Commercial road transport is one of Australia’s most important industries, employing 291,000 people directly and plays a significant role in the general economy. Road transport firms face increasing pressures relating to cost, safety and vehicle emissions. Rapid developments in vehicle and telecommunications technologies have triggered a myriad of devices that remotely monitor or manage most aspects of commercial vehicles. Suppliers of these devices promise transformational results in fleet management, but the complexity and diversity of products, a lack of understanding of the benefits and high capital costs have slowed industry uptake. How can technology be used effectively to drive business improvement?
Over the past fifteen years, wireless communications and accurate vehicle positioning have rapidly reduced in cost, leading to a convergence with other developing technologies and the emergence of a wide range of commercial telematics applications in the road transport sector. The word telematics is a combination of telecommunications and informatics, and is widely used to describe applications of technology that enable staff to collect and interpret data remotely.
The technologies that are available have applications in improving road safety, maintenance practices and vehicle emissions through the appropriate application of telematics technologies. However, until recently little effective research had been done on the practical benefits being achieved by organisations that have actually implemented telematics programs and the factors that influence the success of the program. Fleet Engineering’s founder Andrew Walker completed an honours thesis project comprising a one year study into the success of telematics in driving business improvement for Australian road transport firms. The findings of the study were clear – firms that introduced telematics applications into their fleet with the greatest focus on developing appropriate supporting business processes and on effective change management plans to implement those processes were universally ecstatic with the results. Firms that made technology purchases and implemented them without significant forethought into the integration of the technology into business processes achieved little or no benefit.
Chanage Management versus Success Graph
Implications for Selecting Technology and Technology Suppliers
The main lesson to be learned from this study is that the technology itself should only be part of the consideration for what products you hope to implement into your fleet. Of more importance is deciding on what business processes or functions you hope to improve, and how you intend to integrate technology into the process. Some questions to ask yourself are:
- Do I have a clear picture of how the process currently works?
- What will the new, streamlined process be and what does the technology need to do to facilitate that process?
- If customisation of the technology is required to tweak the process, is that possible and who will do it? What would it cost?
- Does the new process involve any changes in staff behaviour, and how will you manage the change?
- Who will monitor the data produced by your new technology and on what frequency?
- How will you quantify the potential improvements of your new process to justify the implementation costs?
- Implications for Technology Costs
It’s very easy to underestimate the costs of implementing a telematics solution by assuming that the purchase and subscription fees are the major (or only) costs involved. In reality, almost all technological improvements that are made in your fleet only add value when someone in the business analyses the data that is produced and feeds back the useful information to decision makers to improve the fleet’s operation. Without that feedback loop, all you have is pretty graphs and moving dots on screens. There have been many cases where a fleet has implemented a new state-of-the-art system only to realise 6 months down the track that they are not getting any benefit from the system and that they require a dedicated team to drive improvements from the technologies.