Ashley
Martin
investigates how smart investment in systems
can help fleet operators ride out the recession.

Cost management is the number one
priority for all businesses as they battle for survival in the
recession, and that means fleet decision-makers are increasingly
turning to software providers for help.

Fleet operations are, for many companies, the
second-biggest corporate cost after employee salaries, and
therefore a prime focus for cost-cutting in the economic
downturn.

As a result, fleet software providers are reporting
good prospects for growth as businesses realise that the
complexities associated with running a modern vehicle fleet –
coupled with ensuring duty of care compliance and carbon footprint
reducing obligations – can seldom be achieved by using
old-fashioned spreadsheets.

As Neville Briggs, managing director of fleet
software provider CFC Solutions, says: “The recession provides
strong opportunities for fleet software. Essentially, this is a
product that provides control – over costs among other areas – and
this is clearly a very popular selling point at the moment.
Companies are looking to ensure that the cost of running their
fleet is minimised while all legal, human resources and
environmental obligations are fulfilled – so there remains a
buoyant level of demand for our products.”

Hi-tech is the future

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It is a view shared by Jason Francis,
managing director of fleet software provider Jaama, who adds that
‘smart’ fleet decision-makers are waking up to the fact that
today’s hi-tech vehicle management systems can seamlessly interact
with other internal and external software to dramatically improve
operating effectiveness and efficiency.

Sophisticated web-based software developments means
that fleet operators no longer need to manually input every item of
fleet information from a driver’s name to a car’s number plate, and
from a fuel purchase to a vehicle service. Instead, computers,
using a common language, seamlessly populate systems in realtime,
ensuring up-to-the-minute and accurate management information

“Fleet decision-makers are becoming increasingly
software-savvy, and they understand the importance of choosing
technology that can fully integrate with systems operated by
external suppliers and other company departments, such as HR,
payroll and finance, and can also be accessed by drivers,” said
Francis.

“Only five years ago fleet managers still had to
manually enter virtually every single piece of fleet relevant
information. This was not only time-consuming and administratively
cumbersome, but could be prone to mistakes,” he adds “Additionally,
the way data was stored meant it was difficult to monitor, measure
and compare and contrast the performance of individual drivers and
vehicles effectively.”

Today, data and information feeds from contract
hire and leasing suppliers, daily rental companies, fuel management
operators, fast-fit organisations and residual value suppliers, for
example, can update fleet management systems along with information
supplied by drivers – such as mileage, expense claims and working
hours – and information from other departments on, for example, new
starters, employee promotions and changes in driver
circumstances.

Simon West-Oliver, sales and marketing director of
Drive Software Solution, agrees that the market is “very buoyant”.
However, he points out that there are two distinct technology
avenues being exploited by fleets.

Smaller businesses operating up to around 50
vehicles are typically reliant on their leasing provider’s software
systems to provide effective and efficient management.

Meanwhile, companies operating larger fleets are
making the technology investment themselves, but are also
piggy-backing on the reporting capabilities provided by suppliers’
systems.

“Software has become more of a commodity because
the internet has increasingly moved into the automotive sector,”
says West-Oliver. “More and more companies are exploiting what they
can get from their key fleet providers and that is where those
organisations are in turn creating key performance indicator
differentiation versus rival providers. Therefore, technology, the
range of online services available and the sophistication of
management reporting is key for service providers rather than
fighting over monthly rental rates.”

Benefiting from the
recession

Epyx, which specialises in IT solutions
for the automotive sector, has seen its suite of 1link e-commerce
platforms covering functions including vehicle procurement,
maintenance, hire, disposals and relicensing, being adopted by
leasing fleets running more than two million vehicles, 12,000
service providers and motor manufacturers on behalf of their
franchise dealer networks.

Ken Trinder, head of business development at Epyx,
says: “Technology of the kind we provide to fleets is, in many
ways, a product that benefits from the recession. At a time when
fleets are looking to make processes lower cost to operate, more
accurate and faster, we provide answers that can be easily adopted
with minimum expenditure cost.

“All of our platforms replace largely manual
systems relying on phone, fax and paper, with fast, accurate and
cost-effective online mechanisms.”

All software providers, not surprisingly, stress
that the use of technology to manage fleet vehicles deliver huge
financial and administrative savings, but how to quantify those
benefits is not easy.

West-Oliver says that savings are delivered in many
areas and the more complex the fleet operation the greater the
benefits.

Meanwhile, Francis prefers to leave it to Jaama’s
customers to justify the benefits of their financial investment in
the company’s systems.

He points to the amount of administration time
saved coupled with the ability to deliver huge operating cost
savings through the increasingly efficient management of their
fleet and ‘grey’ fleet vehicles – employees who drive their own
cars on business – and associated duty of care responsibility.

He adds: “Our client list can testify to having
recorded significant cost savings, thus improving operating
efficiency and effectiveness.”

But, despite such claims there remain, according to
Briggs, medium-sized fleets running hundreds of cars which are
managed with a makeshift combination of paper files and a
spreadsheet.

But, he argues: “The demands placed on a fleet in
the 21st century are so complex and exacting that you need
specialist software if you are running anything more than a handful
of vehicles. No matter how a spreadsheet is used, it will not help
people who are managing fleets to do everything that is needed when
it comes to tackling the key issues crying out for attention on
their fleet right now – pressure on costs, corporate manslaughter
issues and environmental concerns.

“Any specialist fleet software package should
easily justify its investment through gains in cost control and
general efficiency in a short space of time. A spreadsheet is a
false economy.”

To aid that transformation, CFC has recently made
some of its products available on a pay-as-you-go basis. The new
approach is designed to enable customers to acquire a comprehensive
fleet software package without the upfront costs involved in a
traditional software sale.

Briggs claimed: “On a month-by-month basis, we are
confident that our system will more than pay for itself in terms of
savings made.”

And it seems that technology providers are
confident that demand for products will continue. Trinder suggests:
“There is undoubtedly potential for fleet managers to use more
technology.”

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