How fleets can better utilize telematics data

Matt Cole:

How trucking companies are using telematics data and where there's room for improvement.

Jason Cannon:

Hey everybody. Welcome back. I'm Jason Cannon and my co-host is Matt Colton. Onboard Telematics provides a lot of data to fleets measuring specific aspects of safety, operations, and maintenance that can give insights into how motor carriers are performing. Parsing through that data can be challenging.

Matt Cole:

New research conducted by the American Transportation Research Institute analyzes how fleets are utilizing telematics data to improve their operations and identifies areas where telematics could be used to further improve performance.

Jeff Short:

Last year, ATRI's research advisory committee, Iraq, noted that carriers receive a wide range of data from their telematics systems. And these come from across numerous areas, operational safety and maintenance. And it's just a ton of data coming from their systems into their headquarters and some don't know what to do with all of it or where they should start or where they should be focused. So that was all anecdotal. What we did was quantify this. So for many fleets, the challenge is not a lack of information, of course. It's determining which metrics provide the greatest value. Carriers of course have limited resources. They often can't monitor every single key performance indicator or KPI. I'm going to call them KPIs from now on, but KPIs are there to help them measure performance and they can't necessarily monitor every single KPI that's out there, so they need to identify the measures that matter most.

So at the same time, the trucking industry continues to face rising operational costs as you see in our operational cost of trucking report. Fuel expenses of course are the topic of the day. Carriers are just looking for ways to improve efficiency and control their costs. And thus an important question emerges which telematics-based KPIs deliver measurable value and help offset those expenses. What we did with this report, we evaluated and ranked 44 KPIs that are out there that are commonly available. At least the data is available through commercial telematics platforms, and we identified those that are considered most valuable by the industry.

Jason Cannon:

Now, part of ATRI's research involved talking to telematics providers about carrier success and challenges using telematics data.

Jeff Short:

So we first went out to telematics providers and we asked them what KPIs are out there, of course. We wanted to build an inventory, but we also asked them what's working well and of course what's not working well as far as their customers are concerned. And safety management they said was working really well. Fleets were very focused on that and producing good solid KPIs. Same with fuel efficiency and dwell time reduction. What we heard as far as what isn't working, it's the data overload, the amount of data coming in, that's a barrier to successfully using KPIs and using the data that carriers produce. Additionally, organizational silos. So you can imagine it's tough to break down silos, let's say between operations and safety sometimes. So each of those silos is looking at different data. What needs to happen is the data needs to be looked at together.

And then finally, limited resources for analytics. Trucking companies are focused on trucking. The different components of the trucking company are focused on that, and there's not necessarily a focus on data science, data analytics and that sort of thing.

Matt Cole:

A large part of ATRI's report focuses on telematics enabled KPIs across safety, operations and maintenance. The research measured the importance of various KPIs as well as their utilization by fleets. Safety KPIs are far and away the most utilized.

Jeff Short:

What we ultimately did was put out the list of KPIs to all of the carriers. We put them in three categories. It was safety, operations, and of course maintenance management. That's more of an emerging one. And safety, certainly that is the industry's bread and butter. That's where they have been for many, many years or decades focused on their telematics KPIs. So what we did with each of the 44 KPIs is we asked respondents through an evaluation to score each of them. So take a KPI like risky driving. We said, "What's your score? Is this critical with a score of five? Is it very important, important, somewhat important, not important? That would get you a score of one." So that's the scoring. And also they were able to put down that they don't use it, and that was very important to this research as well. So there are two distinct findings that come out of those questions.

The first is importance. How important is the KPI among users of the KPI? So we're asking those who use it, not those who don't, how important is this to you? And then next utilization. So that's among the whole group, how many use it and how many don't. So first let's have a look at safety. Safety, like I said earlier, is where telematics have been most embedded in fleet management. For carriers that use safety metrics, risky driving, crash rates, driver distraction, and speeding all scored above 4.2 out of five. They also scored highest in top rank, meaning the percent of users who ranked the KPI as very important or critical had that score. So these top KPIs are measures considered genuinely important, not data that just happens to be available. Then we looked at use among respondents. Use was very mixed and it did not necessarily align with importance.

Four KPIs were used by more than 90% of respondents. Critical events was the one that was most widely used. That was fifth for importance, however. Crash rates and driver distraction were ranked two and three for importance. Those, as you can see, had relatively low use.

Jason Cannon:

When it comes to operations, metrics like cost per mile, miles per gallon, and revenue per mile ranked pretty high as far as importance, but they were still well below the importance of the majority of the safety KPIs. This

Jeff Short:

Is where telematics data have become valuable as you connect them to business information. You'll notice that while half of safety importance scores were four or more, none of the operations KPIs hit that level of importance. Also, in this chart, you can see the clear priorities that users have, cost per mile, fuel use, revenue per mile. Those are at the top. These tell a carrier one thing, whether or not they're using their resources efficiently. So onto utilization, fuel use miles per gallon and idle dwell time were the most dominant KPIs by utilization. Interestingly, cost per mile ranked fit for use with 27% not using this metric. 27% did not use cost per mile, though it was ranked number one in importance.

Matt Cole:

Maintenance management is the least utilized by fleets when it comes to telematics data, leaving a lot of room for growth in that area.

Jeff Short:

The highest rated maintenance KPIs, they're the most practical ones, scheduling preventative maintenance, identifying missed maintenance and diagnosing faults. These relate to keeping a truck available for scheduled work, avoiding breakdowns, keeping the equipment, which is quite expensive, out there making money. So as far as utilization, maintenance KPIs were the least used of the three categories. Preventative maintenance scheduling scored highest, but was not used by 22% of respondents. Missed preventative maintenance, that ranked second highest for importance, but that was only 66.7% of fleets. And part of the issue may be related to another finding in this report. 48% of respondents simply do not integrate telematics with maintenance management software, but the engine alert, for instance, is far more useful when that alert is reaching the person scheduling repairs in real time. So that's certainly something to think about.

Jason Cannon:

So with these KPIs and their utilization in mind, where can fleets leverage their telematics to improve their performance?

Jeff Short:

We first did some overall scoring looking at utilization and looking at importance. We merged the list, we combined importance and utilization to rank the overall top KPIs. Every metric in the top KPI list in the top 10 list was related to safety with critical events, speeding, risky behavior. Those are all at the top. That tells us safety is where fleets have most fully developed their use of telematics data to measure performance. They collect these data, they review them and they find the information actionable. What we then looked at were opportunities for greater adoption. It's in that list where we find those KPIs that carriers who are not using them should really consider, have a look at and see if it's possible to measure this KPI, a KPI that's on this list. So we asked the question, which measures are rated higher by users but have capacity for greater use?

And again, these are concrete opportunities that many folks already see as highly valuable. The list includes missed preventative maintenance, engine health, rollover risk indicators, and of course understanding one's cost per mile. And you can see the list right here going all the way down through fault diagnostics, near miss rates, crash rates, preventative maintenance scheduling, seatbelt compliance, driver distraction.

Jason Cannon:

That's it for this week's 10-44. You can read more on ccjdigital.com. While you're there, sign up for our newsletter and stay up to date on the latest in trucking industry news and trends. If you have any questions or feedback, please let us know in the comments below. Don't forget to subscribe and hit the bell for notifications so you can catch us again next week.