07 Aug 2017

Intelligent Business Growth: A Scalable Approach to Adopting Telematics Solutions

Advanced technologies such as telematics continue to proliferate in today’s construction market, and these systems have become more accessible than ever before to contractors of all sizes. Many new machines now come right from the factory with integrated systems that make it easy for business owners to start using this advanced technology, but like anything that is new, it can be a challenge to decide how and when to take advantage of the benefits.

The truth is that these technologies are as simple or as complex as contractors want them to be. The technology itself is simple—what it comes down to is engagement. Adopters of these new technologies won’t see tremendous opportunities by just flipping a switch or ordering a telematics subscription. The real benefits of these systems are seen in how the data is leveraged.

As with anything new, users should start simple if they are unfamiliar with the tool—starting with the basics and growing utilization based on experience. That being said, there are many ways that telematics solutions can have an immediate impact on operating costs for businesses of all sizes. Business owners should look at specific problem areas in productivity or cost containment, and use these new technologies to develop an improvement strategy.

The Basics of Telematics
Telematics systems can give equipment owners unprecedented amounts of data on how a machine is being utilized in the field, and can offer insights that can help lower operating costs both immediately, and over time. And although the technology has been available to the construction industry in some form for over a decade, there are still many contractors—both large and small—that have yet to take advantage of what it has to offer.

When looking at the vast amount of data that is available through telematics systems, it is easy for business owners to get overwhelmed and think that they will have to completely change the way they do business. The truth is, telematics data only supplements what business owners are already doing. Equipment owners already have a firm grasp of the “dollars-and-cents” calculations that are a fundamental part of running a construction business in today’s economy—telematics is just an easier way of collecting the information necessary to make more intelligent business decisions.

For business owners who are just beginning to adopt the technology, it makes sense to start out small with fuel consumption and idling reports. Analyzing this basic data alone can reveal new insights into the productivity and efficiency of any fleet. The most common and often used benefit of telematics often relates to idle time management, and unproductive fuel burn.

Right-sizing equipment
Taking a closer look at real-time fuel consumption and idling reports, equipment owners are able to get a better view of the overall cost of an operation. As an example, excessive idling can indicate a number of things – one of which could be that the equipment is not ideally matched to the application. For instance, a wheel loader with a large bucket may be loading a hopper that can’t handle that much material at once. The loader may be completing a fairly simple work cycle, but is then sitting and waiting for the material to cycle through the hopper before it can dump the next load. This idling is not an efficient use of the machine and may indicate any number of possible improvements that can be made to an operation.  

Additionally, understanding true idle time, instead of getting it by word of mouth, can have multiple benefits to a business owner’s bottom line. Reducing idle time can have a positive impact on reducing unproductive engine wear, warranty time use, and maintenance scheduling frequency; as well as increasing equipment residual values by decreasing the recorded hours on a machine.

Owning larger equipment – when larger equipment is not necessary for the job at hand – leads to a number of inefficiencies: business owners pay more for fuel, pay more for tires and other consumables, and pay more in lifetime owning and operating costs with a larger machine. Idling reports can help identify these issues and allow equipment owners to make better purchasing and planning decisions.

Identifying Underutilized Equipment
Another way that telematics data can have a direct impact on a business owner’s bottom line even at its most basic level is by helping to identify underutilized equipment. Today, the costs of owning and operating equipment are way too high to let a machine go unused, but it’s easy to overlook equipment that may be sitting idle in the yard or at a jobsite. Meanwhile, on another jobsite, crews may be short a piece of equipment and are forced to go out and rent a machine to complete the job because they don’t know that another machine is available for use somewhere else. 

By monitoring fleet utilization via telematics, business owners and fleet managers can identify those underutilized pieces of equipment and put them to work on the jobs where they are needed, potentially reducing purchasing and rental costs for new equipment. This also allows companies to consolidate and identify equipment for liquidation, helping to lower operating costs.

Engine RPMs and Component Wear
Taking it one step further, telematics also offers contractors the ability to monitor engine RPMs. This can give equipment owners even greater insights into machine utilization on a jobsite—it can also help to extend the life of wear components. Bucket teeth, cutting edges or bristles on a hydraulic broom are typically replaced on an hourly schedule, regardless of how a machine is being used.

Differentiating between working and non-working hours can help redefine maintenance intervals on certain wear components, and monitoring RPMs via telematics allows business owners to differentiate between different working situations for a machine. For instance, a fleet manager can identify that a machine is doing its ground engaging work when it registers higher RPM, and is travelling or carrying when RPM is lower. Out of the entire recommended replacement interval of the component, perhaps only a percentage of those hours are actually spent in ground engagement. Identifying this may allow the owner to extend that wear component’s replacement out further and reduce the purchase/maintenance costs throughout the machine’s life – all because of a deeper understanding of how that machine is being used on the job.

Maintenance Planning
One of the simplest ways that telematics can be used right out of the gate is to help manage maintenance intervals and scheduling. Eliminating the need for outdated whiteboards and logbooks, telematics data can show contractors and fleet managers where machines are in their maintenance schedule and how many hours are on the engine with up-to-the-minute accuracy. Telematics systems are also capable of sending alerts when a machine approaches a maintenance milestone, or is operating outside of an acceptable parameter.

By knowing exactly when a machine needs to be serviced, it can prevent fleet managers from pulling a machine from a jobsite too early, which can cause unnecessary downtime. It also allows for service personnel to better plan for maintenance activities and ensure that all of the proper parts, filters and components are in stock because they know right when that machine will need to be serviced.  

Unauthorized Usage and Theft Prevention
Another simple way that telematics technology can have an immediate impact on a business is through the prevention of theft and unauthorized usage. Telematics systems are capable of establishing geofences around areas where equipment doesn’t belong. This can be as simple as alerting a fleet manager when a machine leaves a jobsite, or as advanced as setting up geofences around weight-limited roads to alert the owner if the truck hauling that machine went somewhere it wasn’t supposed to go, which could expose the company to potential fines.

Telematics systems can also help assist in the location and recovery of stolen equipment. The ability to track the location of stolen equipment will help avoid downtime and equipment replacement costs, as well as increases in insurance premiums and other related costs. Transversely, equipping machines with telematics has actually lowered insurance premiums in some instances where the insurer sees less liability with the equipment.

Planning for the Future
There are many ways that telematics systems can have a significant impact on an equipment owner’s bottom line—both short-term and long-term—without having to completely change the way they do business. As the technology continues to grow and develop, contractors will discover even more advanced ways to utilize telematics data to help them make better business decisions.

Starting out with the basics, and expanding the utilization of today’s advanced construction technologies can open up a path to future growth opportunities for businesses of all sizes.