Академический Документы
Профессиональный Документы
Культура Документы
Freight Best Practice offers FREE essential information for the freight
industry, covering topics such as saving fuel, developing skills, equipment
and systems, operational efficiency and performance management.
3
Contents
Foreword 3
Performance Management for Efficient Road Freight
Operations 6
Who Should Use this Guide? 7
Summary 12
Data Collection 15
External Benchmarking 21
Results 21
4
Telematics 26
Refrigerated Vehicles 29
5
Performance Management for
Efficient Road Freight Operations
Your freight transport operation may appear to be running smoothly, but the reality is, if you don’t
measure it, you can’t manage it.
Freight transport operations are made up of equipment, systems and people. Understanding and
monitoring the performance of each of these can be very challenging. This guide gives you, the
decision-maker, an understanding of performance management concepts in freight operations, as well
as advice on putting a performance management process in place. Along the way, we’ll give you some
examples and ideas to try out which will put you in a position to know if you can improve the way in
which you are currently measuring the performance of your operation.
• Key performance indicators (KPIs) - performance is best measured on an on-going basis, and KPIs
which use a small number of key measures in important operational areas provide a good way to
do this
• Roles of management - for more senior managers, KPIs can be used to develop strategy, plan
and make decisions, while at the operational level they can be a day-to-day or week-to-week
management tool
• Measuring process - the process or system used to measure performance should be clear, accurate
and proportionate to the expected benefits
• Measuring tools - there are a wide range of systems, from simple paper records to comprehensive
computerised systems for data collection, that save time and effort
• Analysis of results - it is important to analyse the data correctly and make best use of the findings,
and to look out for the pitfalls that can occur during both data collection and analysis
• Benchmarking - as well as comparing your own drivers, vehicles and systems, benchmarking
your operation against the performance of other similar operations in the same or even a different
industry may reveal areas for improvement
6
• Strategies to increase performance
once you have understood your current
performance you can then develop a
strategy to identify reasons for good
and bad performance, introducing good
practice methods used by good performers,
and focusing training or investment
specifically in the worst performing areas
7
What Is Performance Management?
If you want to make well-informed, tactical and strategic decisions about your operation, you will need to
be able to accurately measure the resources you use to deliver your services. Only then can you identify
areas for improvement and assess how effective any operational changes made have been.
The starting point for any performance improvement programme should be to understand the current
performance of your operation. This means collecting data on key aspects of your operation, and turning
this information into specific measures that can help you to identify areas for improvement - for instance,
how much it costs you to deliver products to your customers, how many miles your vehicles run empty or
the number of late deliveries you make. These measures are known as key performance indicators,
or KPIs.
A KPI on its own will not tell you much. Individual measures and data need to be turned into information
that can help you make decisions. This means setting a target, and measuring and monitoring KPIs over a
period of time to see how you perform against this target. Weekly, monthly and annual reports allow you
to monitor progress and see which areas need the greatest improvement. Producing graphs or charts will
often be the best way of showing performance progress.
Costs
Service
Measuring performance can allow you to strike the best balance between service and costs
Specific
KPIs should be specific, simple to use and easy to understand. Complicated statistics and formulae can
lead to confusion and uncertainty about what is actually being measured in the first place. If KPIs are
specific and kept simple, they can be easily communicated across the business and there is no need for
staff to have an in-depth knowledge of the area being measured.
8
Measurable Timed
KPIs can show changes in performance over The frequency of monitoring is an important
time. For this to happen it is essential to compare consideration. Weekly or monthly monitoring is
like-with-like data. It is easy to fall into the trap recommended for many KPIs but this can depend
of comparing two drivers on different routes for on the measure and the needs of a particular
time utilisation or miles per gallon (MPG). If one business. Some information may have to be
route is more demanding than the other, this collected on a daily basis, such as staff absences
could be misleading. Similarly, comparing drivers in the warehouse, daily delivery drops or nightly
when they drive vehicles of substantially different trunking volume. If certain measures are not
age or vehicle type can also be deceptive. recorded and presented to the agreed timescales,
There are ways you can get around these the risk of changes in performance going
problems however, such as rotating drivers onto unnoticed rises.
different vehicles and different routes and then
monitoring both driver and vehicle performance,
to spot consistently high and poor performers. Which KPIs Are Right
Achievable
for Me?
The size, type and management structure of a
Any targets that are set should be achievable. It company is likely to influence the range and
may seem beneficial to set high targets in the type of KPIs you might use. KPIs can be used to
hope that this leads to greater improvements help managers develop strategy, plan and make
in performance, but people can become decisions, while at the operational level they can
disillusioned when they continually fall short show clearly the areas that need improvement,
of the targets set for them. Regularly reviewing or a change in approach. The inner two rings
performance towards targets and then resetting on Figure 1 show the strategic functions of
the targets to encourage smaller incremental performance and a number of key business areas
(but cumulative) improvements may work much that can all be monitored using KPIs.
better in the long run.
An individual KPI can tell you how well you are
Realistic performing at an operational level, however,
when looked at in combination with other
Remember that decisions and management measures, a picture can be provided of how
actions will be taken as a result of the data you are performing in terms of revenue and
collected and presented, so the data collection profitability and overall fleet efficiency, and
method needs to be realistic, reliable and in relation to customer service and legal
consistent. It is important that the data required obligations. The outer ring and white text on
to produce the particular KPI can be collected Figure 1, opposite, shows a range of different
easily and on a regular basis, as comparison over KPI’s and the data required to help you monitor
time forms the basis of benchmarking and then performance in a range of important operational
improving performance. areas. Appendix 1, on page 27, shows a list of KPIs
commonly used in transport operations and the
data required to calculate them.
9
Figure 1 Key Performance Wheel
The Freight Best Practice Programme offers an easy to use Microsoft Excel© spreadsheet tool called
the Fleet Performance Management Tool which allows you to measure 22 different KPIs.
10
Customer service KPIs are also important
See the Freight Best Practice because they can give you an idea about how
Key Performance Indicators for: your operation is perceived by the people that
ultimately pay you. Important customer service
- Next Day Parcel Delivery Sector KPIs could include the:
11
Focusing on Key Compliance
Service
Knowing how operational performance impacts
on customer service can dramatically influence
your actions, measures can include number of
late deliveries, percentage of product damage
and the number of customer complaints.
12
Operational KPIs Driver Utilisation: Comparing each driver with
the scheduled time for the route.
at Premdor Ltd Driver Performance:
Vehicle Utilisation:
Evaluating the planning function by monitoring
how well vehicles are utilised in terms of time
and vehicle fill.
In this Premdor example, the management KPIs
go to a greater level of detail than the strategic Vehicle Performance:
KPIs, which the Ryder team produces for Premdor. At this level, data is collected for each vehicle in
terms of MPG and maintenance required.
At the management level, Ryder is evaluating
its driver and vehicle performances in order to Customer Service:
improve the overall transport statistics that will The number of failed and late deliveries can be
form the basis of the strategic KPIs going to measured for each route, along with order errors.
Premdor’s management each month. It is then possible to see whether there is an issue
with certain customers, or drivers on particular
routes.
13
How Do You Go about Measuring
Performance?
Changing an aspiration to measure performance into a system that works in practice needs a well
planned and consistent approach, supported by people across your organisation. Once again, the
size and nature of the business and distribution operation will affect the way in which the plans are
implemented.
Think about what you want to know and then look at ways of measuring it. Take the example of an
own-account company that requires a transport manager to account for overall fuel spend. In order to
meet the fuel-spend target, the transport manager may decide to monitor fuel price, fleet mileage and
fuel consumption by vehicle. Armed with detailed information, effective targets can be set and action
taken to improve overall fuel efficiency.
Staff who are the subject of your KPIs need to see real value in monitoring performance levels. If they are
part of the recording process and the burden of information collection interferes with the activity that is
being measured, they are likely to lose sight of the all-important wider operation.
14
See the Freight Best Practice publication Setting and Reviewing
Fleet Performance Management Tool
for a full range of KPI spreadsheets.
Targets
Target setting is perhaps the most important
Figure 2 The Process of Selecting and Measuring part of measuring performance. You cannot
KPIs set targets until you have measured current
performance, but until you have reviewed
performance against targets you cannot know
what action is necessary to improve performance.
Select KPIs
Once you understand your current performance,
setting realistic targets for each KPI is the next
logical step. KPI targets should be in line with the
Set and Review Targets strategic goals of your business and should aim
to move the company towards achieving those
goals.
Data Collection
Targets do not need to be perfect; the very act
of setting a target and monitoring your progress
towards achieving it is really the important
Review/Evaluation process.
(Including Benchmarking)
Always remember that monitoring and reviewing
is an on-going process and if the target was met
very easily, you need to go back and consider
Reporting & Feedback ‘raising the bar’. If you fall well short of the target,
you should try to understand why this might
have occurred and adjust your future target
levels accordingly.
Results Yes
Targets
met?
Tip
No
Targets are often discussed and reviewed on a
monthly basis. Any longer period than this can
Targets Yes mean that targets lose their relevancy.
too high?
No Data Collection
Collecting data to determine your KPIs is
Identify Strategy for
Performance Improvement
often the most difficult and expensive part of
measuring performance. Few companies will
start from scratch so reviewing your existing
process provides the first logical step. The data
Take Action can be collected manually or automatically using
Implement Strategy some form of system, and they can be analysed
within the company or outsourced.
15
A simple system with as few recording methods Specific Data Collection Systems
as possible is the safest starting point, as the
more complex the methods you use, the higher It is possible that your company does not have
the possibility that there will be errors. If you any existing systems that could be used for
are reviewing and improving your performance data collection purposes. In this case, you might
monitoring, you may well find that information decide to buy a system with the main purpose of
is being collected but is not fully analysed or measuring performance. If you decide to do this,
utilised. It makes sense to view the performance then make sure that the system is fit for purpose
management process in the same way as the and offers value for money.
fleet efficiency you are trying to measure: try to
achieve the greatest output with the minimum
of input. Integrating Existing IT Systems
A company may already have systems that can
Manual Paper-based Data Collection provide some of the information, but is not
able to get the most benefit because of existing
Forms can be created so that data can be systems not communicating with each other or
collected by drivers through filling in a daily not reporting in a way that allows comparisons to
driver sheet, collecting data on kilometres run be made.
and the number of cases delivered and whether
the delivery was on time. The driver would There are a number of IT suppliers that focus
also note down the amount of fuel put into on bespoke systems which can link warehouse
the vehicle to fill up the tank at the end of the management systems to scheduling systems
day. When the drivers return to the depot, they or to order systems, so that a far more effective
hand the sheets to an administration clerk who flow of information can take place. The cheapest
can capture the information into a computer approach to improving a current situation is
spreadsheet. to ensure that you have fully exploited the
information available from current systems. You
may find that you can collect data and report on
many of your selected KPIs.
16
Data Collection Errors there will always be the opportunities for data
collection errors to lead to incorrect performance
Whether you already collect KPI information, information.
intend to make better use of existing data
collection systems or wish to put in place a new Problems can result from human, machine or
data collection system, system error. Often, time pressures can be the cause
of data entry errors. A conscious check on data
collected is recommended, whereby any unusual
figures can be checked for reliability. It is also
advisable to periodically monitor the accuracy of
the data entry to spot any errors.
Tip
Good housekeeping, strong procedures and a
dedication to precision can help to reduce the
Human error at point of delivery can cause problem of errors in data collection.
problems when invoicing the customer.
Vehicle Number Distance Travelled Gallons of Fuel Used Miles Per Gallon
1 742 73.2 10.14
2 626 57.6 10.87
3 1746 222.4 7.85
4 1463 173.5 8.43
5 1562 210 7.44
6 2050 265.1 7.73
Total over the six vehicles over the week = 8,189 miles and 1,001.8 gallons
Simply averaging the individual vehicle weekly MPG figures gives a result of 8.74 MPG (52.46÷6). However,
as each vehicle has run different mileages, the true fleet MPG is revealed by totalling all mileage and
dividing by all fuel used. This reveals that the actual fleet performance is 8.17 MPG (8,189÷1,001.8) - a
difference of 0.57 MPG or 7%.
17
Reviewing and Evaluation When comparing one part of your operation with
another, it is important to avoid the common
pitfalls of not matching like for like, leading to
The performance review period can take the misleading conclusions:
form of weekly, monthly and yearly comparisons.
If your business has a number of comparable
operations then benchmarking vehicles, shifts
• KPIs measuring the performance of
different parts of a delivery fleet by shift
or depots can reveal areas where performance
should take into account where shifts are
could be increased. For example, different vehicle
not rotated and are constant nightshifts or
categories within a fleet can be benchmarked
dayshifts - there may be efficiencies gained
against one another to show how they perform
by virtue of the time of day when the
on fuel consumption. If two similar vehicles
vehicles run on the road, i.e. encountering
on similar routes undertaking similar activities
less traffic at night
have noticeably different fuel consumption
performance levels, then this should suggest
further investigation to review both vehicle
• When benchmarking vehicle categories
for fuel efficiency, it is possible that the
maintenance and driver performance.
results show the larger vehicles to be more
fuel efficient. However, it is also likely that
these vehicles may have been run on longer
See the Freight Best Practice Fuel distance trunking routes rather than smaller
Management Guide which looks at vehicles that may have been used for
vehicle versus vehicle and driver numerous urban multi-drop deliveries
versus driver performance monitoring
in more detail • When it comes to benchmarking depots,
the type of operation could be significantly
different. So, for example, a transport
operation could be primarily a trunking
In the Parcel Sector Benchmarking survey or single-drop operation, while another
undertaken in 2005 a number of leading could involve multi-drop deliveries in urban
companies submitted data for three depots areas. The type of product carried may
each representing different geographical differ, and in both the warehousing and
regions of the country (North, Midlands and transport operations it could be that certain
South). One company’s Midlands depot was products require a much longer loading
the best at collecting parcels and bringing and unloading time owing to the size or
them into the regional depot, having 36% complexity of the product
cubic fill at the end of the journey, whereas
the same company’s London depot had the • Sometimes when company takeovers or
poorest performance with only 17% cubic mergers take place there is a difference
fill. Where there are significant differences in the quality and age of equipment and,
in performance, an understanding of the until the equipment is replaced, there could
reasons for this can help the business improve well be a marked difference between the
efficiency. This might be through looking for resources available at each location
opportunities for back-loading, expanding the
customer base and improved route scheduling
18
This has the added value of automatically
In the Parcel Sector Benchmarking survey building-in previous months’ data into the report.
there was the tendency for all London depots
to have poorer fuel consumption figures, The reports can be designed to show actual
perhaps because of congestion and lower figures against targets set for each of the KPIs,
inter-drop distance. On average, across all and from these reports, automated charts can
participating fleets, 18 tonne rigids had fuel be produced. Often a quick view of a chart can
consumption of 3.92 km per litre in the north highlight the problem areas within an operation
and 2.56 km per litre in the south. It would be far more clearly than tables of data.
misleading to compare these performances
directly because of geographical and The value of KPIs can be converted into efficiency
operational differences. improvements only if they actually lead to
changes in the behaviour of the people in your
business. As a rule, feedback should be given to
people at all levels of the business, from strategic
to front-line
For further details see the Freight Best
Practice Benchmarking Guides Key operations - this ensures that all staff members
Performance Indicators for: are aware of progress and can see the benefits
of performance measurement.
• The Food Supply Cahin
In many cases, automated systems will effectively
• Non-food Retail Distribution prescribe the reporting style and it will be
up to you to take the available reports and
• Builders’ Merchants Sector tailor the information, either for your own use,
for communicating with those staff whose
• The Next Day Parcel Delivery Sector performance you are trying to influence, i.e.
drivers, or reporting to more senior staff.
• The Pallet Sector
Tip
19
Figure 3 KPI Cumulative Summary List (Actual v Target)
20
time consuming to complete. Depending on Identify Strategy and Take Action
the nature of your business there may be a
benchmarking opportunity available. This is most • Look at reasons for good and bad
likely to be the case within the public sector, for performance at individual staff member,
instance, within NHS Logistics or between local vehicle, shift or location levels
authority vehicle fleets. Freight Best Practice
has also carried out a number of time limited • Report back to those underperforming and
surveys whose results are available for you to set clear targets
compare your current operational performance.
Freight Best Practice would like to hear from any • Introduce good practice methods,
companies that would like to undertake this type disseminated from high performers to the
of benchmarking. If you are interested, simply lower performers
email info@freightbestpractice.org.uk
• Consider providing appropriate training to
External Benchmarking fill skills gaps
• Judging the relative performance of your It could be that the target has been set too high
operation over time and that it actually de-motivates individuals, thus
people feel they would never be able to meet the
• Comparing aspects of performance with target and less effort may be applied than if there
other practitioners were no targets at all. In this case, the target
should be reviewed and set at an achievable
• Identifying areas for improvement in level.
performance
Targets Achieved
See the Freight Best Practice Key
Performance Indicators for the Pallet It is important that you acknowledge good
Sector Benchmarking Guide. performance, and that the factors that have come
together to produce the higher performance
level are recognised. A particular manager
Results or individual can have made a meaningful
difference and this should be recognised.
21
Targets Set too Low Key Points to Remember when
Introducing Performance
If targets have been met easily it may be that
they have been set too low, therefore they should
Management into Your Organisation
be altered. This is where benchmarking against
competitors in the marketplace can provide
• Relying on people to provide good
information can cause difficulties, so data
companies with common standards.
collection systems need to be easy to
understand and staff should be well briefed
Internal Multi-contract if you need them to collect data for you
Benchmarking Example
• Work with staff to decide on what
In Ryder plc’s Dedicated Contract Carriage information you need to collect and how it
division, benchmarking between different should be collected
contracts takes place. This is a good way of
comparing performance and management • Getting support from company
styles of different operations. It is made possible management is critical - you cannot expect
by having full access to all the data available, people throughout your business to give
unlike comparisons with competitors’ operations. you good information if people at the top
Concerns felt by companies outsourcing their do not consider it to be important
distribution to Ryder over sharing of operational
data are addressed through the non-disclosure • Collecting data can be resource-intensive.
of financial information and the contracts being While continuous performance monitoring
in different industry sectors. Each operation is best, taking regular snapshots over time
benefits by becoming more efficient through can work well too. It is worth continually
using the best practice from one operation and asking the question, ‘How will this data
transferring it to another. help me measure performance?’
Each month a number of areas are benchmarked: • If no system is available for collecting
information, make your own. Simple
• Accident damage (average cost per vehicle) Microsoft Excel© sheets can be useful.
The Small Fleet Performance Management
• Vehicle downtime (average days per Tool shows how, by combining a number
vehicle) of spreadsheets, a comprehensive
performance measuring tool can be
• MPG - comparison of each vehicle type produced
22
When drivers leave the premises they are largely • Technical issues - if you are measuring the
their own boss. Gaining their buy in to performance performance of a new piece of equipment
management is essential to your success during a trial period, make sure you have
support from the equipment or system
• Understand your current costs - you will supplier to ensure that you can make the
need to know your current costs to create most of the equipment
a benchmark from which you can monitor
progress • Weather - to understand the effects of
weather on fleet performance it is best to
• Realistic timescale - the longer the period carry out your trial over a 12-month period
of measurement, the more informative the
results will be • Flexibility for unforeseen circumstances
- a degree of flexibility in the trial procedure
• Representative sample - always remember is essential to incorporate any unforeseen
to take into account seasonality and other factors
external factors when comparing ‘before’
and ‘after’ results
23
Improving Performance in Your
Operation
This section looks at some of the actions you can take to improve efficiency in your own operation.
These are broken down into four key areas: operational efficiency, efficient fuel management, efficient
equipment and systems and efficient people through developing skills.
Operational Efficiency
Vehicle Routing & Utilisation
Medium-sized and larger fleets often use computerised vehicle route scheduling (CVRS) packages which
can collect and provide data to help measure performance levels and, in particular, show where certain
routes or depots are more efficient than others in terms of, for example, vehicle fill, kilometres per drop
and time utilisation.
For more details, see the Freight Best Practice Guide Computerised Vehicle Routing and
Scheduling (CVRS) for Efficient Logistics.
24
Alstons Cabinets
Alstons Cabinets supplies bedroom furniture
from its base in Ipswich to over 2,000
customers across the UK. The vehicle fleet
consists of 22 rigid vehicles and trailers,
completing between 500 and 600 orders every
week.
25
See the Freight Best Practice Guide
Make Back-loading Work For You.
Telematics
Telematics systems are applications that use
computers to control and monitor remote
devices or systems. The management software
in telematics systems can turn the data collected
into information that will help you to manage
vehicles, drivers and operations more effectively.
26
Improving Fuel Efficiency A 3% improvement on fuel efficiency of the whole
fleet was achieved in one year, corresponding to a
at Thorntons plc cost saving of £7,300 per year. Staff running costs
were £4,200 per year, giving net annual savings of
Thorntons is a major UK manufacturer and retailer £3,100.
of premium confectionery, with more than 4,200
employees. The company links manufacturing, Phase 2 introduced data loggers which could
packing, warehousing and distribution operations measure the following indicators of fuel
in one location. consumption:
27
Example of an In-vehicle Tip
28
successful operational benefits, such as enabling
See the Freight Best Practice Guide Truck a reduction in the size of the fleet
Specification for Best Operational
Efficiency for more information.
See the Freight Best Practice Case
Study Focus on Double Decks for more
Refrigerated Vehicles information and the Focus (DIY) Ltd Case
Study below.
Specialised vehicles such as refrigerated
vehicles impose extra purchase and running Buyers Guide to Refrigerated Transport
costs, which means it is all the more important Equipment.
to keep a check on the costs of maintenance,
fuel and other operating costs. Fridge units
can be powered from a number of sources
including: electricity, red diesel, white diesel, Focus (DIY) Ltd
cryogenics (liquid nitrogen) or direct drive. By
using a continuous performance measurement Focus (DIY) Ltd found that cubing out before
process, the operating costs of running a unit, weighing out is a particular problem with
which include maintenance and fuel, can be their range of products being delivered on
analysed separately to the main motive power a fleet of single-deck and fixed double-deck
unit of the vehicle. Hence, accurate specification trailers. A nine-month feasibility study with
of equipment will, over time, result in greater a prototype moving a double-deck semi
operational efficiencies, which can save trailer demonstrated its potential to improve
significant amounts of money. operational efficiency, with the benefits being
the potential to reduce the fleet size. Other
benefits included reduced overall mileage,
lower fuel costs and shorter waiting times at
loading docks. Using the double-deck trailer
compared to two single-deck trailers gave the
following benefits:
Double-deck Trailers
Many businesses suffer from inefficiencies in
their deliveries due to variable product sizes,
meaning that efficient vehicle fill is difficult to
achieve. Innovative vehicle specification can help
to improve vehicle fill and increase productivity.
Performance measuring can help to verify that
the introduction of double-deck trailers has had
29
Padding Block
Demountable Bodies
Demountable bodies offer another approach to improving operational efficiency through vehicle
specification. Demountable bodies enable drivers and vehicles to be used more intensively owing to
quicker turnaround times at the depot. Essentially, drivers do not have to wait for the vehicles to be
re-loaded.
In terms of KPIs, a company can measure demountable efficiencies by analysing the loading times which
would cause a standard vehicle to be standing in non-working activity. Efficiency gains can also be
made with regard to reduced damage to products. If high-value, awkward-to-handle products are being
transported between depots and transhipping is required, then looking at the statistics on damages can
show whether it would be worth introducing a demountable operation to reduce the cost of damage.
30
Condition of Vehicle Fleet Correctly fitted aerodynamics equipment can
improve performance significantly
Other factors influence vehicle performance,
such as age and general condition of the
vehicle, especially in terms of engine, axles and Tip
tyres. Ensuring the most appropriate vehicle
specification for the tasks that are expected A truck specified or fitted with the correct
to be performed will improve both fuel and aerodynamic styling can use 6-12% less fuel
operational efficiency. There is often a financial compared to a vehicle with little, or badly
trade-off between the initial investment required adjusted, aerodynamic equipment. You do not
to buy a higher specification vehicle and the cost even have to replace your vehicles – there is
of operating the vehicle over a long period. a range of add-on features available that can
significantly improve the aerodynamics of
For example, the effects of using a vehicle that many vehicles on the road today.
makes loading and unloading of the product
difficult, or poor manoeuvrability of the vehicle The Freight Best Practice programme offers a
in an urban environment may increase delivery comprehensive and pocket-sized guide which:
time. By collecting data on vehicle maintenance
costs, fuel used and average loading and • Provides a brief introduction to
unloading times, a fleet manager can begin to aerodynamic styling and its benefits
work out the operational costs of running the
vehicles in the fleet. This can then be set against • Helps you to work out which
the cost of the vehicle lease or purchase. aerodynamic features are suited to your
operations
Aerodynamic Styling
• Shows you how to maximise the fuel
Aerodynamic styling fitted to goods vehicles savings from any features fitted to
can significantly reduce fuel consumption, but your vehicles
this saving has to be weighed against the cost of
fitting aerodynamic styling products. However, • Points you to further information
it may be possible to test the benefits by
benchmarking two similar vehicles, one of which
has good aerodynamics and one which does
not. It is then possible to see the effectiveness
of the aerodynamics for the particular transport See the Freight Case Study Smoothing the
operation. Maintenance costs should also be Flow at TNT Express and Somerfield using
taken into account. In-fleet trials provide a basis Truck Aerodynamic for more information.
for understanding these costs.
Tyres
Most operators know that improving the
aerodynamic performance of their vehicles can
reduce fuel consumption. However, did you
know that the rolling resistance of the vehicle’s
tyres can also have a significant impact on the
amount of fuel used? Suppliers claim that fitting
tyres with a 25% reduction in rolling resistance
on all axles of a vehicle could improve its fuel
consumption by at least 5%. Monitoring and
maintaining the correct tyre pressure is essential
and the potential for contributing to maintaining
and improving standards is too important to
ignore. (See the Moy park mini case study on
page 23.)
31
help you improve performance.
In-fleet Trials
Drivers and Operational Staff
Many suppliers test their own products
and give estimates of potential savings, but • In general, there are 3 key skill areas for
these are likely to be variable in different drivers and operations staff:
applications. Therefore, it is recommended that
operators consider conducting an in-fleet trial • Technical Skills - Safe and Fuel Efficient
to ensure the suitability of vehicles, equipment Driving, Telematics and Computer skills,
or systems before embarking on a potentially driver checklists and maintenance skills
expensive acquisition programme. An in-fleet
trial is the testing of a vehicle, equipment • Personal Skills - Customer Care,
or systems in normal service as part of the Communication and Team work
day-to-day transport operation to see if it is
suitable for the intended application and able • Knowledge - Knowledge of the vehicle, EU
to produce noticeable benefits to the operator. Driver Legislation and hazardous goods
This is the concept behind manufacturers
offering demonstration vehicles/units to Driver and operational training is vital to the
operators for a period of time. successful performance of any operation.
By establishing KPIs you can set a company
In-fleet trials can be used to measure any standard and identify any problems that occur.
intervention from physical changes to A good method of achieving this for drivers
vehicles, such as changes to the gearbox, tyres and operational staff is to create league tables.
or aerodynamic design, or changes to the League tables can measure performance in
way the vehicles are driven through drivers several different areas such as fuel efficiency,
undergoing driver training. Tests can be carried number of accidents, product damage, on-time
out relatively easily and can provide valuable deliveries and communication errors. They can
information, helping to influence future also create a healthy competitive atmosphere
decisions on the purchasing of equipment within the organisation. Effectively, this method
and systems, or analysing the effectiveness of of performance measuring allows you to
training approaches. efficiently allocate your resources where training
is actually needed.
32
administration staff and managers understand
Moy Park Ltd the concept of performance management so
that they can correctly collect information that
can help you improve your operation. If the
Derbyshire-based Moy Park Ltd operates a fleet
information is collected correctly, then problems
of 42 commercial vehicles. Comprised mainly of
can be identified and tackled quickly.
tractor units, together with a number of rigids,
the fleet is used for supplying poultry products
Communication is a key skill in the success
to customers nationwide. The company has
performance of any logistics company. Managers
been using Michelin tyres for over 10 years,
should be able to effectively communicate
managed by local dealer, TyreMiles.
instructions to team members and likewise
administration staff should be able to
In May 2003, the company took delivery of four
communicate vital information to the drivers and
new Mercedes Axor 18.40 4x2 units and, for the
operational staff. Once again KPIs can be set to
purpose of a three-month trial, specified two
identify shortfalls in this area.
with Michelin 295/80 R 22.5 energy low rolling
resistance tyres and two with competitor’s
tyres. How Does Performance
Management Encourage Staff?
All vehicles had similar working patterns
during the trial and operated at 38 tonnes. Everyone should have continual professional
The trucks running on energy efficient development in your organisation. If carried
tyres recorded a fuel saving of 8% over the out appropriately, performance management
competitor tyre fitted on the other vehicles. can encourage staff to become efficient in their
Running 20 vehicles on the energy tyres led to everyday activities. This process will identify
an annual fuel saving of nearly £7,600. Garage weaknesses that can then be improved, but also
Manager Nigel Nash explained “Despite the raise the standard of your employees. This will
cost of tyres being 3% of running costs for not only benefit your business as a whole but
commercial vehicles, specifying the right tyre employees will feel more fulfilled and be more
can have a significant impact on reducing one likely to stay longer and work harder.
of our main expenditures - diesel”.
There is a large range of professional training
courses available for drivers, administration
Administration and Management and managerial staff including SAFED, General
National Vocational Qualifications, Certificates of
Administration and managerial staff also need Professional Competence and other accredited
technical, personal skills and knowledge, but courses. The following organisations will help you
the specific skills they use from day to day are identify relevant development courses for your
different to those of drivers: staff;
• Knowledge - Transport policy, health and It is imperative that every part of the business is
safety legislation and customer priorities involved to ensure full participation and ‘buy in’ to
performance management
Understanding new technology can maximise
efficiency and performance, and it is important
that managers and administration staff are
computer literate. It is also important that all
33
Safe and Fuel Efficient The DfT SAFED driving scheme has benefited
many companies, with considerable fuel savings
Driving (SAFED) achieved.
The Safe and Fuel Efficient Driving (SAFED) Clugston Distribution Services
training scheme has been specifically developed
to enable both vehicle operators and training Benefits highlighted:
providers to implement driver training within the
road freight industry. • Average fuel consumption improvement of
7.3% for 23 drivers
The training covers all of the following areas on
which drivers can have focused training: • One driver trainer improved fuel
consumption by 13.5% on the day
• Adjustable aerodynamics
• Useful refresher on safety
• Braking
Winfield Transport (Cannock) Ltd
• Clutch control
Benefits highlighted:
• Cruise control
• Exhaust brake • Average fuel savings of 3.2%
34
For more information on SAFED, see the following publications
SAFED for HGVs: A Guide to Safe and Fuel Efficient Driving for HGVs,
Companies and Drivers Benefit from SAFED for HGVs: A Selection of Case Studies,
SAFED for Vans: A Guide to Safe and Fuel Efficient Driving for Vans.
Website: www.safed.org.uk
A full list of the FREE Freight Best Practice publications can be obtained from the
Hotline 0300 123 1250 or by visiting the website at
www.businesslink.gov.uk/freightbestpractice
35
A Checklist for Measuring and
Improving Performance
Understanding and monitoring performance can be challenging. This guide has aimed to give you,
the decision-maker, an understanding of the performance management concepts, advice on putting a
performance management process in place and a range of initiatives you can introduce to improve your
operation’s performance. Measuring current performance is a fundamental first step you need to take
before you can put measures in place to improve operational efficiency and reduce costs.
The table below shows some important questions you can ask to help set up a performance
measurement system in your organisation.
36
KPIs Used in the Freight Best Practice
Fleet Performance Management Tool
and Information Needed to Calculate
them
Area KPI Data Required
Rent cost/depreciation, road fund licence cost,
O Licence cost, no own driver costs, agency
Average cost per driver costs, fuel costs, tyre maintenance costs,
unit delivered (£) maintenance cost planned/unplanned, number of
trips, units carried, distance travelled/number of
trips
Rent cost/depreciation, RFL, O Licence costs,
Total whole vehicle annual insurance costs, own driver costs, agency
cost driver costs, fuel costs, tyre maintenance costs,
(p per mile) maintenance costs planned/unplanned, distance
travelled/number of trips
Average running Own driver costs, agency driver costs, fuel costs,
Cost cost tyre maintenance costs, maintenance cost planned/
(p per mile) unplanned, distance travelled/number of trips
Rent cost/depreciation, road fund licence cost, O
Average standing
Licence cost, annual insurance cost, number of A/C
cost (p per mile)
periods, distance travelled/number of trips
Average driver cost Own driver cost, agency driver cost, distance
(p per mile) travelled/number of trips
Total maintenance
Maintenance cost planned/unplanned, distance
cost
travelled/number of trips
(p per mile)
Total maintenance Maintenance cost planned/unplanned distance
cost (£’000) travelled/number of trips
Average miles per
Fuel litres, distance travelled/number of trips
gallon
Total miles run
Odometer opening, odometer closing
(‘000s)
Total empty miles Number of empty miles, distance travelled/number
run (‘000s) of trips
Operational
Percentage empty Number of empty miles, distance travelled/number
running total of trips
Capacity, distance travelled/number of trips, units
Average vehicle fill
carried
Average time Time vehicle available, time vehicle used, distance
utilisation travelled/number of trips
37
Area KPI Data Required
Number of deliveries, number of collections,
Percentage of late
number of late deliveries, distance travelled/
deliveries total
number of trips
Number of deliveries, number of collections,
Percentage of
Service number of damages, distance travelled/number of
damages total
trips
Number of deliveries, number of collections,
Percentage of
number of complaints, distance travelled/number
complaints total
of trips
Total number of Number of overloads, distance travelled/number of
overloads trips
Total number
Number of traffic infringements, distance travelled/
of vehicle traffic
number of trips
infringements
Compliance Total number
Number of driver infringements, distance travelled/
of drivers’ hours
number of trips
infringements
Number of blameworthy accidents, number of non-
Total number of
blameworthy accidents, distance travelled/number
traffic accidents
of trips
Percentage of failed Number of inspections due, number of inspections
inspections total overdue/failed, distance travelled/number of trips
Maintenance Percentage of
Number of defects, number of defects rectified in
defects rectified in
last 24 hours, distance travelled/number of trips
24 hours total
38
39
Freight Best Practice publications, including those listed below, can be obtained
FREE of charge by calling the Hotline on 0300 123 1250 or by downloading
them from the website www.businesslink.gov.uk/freightbestpractice
February 2010.
Printed in the UK on paper containing 100% recycled fibre.
FBP1047© Queens Printer and Controller of HMSO 2010.