Fleet Management vs Fleet Operations: What’s the Difference?

April 2, 2020

Digital transformation has completely changed the way that enterprises manage their commercial vehicles. What used to be a manual, paper and spreadsheet-based management process is now mostly done using digital, cloud-based applications.

As a result of this transformation, fleet management is easier, faster, and more effective than ever before. Yet, confusion still abounds. Many managers and administrators—especially those who are used to the old way of doing business—are struggling to understand this new world of digital fleet management. They are also struggling with the latest trends and technologies that are shaping the industry.

For example, one of the most common points of confusion today centers around the difference between fleet management and fleet operations. This post will help you understand what fleet management and fleet operations are, what they have in common, and what’s different about the concepts.

What Is Fleet Management?

Fleet management is a very broad term. It covers many different categories.

In short, fleet management refers to the management of a business’s commercial motor vehicles. Fleet management can be applied to automotives (e.g., cars, trucks, vans, or heavy machinery), aviation (e.g., airplanes or helicopters), or nautical crafts (e.g., boats, barges, or submarines). Fleet management can also include rail cars.

Today, fleet managers are using a combination of on-board telematics—or long distance data transport systems—and digital dashboards to collect, analyze, and process real-time and historical data. This data guides daily decisions related to all aspects of fleet management. Over time, it optimizes operations and builds a more efficient company.

How Fleet Operations Fits in With Fleet Management

There are many different functions involved in fleet management, all of which are critical to the overall stability and effectiveness of an organization. After all, most companies today are completely dependent on their supply chain in order to function. And fleets play an instrumental role in keeping them running.

Some of the main functions in fleet management include vehicle leasing and financing, supply chain management, accident management, and licensing compliance. And one of the most important categories within fleet management is fleet operations, also known as logistics.

Fleet Operations: An Overview

Fleet operations has to do with short- and long-term logistical fleet management. The job of a fleet operations manager is to make sure that all vehicles under their care stay in proper working order. They are also in charge of ensuring they stay within their allotted budget. These responsibilities are much easier said than done without the right tools and technologies in place.

Let’s dig a little deeper into some core components of fleet operations.

Daily Fuel Consumption

Fuel costs can add up very quickly for a business. That statement is even more relevant when companies have hundreds or thousands of vehicles operating around the clock. Therefore, companies need to map and track fuel prices in real time. This enables them to provide drivers with timely information about where to stop along their routes.

Without daily fuel consumption data, drivers are often left to their own accord. And most drivers are more apt to choose convenience over price. Depending on the scope of operations, that preference could have a significant financial impact on your bottom line.

As a result, a system is needed to govern how much drivers are allowed to spend on fuel. That way, there won’t be a question about where to stop when the fuel light comes on.

Maintenance and Repairs

In the past, drivers would communicate when repairs were needed on their rigs. Again, this system led to a lot of problems.

Now, this process is essentially automatic using on-board telematics. These systems compile data on things like mileage, oil, and tire pressure. With the help of a reliable telematics system, companies can mitigate operational risk. This enables them to improve safety, reduce costs, and extend the lifespan of the company’s vehicles.

Regulatory Compliance

Fleet managers need to follow a variety of local, state, and federal restrictions. For example, the Federal Motor Carrier Safety Administration (FMCSA) has strict policies that limit drivers’ on-road hours.

Managers need to track drivers’ logs in order to ensure compliance and avoid hefty fines and penalties. This is now done electronically, through the Electronic Logging Device (ELD) rule.

Driver Monitoring and Management

A growing number of fleet managers today are using telematics systems to track drivers’ on-road behavior. For example, telematics systems can report data when drivers brake suddenly, speed, or fail to use signal lights when they change lanes. This data can go a long way toward reducing on-road violations. It can also help keep drivers on the road—and out of trouble.

Of course, these are basic operational management features that companies are using today. A new wave of fleet operations technologies are coming to market that make it easier than ever for operators to stay informed about what’s happening across all of their companies’ routes on a daily basis.

Taking Fleet Operations to the Next Level

In line with digital transformation, the next generation of fleet management solutions are mobile. This allows for an easy, convenient, and reliable user experience.

Here are some examples of how mobile technology is transforming fleet operations around the world.

Mobile Capture

In the past, paperwork could take days or even weeks to process, depending on drivers’ schedules. This often resulted in backlogs and lost reports.

Now, paperwork can come back from drivers immediately using mobile scanning and document management functionality. This type of solution automatically captures, crops, and enhances paperwork, delivering much more efficiency to the process.

Drivers love mobile capture because it makes their jobs easier. It also saves them valuable time during and after customer stops.

At the same time, managers love mobile capture because it expedites back-end processing and reduces risk. It’s a win-win.

Driver Workflow Management

Digital transformation has also improved driver workflow management, which was traditionally a major pain point for fleet managers.

Up until recently, drivers were largely responsible for calculating mileage and pay. This often created confusion for truckers, especially for those working with multiple companies. Different businesses, after all, each have different variables for tallying compensation.

Today, it’s possible to pull data directly from telematics and transportation management systems (TMS) and calculate pay using specific algorithms and custom specifications. This approach can automate a large portion of driver payroll while eliminating errors like duplicate data entries.

This type of solution can also come in handy during audits. Managers can easily access and export data with push-button ease. They don’t have to spend hours tracking down information.

Instant Payments

Every manager dreams of being able to collect payments instantly. No one likes to wait for paperwork to clear.

With the right tools in place, this is possible using rendition billing over a mobile device. All a driver has to do is launch a mobile application and scan a POD. You can then create an invoice automatically based on unique customer preferences—resulting in rapid payments.

Using Vector to Streamline Fleet Operations

Vector is on the front lines of digital innovation in fleet management, offering a variety of new technologies to help streamline logistics and operations.

With the help of Vector, fleets can operate with much greater transparency, while eliminating back-end complexities that can slow down business.

Learn more about how Vector can help your business.

‍This post was written by Justin Reynolds. Justin is a freelance writer who enjoys telling stories about how technology, science, and creativity can help workers be more productive. In his spare time, he likes seeing or playing live music, hiking, and traveling.