On paper, business seems so simple. You create a product or provide a service in return for money. And if you do it well enough, you make a profit. Yet, when a business adds in its own fleet of vehicles to the equation, managing it and staying on top of costs can be an administrative nightmare. From maintenance to driver monitoring and fuel consumption to fuel management, there are lots of different variables at play.
If you are the operator of a business that falls into the above category, you have likely come across the term “telematics” before. It is a branch of fleet management technology that can solve the above and a whole lot more through the use of clever tools and solutions that provide fleet managers with a top-down view of their vehicles.
In this guide, we are going to introduce telematics and explain what they are, what they do, why you should be using them, and how you can use them to get the best possible ROI.
It is an essential technology that ties into the day-to-day of fleet management. Fleets operators nationwide use telematics to ensure that their fleet managers are not only able to do the best job possible of staying on top of their fleet vehicles and drivers but also saving the business money at the same time.
Telematics provides you with all kinds of data about your fleet – fuel usage and spend, vehicle locations, driver activity and performance, vehicle speed, and more. Over time, these powerful data points allow you to find out exactly where your fleet could be losing money through inefficient performance or use so that you can trim costs down by taking action.
The Gartner IT Glossary defines telematics as, “The use of wireless devices and ‘black box’ technologies to transmit data in real time back to an organization. Typically, it’s used in the context of automobiles, whereby installed or after-factory boxes collect and transmit data on vehicle use, maintenance requirements or automotive servicing.”
When deployed and used correctly, telematics help businesses save thousands of pounds per year on fuel costs and more.
Telematics utilise telecommunications technology to locate, track, and monitor your fleet vehicles. Information is captured and recorded before being sent to an online platform in the cloud where you can access it. Although many refer to them as GPS systems (indeed, telematics does feature GPS tracking), GPS is just one of many telematics features.
Some of the data that telematics systems record includes:
Engine idle times
All of the data that is sent to your online telematics platform is then compiled and displayed as neat, easy-to-understand graphics, eliminating the need for you to crunch your own numbers and spend hours figuring out where inefficiencies are.
Telematics data is invaluable for fleet management and monitoring. Equipped with telematics information, you can hold your fleet drivers to account and incentivise them to improve their driving habits.
Although telematics systems produce a lot of data, this is not a reason to be apprehensive. A good telematics system will make effective use of the data that it collects. It will analyse and compile it into presentable information that you can then view in a clear and simple format and use to improve your fleet.
Most telematics systems will come with an online platform where you can view fleet data in real-time in the form of columns, charts, graphs, and statistics. To make things even easier, lots of providers condense this information further into daily, weekly, and monthly reporting that you can search granularly.
With a decent system, you will never have to manually process or interpret the data yourself.
It is important that you understand your telematics needs when shopping around for a system. If you don’t, you may end up paying for more than you actually need or be stuck with an underperforming system that doesn’t do what you need it to. Due to the sheer number of systems and providers available on the market, it pays to sit down and carefully consider what problems your fleet has, what solutions you think you need, and what results you are looking for.
A good way to kick things off is to define your business pain points and the goals that you want to achieve. This allows you to paint a clearer picture and better evaluate different telematics systems. When looking at and comparing systems, look at which functional areas each one performs well in, which metrics and features each one has, and any additional capabilities that some have over the others.
In addition to looking at day-to-day operational capabilities, be sure to check whether the systems you are comparing offer tools and metrics for the reduction of fuel consumption, route optimisation, and idle monitoring, etc. Because fuel cost reductions are the biggest and easiest benefits to reap from a telematics system, it is important this metric is there in any system you are considering.
Many providers offer a professional installation service. All you need to do is ensure that your fleet vehicles are available for a few hours so that your provider can come along and install any hardware. Everything else is software-based and can be done via a computer and the cloud.
Once your system has been installed and deployed, everything is managed from an online dashboard that you can access 24 hours a day, 7 days a week.
The benefits of using a telematics system are vast, and none of them should be understated. In the interest of brevity, however, here are the five most important ones:
Fuel is by far one of the largest, if not the largest, fleet overheads. It is also one of the biggest areas of pure cost saving potential.
Telematics can track your fuel consumption in real-time and converts this information into raw monetary figures. By gathering information surrounding vehicle usage such as engine idling, harsh braking, excessive acceleration, and gear usage, telematics is able to highlight exactly where your fleet is unnecessarily haemorrhaging fuel. This top-down view of your fleet’s fuel consumption enables you to take swift action and begin rectifying inefficient behaviour.
Drivers that are safe and efficient can save you money. Not only is save driving a lot better for fuel efficiency because it works the engine less and in a more efficient way, but safer drivers are far less likely to be involved in accidents. By building a picture of your fleet drivers’ habits with telematics data, you can identify areas where drivers may benefit from extra training.
In addition, where drivers know that their vehicles are being monitored by telematics, they are far more likely to make a conscious effort of driving in a safer manner.
Vehicle maintenance is another major fleet cost. Although it is impossible to completely eliminate maintenance costs – regular maintenance checks are important, after all – it is possible to reduce them.
Telematics can track engine use and miles travelled since a vehicle’s last service, allowing fleet managers to take a preventative maintenance approach. Reminders can be sent when it is time for a vehicle to be given a once over or when key checks need to be performed, such as tyre tread. With this approach to maintenance, your vehicles will perform at an optimum level at all times.
Furthermore, vehicles that are driven in a safe and less aggressive way are less likely to require servicing.
Telematics systems can be used to provide a boost to logistics, too. For example, mapping can locate the drivers closest to a particular site or delivery spot, live traffic reports can be used to re-route drivers around delays, and drivers can find their nearest petrol station using an app. All these save valuable time and make drivers more productive.
Whilst features like this vary between different providers and systems, most telematics solutions will include something along these lines.
When your fleet is more productive and efficient, it is able to deliver a higher level of service to your customers. Telematics systems can also be used to provide customers with up-to-date information on driver location, estimated delivery times, and more.
The world is waking up to the effects of climate change and many consumers now make a conscious effort to be greener. As such, there is an increasing trend whereby consumers will opt to buy from or transact with a company that is more environmentally friendly, even if that means paying more of a premium, over ones that are not.
By enabling fleets to consume less fuel and be operated in a more efficient way, telematics makes businesses that use them automatically greener. Telematics doesn’t just save you money, but the environment too.
When researching your options, there are two important things to consider, i) the system itself and ii) who supplies it.
In recent years, the telematics market has opened up to a range of new suppliers as the costs of hardware and communication technology have fallen. Whilst this is good and gives you plenty of choice, it means you need to put more effort in comparing the different telematics suppliers available and settling on one.
Generally speaking, you want to go for a supplier that has a good reputation as a long-established provider of telematics systems. You should also opt for a system that will be professionally fitted and set up for your fleet’s use. A company with a strong reputation and presence in the sector will do this for you, no questions asked.
iCompario is operated by fleet industry experts and offers a free comparison service for all businesses across the telematics industry and more. Many of their experts have over three decades’ worth of experience in the fleet industry and work very hard to unlock cost savings for their customers by matching them with the right products for their business.