It’s clear now what data needs to be analyzed to improve your company’s fleet financials.
In the July/August issue of Fleet Financials, fleet management company subject-matter experts shared steps on how to better leverage the growing amount of data generated by fleet analytics. Now, these same subject-matter experts discuss how to turn this analytical knowledge into action and cost-saving strategies.
Knowing the Value of Data
According to Don Woods, department head, Client Information Systems (CIS) at ARI, “a fleet manager needs to be able to answer several critical questions when looking to leverage their fleet’s data to their advantage.”
These questions include:
- What are you going to measure?
- How are you going to measure it?
- What data can you obtain inside your organization, through your supply chain, or third-party technology solutions?
- How is it connected and related?
- Are there any legal or regulatory restrictions (especially if the fleet is part of a global organization)?
- What does your output look like, i.e. what are you aiming to produce?
“There is real power in data, which can serve as the catalyst for introducing significant and positive change throughout a fleet. But, analytics involves more than just having the data. Fleet managers must make sure they understand what the data is telling them, which means they need systems to help them make sense of it all. Meaningful action and genuine cost savings can only be uncovered once you have the ability to not just see the data, but to understand it as well,” Woods said.
As always, policy is key. Once you have fleet analytics in hand, and have spent the time analyzing the data, your main goal is to hold your gains.
“It is important to hold the gains, so tying them to the fleet or company policy and then monitoring performance is key. Leverage exceptions reports with the field and hold recurring management calls to review the trends and required actions. Focus on areas with the greatest opportunity and push incremental change,” said Dan Hannan, executive director of strategic consulting for Merchants Fleet Management.
Understanding the value of analytics is also extremely important.
“Predictive analytics enable fleet managers to forecast future fleet costs under a variety of different scenarios. They are able to find optimal scenarios that generate reduced costs and then drive fleet behavior to achieve those scenarios. Some fleet managers are using data to drive competition among the drivers. By publishing driver scorecards and providing awards, whether monetary or recognition based, drivers are educated about their ability to help control fleet costs and impact the bottom line,” said Amy Blaine, VP – Consulting, Analytics, and Sustainability for Donlen.
And, don’t forget all possible data points.
“There are four key areas that generate fleet data: the driver, the vehicle, the journey, and the vendor. Being able to tap into each of these four areas can yield huge amounts of analytical data for fleet managers — everything from vehicle availability, to telematics trip and diagnostic information, to motor vehicle record checks or fuel cost capture,” said Woods of ARI.
Finally, discussions must be had.
“Reports are powerful, but not full of impact if an organization is not having dialogue about the data; it’s important to talk about it,” according to Hannan of Merchants.
Additionally, leverage the knowledge of subject-matter experts.
“Fleet managers are leveraging industry experts or statistically trained individuals to assist in their more complex data and analytic inquiries. This collaborative effort typically renders actionable ‘out-of-the-box’ logic and analyses,” said Mark Donahue Jr., manager of fleet analytics for EMKAY.
Finally, know your fleet.
“Fleet managers need to understand the ‘levers’ that directly, or indirectly, impact the fleet’s cost-savings objectives. Cost savings can be influenced from many factors including fleet policy, operational efficiencies, fleet vehicle strategies, and corporate culture relative to vehicle usage,” noted Jeff Hurrell, regional sales manager – West Region for Union Leasing.
Making Ever-Lasting Change
A few trends are starting to pop up to help make ever-lasting change in fleet operations and further leverage analytics. Some of the key trends include using data for predictive analysis, accident data analysis, and gamification.
“The creative and ‘out-of-the-box’ actions are occurring when fleet managers look for ways to correlate seemingly unrelated sources of data — in other words, finding ways to use data beyond its intended use,” noted Woods of ARI.
For example, Woods explained that fleet managers are accustomed to managing maintenance and repair data for purposes of keeping their vehicles safe, compliant, and on the road.
“Predictive analysis allows this data to become even more valuable by allowing fleet managers to use this data to predict breakdowns or component failures, which, in turn, allows them to avoid costs by minimizing downtime,” Woods said.
Fleet managers are also starting to compare their fuel card provider data to their driver data through their fleet management partner database or internal system.
“They match fuel data recorded to the assigned driver in the database to note updates that may be needed for more accurate driver information,” noted Laurie Hunter, senior account manager at LeasePlan USA. “This is a best practice that leads to time and cost savings. For example, updated data avoids problems with the vehicle registration process, such as having to re-register or request duplicates sent to incorrect address. Fleet managers can also use this data to get their drivers to their closest maintenance centers, instead of directing them to a location based on inaccurate driver information.”
Fleet managers are also looking toward creating rewards and incentive initiatives.
“Rewards and incentive initiatives encourage greater care and engagement amongst drivers. We’ve seen some organizations develop healthy competitions amongst divisions and institutes as part of existing bonus programs,” said Hannan of Merchants.
Utilizing a game-like rewards program is another way to incentivize drivers.
“The ability to gather and analyze driver behavior data allows companies to implement successful gamification programs where drivers are incented on behaviors that benefit their organizations. Gamification is one of the growing trends in the fleet industry right now,” said Marcin Michno, project manager, Strategic Consulting for Element Fleet Management.
In addition to looking at fleet data to drive down their costs, Terri Wallace, VP of the Client Experience for Mike Albert Fleet Solutions, recommends that fleet managers should look at data to drive growth and revenue within their business.
“For instance, fleet managers can use vehicle wraps and graphics to increase brand awareness, improve brand recognition — increasing overall sales. A vehicle can generate 30,000-70,000 impressions per day and 75 percent of consumers form an impression about a company based on its graphics. Vehicle wraps cost approximately $0.48 per impression, while other advertising mediums can be as high as $23.70,” Wallace said.
Analytics can also help find solutions to reduce accident incidents.
“Discussions with one fleet manager led us to test the hypothesis that certain driver behaviors, such as harsh braking, could lead to a higher accident rate. Using telematics data, we connected the harsh breaking data to the accident information. Further analysis showed the drivers with higher harsh braking tendencies also had a noticeably higher accident rate over their peer group. With this data in hand the fleet manager was able to work on an action plan to message and assign relevant training,” said Candyce Trautwein, senior data analyst for GE Capital Fleet Services.
Another innovative way fleet managers are using this data is for accident impact analysis.
“Telematics systems have the ability to generate vast amounts of information about a vehicle’s journey. Telematics units fitted with high resolution g-force sensors can now monitor vehicles during a road accident and feed that data back to fleet management companies. The data can then be analyzed to instigate a claims management process and help determine who was at fault,” said Woods of ARI.
The bottom line? “It is what we do with the data that is going to have the most impact. Analytics is the future of everything,” said Donahue of EMKAY.
Originally posted on Fleet Financials