Driver behavior is just one example of data that can be gleaned from telematics that can help a fleet’s bottom line. Photo by Jim Park
6 Ways Telematics Can Help a Fleet’s Bottom Line
Today’s telematics solutions can do more than follow vehicles’ digital breadcrumb trail on a map or track truck driver hours of service. They are now business tools that can provide actionable detail on every aspect of a fleet’s operations. This operational data can help you accomplish short- and long-term goals by improving efficiency and by driving savings and revenue directly to the bottom line.
While there are many ways a telematics solution can meet your business needs, the following six show just how much of an impact this must-have technology can have to improve operations and save money:
1. Cutting Fuel Spend
It’s no secret fuel is one of the biggest cost centers for a fleet operation. Telematics is a powerful tool fleet managers can use to control their fuel costs, including:
- Minimizing idling: Idling is one of the biggest fuel-wasting behaviors. According to the U.S. Department of Energy, a heavy-duty truck wastes about 0.8 gallons of fuel per hour, with a typical truck wasting up to 1,500 gallons of diesel per year. Spread that amount of wasted fuel across several hundred or even several thousand vehicles and the costs add up quickly. How telematics can help: With telematics, fleet managers can monitor idling and determine solutions, such as coaching or complementary technologies, that best fit the fleet’s operation.
- Monitoring driver behavior: Aggressive driving wastes significant amounts of fuel. The Department of Energy estimates that aggressive driving can lower mileage by between 15% and 30% at highway speeds and between 10% and 40% in stop-and-go traffic. How telematics can help: In many telematics solutions, alerts can be set to notify a fleet and/or driver’s manager about aggressive driving behaviors. This provides an opportunity to coach wasteful drivers on «eco-driving” techniques that saves fuel and lower driver risk.
2. Optimizing Routes
In today’s ELD environment, getting from point A to point B efficiently is not only a matter of meeting a customer delivery deadline, but also necessary to keep drivers in compliance. With optimized routing, there’s less of a possibility a driver will run out of hours.
Other benefits of route optimization include better last-mile on-time deliveries, fewer delays due to road hazards or construction, and reduced fuel use because of fewer miles driven and less idling.
Optimized routing also helps improve driver safety, because there’s less danger that a driver will rush to a delivery or pickup site because they’re trying to fulfill a customer deadline or running short of hours.
3. Reducing Risk and Improving Training
As outlined above, a telematics solution can be used to help fleet and driver managers monitor aggressive and risky driver behavior. This opens the door to enhanced, one-on-one coaching or other actions as set forth by fleet policy, up to and including termination.
The result of this type of monitoring is cutting risk and the likelihood of a crash, saving maintenance and downtime costs, which, in a fleet-related injury crash, averages about $200,000 and quickly ratchets up into the millions if the crash is more severe and/or involves a fatality. It also saves fleets and their companies the potential for ruinous liability payments, both in direct costs in the form of payments to plaintiffs and lawyers, as well as indirect, reputational costs due to negative publicity.
Some trucking fleets have begun using camera systems, alone or in conjunction with their telematics solutions. While this technology sometimes meets with driver resistance at first, its ability to exonerate drivers in the wake of a complaint or a crash often can result in wider driver acceptance and even demand.
4. Increasing Driver Accountability
Driver accountability isn’t just about measuring and minimizing risk. In conjunction with a trucking fleet’s ELD, telematics can give detailed insights into driver behavior in and out of the truck.
Are drivers arriving on time? Are they completing electronic paperwork to show they’ve completed the work to be done? Workforce management is a powerful tool within telematics that can improve efficiency, productivity, and billing.
Telematics also can help fleet and driver managers identify unauthorized after-hours use of vehicles, particularly when drivers are scheduled for rest or sleep breaks pointing to a driver not adhering to hours of service regulations, jeopardizing the fleet being in compliance, and, more importantly, the possibility of a costly violation and driver downtime.
5. Increasing Back-Office Efficiency
With the ability to integrate telematics solutions with an ELD and other fleet management and back-office business solutions, inefficient technological silos can be broken down.
Telematics is an ideal tool to feed data to these systems about the truck and the driver.
The result is better visibility into business operations, whether that’s a more complete picture of vehicle total cost of ownership, a better understanding of how much each customer interaction costs the company, or a better handle on personnel costs.
With this information in hand, vehicle spec’ing, pricing, and salaries can all be better managed.
6. Reducing Theft
Vehicle and cargo theft continue to plague the trucking industry. The latter alone accounts for $15 billion in annual losses.
While much of this theft is a matter of opportunity, caused by parking in a dark corner of a parking lot or inadvertently leaving a trailer door unsecured, telematics can be a key tool in recovering stolen assets.
Many of today’s trucking telematics providers include trailer asset tracking as part of a suite of solutions. Coupled with vehicle telematics, this helps fleet personnel work with local law enforcement to pinpoint both the truck and trailer’s location in a matter of minutes.
Key to success
Telematics offers fleets a number of tangible ways to improve efficiency and productivity, because it:
- Provides greater visibility.
- Encourages accountability and ongoing improvement.
- Allows for integration with ELD solutions, increasing compliance capabilities.
- Decreases the threat of theft, which directly affects driver safety and the bottom line.
Quotes from GPS tracking suppliers are available at HDT sister publication businessfleet.com.
FLEET MANAGEMENT AUDIT
Fleet management is the use of a set of vehicles in order to provide services to a third-party, or to perform a task for our organization, in the most efficient and productive manner with a determined level of service and cost.
Fleet management activities are shown in the following graph 1:
Graph 1: fleet management activities
The proposal audit analyses and assesses all fleet management activities shown in the graph 1, and its main goals are:
- Know the overall status of the fleet management activities
- Provide the analysis, the assessment, the advice, the suggestions and the actions to take in order to cut costs and increase the efficiency and efficacy of the fleet management activities
With the information obtained, we’ll elaborate a report that holds the overall status of the fleet management as well as the suggestions, recommendations and the measures to take in order to cut costs and optimize the fleet management activities.
CLICK ON THE FOLLOWING LINK TO DOWNLOAD THE PROPOSED FLEET MANAGEMENT AUDIT:
José Miguel Fernández Gómez
I´m a Fleet Management expert, and the manager of Advanced Fleet Management Consulting, that provides Fleet Management Consultancy Services.