Tim, let’s talk about value proposition for fleets who are just considering telematics.
The value proposition for telematics is essentially to save money on fuel, to measure and improve utilization of your fleet and your resources, to drive safety improvement and to empower your employees to do a better job. It is all connected, right? There is this connected ecosystem of the driver, the customer, your enterprise systems, and the vehicle. You can improve performance in every one of those dimensions with telematics.
How is this going to impact the fleet with respect to fuel savings and driver safety?
A couple of key low hanging fruits in telematics are fuel savings and driver safety. On the fuel savings side you can immediately reduce nonproductive idle time. The typical installation of hardware allows you to measure idle time, but if you have an up-fitted component on the truck that is connected to the PTO like a boom on a bucket truck then you measure nonproductive idle time and productive idle time. Typically, fleets that are not measuring idle time are idling two to three hours a day. They don’t believe it but it is true, that is what the data shows. The telematics investment is almost completely paid for — generally several times over — solely by the reduction of idle time.
But then on top of that because you know how many miles your trucks are driving, you know how fast they are driving, you still reduce fuel consumption and expense by reducing miles. A slower fleet uses less fuel so there is a lot of fuel savings in the telematics investment that immediately pay for the system.
If a fleet opts to adopt a telematics solution, what do the next steps involve?
There is a certain investment in hardware that goes on the vehicle. The hardware can also come from the manufacturer in the case of some of our OEM partners such as Ford, Volvo, Mack, Manitowoc Cranes and just recently, General Motors. The hardware can be installed at an up-fitter or it can be installed by the customer themselves, but we need a piece of hardware on the vehicle that gives us ignition on and off, location, heading and speed. It will also give us engine date, oil life, temperature, seat belt connection, and if you put in other sensor inputs, outriggers out, PTO engaged, boom-out-of-cradle; things like that. So, the intelligence is coming from the vehicle through a data connection through a wireless network to our servers. We present it in the form of information, alerts, reports, and data trends and dashboards to allow the customer to do something with that information.
Now, how does the fleet manager get this information?
The information is delivered over the web via a cloud-based product line called Software-as-a-Service or “SaaS”. A laptop, a notebook, a phone, any wirelessly connected or web connected device will provide that visibility. Most supervisors in the field are using a tablet or a laptop to find out where the vehicles are that they are managing. How fast they are driving? Are they on the jobsite? How much time on the jobsite is work time? All of those metrics are available to the mobile supervisor through a mobile app that can be installed on any iOS or Android device.
Why would a fleet not want this?
We say that our customers have been transformed by location intelligence because there are so many different dimensions of the mobile enterprise that can be improved; from fuel savings to safety to better utilization of the equipment to their customer satisfaction. And then when you connect our data with maybe data on the ERP program such as SAP or you match up fuel cards to what we are doing, it just keeps providing savings to the customer. For a company that doesn’t have telematics, you start with two or three things and you move forward and you immediately see the results. In the words of one of our large customers, keep peeling the onion layers of the things you can do with telematics to drive a better and better business.
Can you give us an instance of what a successful fleet has been able to do with your help?
I asked one of the utility customers at the end of their first year with us what had changed, what were their “ah-ha” moments and the fleet manager said, “Well, out of my thousand bucket trucks I realized I have too many. We have a boom-out-of-cradle sensor and I look at the monthly report and I realize that for a large percentage of my bucket trucks the bucket is not getting out of the cradle.”
They were sending bucket trucks to do what a pickup truck could do so they had too big of an investment in buckets. And then they realized they were doing maintenance on those booms on a periodic basis — not based on the number of hours used. So, they went to the manufacturer of the buckets and said, let’s put together a maintenance program based on hours used, and it saved them $300,000 in the first year. Those were real dollars, but it wasn’t something you would have found in the original ROI estimates.
How long does it take for a typical fleet to get their return on investment?
Well, the installation takes a matter of days or weeks depending on how widespread you are and how fast you want to get it done. The software you can learn in the matter of a few hours and to see savings all you need to do is start putting up a scorecard for people. We say: if you can measure it you can manage it. When you connect things and you provide a scorecard the company starts changing behavior. We see customers transformed in a matter of three or four months. Literally, they will save the money that they invest in a matter of months. If it takes more than six months I would be surprised. It is a matter of being committed to using the information, having executive sponsorship and a team that engages — and then you launch.
What are your clients telling you about the impact on safety?
There are several dimensions to the safety impact of telematics. The first is excessive speeding. Nobody thinks their drivers are going over 75 miles per hour in their Ford F-150; the 23-year-old guy who gets off on a Friday night and is driving home. You don’t think he goes over 75 miles per hour, but when you start providing visibility and accountability — we are all accountable to our community, to our shareholders, and to our drivers for safety — people slow down. You can put out an alert, you can put out a report and we show it on the dashboard what happens to speeding. For most of our customers when they start score carding excessive speeding it drops by 80 or 90 percent. The result is fewer incidents, less fuel used, right? That is tremendous.
We also have a score card for drivers that consolidate multiple types of driver performance. Not only speeding against posted speed, but idling, hard braking and hard acceleration. We can configure a score card for the whole fleet and it shows a driver where they stand compared to their peers and to tell the customer – is your fleet improving on these things? Because the result is a more efficient fleet, safer drivers, less fuel. It all works together but I call it gamification. It is not Big Brother; rather it’s about making a game out of being better.
One utility customer that just deployed over a thousand vehicles with us: hardened, East Coast union drivers. The operations people who are on the team said, “Our drivers are tripping all over themselves to get to the top of the leader board.” We are making a game out of it and it works.
So you think the ‘Big Brother’ concern the drivers initially had has disappeared?
It goes away after they understand that the “facts” from the data protects them. If someone calls and says that your driver ran over my mailbox and then left but then you look at the application and say, “what happened to this spot on this day?” and you find out that none of your trucks were at that location, the driver’s reputation is saved. Most of the drivers are great drivers and they like that so we really don’t have a problem with it after the company explains what they are trying to do.
Tell us about the new Telogis alliance with GM OnStar.
We have been working with General Motors to take the investment they have already made in the built-in OnStar hardware architecture and information coming from the vehicle – location, heading, speed and engine data to provide that to their commercial customers. It will be available to their retail clients, but since we provide this product and software to commercial fleets we wanted to partner with GM to provide a more intelligent fleet based on the investment already made by the OnStar people. Now we have the ability to take that data from General Motors OnStar servers and turn on software location intelligence for the commercial fleet that is using GM commercial vehicles.
Do you work with any other OEMs?
We have several OEM providers that allow the customer to check the box to get hardware installed at the factory. If the customer has a mixed fleet, they have some Volvos, they have some GMs, they have some Fords, they can get telematics built in from all of their fleet using our platform. That is a real win for the industry.
We already have a relationship with Ford called Ford Crew Chief powered by Telogis. So if a customer wants to order a vehicle with the Ford Crew Chief hardware installed they can order it with their dealer and it comes with the hardware installed and one year of Telogis service.
Chief Client Success Officer
Mr. Taylor has extensive experience in senior leadership positions with start-up and fast-growth companies on an international scale. As founder and CEO of Tycom Corporation (now Kyocera Tycom Corp.), CEO of Tycom Dental Inc. (now SybronEndo Corporation, a division of Sybron Dental Specialties) and CEO of Tulon Inc., Mr. Taylor has a track record of successful product development and company leadership in a variety of markets. Prior to joining the team at Telogis, he had been the director of Liquidmetal Saga Italy, a technology start-up company in the Veneto region of Italy aimed at the European luxury goods market.
Mr. Taylor earned a Bachelor of Arts in Russian Language and a Bachelor of Science in business administration from the University of Southern California.