July 11, 2008

Global Positioning System-based telematics drive fleet management

Construction Corner

Korky Koroluk

Fleet-management systems have been around for a while: handy software programs that help with such things as scheduling routine maintenance and managing lease/purchase payments and insurance.

But since I last wrote about them two or three years ago, they have grown in both capability and in popularity. Indeed, with the growth in environmental concerns, and, especially, the drastic recent increase in fuel prices, Canadian and American system providers have reported a sharp up-tick in sales.

Today’s systems are usually linked to a Global Positioning System (GPS), which has introduced a lot of new possibilities to what has become known as vehicle telematics.

With send/receive units mounted in each vehicle, such systems can be used to track vehicles, monitor engine performance, manage fuel consumption, and even set up what the industry is calling geofences, which notify the dispatch office any time a vehicle leaves a designated area or enters a designated restricted area.

Equipment theft is a problem that is as old as the construction industry itself, and many solutions have been tried. The problem with most is that they have to be purchased and installed, and, well, things are busy, but maybe next week.

GPS-based telematics can help with that. But fuel prices have been the big subject lately, not equipment theft, and that concern has turned fuel management into a whole new industry. And companies in that industry have seen double-digit growth for the last couple of years.

Companies have piggybacked telemetric services on one another, providing a variety of inclusive packages, or providing a basic platform with individual modules that can be purchased for specific purposes.

Thus, it is possible to buy a module that provides information needed to detect and correct poor driving behaviour, including speeding and excessive idling time, and premature wear and tear on brakes, tires and vehicle suspension — things that are often associated with aggressive driving. Another module enables management of preventive maintenance schedules and vehicle diagnostics, another provides GPS tracking, and so on.

As the need for such systems has grown, so, too, has the sophistication of the sales pitches one can expect. For example, one firm has sales staff trained to walk the prospective customer through a process that includes labour, insurance, productivity and efficiency factors to demonstrate that the actual cost of fuel is different from its price.

The difference between sticker price and real cost is something that environmentalists have know about for years, but only increasing environmental concerns and the drive toward sustainability have brought the lesson home to many in the business world.

Telematics systems are still evolving, with many partnerships formed in the last year between telematics providers and companies providing wireless fleet-tracking systems. Such partnerships are already providing real value to the construction industry.

There have been glitches, of course — not so much with the sophisticated electronics, but with the need for physically strong equipment.

One provider installed tranceivers that failed under the rigours of the jobsite. A second generation of the equipment also failed. Finally, the company took a close look at the environment on the jobsite, and built a third generation of tranceivers that have been “ruggedized” for the construction industry.

Other companies have followed suit. There is lots of information available. Just Google ‘vehicle telematics’ and you’ll see what I mean. You’ll have dozens — hundreds—of products to investigate.

I’ll only mention one company — an Ottawa outfit called Netistix. I don’t know whether their product is any better or worse than anyone else’s, but their Web site is surely one of the most informative, and well worth a visit. While there, download a cost-benefit analysis they’ve done on the use of telematics on a large fleet. It contains both interesting figures and interesting assumptions. You’ll find it at www.netistix.com

Korky Koroluk is an Ottawa-based freelance writer. Send comments to editor@dailycommercialnews.com

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