BusinessCorporate FinanceFleet special: the value of vehicle tracking

Fleet special: the value of vehicle tracking

Vehicle tracking may seem like just another addition to life with Big Brother. But by installing tracking systems in fleet cars, companies are able to manage their vehicles and drivers more efficiently - if only they can handle the data

Imagine your company could track every vehicle in its fleet, be it an
executive car or an engineer’s van, at very little cost, wherever it is in the

Add to this the ability to grab every conceivable type of telemetry data from
every car on the road, right down to every gear change, and one has to wonder
why anyone would want, or need, all this information.

Today’s technology can give fleet managers the ability to collect an
impressive volume of statistics in real time. Hidden in all that data will be
some fairly important facts about the motoring characteristics of all the
company’s drivers.

For any organisation involved in routing and scheduling, there will also be
some priceless logistical information. All it takes is a little analysis and the
ability to ask the right questions of the data.

Tom O’Connor, chief executive of vehicle tracking specialist Digicore UK,
points out that companies deploying a vehicle tracking system need to be clear,
from the outset, what they would like the system to do. ‘Some just want basic
vehicle tracking. If all they want is real-time positional information on every
vehicle, it will cost them somewhere in the region of a pound a day. But the
systems can do a whole lot more than this.’

Some issues are more immediate for the client company than others. For vans
and trucks, fuel efficiency and routing efficiency tend to be major concerns.
For company cars, deeper compliance with health and safety is a more pressing

‘What we try to tell companies is that it can fundamentally change the way
they do business. They can work smarter by using the knowledge that vehicle
tracking and the associated telemetry can offer,’ O’Connor says.

He points out that companies are under a lot of pressure in today’s economic
climate to extract the maximum value from their assets, regardless of whether
they have vans or salespeople on the road. ‘One of the first things that t
racking and telemetry in combination can reveal is whether you have too many, or
too few, assets deployed,’ he says.

The system will track the amount of time a van or car remains immobile in the
car park, so underutilised assets can be seen at a glance at the monthly report.
Often there are more cost-effective ways of dealing with peaks. The company can
put contracts in place to hire more vehicles on a temporary basis, for example.

This could well work out cheaper than leasing all the vehicles that the
company could possibly require at its busiest period, and then watching them sit
idle at the depot.

The telemetry that comes with the vehicle tracking will reveal which company
fleet drivers are driving more aggressively than others. Brake wear, tyre wear
and rapid acceleration away from lights and stop junctions are a dead giveaway,
and these trends can all be flagged up by exception reporting, without having to
read through mountains of figures in order to obtain the information.

‘The point is not to play Big Brother. The system should not be used to
entrap or punish people,’ O’Connor argues. Rather, the point of using the
telemetry to identify rogue driving trends is to help the company pinpoint
drivers who might benefit from either a quiet word or advanced driver training.

At the same time, the company is putting itself in a much better position to
defend its record. If its executives ever find themselves in court charged with
corporate manslaughter as a result of one of their drivers being involved in a
fatal accident, company officers will have a defence. They will be able to show
that the company was diligent in taking all possible steps to monitor and
improve driving skills in its team of drivers.

Of course, this can also have a negative effect and, if tracking is
mishandled, companies could experience a backlash from disgruntled employees.
They could even find staff voting with their feet and heading for the
opposition. But O’Connor argues that this can be overcome if the company c
ommunicates its intentions properly with its drivers.

One of the great advantages of vehicle tracking for a sales team, for
example, is that because the position of the vehicle can be seen in real time,
the company can be proactive about any potential delay or hold-up.

Another great benefit is the ability to trigger alerts based on the
information provided by the telemetry. So, if a salesperson has six visits
scheduled for the day, the system can send an alert as soon as the car starts to
move again after each visit.

It also means that a salesperson who decides to take the afternoon off
playing golf instead of doing client rounds will have to explain why their car
was parked at Happy Valley Golf Club for four hours that afternoon.

No matter how well vehicle tracking is communicated to staff, there will be
occasions where staff will resent having their whereabouts tracked by the
company. O’Connor says this can be addressed by using a ‘business usage/private
usage’ switch in the car that stops transmitting or recording as soon as the
privacy mode is activated.

Stuart Gall, a director of vehicle tracking specialists Toad Group, explains
that, outside logistics, one of the most popular uses of vehicle tracking
devices in cars is for what is euphemistically known as vehicle recovery, where
the device is able to signal the whereabouts of a stolen vehicle.

The recovery company can locate and secure the vehicle before the thief
locates the tracking device. ‘Often, what companies do is put two devices in the
vehicle; one that is hidden and hard to find and one that is obvious,’ Gall
says. This is great for the company selling the device, of course, because it
gets to sell two for each car instead of one.

The professional car thief is rather more difficult to deter. ‘They will
often steal a vehicle and park it somewhere where they can watch it for 24
hours. If someone turns up to repossess the vehicle, then they’ll know it has a
tracker hidden within it,’ he says.

The benefits of using a vehicle tracking system are many and – as long as the
client company keeps its staff informed of its motives and intentions – should
prove effective.

This is an edited version of an article that originally appeared in
Accountancy Age sister title Financial Director

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