The market for GPS-based mobile resource management systems has grown to 3.6 million units, according to the comprehensive 2009 Mobile Resource Management Systems Market Study released by C.J. Driscoll & Associates. All those systems — deployed on computers, electronic onboard recorders, handhelds, cell phones and other devices — are gathering and delivering an incalculable amount of data to truck fleets every minute of every day.
It is all there: vehicle locations, driver performance data, pick-up and delivery status, vehicle diagnostics, work flow tracking, cargo monitoring and much more. The challenge, for users and system providers alike, has been to translate all that data into useful, usable intelligence for everyone along the supply chain. “Onboard systems have a tremendous capability and no one uses it all,” says Tom Lemke, executive vp for Trackwell ADS. “Most companies begin by focusing on a single need, such as reducing fuel costs, and build out from there.”
According to Brian McLaughlin, COO for PeopleNet, about half of their new customers are previous users of competing systems while the other half have never used a telematics system before and have a few key reasons for considering one, such as the desire to automate driver logs. “We usually have to pull new customers back,” McLaughlin says. “You can't successfully do everything at once, so we tell customers to begin by focusing on the areas with the greatest ROI first.”
For most fleets, that has meant beginning with the operational basics, for example, by optimizing routes and improving driver performance to reduce fuel usage by managing deadheading, idling, out-of-route miles and fuel-robbing driving habits like speeding and improper shifting. “Just the fuel savings and automating driver logs pays for the system,” says Lemke. “The rest is all gravy.”
BENEFITS STILL ON THE TABLE
It is precisely “the rest” that has the attention of today's fleet owners and managers as well as system suppliers because there are so many more benefits yet to be realized just by using the data that already exists in additional ways. “We believe that the 80/20 rule applies,” says Angela Shue, director of client management for Xata. “People have gotten very good at improving operational efficiencies, doing things like reducing idling and managing speed and other driver behaviors. Some companies have saved hundreds of thousands of dollars on fuel alone.
“There is a larger opportunity waiting, however, if you can expand [the use of telematics data] beyond transportation to other areas of the company, to the billing department, human resources, customer service,” Shue adds. “We hear IT people tell us they are saving exponentially more in back-office functionality than they are in operations by feeding real-time information from the telematics system to payroll, invoicing, inventory management and planning. For example, several customers have told us that, because they can get real-time updates about what happened at the point of delivery, they can cut invoices immediately. They know before the driver gets back if there were shortages or damages or other things that have to be factored into the invoice. Accounting can also take the automated time and attendance information from driver logs and use it to streamline payroll by taking manual processes out of the loop.”
“The truck has become a technical broadcast station,” says Eric Manegold, vp-business development for Zonar Systems Inc. “The question is, who wants access to what portion of the data and how do they want to get it? Everyone should be able to ‘dial into’ the truck and get what they need to see when they need it, and that includes safety and compliance, operations, maintenance, human resources and accounting.”
Easy access to real-time information changes everything, according to Manegold. “For instance, suppose you get the opportunity to pick up a pallet of live crab at a dockside address. The driver and truck must be able to handle street side loading, which will require a rail liftgate and a pallet jack, plus a temperature-controlled truck with the weight and cube capacity to handle that pallet,” he says. “Without the right real-time information, your dispatcher's process may be to say, ‘Gosh, I think Brady went out this morning with one of those trucks and a pallet jack, and he might be nearby. I'll call and check.’
“Today, you can ask the GPS location report to ‘show me the five assets with these attributes that are closest to this address,’ and you're on your way,” Manegold adds. “Access to actionable information in real-time has allowed you to capture new business, while making the most efficient use of your deployed assets.”
Chris Silver, a senior product manager for Qualcomm, also sees shared access to real-time, actionable information as the path to realizing more value from the data fleets already have. “We have some customers who, even with just basic positioning and engine data, have done a great job helping their companies,” she says. “Now everyone wants to be able to see the information they need as they need it.
“Our fuel manager system, for instance, can take fuel data from each truck and turn it into a web-delivered report that ranks drivers by what it costs the company to use them,” Silver notes. Dispatchers can use that information to assign drivers to loads; training can use it to identify drivers who need some refresher training or coaching; HR can use it as input for a driver bonus program; and planning can use it to see if there are issues with a particular customer, route or vehicle that are impacting cost beyond the driver's control.
“It is all about making data timely and actionable so you can use it in a way that is beneficial to your business,” agrees Frank Moreno, vp- marketing and product management for Cadec Global Inc. “The opportunities we see now are in the area of automating business processes, such as fuel-tax reporting, vehicle trip inspections and vehicle maintenance management. The data is all there already; you could mine it for information, but having it in real-time in an actionable form is so much better. It turns data into business intelligence that you can use to automate routine processes and then manage by exception to baselines you set.”
According to Norman Thomas, vp-information services for Carrier-Web, the same data can become more or less valuable depending upon its timeliness and the user's ability to place it into context with other relevant information. “For example, a fleet may track average deadhead miles per month and determine that they need to get empty miles down to reduce costs,” he says. “However, if you force deadhead down without also understanding freight and load plans, you may increase your downtime because drivers end up sitting and waiting for loads. What you might really want the telematics system to do is to look at potential deadhead miles every day, so that when a driver drops off a load, there will be another one waiting nearby.
Telematics at work
One fleet's success story
“Companies that are working the hardest [to realize the opportunities telematics systems can provide] are not segmented by fleet size, either,” Thomas adds. “Smaller to medium-sized fleets in many cases are being the most aggressive with technology because they have to compete with the big fleets.”
It is one thing to suspect your company could be getting more from its investment in telematics technology, but it can be another matter entirely to actually move to the next level. That is why many telematics solution providers have also developed consulting services to help customers translate more data into actionable business intelligence.
PeopleNet, for instance, can incorporate a “professional services discovery process” into the initial implementation of its system, which maps out a company's current processes and then identifies the things that could be improved and the dollars associated with them.
At Teletrac, the company has “ambassadors” whose job it is to make sure customers get the maximum value out of a system, according to Drew Hamilton, the company's executive vp. “Ambassadors have assigned accounts and are responsible for making sure that customers are trained,” he notes. “It is a simple task with an enormous impact on satisfaction.”
“We try to do a better job educating customers about what they can do with our mobile workforce management system,” notes Ravi Acharya, associate director of business-to-business marketing for Tele-Nav. “Any technology is the same; you begin with the basics and then learn what else can be done. Many customers today need to see a payback on their technology investment sooner than in the past, so one of our roles is to show them how to get more ROI [by utilizing the full potential of a capability.]”
As fleets and their technology suppliers work together to realize the full potential of the data today's telematics solutions can provide, they continually turn up new applications, moving the leading edge of telematics utilization forward and then forward again. At PeopleNet, for instance, one area of new activity is what the company calls “predictive analytics,” or using telematics to help customers make decisions about the future before events happen.
It is all about cause and effect, explains Brian McLaughlin. “Suppose a driver has an hours-of-service violation,” he says. “The system can automatically send a warning letter. If he or she has a second and third violation plus recorded instances of over-speeding, the system can send another letter, set up a meeting with the driver and mandate viewing of a safety video right in the cab, and the entire process can be automated.”
Predicting which drivers are most apt to stay with the company is another emerging use for telematics data which Qualcomm is exploring, according to Chris Silver. “We have an application called Predictive Performance Service that takes data from many different sources to build a profile of the type of driver who is most apt to stay with a company,” she says.
Drew Hamilton of Teletrac sees two other applications on that leading edge: vehicle mileage taxation (VMT) and commercial pay-as-you-go insurance. These are not the result of fleet and supplier collaboration, but of different interest groups using the data telematics provide to accomplish other objectives. Using telematics to track actual mileage and assessing taxes or tolls accordingly is already being piloted in some places to help raise funds for infrastructure rebuilding, he notes. Pay-as-you-drive insurance, already piloted in the U.K., varies rates based upon what actually takes place, including factors such as speed, miles driven, hard braking/rapid acceleration, time of day, traffic patterns, and so on.
The true, transformative power of telematics is being revealed day by day as people use technology to combine information they already have, illuminating new areas and make new things possible. “One little system can impact so many areas,” notes Tom Lemke of Trackwell ADS. “It is just a matter of taking the tools we already have, putting them all together and using them.”
Telematics at work: One fleet's success story
Central Freight Lines' LTL operation keeps some 700 drivers busy moving freight for customers in the Midwest, Southwest and Northwest through the company's more than 50 terminals. Consolidating mostly time-sensitive loads from multiple shippers and then routing them efficiently day in and day out is a huge and complex task, so in 2008 Central Freight Lines made the decision to use digital communications technology to bring timely, actionable information into its dispatch management processes.
The company chose to work with Cheetah Software Systems Inc., and they dubbed the project the Digital Dispatch Management System, or DDMS. The first pilot began in October 2008 and by May 2009 the organization-wide rollout was complete. Basically, the Cheetah system utilizes drivers' delivery manifest data, pickup requests, digital maps and a dynamic routing algorithm to provide dispatchers with the precise information they need to make critical decisions.
The Cheetah DDMS determines projected delivery times, provides real-time driver location and status, suggests optimal pick-up driver assignments and reports dynamically on estimated pick-up times. It will also proactively display alarms when drivers are delayed or when service windows are in jeopardy. “What is unique about Cheetah is that it was specifically developed for pickup and delivery,” says Mark Stein, director-operations services for Central Freight Lines. “It follows our processes. We send our data to a Cheetah server; they put it into their environment and then we all tap into it with various applications.”
According to Stein, the investment in the new system was an investment in the company's future, but it is already delivering significant benefits only months after its implementation. “We are already seeing gains in productivity and reduced fuel costs,” he notes. “For example, in the past we put out the same number of drivers every day. Now we can manipulate and balance the number of drivers assigned to various routes; maybe we need 50 drivers one day, 42 the next and 48 the next. The system will actually make suggestions and tell you the cost of going from the first-choice scenario, to the second, to the third.
“Drivers used to go out with manifests and then fill them in as they went along,” Stein says. “Then the information was entered into the system at night when they got back. Now, within about 40 seconds after a load is picked up, a pro number has been assigned and tracking begins. We also have a lot of data about the specific attributes of a load, such as weight and cube.
“This lets us do outbound load planning while the truck is still en route,” he continues. “That process, if it happened at all, used to happen right on the dock at the terminal. This tool is like having a crystal ball for what you need that night for the line-haul operation.”
Stein says that the system is also helping them build stronger bonds with customers and to vary charges as appropriate. “Everyone wants lower costs,” he notes. “With DDMS, we don't have to charge every customer the same price per stop. GPS data shows us what actually happened at each stop: when the driver arrived, began unloading, finished unloading and departed. This allows us to point out where actual times and costs are to each customer and to look for efficiencies together. Customers can also use the system to track their freight.”
“The more information you have, the better decisions you can make,” observes Don Orr, president of Central Freight Lines. “You have to take the numbers and aggregate them, however, to tell the ‘stories’ that will let you do things better than you did before.”