton@cogeco.ca) is a consultant in the greater Toronto area.