Asia Fleet Tips: Governance and Policy before vendors?

Fleet (and mobility) policies that extend to Asia are, at best, rare. APAC has not been part of the agenda for a long time, apart from Australia (familiar) and Japan (big volumes). However, since a few years, enterprise fleet owners have started to look at the region and take some action.

Asia 1-O-1

Old habits kick in easily. The global fleet managers commencing their journey in APAC are surprised to see the enormous variety of suppliers and funding methodologies. It’s not uncommon to have more than a dozen vendors per country – not all of them up to the standards and expectations of a Western fleet professional.

Most often – and let’s not forget that for most companies, fleet management is part of procurement – the first action on the list is supply chain harmonization; it’s usually in the first 3 slides of any APAC strategy deck and, although truly important, there are perhaps better options.

Policy versus supply chain

The APAC supply chain is hugely diverse and even those suppliers that are present across the region (Toyota, Nissan, Orix, Sumitomo) don’t operate as a unit, which means that the benefit of consolidating vendors is limited, but the effort is extremely high.

From a policy and governance perspective however, the Asian countries offer more potential of harmonization. Fleet Management is typically highly decentralized and not very formalized. This means that policies, if any, will be local and few business processes will be in place. This leads exactly to the issues that global Fleet Managers are facing: poor data quality and cost reporting, misalignment of eligibility and vehicle selection and a lack of vendor management.

Create the baseline

Nonetheless, you will find the local people in charge of fleet eager to learn and keen to put more structure in place. In terms of items to cover from a policy point of view, we recommend an approach that delivers benefits to the employees (e.g. safety equipment, driver training) rather then only rules and limitations (eligibility, fit-for-purpose).

As far as governance is concerned, we recommend introducing a simple fleet and cost reporting – even a spreadsheet can do the job – that you can expand across the region and consolidate on a higher level. As people start to get more involved, you can start rolling out more sophistication.

Whilst doing this, you’ll learn from your Asian colleagues, understand their needs and build relationships with them. This approach creates a good and effective baseline for your next step: vendor strategy.