A connected vehicle is a vehicle that is equipped with Internet access, allowing it to remotely send and receive data. By 2022, more than half of all vehicles on the road in the U.S. will be connected, allowing them to exchange data with external sources.
According to McKinsey & Company, an average connected vehicle generates approximately 25 gigabytes of data every hour. This data volume promises to further increase as entirely new data sets are incorporated into data transmissions, such as weather conditions, traffic flow, road conditions, etc. The forecast is for data volume from connected vehicles to increase 50-fold in the next 10 years. And, looking even farther into the future, one prediction is that the autonomous vehicles of tomorrow will generate up to 4,000 gigabytes of data per day – that’s over 1,400 terabytes of data per year from a single vehicle. That is impressive in and of itself, but consider that data volume increases a staggering 500-fold if you are operating a 500-unit fleet.
“Our vehicles nowadays are creating constant streams of data and it’s critical that we have the capability to manage and optimize it. It’s not just about geo-location and accelerometer information anymore either, as new technologies have made non-engine vehicle-related data available, such as facial tracking technology to detect drowsiness, seat belt monitors tracking compliance, and much more,” said Carolyn Edwards, senior VP, client success of LeasePlan USA. “Another challenge for fleets alongside this tidal wave of data, will be ensuring that they remain as data agnostic as possible.”
(Editor’s note: “Data agnostic” refers to a system that can work with information received from different databases with dissimilar data formats.)
Interesting but Useless Data
We all agree that data is great and lots of data is perhaps even better, but it poses the question: How do you make it actionable to the specific needs of my fleet and business without the process becoming burdensome on scarce fleet resources?
“Never before have fleet managers had access to the sheer volume and variety of data that they do today, much of it in real-time. But what to do with it? How does a fleet manager filter the ‘interesting but useless’ excruciating detail from that which will truly help manage and reduce costs?” said Bob Cavalli, principal, RAC Fleet Consulting LLC. “Is all real-time data truly actionable? If you manage a 500-unit fleet and a driver in Los Angeles is pumping premium fuel at the end of his or her day, which may be 8 p.m. your time if you are based on the East Coast. What is the value of knowing that in real-time? The mere ability to know something doesn’t speak to its usefulness.”
Similar, but different, types of questions need to be addressed to the operators of fleet data platforms.
“On the other side of the equation, how do providers of that data — FMCs, telematics providers, and OEMs — determine the format and frequency of presenting that data to their customers?” said Cavalli. “What kinds of reports do fleets want and need and pay for? Pre-formatted reports or a data dump with custom reporting capabilities? Or both?”
The volume of the relentless ongoing data stream is aptly illustrated in the following metaphor. “We’re all drinking from the telematics ‘firehose’ of data, which is why it is important to make data actionable,” said Tom Coffey, senior vice president of sales for Merchants Fleet.
Using another metaphor is Frank Dankovich, director of fleet sales for FCA. “Fleet managers are on the verge of a data avalanche. Now is the time to prepare,” said Dankovich.
Despite feeling overwhelmed, fleet managers recognize that Big Data provides new opportunities for them to more effectively manage their fleets. “This is an opportunity because there are more tools than ever to aggregate and present data in meaningful ways. With many systems and large amounts of data, fleet professionals must become more savvy regarding IT, system integration, and data management to minimize information overload,” said Arthur Kappel, CAFM, director of fleet operations for Altice Tech Services.
The Risk of Data Paralysis
AF recently surveyed commercial fleet managers about the challenges they face and one of the recurring themes was the issue of data overload and the potential of data paralysis.
“Telematics has increased the volume of fleet data by a factor of 10, fleet managers are crying out for making things more simple, intuitive, easier to use, summary versus detail reporting. In addition, management by committee demands fleet managers have the right report at the right time with the right story to sell upstairs,” said Tom Callahan, president of Donlen.
The issue of data overload was also cited by Kimberly Fisher, global manager, fleet & travel for National Oilwell Varco. “We get a great deal of data, but I find that sifting through some of that data is a challenge or I just do not have the time to sift through it all to make it useful. We continue to be asked to do more from our companies with less resources. There is such rich data and I feel that we are not applying it to achieve the best results in our fleet,” said Fisher.
In addition to feeling overwhelmed by the volume of data, fleet managers struggle with how to extract actionable data.
“How can we get to the bottom line and use the information for a more productive and cost-effective fleet without going blind. How can we use the new data from in-vehicle modems to compliment other telematics data,” said Brenda Davis, global fleet category manager, indirect sourcing for Baker Hughes.
In the long-run, fleet managers acknowledge that the power of Big Data will make them increasingly dependent on the use of it to manage their assets and drivers.
“Can you still manage a fleet without understanding the insights that your fleet’s data can tell you? How well can a fleet manager function without some grounding and understanding of data, statistics, analytics, and the pitfalls of data manipulation? The leasing companies are strong in this area, but can you effectively manage something if you cannot understand how the solutions were derived; I submit that you cannot,” said Michael Bieger, global fleet manager for Catholic Relief Services.
A widespread response from fleet managers to data overload is the lack of resources and manpower to extract the data and understand it.
“As fleets implement new systems to manage their fleets, there also needs to be a commitment to resources that includes staffing individuals who can extract pertinent data to manage the fleet through the use of metrics and KPIs,” said Tony Orta, fleet operations manager for SoCalGas. “There are countless number of fleets today that are under pressure by senior management to maximize the extraction and usage of key information that can achieve the ROI that was originally promised. This requires the need to have individuals who can efficiently extrapolate the right data and format that information in a useable format for effective decision-making by fleet managers.”
One source of confusion for companies looking to acquire and implement a telematics solution is the multiplicity of service providers who all promise similar or better results.
“There are so many fleet products and services that it becomes hard to decide what is important for your fleet,” said Eliot Bensel, vice president of account development at CEI Fleet Driver Management. “Key stakeholders need to ask difficult questions, such as: ‘How do we justify the initial investment to realize the ROI of a new initiative and make the fleet safer?’ ‘How does this program from one supplier strengthen our efforts with our main provider, and can we integrate the two?’ Taking a step back to see how a product or service will fit into the current ecosystem can often help inform how effective it will be in the fleet.”
This market confusion leads to the fundamental question of whether a corporate fleet wants to be an early adopter or a fast follower.
“There are more tools and services than ever, but as new technologies come along with promises to save lives, time, and money, fleets have to decide when they will choose to adopt the technology. Adopting new safety technologies early can be costly, but it will give your fleet a layer of protection if litigation does occur, because your fleet went above and beyond what your peers in the industry are doing,” said Bensel of CEI.
Developing New Metrics
The job expectations of fleet managers are changing in the new world of fleet connectivity. “A fleet can’t survive on preventive maintenance strategies alone. It must increase its focus on predictive maintenance and be able to tell the story of efficiencies and effectiveness to senior management,” said Orta of SoCalGas.
As Big Data becomes more seamlessly integrated into the fabric of fleet management, it will be necessary to develop new metrics to monitor its use, implementation, and efficacy.
“Having the metrics needed to manage the fleet and share fleet success with management and fleet stakeholders is crucial. Try as hard as you can, if you do not have the metrics to understand how your fleet vehicles are being used and where your money is being spent, it will always be an uphill battle to control the chaos,” said Ed Smith, president and CEO of Agile Fleet. “Using metrics, fleet managers can justify replacement budgets, purchasing new vehicles, or adding automation.”
A common refrain from some fleet managers is that they are being overwhelmed with too much data to make informed decisions.
“With the vast amounts of data pouring in from all the devices and processes that are involved in a fleet operation, making sense of the data is crucial to be able to operate efficiently and effectively. When much of this data comes in, it is raw data. The key is to simplify and organize data in a manner that makes it clear how processes work together and what the trends are on a more granular level,” said Bensel of CEI. “Data should be centralized – having to look in several places to get the full picture is not a viable solution for safety and accident management. One of the biggest trends for making informed decisions is data visualization, which helps make a compelling case when presenting large amounts of data to key stakeholders in the fleet safety program or the fleet operation as a whole.”
One value to utilizing telematics data is to modify and improve driver behavior, along with identifying high-risk drivers before an incident occurs.
“This is a big challenge but also a significant opportunity with the right tools and analytics in place. Traditionally, companies have focused on negotiated maintenance savings, fuel rebates, tire discounts, etc. to reduce costs and while these strategies are certainly still important, effectively managing drivers can have a greater impact on your business,” said Greg Wallingford, director of business development, ARI.
Emerging Legal & Privacy Issues
Data generated by a connected vehicle also includes information that is identifiable to the driver, which is a concern for multinational corporations operating fleets in different global regions that may have more stringent privacy regulations than the U.S.
“As the world becomes more unified in so many ways the need for protection of employee personal data becomes a stronger need. With the enactment of GDPR across the globe, how will you ensure that your drivers’ data is protected,” said Bieger of Catholic Relief Services.
(Editor’s note: The GDPR is an acronym for General Data Protection Regulation, which is a legal framework that sets guidelines for the collection and processing of personal information from individuals who live in the European Union.)
The issue of potential regulatory, legal, and privacy issues associated with the collection and use of Big Data promises to grow in the future.
“On the horizon will be the new laws that could be passed around data generated from the newer cars and concerns about privacy. The state of California has a new law that went into effect in January 2020. This has caused some fleets to update communication to employees in California with respect to the new law. Commercial fleets have one year until they are impacted, but many of us are already having discussions on how to communicate to our California drivers,” said Bret Watson, Lifetime CAFM, manager, corporate fleet for Sprint.
Another potential issue is that the presentation of actionable data is forcing managers to respond to it. What is the potential liability exposure if they do not respond to actionable data, especially if it is discovered after-the-fact during litigation. “As the more actionable information gets in the hands of fleet administrators and managers, the more it will be necessary to act on it. Bold and courageous decision making will need to take place to put into action the information obtained to keep people safe, optimize vehicle use, save money, and tailor solutions that benefit everyone that we serve,” said one anonymous fleet manager.
The question asked by other fleet managers is whether senior managers will be willing to act on actionable data that may be perceived as being controversial within the company. “In particular, is there enough buy-in from key stakeholders to make uncomfortable decisions?” said a fleet manager who did not wish to be identified in the article.
“Are your fleet leaders prepared to make an uncomfortable decision once data is presented that proves that a process in play is not working? Will the fleet be willing to take corrective action on employees evenly? In today’s highly litigious society, the fleet must be able to move swiftly when a program is not doing enough to protect its employees, and corrective action against drivers must be handed out evenly, regardless of their position in the company. Am I prepared to do that? The answer has to be yes,” said Bensel of CEI.
New Uses of Vehicle Data
Almost all fleet managers see value in telematics as a cost-saving and safety tool that identifies under-utilized vehicles, optimizes routing, changes driving behavior to increase safe driving practices or become more fuel-efficient drivers. Telematics data also identifies risky driving behaviors such as harsh braking or jack rabbit acceleration, which allows fleet managers to proactively deal with these high-risk drivers before an incident occurs. However, many drivers continue to remain skeptical and there is pushback from vocal employees who see telematics as Big Brother intrusively entering their work lives.
The widespread use and integration of telematics into sales fleets will add a new dimension to how this data is used by evolving beyond the use from limited behavior monitoring (risky drivers) to a more comprehensive strategic approach that integrates benefit to the business. “The convergence with sales force tools is coming quickly and it’s not an area fleet is typically engaged, nor should the fleet department initiate,” said one fleet manager.
“In order to effectively use analytics to make a meaningful impact on your business, it is necessary you understand how fleet influences and aligns with your corporate strategy. And this doesn’t always mean simply looking to cut costs. It could mean increasing your fleets’ revenue generating capabilities by minimizing downtime, allowing drivers to complete more deliveries, or increasing efficiency to optimize profitability. What’s your business strategy and how does fleet align with and support those objectives,” said Wallingford of ARI. “With this clarity and an analytics strategy designed to address your business challenges, you’ll be well positioned to remain agile and align fleet decisions with the evolving needs of your organization.”
Customer requirements are causing the adoption of new technology and data analytics to move to the forefront at many fleets, especially among some vocational fleets.
“Even though fleets have a fairly simple mission that appears to not have the need for technology — delivering a product or service safely and on time without loss, damage, or delay — technology is taking over the industry. Customer demands, the need for greater efficiency, the need to do more with less when it comes to support functions, the drive to improve safety performance, and the changing employer/employee relationship are all reasons the use of technology is in the industry and increasing,” said Tom Bray, editor for J.J. Keller & Associates. “As a result, fleets are having to make decisions related to purchasing technology (safety systems, customer interface programs, electronic logs, communications and tracking systems, etc.) and having to find ways to effectively deal with and use all the data the technology is generating.”
Similarly, there is a synergy with the automotive industry’s use of Big Data and how its fleet customers are using it.
“At FCA, Big Data is primarily used to enhance vehicle performance in the areas of design, engineering, reliability, efficiency and safety. However, fleet managers can also harness the power of Big Data to monitor not only the performance of their vehicles, but also the performance of their drivers. This includes everything from travel routes, driving behavior, vehicle incidents, and fleet utilization rates. The challenge we will face in the future is to distill the raw data into useful and insightful information. This challenge will only intensify with the introduction of connected vehicles. These vehicles will collect and transmit data on themselves, their drivers and on other vehicles around them – all in real-time,” said Dankovich of FCA.
Greater Reliance on Data
Telematics has a proven track record in making a positive impact on identifying at-risk drivers and helping to modify driver behavior.
“While fleet managers have been leveraging data for many years relative to the vehicle, a focus has shifted more on using data for behavior monitoring and tracking, which of course can impact operating costs dramatically” said Brad Jacobs, director of fleet consulting for Merchants Fleet. “These available data systems include cameras, sensors, onboard computers and more that keep track of the vehicle, the driver and materials being transported. Many of these systems are OEM-supplied now or installed through an upfitter. Fleet managers are increasingly seeking predictive analytics and proactive exception reporting to better manage their fleets.”
As telematics devices proliferate within fleets, there is an increase on the reliance of telematics data for maintenance. “Maintenance scheduling and checking for parts availability are a few features many fleets are already leveraging today by using telematics data to help controls costs and limit downtime. This will only continue to rise in 2020 and beyond,” said George Albright, director of fleet maintenance for Merchants Fleet.
Fleet managers are increasingly seeking predictive analytics and proactive exception reporting to help better operate their fleets and manage maintenance spend.
“In one case, predictive models are now being used to predict vehicle odometer. In turn, more accurate odometer forecasting allows models that predict repair needs and prescribe where and when to seek service to run more efficiently. These models collectively work to drive up scheduled maintenance compliance and network utilization,” said John Wuich, vice president strategic consulting services for Donlen.
In addition, modeling is also being used to understand the impact to TCO from downtime due to maintenance repairs. “Modeling is being used to manage and reduce downtime associated with repairs. Here, dashboards are used to identify which assets are down and the length of downtime, allowing for intervention to find needed parts, replacement assets and for communications,” said Wuich. “Finally, analytics are being used to prescribe preventive services on parameters such as fuel consumption and engine life – something other than simply looking at mileage and/or days intervals.”
According to fleet management companies, the number of fleets employing telematics systems for maintenance management is on the rise. A key advantage to telematics systems is the ability to spot maintenance issues at their inception before they become larger and more expensive problems using telematics diagnostic trouble codes (DTC).