GPS tracking proves its worth
From the Fleet Management October 2012 print edition
Hensall District Co-Operative’s 120 truck drivers are safer than ever since the August 2011 installation of Shaw Tracking’s top-of-the-line MCP200, a wireless GPS vehicle tracking system.
“Despite the fact Hensall District Co-Operative (HDC) already had a great Commercial Vehicle Operation Registration Certificate rating, typically under 10 percent, we wanted continuous improvement, because if you stop trying to get better, you will get worse, ” says Mike Millian, driver and vehicle safety auditor, safety compliance and training, Hensall District Co-Operative (HDC) in Hensall, Ontario. “Right now, we’re at seven percent, but our CVOR rate ebbs and flows. It’s been as low as three percent and as high as 24 percent. You get suspended when your CVOR hits 100 percent. Our long term goal is to keep our CVOR below 10 percent.”
HDC has annual sales of over $500 million, employs more than 400 staff and services approximately 4,500 farmer members. Last year, HDC’s truck fleet ran 5.4 million kilometres, equivalent to 135 round-the-world trips. Its truck fleet transports everything from animal feed, fertilizer, herbicides and seed to diesel fuel, gasoline, furnace oil and propane. In addition, HDC operates a grain and bean elevator system.
“Was I worried about unsafe driver behavior? No! HDC has had a consistently good safety record, but if a driver is going 15 to 20km over the posted 80kmh limit, it’s not helping our public image,” says Millian. “When a big truck that’s got our name written all over it goes barreling down a road—it doesn’t look good. While we get few complaints about the behaviors of our professional drivers, we can always improve any facet of our operation, which includes our fleet and drivers. Our new telematics system is just one more way to do that.”
Last August, the co-op installed Shaw’s MPC200 system on 74 of its 107 trucks. The MPC200 has essentially the same features as the telematics system it replaced, but it’s known for its robust reliability, a key consideration in view of the fact the previous product was prone to failure every one to four months.
After pulling out the competitor’s units, for which HDC paid $800 each plus a monthly service fee, HDC’s year-round truck fleet went 18 months without telematics. Managers and dispatchers missed seeing where their trucks were for dispatching purposes, and Millian missed the data on behaviours, which included idling, speed and harsh braking.
It made sense to install Shaw’s MCP200 on the vehicles that work year-round, but not on the seasonal vehicles that cover just 4,000 to 5,000km in a six-week period. The co-op spent $2,290 per truck for the MPC200, including the plate and mounting, in addition to the monthly $59 service fee, which also covers airtime.
A taste for telematics
HDC’s first telematics system had given Millian and HDC a taste of what a truly dependable telematics system should be able to do and the possible repercussions when it didn’t perform. When the competitive system worked, it effectively showed Millian and the HDC management team where the trucks were and how fast they were going. However, because the units had a 20 percent failure rate, the constant replacement reduced both productivity and efficiency. Unfortunately, it also shook employees’ and drivers’ faith in telematics and provided them with ready arguments whenever HDC challenged them on their results, speeding and other questionable behaviours.
“I don’t believe it! How accurate can those things really be if they’re always breaking down?”
HDC had to concede the drivers had a point and realized unless HDC and its employees could completely trust the telematics units, they were inherently useless. “Our first telematics experience was not positive and we knew that we would need to make the necessary investment in a truly dependable system,” says Millian. “We took our time, did the research and spent what was required to get exactly the right fit.”
The wish list
Once again, HDC wanted a GPS wireless tracking system that also provided PDF viewing, printed, automated driver tracking, electronic logbooks, vehicle positioning via GPS, optional Wi-Fi, integrated text-to-speech, over-the-air software upgrades, in-cab training and more. Because he is firmly convinced the government will mandate electronic logbooks within two to five years, Millian insisted on that capability and his drivers have been successfully using Shaw’s electronic logbook function since October 2011.
After zeroing in on two highly reputable firms, HDC did the due diligence. It took a full year to assess the various pros and cons and speak at length with a number of users. Millian had piloted the first system on 11 vehicles for three months before rolling it out. This time, he figured it made more sense to have candid conversations with long-time users about their first-hand experiences.
Drivers worked with Shaw’s MCP200 onboard for about a week without knowing it was there because Millian, away on business, hadn’t mentioned the capabilities of the system. Upon his return, he called a meeting and presented managers and drivers with a full week of data. Drivers’ names had been blocked out, but it was tangible proof that there was room for improvement.
Drivers and their managers receive daily and weekly reports on the overall fleet and division results, as well as the individual’s status. These results are shared with drivers so they can see how their group stacks up against others, and how it compares to the overall fleet numbers. Drivers who get more than five speeding violations in a single day (a speeding violation is anything more than 10 kmh above the posted speed) receive an email telling them how many they had and asking them to improve on this in the future. Some drivers do complain when they get the reports that enumerate their warnings, but Millian simply responds with, “If you don’t want to get speeding notices—stop speeding.”
At this point, Millian isn’t prepared to discuss the return on the investment in Shaw’s MCP200 quite simply because he needs to track at least two full years of data to accurately assess the payback. Those figures should be available in early 2014. He expects the bulk of the cost savings to come through improved fuel consumption.
“In colder temperatures, the engine works harder regardless of speed and braking,” says Millian. “If the engine is pushing that vehicle through snow, the extra drag also boosts consumption.”
Unfortunately, he’s not expecting the telematics system and related behavioural changes will earn HDC a rate break from its insurance firm. While sticking to the speed limit and avoiding hard braking is safer, at best, a fleet manager can hope the typical annual rate increase won’t be as high. As Millian points out, even when HDC achieved its two percent CVOR—a company record—its insurance rate remained the same.
Rewards for good driving
Millian is so sure the telematics system will reduce HDC’s fuel costs and even lengthen the vehicles’ lifecycles, HDC has committed to a bonus system they expect to implement in 2013. “I was a driver for eight years, so I know what it looks like from both sides,” says Millian. The system is being developed according to data he’s been collecting since January 2012. As he puts it, he needed a solid baseline on which to base the various thresholds for each individual driver because he had to be absolutely sure the new system was both fair and accurate.
Bonuses will be based on several factors, such as hard braking, speeding and idling. Exact details of how this will break down will be presented to HDC’s drivers in late November and early December.
“You do what you can to motivate them,” Millian says. “If we’re giving them a hard time over unacceptable behavior, we need to reward them for meeting our expectations. No matter what we work at, we all like, and need, to be told how good a job we are doing. At the same time, we need to realize all people are different. Some individuals do their best because that’s who they are. Others need a more tangible incentive.”
From a purely practical point of view, Millian also recognizes that savvy drivers realize their driving behaviours are sure to save HDC cold hard cash. Understandably, they’d like their share of those savings and Millian knows that’s only fair. “If they’re on the road an extra 15 to 30 minutes because they drove more safely and fuel efficiently, they should get something out of it,” says Millian. “This safety bonus system is HDC’s way of profit-sharing and giving back some of what they’ve saved HDC.”