At NAFA’s International Fleet Academy last month, Kevin Moore, Vice President of OEM Sales at Telogis, delivered a fascinating keynote address on how telematics are changing the landscape for fleet. Afterwards, we sat down with him and talked about a wide range of subjects, including the connected car and how it translates into efficiency and cost savings for fleets. In this interview, Kevin gives us some real-world examples of fleets – small and large – that have used telematics to make data driven decisions to improve their business.
FMW: Let’s talk about the connected vehicle.
KM: Today, the connected vehicle is in a state of evolution. Some vehicles are more connected than others. Most folks are aware that each OEM has a consumer connected strategy. GM’s announcement of 4G, Wi-Fi Hot Spots is in the news, but so is Ford with their Sync product, their new AppLink applications. Others in the commercial space are coming as well: Volvo with Remote Diagnostics, Mack with GuardDog Connect, and Freightliner with Virtual Technician. The car and truck manufacturers are coming to the forefront with their own connected commercial vehicle strategy. Some are choosing to embed it as a no-cost option where others are still taking it as an option when the vehicle is spec’d.
FMW: What’s the next step?
KM: As we go forward and by the time we end this decade, we won’t be talking about the connected vehicle anymore; it will be taken for granted. We are moving from not only the connected vehicle to the Internet of Things where everything will be connected. In the future, the vehicle will be connected to lots of things. Certainly, it will be connected to us as a purchaser or an owner or a fleet manager, but it will also be connected to the infrastructure. It will be connected to other vehicles.
There is a lot of buzz in the marketplace by companies like Google, Mercedes, Volkswagen and Volvo. These vehicles have to be really intelligent and they have to talk to many things, so the connected vehicle will be connected to lots of things. So, that means that vehicles are going to have to be really, really smart. They are going to have to be super computers on wheels. When we think of a connected vehicle, we think of a car or truck, but it is really your smart phone that is on four wheels or 18 wheels. It will produce tons of data. The question is how do you handle all of that data and what do you do with it?
As an example, the recently retired space shuttle had 500,000 lines of code on it and today, an average sedan has millions of lines of code. These vehicles are going to get so much smarter and they are already producing so much data it is a question of what do you do with that information.
FMW: What is the value proposition for fleets?
KM: The low hanging fruit, as I call it, for fleets today are the things that impact operational cost; whether that is speeding, idling, driving behavior — identifying those things that impact the upfront operating expense. With data coming from the vehicle, they now have a chance to really start to impact the behind-the-scenes operating expense. Everything from maintenance based upon calendar days or based upon driving behavior, vehicle behavior or vehicle characteristics.
Manufacturers go to great lengths to test their vehicles and they have limits, they can’t replicate what a fleet has of 5,000 or 10, 000 individual drivers out there that are running around the countryside or running around the world and simulate all of those conditions. Now, fleets have access to information and it is only going to get better. The OEMs are going to continue to provide more and more information to fleet customers so they can do a better job of managing it.
It is really a win/win situation for the OEM. The more information that they make available to customers, the better the experience the customer has with their product. I think the better experience a customer has with the product translates to durability, reliability and serviceability. By making the information available, then OEMs can start to lower their warranty claims expense.
If I build a better product, I have more information about the product – I am getting better feedback from customers on what things they are seeing with the vehicle. Maybe I can start to do some things that are not only from a development and engineering standpoint, but with connectivity comes the ability to start to do things like over the air updates. So, instead of having to take your car back to a dealer to have the ECM updated or have a program updated I can do that over the air, and that can be a game changer.
When you think about a rental car company who has to take a car out of service to do a service campaign, that rental car company may lose one, two or three days getting that vehicle updated. If they don’t have a car to rent to a customer, it is lost revenue. For a fleet customer, that vehicle goes out of service. I may not be able to get a replacement for it. I have costs for getting the vehicle there. I may have costs for lost downtime from the fact that I can’t service my customers. I can’t perform the business that I want to do, and it is not always easy for a fleet to get that scheduled. It takes time and manpower.
FMW: Give us examples of how you have been able to help fleets increase efficiency and cut costs.
KM: Here is a success story that I think is very interesting. It is a deli delivery business that is called TooJays, out of Florida. TooJays was having a number of challenges. As a premium delicatessen provider, they were focused on delivering lunches to business clients. Well, if you can think about a business client and you are catering lunch to them the first time that business customer has a bad experience what happens? You don’t get a call back, right? So they recognized that they needed to be able to manage their business and since they had vehicles as a part of their business they need to know where the delivery trucks are, where the drivers are and they needed to know how they were progressing. The TooJays team needed to know if they are on schedule, behind schedule, and they needed to be able to do this in real time so that they can manage their business better and retain their customers. Because their mindset is that it is easier to keep a customer – it is more cost effective to keep a customer — than it is to go get new ones.
They are a case study where they use all aspects of our platform. They use our fleet management aspects, commercial route and optimization tools, and plan versus actual. They are a small customer that doesn’t have the time to be a “fleet” but they have a number of vehicles. So, they are using our platform to manage their vehicles. When it comes to the OEM aspect of that, now they can get the vehicle solution factory fit. They don’t have to worry about hardware, they don’t have to worry about installation — just order the vehicle, it comes with it and they can get up and running.
Then you have mega fleets like Asplundh Tree Expert, a longtime customer with Telogis and one of our keynote speakers at our Latitude conference. Scott Asplundh, the company’s CEO and third-generation owner will tell you they are in the business of cutting trees. They are not a technology company. But Scott can also point to case upon case of how the technology has helped them become safer, more efficient, lower their operating expense, and improve productivity. There are lots of success stories there and Asplundh is one of those companies that understand that they have to keep peeling the onion; Scott has to keep looking for ways to use this information, this data, to make data driven decisions and improve his business.
FMW: How does Telogis differ from other telematics companies?
KM: It is easy for Telogis to be kind of “pigeon-holed” as a telematics company but we are much, much more than that. When we talk about Telogis being a location-based services platform, that platform is literally broad in the sense that it is fleet management, it is telematics, and it is mobile workforce management. It is the whole gamut of really taking what we call your mobile ERP and bringing that all to bear. You have vehicles, you have resources, you have work, and you have backend systems that you use to run your business. Our platform is uniquely positioned to leverage the systems that you have, the work that needs to be done by your workers, or your techs or your drivers, along with the vehicle data in order to really give you that holistic view of how your mobile enterprise is performing.