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By setting clear goals;


utilizing forward thinking;
and performing detailed,
initial analysis, telematics
can easily help increase
driver productivity,
promote safer driving,
and maximize fleet
dollars.
By Lauren Fletcher

ts been said before, yet the message bears


repeating: Telematics is no longer just GPS
tracking and vehicle routing. However,
with so many options at a fleet managers
fingertips, how do fleet managers select the
right program, the best provider, and ensure
a company achieves a return on its investment? According to the telematics industry experts, it all boils down to one simple
directive: focus on the companys goals.
Each fleet has differing needs, requiring
unique approaches to achieve desired results.
Focusing on the end goal of what a company requires from its investment in telematics
will lead fleet managers through the path of
least resistance when instituting a new program or modifying an existing one.

Identifying the Many Known (&


Unknown) Benefits of Telematics
The benefits of telematics are common
knowledge, including increased fuel savings,
more efficient vehicle tracking and routing,
and the ability to set geofencing parameters.
However, due to the growing needs of
fleets around the country, telematics programs are evolving to encompass driver safe-

at a glance
When looking to implement telematics into a
fleet, fleet managers should be sure to:
Set clear, consistent goals for the project.
Perform detailed initial analysis and do the
necessary background work.
Involve all key stakeholders.
Communicate program benefits with drivers.

20

automotive fleet I february 2013

ty, increased employee productivity and efficiency, route compliance, and improved
customer service, among others.
Driver safety is one recurring theme noted by several telematics providers.
The age-old challenge with the mobile workforce is that you simply cant get
enough visibility into their day to provide
meaningful feedback to drivers, noted Karen White, senior vice president of Customer Solutions for GreenRoad. How safely a
driver arrived at a destination isnt measured just by whether the driver crashed or
arrived safely; we measure it maneuver by
maneuver, every mile, based on forces exerted in the cab.
According to White, with the aid of technology, you can overcome the mobile workforce dilemma and gain insight into how
a driver is doing his or her job without being in the passenger seat.
Having a device in a vehicle, acting as a coach, instantly helps drivers become more
cautious on the roads, agreed
Todd Follmer, CEO of inthinc
Technology Solutions, Inc.
Safety is also of paramount importance to an
organization, and its twotiered: employee safety and
the duty to ensure the safe
operation of a vehicle on

public roads, according to Angela Vanek,


project lead for Strategic Accounts at SageQuest, a branded offering of Fleetmatics.
One factor not typically connected with
telematics is improved customer service.
Again, while not a new feature, fleets are
utilizing this aspect of their telematics programs in a new way.
Our program clearly shows the closest driver to dispatch to a needed location.
This can help validate service, helping verify that service was done. It can also help
improve the response time to customers,
according to Todd Lewis, president of GPS
North America.

Reduction in Average Miles Per Gallon

15

Showing Management an ROI


Fleet managers should understand that
there is no need to overspend on a solution. Make sure you choose an easy-touse, easy-to-understand solution, noted
Corinna Tutor, vice president of Integrated Marketing for Spireon. Telematics can
save time and money, not only on the road,
but in the back office as well. Ensure the solution you select helps you use less administrative and management resources, in addition to being more efficient on the road.
Vanek of SageQuest noted the benefit of
increased efficiency as well. In this economic
climate, efficiency is key. The ability to easily
understand how your fleet is operating and
where your opportunities for operational
improvement lie are paramount, she said.

May June

200

12

11.96
13.79

12.97
12.90

8.23
13.41

Increasing mpg is one


of the best known
benefits of a telematics program. One business fleet showed
how, on average, mpg
increased across
three sites utilizing
telematics.

Pounds Reduced

MPG

This is especially key for emergency- or


disaster-response situations, where immediate assistance can make a huge difference.
Telematics can also assist with compliance issues, including corporate policies,
hours-of-service requirements, and seat
belt laws, among others.
Finally, in the age of more available reports than minutes in a day, telematics can
help take big data and make it useful.
Fleets often have different sets of information. By integrating GPS data with
fuel card usage and miles driven, you can
get intelligent reports and insight into your
business that can really drive savings, according to Mark Wallin, VP of product management for Telogis. Fleet managers need
to be able to take all of this data and make
it actionable.
Time is definitely a concern for already
busy fleet managers. Managers typically
think they are too busy to embark on yet another new project, swimming in data they
dont have the bandwidth to use, White
noted. Thats why GreenRoads mantra is
Data into action. We focus on not just providing data, but on exception-based management that makes it truly actionable, with
minimal effort.
Follmer of inthinc also believes that
improved driver efficiency is an up-andcoming benefit of vehicle telematics.
Managers are able to monitor performance,
study trends, and identify areas of weakness
in their fleets, he noted.

site1

site 2

site 3

150

100

50
source: fleetmatics

Ryan Driscoll, marketing manager for


we typically see those customers cancel and
GPS Insight, cautioned against just selectgo with the higher-end solution once they
determine this for themselves.
ing the lowest-cost provider, using gold and
silver as an analogy.
Ryan Foisy, program manager for WEX
As our founder, Rob Donat, always says,
Telematics, recommended using a scoring
if you can buy a bar of silver for $25, thats
model to be
sure fleet managers are makROIa - Labor
and
great deal and will provide Fuel
a fantastic
ROI.
ingvs.
the right
choice.Cost
Savings
Total
$500,000
Keep in mind, although you will likely
However,
if you can alternatively buy a more
Cumulative
expensive bar of gold for $40,
your ROI is Savings
achieve some level of savings with most so
Cumulative
vastly more
than if you purchased the bar Investment
lutions,in most instances, you get what you
$400,000
of silver, Driscoll said.
pay for, he said. In short, dont make it all
He noted
that,
while
gold
costs
more
up
about price as this is an investment no mat$300,000
front, it will yield significantly more ROI if a
ter how you slice it. So, be sure its the best
fit for your company and specific business
small premium is paid. We hear about this
$200,000
all the time, he said. Companies went with
case. If the right solution is used properly,
the lower-cost solution. However, its about
you will see tremendous results long term.
the opportunity
cost of not going with a soAs the old phrase goes, you dont know
$100,000
lution that will really fit your cost of business
what you dont know. This is particularchallenges in a way
ly apt for telematics, according to Vanek.
$0 that a higher-end (and
slightly more expensive)April
solution does.
And, June
My favorite
of each customer
deJulypart
August
September
May
ployment I perform is the moment where
I look at fleet performance data for the
Fleet Feedback & Top
first time with my customer, Vanek said.
reasons to use telematics
Each customer I work with has an idea of
hen asked for the top reasons to utilize telemathow they think their fleet is operating, yet
ics, the industry experts and fleet managers
are stunned when they are able to actually
shared more than could fit in print. Take a look
look at the real data that shows them how
online by scanning the QR code with your mobile
their fleet is really operating.
phone, or go directly to www.worktruckonline.com/
magazine to see what they shared.
Driscoll noted that a GPS tracking solution can pay for itself in as little as one or
two months, if used fully.
When selecting a telematics solution,
Chris Ransom, director of sales engineering for Networkfleet, recommended fleet
managers consider the experience and reputation of the vendor, if the application supports all vehicle types, what type of sup-

february
month
2013
Yr I automotive fleet

21

$25

$20

$15

$10

$5

$0

erage Miles Per Gallon


telematics

200

Cumulative Emissions Reductions


Carbon Dioxide

$
22

automotive fleet I february 2013

September

August

July

June

May

12.97
12.90

11.96
13.79

Pounds Reduced

port is offered, and how easy the system is


to install and use. Fleet managers should
In addition to reduced
fuel consumption and
150
also consider flexibility in pricing, such as
increased vehicle mpg,
monthly service plans with no up-front
fleets can also bencosts, Ransom said.
efit from telematics
The insights into greater efficiencies can
through reduced ve100
help transform fleet operations and provide
hicle emissions. The
data shows the results
the ability to validate an ROI, which can reshared by one 250-unit
sult in real cost savings across the board in
fleet over a five-month
fuel, utilization, maintenance, insurance
period.
50
costs, and more, according to Ransom.
First, drivers become more aware, drive
source: networkfleet
safely, reduce speeding, and become oversite 2 all more efficient.
site 3 This not only reduces fuel
0
costs, but can provide cost savings in labor or
increased efficiency, Ransom noted. Revenue can also be increased through the abiliadvice: Work closely with your solution
focus on fuel efficiencies from optimizing
ty to increase the number of stops each day,
providers. They have the experience in the
routes and reducing idle time, while a serand a fleet may be able to reduce the numindustry and with customers who have had
vice and repair fleet may care more about
ber of vehicles by monitoring fleet utilizasuccess, he said.
the ability to dispatch service personnel in
a way that improves response time.
tion and vehicle usage, which can provide
Fleet managers should also be sure they
Daily
Individual
Vehicle
ROI
$25
a savings of 5 to 10 percent.
have focused on key goals, figuring out
Telematics can also make a fleet managers
ROI -Marlene
Labor
and
Waltz,
director of solution sales
what they expect from
the project. Focus
job easier $21.73
in two important ways: enabling
Fuel
uel Savings
vs.
Total
Cost increases on one or two key goals
at Sprint, noted that significant
for the business,
drivers to self-improve through real-time
Payroll
$20If its driver
in operational efficiencies can be found,
Wallin said.
safety, reduced opfeedback in the vehicle, and by providing
Revenue
Cumulative
Savings
not only in the fleet space, but savings and
erating costs, etc., there
are so many benemanagers with detailed visibility into their

Investment
Cumulative
Investment
efficiencies
that reverberate throughout
fits available. Focus on a few and really figresources (both human and physical) when
the company as other departments beneure out what
those resources are off the lot.
$15 you need to achieve from the
fit from the insights and process improveproject. What are the goals, and how you
Its a step change in the mobile resource
ments as well.
can get the biggest bang for your buck?
management experience, White said. There
Colin$10
Sutherland, VP of sales for Geotab
There is plenty of data available to supare huge wins to be had here, with some
port the implementation of a telematics sysalso believes if it cant be measured, it cant be
potentially surprising external results to
tem. Today, the awareness of telematics is
managed. Telematics is an essential manageboot. Weve heard from customers whose
there. Its all about pulling the trigger, said
ment tool based on recording precise infor- $4.44
$5
$3.85 employee retention soared as their managLewis of GPS North America.
mation on how people and assets are used 24
er engaged more with drivers who experi$1.36
Look at other company fleets successhours a day, he said.
Fleets should look at
enced a reduction in safety incidents and
of telematics
urge
two high-level objectives reducing expensfewer crashes. When you engage your team
June
July programs.
AugustWe
September
May ful use
$0
our customers to point to the success of
es and improving
the companys revenue. To
rather than watching them from behind
Daily
Daily Savings
our current customers, said Follmer of inreduce expenses, fleets
need
to
first
target
how
the glass and build a pervasive safety culInvestment
thinc. Barrick Gold Corp. reduced its inciand where fuel is consumed from the fuel
ture, good things happen.
dent rate by 68 percent within the first year
card purchase to the miles that are driven.
When evaluating or promoting a new
of implementation. Cintas experienced an
When determining goals, Waltz of Sprint
telematics program, it is important to be able
85-percent reduction in speeding alerts and
recommended when working on the ROI,
to measure the ROI, according to Tutor of
89-percent improvement in seat-belt use afits important to recognize different busiSpireon. You also need to ensure you partter installing our technology.
nesses have differing goals that are most
ner with the right company. Look for a finanWhite of GreenRoad also urged fleet manimportant to their bottom line, different iscially solid company driven by innovation
agers to look at the results of others. The
sues they are trying to solve. Its important
that provides scalable technology to grow
to identify that one thing that is most improof is in the pudding, she said. There is
with your business, and its needs, she said.
portant to that business and build the ROI
no substitute for the success stories of other
Lewis, an ex-service business owner himfleets. We can connect prospective telematanalysis around that, then work to address
self, also noted the importance of a scalable
ics adopters with other GreenRoad customthe other concerns and of the stakeholders
program. Scalability means that, for under
ers so they can discuss ROI measurements
and how the solution may help improve
$300, a company can implement the proand results with their peers.
those areas as well.
gram and get a unit that gives them comWallin of Telogis agreed and added this
For example, a delivery fleet may want to
plete tracking, but provides the ability to

telematics

add-on features
ROI - Labor
andlater that they might not
havevs.
wanted
today,Cost
such as a mobile data
l Savings
Total

$25

terminal or simple GPS unit for dispatch


mulative Savings
and navigation.
mulative Investment
The bottom line, according to Tutor:
Get a system that is easy-to-use and easyto-implement.

$20

Promoting Telematics to
Management

$10

May

The support of senior management is


crucial to the successful deployment of any
program, including telematics. Their involvement should be sought early on, and
continue throughout the process.
June
July August September
Involve C-Level management early to explain the savings. Dont be overwhelmed by
the investment, as savings will truly dwarf
the investment, according to Foisy of WEX
Telematics. Lean on your sales consultant
to show how the savings will happen.
Waltz of Sprint recommended identifying key stakeholders who may benefit from
the data and improvements telematics can
create. Identify what information gaps and
deficits you have today that, if filled, could
increase the efficiency and productivity metrics, she said. Estimate the improvements
and value of filling those gaps, such as what
savings could be achieved, what additional revenue can be realized, and how many
more widgets could get shipped out, etc.
As Sutherland of Geotab noted, you cant
manage without measuring whats going on,
and this can be a key push for telematics.
Telematics is like having a supervisor in
each vehicle recording all activity every minute of every day, he said. Today, telematics
software is simple to use and identifies opportunities for savings and growth as well.
To help promote telematics to management, you must continue to prove the ROI.
Foisy shared three ways the ROI for telematics is typically proven:
ROI in concept. This is a high-level look
relying on study info from such sources as C.J.Driscoll& Associates, Aberdeen Group, or even Automotive Fleet
magazine. If you can realize 10-20 percent in fuel savings, ROI should easily be
achieved for most fleets.
Rather than study data or a supplement
to it, use an ROI calculator applying the
fleets best estimates of data elements.
24

automotive fleet I february 2013

Fuel
Payroll
Revenue
Investment

$15

$5

$0

Daily Individual Vehicle ROI

$1.36

Daily
Investment

$3.85

$21.73

$4.44

One fleet shared a


breakdown of daily
savings, including
fuel, payroll, and
increased revenue,
compared to its
daily investment
in a telematics
program. The daily
savings (fuel, payroll,
and revenue minus
the investment) is
$28.66.
source: spireon

Daily Savings

Start small by piloting a few vehicles


and prove savings.
The rule of thumb is that for most fleets,
the fuel savings alone get you a relatively
quick ROI if you believe that, then the
rest is gravy, Foisy continued. In truth, its
just the beginning of a meaningful, lasting
change in your business.
Fleet managers need to select a telematics program that can provide a variety of
reports and information, noted Ransom of
Networkfleet. For example, Networkfleet
provides the type of high-level reports, such
as fleet utilization, that senior management
needs to understand the impact of the program, he said.
Push back from management is always
a possibility, especially in terms of the cost
of purchasing a new program, according to
Driscoll of GPS Insight. We suggest focusing on the core business challenges you want
to solve, and how telematics can help solve
them. Then, look at how your company will
save more than the actual product or technology costs. We recommend a pilot to help
prove this, Driscoll said. Employee push
back tends to be the Big Brother issue, feeling as though they are not trusted. Management needs to explain the program is in place
to save the company money and have the ability to back the driver up if the need arises.
Foisy of WEX Telematics agreed that the
most common challenge is driver push back
or objection. But, the good news is that a
well thought-out and well-implemented

game plan can actually shift the pendulum


in the other direction, he said. I recommend engaging drivers early, setting up a reward system, stressing what is in it for them,
and politely communicating driver policy.
When looking at policy, Sutherland recommended not trying to invent a new policy. Fleet managers need to look at what is
already published and communicated to employees in the driver handbook, including
cell-phone use and fuel card policies, and
build on that, he said.
Before implementing a telematics solution, fleet managers need to take the time
to lay the groundwork, gathering information on current vehicle utilization and operating costs.
This will be needed to compare costs before and after implementation, and to calculate ROI, according to Ransom. If possible,
the utilization information should include
vehicle usage, idle time, fuel consumption,
mpg, total trips per day, and routing processes, in order to determine if every vehicle is being utilized efficiently.
However, perhaps one of the most compelling factors to promote to management is the
human factor. One fatality is too many for
any organization, according to Follmer. Systems like ours help prevent risky behavior and
allow drivers to get home safely, every day.

Common Misperceptions
Even though telematics has come a long
way from being thought of as simply vehi-

cle routing and tracking, its still tough to


get rid of the Big Brother or spy technology mentality.
A common misperception is that telematics is only being used to monitor employees, said Ransom of Networkfleet. However, telematics actually helps ensure the
safety of each driver. By making sure a vehicle is being used efficiently, is well maintained, and is running properly, it can help
ensure the safety of the driver.
Ransom continued, Further, even though
there is sometimes initial resistance from
field personnel, telematics is almost always
universally accepted a short time later. People quickly see improvements in efficiency,
which makes their company stronger. Everyone has a stake in that.
GreenRoad has also found that, based on
its experience, 95-percent of the time drivers embrace the technology. There are always a few drivers that resist, but the vast
majority of drivers are true professionals interested in new technologies that can help
them self-improve, White said.
Vanek of SageQuest continued on the
theme of driver acceptance and the Big
Brother mentality, noting the biggest
misperception that exists around utilizing
telematics is the assumption that it is hard
to bring this powerful tool into an organization and have it embraced and promoted to enact efficiency change.
This couldnt be farther from the truth,
she said. Also, fleet managers need to overcome the Big Brother perception associated with rolling out a telematics solution.
SageQuest does not promote the use of the
application as a monitoring tool; it is promoted for what it is an efficiency tool.
We work with fleet managers to ensure the
solution is viewed as a tool, not a weapon.
Fleet managers must avoid using the tool
in a negative manner, and work to ensure
employees are aware that the program is
not intended to be an enemy.
The positive intent on the operator
should always be assumed, Vanek continued. The data collected is, and should be,
used as a method to streamline operations
and improve revenue retention.
White of GreenRoad commented, No
one wants a spy in their cab, and telematics often has that reputation.
26

automotive fleet I february 2013

$500,000
$400,000

$20

Cumulative Savings
Cumulative Investment

$300,000
$200,000
$100,000
$0

$25

ROI - Labor and


Fuel Savings vs. Total Cost

April

May

June

July

$15

$10
source: networkfleet

telematics

August September

Telematics programs typically have a steady monthly investment; however, month-overmonth savings continue to increase when the program is utilized to its fullest.

Many telematics applications offer drivers full visibility into the data their managers
see, and, in some cases, they get to see it first.
Fleet managers may also be under the impression that telematics solutions are completely plug-and-play, and that, by simply
installing a system in vehicles, all of their
troubles will disappear. We have found
that companies with the highest ROI are
those that have hired dedicated champions
to look over the program, monitor the results, study the trends, and take appropriate
action, noted Follmer of inthinc.
Wallin of Telogis also agreed that dedicated resources are a necessity for a successful program. Have dedicated resources. Program implementation should really
have someone assigned to the project with
a clear understanding of business objectives. It doesnt work if you install the program and hope that magic happens. You
need to have a plan and goals; and its dedicated resources that help.
Additional misperceptions noted by Tutor
of Spireon and Foisy of WEX Telematics are
high start-up costs and expensive programs.
Common misstatements include its
too expensive, or they are all the same,
therefore the lowest price wins. The decision should be weighted far more toward
fit and effectiveness than price, Foisy said.
Low-cost providers are risky and it tends
to follow the old adage that you get what
you pay for. There are many providers
out there, so be methodical when making your choice.
A recurring theme surrounding chal-

lenges related to instituting a telematics


program was the lack of forward thinking
and planning ahead.
Fleets are most successful when they take
the time to develop an internal deployment
plan for telematics. In this plan, they identify what to focus on first and what they expect to master in the first few weeks, months,
and years to realize the greatest ROI, said
Ransom of Networkfleet.
Finally, there is always the danger of data
overload. Leveraging the right data is a
common challenge of fleet managers, said
Follmer of inthinc. It is easy to draw quick
conclusions from data without studying the
trends and understanding the whole story.
Remember, your organization has vehicles driving all over, most likely with your
company logo on it. Any operation of that
vehicle is a reflection of the organization,
Vanek said. AF

Featured Telematics
Programs & Providers

or a detailed list of the programs offered


by the providers covered in this article,
scan the QR code with your mobile phone, or
view the article online at www.worktruckonline.com/magazine.

$5

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