By Steven Bojan,
Vice President, Fleet Risk Services at HUB International Limited
For many commercial vehicle fleets, telematics are now required as they are necessary to utilize Electronic Logging Devices (ELDs). While the ELD regulations are often viewed as onerous and intrusive, when utilized correctly, they can play a critical role in improving the safety performance and profitability or most fleets. Most telematics systems can monitor a vehicle’s engine to capture data, miles driven, duration of engine operation, aid in crash investigations and more.
Smart commercial fleet operations across industries are taking telematics beyond what’s required by the FMCSA and turning them into a competitive advantage. From motor carriers and local delivery operations to buses and construction companies, fleet operators are leveraging data collected from telematics to optimize a variety of key performance metrics, including: fuel consumption, maintenance costs, driver productivity and customer service.
Consider the following five reasons why selecting and implementing the right telematics/ELD system is essential for improving business performance:
- More insurance carriers are now requiring telematics systems
Insurance carriers are beginning to demand the use of telematics before providing coverage to vehicle fleets of all sizes, across all types of industries. Underwriters understand that all drivers work independently with little direct oversight. It is critical that fleet managers know how their vehicles are being driven and which drivers are posing the greatest risk to the organization. The 80/20 rule applies to fleets. It is the 10 to 20% of the driver population that keep bosses and underwriters up at night. The more information that can be used to identify these individuals so they can be retrained or disciplined to become improved drivers.
- An answer to the skyrocketing costs of auto liability claims
If a picture is worth a thousand words, then a video of a crash situation is worth 10,000 words. Fleets are embracing telematics systems with video capabilities as an exoneration tool for crash situations where the facts are not clear cut and as a teaching tool to allow drivers to review their mistakes. Telematics show where a vehicle has been and how it has been driven, which can be important when a claimant calls about a crash where a police report was not written. The fleet operator can show where the vehicle in question was at the time of the supposed crash and at what speed their vehicle was traveling. Knowing with certainty can save valuable claims and litigation costs.
- ELDs can assist in reducing both driver and vehicle fatigue
Pushing drivers and vehicles to their limit usually results in decreased efficiency. Drivers need to rest so they can be productive, and vehicles need to have preventative maintenance done at prescribed intervals. ELD’s provide driver hours of service information directly to dispatchers. This transparency allows management to better understand what their drivers are experiencing and also gives drivers a tool to let their dispatchers know when they need to stop. Many telematics systems will also transmit vehicle fault codes to maintenance so that they can diagnose problems on the road and direct drivers to a shop before a breakdown occurs. These systems can also be used to track miles or hours operated to indicate when a PM is needed.
Safety, maintenance and operations can work hand in hand sharing information to improve the bottom line. When a driver leaves work in the same or better condition as he or she arrived, product and service standards are maintained, reducing the impact of losses and claims. Safety and operations need to work hand-in-hand in order to be truly successful. The right telematics system will promote this relationship.
- Improving fleet fuel economy
For many fleets, fuel expenses are the second largest cost. Drivers that speed or use excessive. RPM’s are giving away significant fuel economy. Most telematics systems can track speed, engine RPM’s and idle time. In some states there are now fines for commercial vehicles that idle for as few as 10 minutes. Excessive idling and pushing the capabilities of the engine also greatly increase vehicle maintenance costs. Improving fuel economy is not only good for the environment, it is very good for the bottom line.
- Enhancing customer service
Today’s reliance on just in time (JIT) systems have wrung waste out of the supply chain and put additional pressures on transportation providers. Customers need their products delivered on time and want to know where items are within the supply chain at all times. Even consumers are demanding to know when they will receive their goods within short target windows. By utilizing vehicle location and ELD data, a fleet operator can provide a level of transparency to customers that was never available before. For service providers and construction fleets location data can be used to direct people and equipment to where they are needed most in a timely fashion. The information provided by a telematics system beyond regulatory compliance and general location is no longer just an honesty check, but is a critical competitive advantage.
As a fleet carrier, it is important to know where and how vehicles are operating. Clients are counting on your driver to deliver or appear on time so that they can conduct business. A vehicle running late, or involved in a crash, results in service failures.
Today's customers demand better, faster communication between all business segments. A well-chosen and implemented telematics system will proactively alert dispatch to problems with vehicles or drivers that can be anticipated or avoided. This saves time and money with the simultaneous benefit of reputation management. A sound delivery record translates into business opportunity growth.
Contact your HUB Transportation Specialist for more information on how you can leverage telematics with your fleet.