Key Hire operates a large fleet in an environment that plans for the future while dealing with current
operational issues. This is the breakpoint where many do not perceive or understand the difference
between Fleet & Transport management – fleet size drives this as small fleets cannot employ
specialist management from a cost point of view.
“At Key Hire Rossburgh and across all our branches we have the advantage of practicing both
disciplines for the benefit of our customers,” says Faizal Mohideen, Key Hire Managing Director.
Mohideen adds: “The difference lies between Strategy = What = future thinking and Operations =
How = current thinking.”
Fleet management is strategic in nature – policy orientation, trend analysis, technology forecasts,
asset planning for future use and scenarios, benchmarking and exception reports, legal issues, image
& environmental issues Transport management is operational – fix it, measure it, control it,
discipline it, sample test, attention detail – it’s all about daily urgencies.
Most fleets are managed with operational competency – few with strategic competency
Operationally incompetent management is costly in terms of both fixed and variable fleet expenses.
The challenge is to earn more profit without using more capital – this means extracting higher
utilisation from the existing fleet. Cost cutting is a favourite method - harvesting by reducing
maintenance.
And then how can we reduce standing time?
Use less capital – how can you service your customers with fewer vehicles? What continuing
research and studies are being conducted to achieve this?
• We need to forecast the future of the fleet – not only examine the rear-view mirror. In other
words, what is happening up ahead?
• Use less capital – how can you service your customers with fewer vehicles? What continuing
research and studies are being conducted to achieve this?
• Invest capital in higher return projects – such projects must be expected to earn more than
the total cost of the capital they require - outsourcing fleet and distribution operations, or
investing in more productive equipment – are 15-year-old trucks productive?
FORTUNE – September 20, 1993
This competence matrix offers a summary view.
Reference: Strategy Pure & Simple - Michel Robert; Published by McGraw-Hill.
EXPLICIT STRATEGIC
VISION Operationally
Competent
UNCERTAIN
STRATEGIC VISION
Operationally
Competent
EXPLICIT STRATEGIC
VISION
UNCERTAIN
STRATEGIC VISION
Operationally
Incompetent
Operationally
Incompetent
• It’s much more than managing – it’s about leadership.
• It means leading people to arrive at a different future.
• It requires forecasting the profile of the asset base to match future needs.
• It needs a realistic vision of the future.
Mohideen concludes: “A vehicle fleet is like a human population. Do not renew all the fleet at once.
A fleet requires an average age profile with the older ones being replaced with new vehicles trickling
into the system.”
A vehicle fleet must not ‘expire’ simultaneously or face simultaneous engine or major component
overhaul. Complete renewal has a massive negative impact on cash flows in terms of maintenance
and replacement.
If you wish to discuss this viewpoint, please contact, please Faizal Mohideen, Key Hire Managing
Director. Tel: +27(0) 83 781 8112
