You need to know where you have been, before you know where you are going. Telematics can help you get there. It is an automatic way to log information about where your vehicles and equipment are—and where they have been—as well as how they are used and performing.
By Frank Schneider
Fleet managers work to balance their resources and expenses through efficient allocation. Optimizing operations requires continual analysis to spot new opportunities to reduce costs and improve how the fleet is used. Not only does correct allocation help the bottom line, but it can also make companies more competitive from fewer breakdowns to better customer service to new business ideas.
While information can be collected manually or pulled from different systems, automating the process can reduce data entry errors and offer better access, often in real-time. Capturing data logged directly from your fleet vehicles and drivers with telematics and other integrated technologies is one way. Regardless of how the information is collected and reported, it is important to identify:
• Current productivity patterns
• Ways to reduce expenses
• Service improvement areas
By gathering this basic intelligence, fleet and operations managers can then apply it to stay competitive. Being able to respond to current con-ditions and the operating environment requires the
ability to change in real time and is key to optimizing operations. For example, consider a new road opening or a Thanksgiving parade. How could you adapt your scheduling to take advantage of the new access or circumvent around unavailable streets? First, you need to know where your operations are today before you can determine where you need to go. Here are three ways to step up your resource allocation game.
#1: Define and Measure Your Current Use
If there are not already operational measurements in place or they are not specific enough, you will need to define what you should track and how to measure it. The first step is to understand your operations fully, not simply pieces of it. If you do not, a change in one area can have a big impact on another. Once there is a complete view, fleet managers should look to areas that affect the total cost of ownership, such as usage, age, maintenance, repairs and fuel costs. After you define the key data to measure, create a program to acquire this information consistently.
One way to track is by creating a digital vehicle record that contains data such as the vehicle year, time in service, maintenance logs and mileage. Reports categorizing the fleet by time of day or shifts can also help uncover trends. While the information can be captured manually or by independent systems, a faster and more accurate method is an integrated solution like telematics. The data goes directly from the vehicle via a gateway to the cloud that provides instant access.
When your baseline metrics are defined and being collected, establish a regular schedule to review the information. Trends, or patterns, and exceptions often become visible, such as at what age do your vehicles require more maintenance? What areas of the city have the most emergency requests? Then you can determine if it is worthwhile fixing the issue(s) or using them to your advantage. For example, a Virginia ambulance company used data to discover where the highest number of calls happened throughout the day and positioned their vehicles accordingly. It helped cut down the response time, which can be critical during a true emergency. Another example is if a truck often only has a few stops, there might be too much capacity for the service requirements of its route. Additional operational areas to examine might be:
• Hours your drivers and other personnel are available
• Number and duration of stops on all routes
• Vehicle travel patterns in relation to the time of day.
• Qualification of staff to meet the current requirements
#2: Determine Unnecessary Costs
There could be costs hiding in your fleet. With a telematics solution, you can see which vehicles, assets and drivers are outliers that cost more or provide less benefit than similar ones in your fleet. These exceptions range from excessive idling to aggressive driving to underused assets. It is difficult to find these hits to your budget without telematics because it has direct access to vehicle operations. Excessive idling is additional stress on the engine as well as running up fuel costs. Consider managing this situation through training and incentives once identified. Aggressive driving such as speeding or hard braking places extra wear-and-tear that can increase maintenance and repair costs. It also opens the company up to fines, such as speeding tickets, and damage to your brand.
By reviewing utilization reports from their telematics solution, one company discovered that they had more than 30 vehicles just sitting in the lot. While not a direct impact to the fleet budget, the indirect costs of depreciation, taxes, etc. do add up. If you were in this situation, would you sell the excess inventory or decide to reallocate your current fleet?
#3: Uncover Opportunities
Once you have a good understanding of how your fleet operates, you can identify areas for improvement. If your use changes seasonally, for example, you might be able to convert part of your fleet to a rental or lease program to reduce cost. Another option would be to explore additional services. Landscaping companies frequently offer snow plowing or other winter related services during their “off” season. If you are using specialized equipment to serve a small, specific market, it might be worth a cost/benefit analysis to determine whether the income justifies the expense.
The data may show opportunities to shift delivery times or service schedules to accommodate traffic or weather patterns. An example is trucking companies delivering before severe weather hits, such as a tropical system or snowstorm. Another is routing around school zones during certain times of the day. Companies may consider expanding service hours or offering emergency services to attract new customers when reports indicate increased demand right before closing time or after hours.
Some service companies integrate customer demand with their in-vehicle GPS devices and telematics information. It allows, say a cleaning service, to accommodate both regular and new requests by planning routes the night before and uploading to the staff’s vehicles. Pre-planning also helps drivers prepare for their schedule, which can improve safety by being familiar with it. The same goes for varying routes occasionally to keep drivers from operating on autopilot.
Stay Competitive with Telematics
How you use your assets may only be part of your reallocations. The information could eventually power changes to your business model as was discussed briefly above in the previous Uncover Opportunities section. However, none of this is possible without accurate data. Paraphrasing a common saying, “You need to know where you’ve been, before you know where you’re going.” Telematics can help you get there. It is an automatic way to log information about where your vehicles and equipment are—and where they have been—as well as how they are used and performing. This information fulfills the “know where you’ve been” idea. It is now your job to use the data to stay competitive by mapping out your future operations.
Frank Schneider is Director of Product Management for SaaS. He is responsible for leading all corporate software product development initiatives. In addition to creating and executing the corporate strategy to transform the industrial internet of machines marketplace, Frank is integral to CalAmp’s efforts to partner programs that enable an ecosystem of unique enterprise solutions. Frank has worked in product management in a diverse array of companies ranging from Fortune 10 to startups over the past 15 years. For more information, call (888) 3CALAMP or visit www.calamp.com.