It's important to know where your trailers are at any given moment, and it might even be useful to see those locations plotted on a map for an overview of your entire fleet. But don't confuse location information with asset management if you intend to get full value out of your investment in wireless trailer tracking systems.
The good news is that asset management involves a change in perspective rather than a major investment in additional technology. Instead of asking “Where are my trailers?” you should be considering “Why are they in that location?” and “What are they doing there?” Answering those questions will lead to true asset management and a significant payoff from better equipment utilization, optimized driver productivity and happier customers.
“We're definitely seeing that shift in our customers,” says Roni Taylor, executive vp-marketing for SkyBitz, a trailer and container tracking system provider. At a recent user group with representatives from 25 fleets, “the talk was all about trailer vs. asset tracking,” she says. “In general, they were more interested in knowing where the load was then where the truck was. Their entire focus is becoming more load- and cargo-centric.”
Trailers represent a fairly large capital investment, so fleets have been interested in tracking them as a way to minimize that investment through higher utilization. One of the large truckload fleets that's evaluating Qualcomm's new T2 Trailer TRACS untethered tracking systems “estimates that it spends $4-million a year on fuel just looking for trailers,” says Norm Ellis, vp and gm, Transportation & Logistics, Wireless Business Solutions. Simple trailer location information represents a significant value for them in fuel savings alone.
But that's just the beginning. When you begin monitoring trailer arrival and departure times from customer location, you take the first step past location to asset management. Letting events drive monitoring with automated features like geofencing means you can quickly and reliably identify detention problems, which have a direct impact on asset utilization.
“The next step is looking inside the trailer with a cargo sensor,” says Todd Felker, vp-marketing and product development for Terion. “Is it unloaded and ready to book for another revenue generating load? Customers can forget to call you, but with a cargo sensor you have that information automatically.”
Once you adopt the asset management perspective, it quickly grows beyond better utilization of just trailers. “Our trailer tracking customers also see it as a driver retention issue,” says Ellis. “They say a driver spends on average two to four-and-one-half hours a week looking for trailers. They're not earning money doing that, which is very frustrating. Being able to send a driver directly to the right trailer makes for a happier driver.”
Again, simple tasks like directing drivers to trailers begin to offer compound dividends when you allow the concept of asset management to broaden your strategic vision.
“We see larger truckload carriers regionalizing their operations in order to get drivers home more often,” says John Lewis, CEO of GeoLogic, a provider of both tractor and trailer wireless systems. “That means more hook-and-drops, and coordination of that becomes a big deal. With the limited labor pool, drivers' time is a valuable asset that needs to be managed carefully. That takes a sophisticated system because you're tracking trailers for loads and tractors for drivers, but the opportunity for productivity gains and better driver retention is great.”
The next level of asset management moves beyond optimizing carrier operations and places a fleet firmly in the middle of supply chain logistics. “Trailer tracking alone gives [a fleet] a huge competitive advantage in customer service,” says Taylor. “But what if you could offer a customer a window into that trailer, let them monitor their own inventory as it moves? That's the next step some customers are asking for — I can see the trailer, now let me see inside the trailer.”
The Dept. of Defense is already pushing for that kind of shipment detail, and WalMart's well-publicized RFID requirements for its largest suppliers are also attempting to jumpstart that kind of fine-detail asset management, adds Jay Brosius, chief technology officer for SkyBitz.
“Clearly the next step [beyond trailer tracking] is knowing what's on the trailer, probably with RFID,” says Felker. “It's still early, but we're testing integration of RFID with our system. It turns a trailer into a moving warehouse for a shipper.
“Imagine an RFID reader on a dock recording what's being loaded onto a trailer, creating a manifest right there on the dock and transmitting it wirelessly to the trailer tracking unit,” he says. “As freight is removed, the manifest is updated in real-time. That real-time visibility could have great value to shippers because it allows them to begin investigating dynamic inventory balancing.”
And while such a system could be a valuable customer service for a truckload carrier, it might have more potential for private fleet operations, moving them even more firmly into their parent company's supply chain management. “We certainly see the light bulbs go off when we talk to private fleets about it,” says Felker. “It's still very early in the evolution of RFID, but the initial feedback is positive.”
“There's certainly more ‘inventory consciousness’ on the private fleet side,” says Ellis. “Some private fleets have been slow to adopt in-cab [wireless)]devices, but we're seeing a lot of interest from private fleets in trailer tracking because [trailer systems] are tied to inventory control, which makes them easier to justify.”
Right now, the costs of using RFID even at the pallet level are high, “but I don't think it will be long before you see active (RFID) tags being used on high-value commodities,” says Ellis. “Then with volume, prices will fall and the technology will move into other commodities.”
While most fleets see the dollars in utilization as justification for investment in tracking systems, that isn't the only potential benefit from tighter asset management.
“A reasonable return-on-investment comes from utilization and efficiency, so security and theft control are not the reason fleets buy tracking systems,” says Taylor. But once those systems are in place, they have the potential to add value in that area, she says.
“There are significant security benefits, especially for high-value and hazardous materials applications,” says Ellis. “Door sensors tied to location can tell when a door is opened in the wrong place or at the wrong time. Trip logging that keeps a history of where a vehicle has been and when doors have been opened can be valuable even if someone manages to disable the unit's wireless links. Electronic seals are another way to add reliable security improvements [to tracking].”
Whether the goal is increase utilization or better security, the transformation from trailer tracking to asset management really rides on automation, which means better integration with existing and new applications.
For one thing, limiting human involvement increases data accuracy and timeliness. “Why should you rely on a driver telling you when they cross a state line when that can be automated so that information is always accurate and the driver can concentrate on more important things?” says Lewis. Similarly, trailer status isn't always a shipper or consignee priority, so automating notification can take valuable time out of that process as well as improve the quality of the information fed into load matching and dispatch systems.
The major fleet-management software providers are already moving to improve integration of trailer-system data into their applications, says Taylor. “That integration will continue to evolve and should actually change the way fleets think about the number and frequency of location reports,” she says. “Instead of requiring scheduled reports, they can begin to rely on automated event-driven reports, exception reports that alert you to unplanned geofence crossings or door openings.”
Application development and a high level of integration will be even more important when moving to the inventory level of asset management, adds Felker. “The applications to support managing that data are still off in the future,” he says. “But (that kind of integration) brings the shipper into the equation. Carriers will move beyond just increasing the efficiency of their assets and extend (these systems) into the shippers' value set.”
“We've seen that some shippers are willing to commit more volume to carriers with trailer tracking, but they're not willing to pay more for it,” adds Ellis. “Supply chain visibility and integration do have value for shippers, though — significant value.”
So even though you may be interested in trailer tracking simply to keep tabs on your equipment, you could be opening the door to an entirely new way of viewing your fleet. All it takes is a new perspective on the value of your trailer pool and a little imagination.