Using Prescriptive Data to Manage Fuel Costs, Boost Productivity

Bernie, what are the con­cerns that fleet man­agers are bring­ing to you now with respect to fuel man­age­ment?

I think what our clients are telling us now is more around data; not just being pre­dic­tive but being pre­scrip­tive. They don’t want to just receive all of the avail­able infor­ma­tion and hunt and peck through it and try to find oppor­tu­ni­ties. They are look­ing for us to take all of this dis­parate data, bring it togeth­er, aggre­gate it, and tell the sto­ry for them. They are look­ing for us to do the analy­ses, use dif­fer­ent pieces of data that they can pro­vide, or we can pro­vide to them, and just help in over­all enhanc­ing their busi­ness.

What sort of data are they most­ly con­cerned about? What are some of the hot but­tons?

When you take one piece of data it may tell one sto­ry, but when you can take dif­fer­ent pieces of data and put them togeth­er it tells a much dif­fer­ent sto­ry. An exam­ple of that would be enhanc­ing the report­ing with both our fuel data and our telem­at­ics data. When you start to put those two pieces of data togeth­er, you start to look at things like chang­ing dri­ver behav­ior, which helps to low­er your oper­at­ing costs and to boost pro­duc­tiv­i­ty.

It is get­ting into the mind of that dri­ver and, again, being pre­scrip­tive and not just being reac­tive to what that dri­ver did, but try­ing to find out where the vehi­cle has been going based on fuel­ing pat­terns, where the vehi­cle should be, and then putting togeth­er a rec­om­men­da­tion for that fleet to ulti­mate­ly enhance that dri­ver expe­ri­ence.

How are suc­cess­ful fleets using this data?

I think there have been a num­ber of suc­cess sto­ries based on what the com­pa­ny is focus­ing on. We offer four dif­fer­ent prod­ucts from a telem­at­ics stand­point because each indus­try is a lit­tle dif­fer­ent in what they are look­ing to focus on. As an exam­ple, a deliv­ery com­pa­ny may be more con­cerned with pro­duc­tiv­i­ty and rout­ing and things of that sort. We have suc­cess sto­ries with com­pa­nies who have been able to look at the data, find out where their dri­vers have been going and opti­mize that dri­ver route — and sav­ing upwards of one to two thou­sand dol­lars per vehi­cle per year. That can start up over time when you have a cou­ple hun­dred or maybe even a cou­ple thou­sand vehi­cles.

We also have a num­ber of suc­cess sto­ries from the safe­ty stand­point. Fleets that have been able to low­er insur­ance costs or a heavy equip­ment fleet who needs to find out whether safe­ty mech­a­nisms on the vehi­cles are in place before they put a boom up. Telem­at­ics data can tell you that, and each com­pa­ny spe­cial­izes in a dif­fer­ent piece of data, but when you pull all of that data togeth­er and aggre­gate it, it tells a much dif­fer­ent sto­ry.

You have some unique prod­ucts in the fuel space. Let’s talk about fuel hedg­ing.

Hedg­ing con­tin­ues to be an offer­ing that is of inter­est to folks. I think any­time you can lock in or at least cap some sort of a fuel cost, it is entic­ing. I think busi­ness­es need to make that deci­sion, though, to say, if fuel prices were to rise what impact would that have on my busi­ness? And if it is not a great impact, then they are not real­ly going to be inter­est­ed in that. Some com­pa­nies have a built in hedge. Some com­pa­nies are able to pass through that cost to their end cus­tomer. We have seen a lot of suc­cess in the hedg­ing prod­uct in places like util­i­ties. Folks that are not nec­es­sar­i­ly able to pass through that cost or maybe just don’t want to pass through that cost, so they enter into pro­grams where they know they have a cap on a PPG, if you will. They know that as they are bid­ding out con­tracts for three and five years, they are pro­tect­ed so it allows them to be a lit­tle more aggres­sive in the mar­ket­place.

What is the next big thing in the fuel busi­ness?

I think the next big thing, real­ly, is going to be cen­tered around data. It is the abil­i­ty to  access that data in real time fash­ion and then being able to return that data to some­body who can make deci­sions using that data.

We are going to need to be involved from a card stand­point, from a data col­lec­tions stand­point. We are work­ing very close­ly with our part­ners on the oil side of things with the point of sale devices to make sure all the data can be cap­tured and passed through. I think that is real­ly where the mar­ket is going to go.

What trends that you are see­ing in the indus­try?

We are see­ing a lot of inter­est in the telem­at­ics prod­uct. A lot of folks are now look­ing more at dri­ver safe­ty — at dri­ver behav­ior. Ear­ly on, I think fleets were ques­tion­ing their return on the invest­ment. What we learned very ear­ly on was you might not nec­es­sar­i­ly be able to pin­point what the oppor­tu­ni­ty is going to be until you actu­al­ly have those devices in the vehi­cles. We have had a num­ber of clients come back and say, “I nev­er knew I was going to find this infor­ma­tion. I nev­er knew I had a prob­lem in this area.” Telem­at­ics has become very pop­u­lar.

Are you agnos­tic in terms of telem­at­ics providers?

We are agnos­tic in the sense that we can take data in from any of the providers to inte­grate it with every­thing else that we can do. We do resell for four dif­fer­ent com­pa­nies and we have been very selec­tive with whom we part­ner to meet the spe­cif­ic needs of the indus­try. But as far as the data goes, we are agnos­tic to that. That is real­ly where you are see­ing it, you are see­ing that most folks now are mov­ing away from the hard­ware itself and real­ly just con­cerned with the data.

BIO
Bernie joined WEX Inc. in 1996 as a Dis­trict Sales Man­ag­er and his career has been a steady pro­gres­sion of increased sales and mar­ket­ing respon­si­bil­i­ty between exist­ing and new seg­ments of the Fleet and Vir­tu­al Pay­ments busi­ness. In 2008 Bernie was named Vice Pres­i­dent of Cor­po­rate Pay­ment Solu­tions. In this role he is respon­si­ble for over­see­ing the reten­tion and growth of all mid- to large size cus­tomer rela­tion­ships in both the Fleet and Vir­tu­al Pay­ments lines of busi­ness. He also has respon­si­bil­i­ty for the Part­ner rela­tion­ships, help­ing the Fleet Man­age­ment com­pa­nies grow their busi­ness and over­sees the acqui­si­tion and growth of the Gov­ern­ment line of busi­ness. Pri­or to join­ing WEX, Bernie held a num­ber of roles with Enter­prise Rent-A-Car and Enter­prise Leas­ing.

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