Trucking’s hidden genius

Dec. 9, 2013
Few people appreciate the industry’s transformation

While trucks are part of everyone’s daily lives, few outside of the industry really know much about them other than they’re big and they sometimes deliver that stuff you’ve been waiting for.  Last month I wrote about the new perspective that comes from describing the industry and its major business characteristics for an outsider.  Taking a few steps away from my own deep immersion in trucking was a revealing exercise.

Viewed from the outside, it’s clear that the industry is being driven by three trends—sharp increases in the cost of equipment, a chronic shortage of qualified drivers, and deep reluctance by fleets to increase capacity.  Nothing too surprising to anyone in trucking, but to the dispassionate outside observer, all three point to a future of challenged, if not outright constrained, growth and profitability.  However, I also see a fourth trend that holds promise for a much rosier future, one that my non-trucking audience knew nothing about.

To most of the general public, trucking is an old-fashioned, slow-changing industry filled with characters from “Smokey and the Bandit” singing “Six Days on the Road.”  While they may be vaguely aware that trucks are expensive and drivers scarce, they are completely unaware that their outmoded image of trucking has been replaced by the industry’s steady and now deeply entrenched conversion to what I call “datacentric management.”

Think about some of the things you take for granted as standard tools for running your fleet.  Start with management software systems.  Not only have they long been a part of most operations, but they’re deeply integrated in virtually all aspects of a fleet’s business—from dispatch to human resources to customer service.  They tie together operations, maintenance and back office seamlessly.  These systems also provide top management with real-time views into their businesses, helping them identify immediate problems as well as long-term trends.

The fact that trucking led the way into the wireless data revolution when it became the first commercial application of that technology 25 years ago also comes as a surprise to many.  But that historic achievement pales compared to today’s exploding telematics applications.  While most automobile users feel quite modern using their new in-dash navigation or smartphone apps, trucking has combined GPS and wireless data for many years to power things like geofencing and automated arrival notifications.

And now, the computing power onboard a modern heavy-duty truck has brought the industry into practical machine-to-machine (M2M) applications with remote vehicle monitoring and diagnostics that can determine if problems are immediate or can wait and even direct a driver to the nearest shop for a repair.

Even more astonishing to outsiders is the new development of predictive analytics that can identify future safety risks and business opportunities, all driven by the huge amounts of data generated and captured by fleets and their trucks. 

The reason this matters to trucking is that datacentric management offers a positive response to the other trends driving capacity constraint.  Working smarter allows you to offset some of the productivity pressure being exerted on your human and capital assets.  Despite high equipment costs, shrinking driver pools, and stagnant fleet growth, it will allow trucking to thrive and take advantage of what is predicted to be a steadily growing freight market for the next decade.

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