The Car and Truck Fleet and Leasing Management Magazine

Home Depot Questions Value of Telematics for Fleet

May 10, 2005

ATLANTA - Executive VP and CIO of The Home Depot, Bob DeRodes, is currently busy conducting the company’s IT transformation. Among new IT expenditures under consideration by the second largest retailer in the United States, is for telematics solutions. Home Depot and GM recently built a prototype “contractor truck” to test the value of telematics in driving up sales of building supplies to contractors who can check availability and place orders directly from building sites via the truck’s onboard telematics terminal, according to the Telematics Journal. “The prototype is interesting, but my question is: ‘How is telematics any better than a cell phone? We’re looking into it. But right now, the value is questionable,” DeRodes told Telematics Journal. His observation mirrors the concerns of some other CIOs who find the technology fascinating but feel they cannot justify the expenditure. It is an unspoken challenge to the telematics industry to prove the benefits in terms of hard dollar ROI and value in attracting or maintaining customers. Anthony Bosco, CIO of Day & Zimmermann, a global company with annual revenue of $1.3 billion and ranked as one of the largest private companies in America by Forbes, agrees with DeRodes. “We just don’t see how telematics applies to us, or can be of help to us,” he said in the Telematics Journal article. Considering Day & Zimmermann businesses include: recruitment and staffing; power-plant maintenance and modifications; security services; munitions and defense operations and maintenance; engineering and construction management; and pharmaceutical and biotech quality control, the lost opportunity for the telematics industry is particularly disappointing. Combined, Day & Zimmermann businesses serve over 1,700 customers and more than 60% of Fortune 100 companies. There are other reasons telematics are not being quickly incorporated in enterprise IT budgets. For example, there are no plans to equip Home Depot’s fleet of customer rental trucks and larger shipping trucks with tracking or other telematics devices, according to DeRodes. The reason: “We just don’t have a problem getting customers to return the trucks as promised nor do we have any significant shipping problems,” he said.
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