The global construction industry accounts for between 25-40% of the worlds carbon emissions from all its gas-guzzling assets. It’s no surprise construction companies are under intense scrutiny over fuel consumption. Increasingly rigid government regulations are demanding accountability for every drop of fuel that goes into an asset’s tank and how every one of those drops are being spent. Public opinion now plays an equally strong value on sales and gas-dependent companies need to get green to keep and gain more clients, especially regarding lucrative government contracts. Construction fleet managers are needing to report on behaviors they once took for granted and providing detailed data beyond the amount of fuel purchased. They need to know where, how, and why it’s being spent. Traditional methods of manual data collection are no longer adequate and new industry leaders must implement more efficient solutions. The need for accurate reporting tools has become clear, and gas giants like BP are painting perspectives for their customers on the imperative benefits of having automated & integrated fuel management systems, like SM2. At Coencorp, we always start with the individual’s unique needs, so let’s start there to illustrate what BP is telling all fuel consuming industries.
Pay Attention, Or You'll Pay!
I was planning my budget the other day and thinking about how much gas I used for trips to and from work, to do groceries, to the gym, to go on weekend outings with friends and family, and I realized that other than the mileage on my odometer, I didn’t really track where I spent on fuel each week; much less for each month, or year. I suppose if I knew I’d be a little shocked, and I’d also be a little more careful about what I paid for gas, how I operated my car, and how many trips I made each day. The truth was, I only had a vague idea about my gas spending behavior and I probably wouldn’t even see if my changes made any major difference or not to my single car usage. Then I thought about my clients.
In our previous article, we discussed the importance of capturing real-time data when managing a fleet. However having loads of raw data flooding in is one thing, being able to visually organize and analyze it all in real-time is a whole different challenge for most fleet managers. Increasingly, companies and industries demand real-time insights in order to fully understand what is going on within their organizations. What are the advantages of real-time data analytics, where are the challenges, and which tools can be used for real-time processing of the live data?
Across industries and markets, we hear the call to real-time data collection and its importance to profitable big data analytics. Companies with fleets to manage have known this for a long time and continue to partner with fleet management system (FMS) suppliers to improve business practices and outcomes.
One-Size Fits All vs One-Stop Shop
The implementation of a fully integrated fleet management system that answers the challenges of a vast diversity of industries and companies needing them is realizable when the supplier builds its system on these strong values: flexibility, adaptability, scalability, and user-focused functionality. Most companies’ needs vary beyond what combination of equipment and assets they own; they include the very human factors of management styles, objectives, and visions. In reality, one-size-fits-all solutions often fail because no two fleets are exactly alike. Your ideal fleet management solution must be built on an equal understanding of the equipment being used and the people who will be using them: the fleet managers and equipment users.
Here are a few key needs our clients have identified in their industries:
- Automated tracking and control of stationary fleet fueling facilities, mobile fuel tanks & deliveries, and remote tanks & generators,
- Maintenance bay management
- Yard access/gates &doors control
- Tracking fuel during transportation
- Recording & managing fuel drops at mine sites
- Remote generator management, including real-time capture of fuel tank levels
- Controlling and tracking fueling transactions at fixed and mobile tanks
- Managing maintenance of various vehicles and equipment (maintenance plans, work orders, parts, labor, etc.)
- Access control (gates, doors, etc.)
- Automatic, real-time tracking of fuel in transit
- Automatic, real-time tracking of fuel drops
- Management and control of fleet fueling facilities, fuel depots, mobile tanks, pumps, remote tanks, and remote generators
- Maintenance bay management
- Automatically manage distribution of fuel and other fluids at all maintenance bays
- Automatically manage inspection bays and lube bays
- Manage maintenance of vehicles and equipment (work orders, recalls, parts & labor, warranty tracking, etc.)
- Track buses and passenger count in real-time
- Control access to facilities and buildings
- Automatic fuel management
- Maintenance & work order management
- Vehicle tracking and driver’s logs
- Automatic access control (gates, doors, etc.)
How Can We All Come Together?
While there are some differences across industries, the two points remain consistent: the data collected must be automatic, real-time, and accurate, and the ability to pull reports on the data must be flexible to the needs of the individual company. Whether operating a refinery, fuel depot, transporting fuel, or providing mobile services in any industry, the cost of fuel, labor, and maintenance are among the highest and, more importantly, these activities are operationally critical. They need to be managed accurately with full accountability. It has been a major challenge for fleeted organizations in any industry to manage their operations with technologies incapable of providing automated, seamless, and integrated solutions.
Where Your Fuel Management System Makes You Money
When discussing the high costs of fleet management, our customers often tell us fuel consumption is on par with expenses related to labor. In fact, they tend to complement each other in clear and trackable ways. The most obvious is when your fleet increases in size, so do labor and fuel expenses. However the relational increase isn’t always a one to one ratio. The question is why it sometimes seems to increase exponentially.
WHO IS COENCORP?
Ask their customers for the advantages of working with the Coencorp team and you will get
beautiful stories describing the five pillars of the company: Accessibility, Adaptability,
Automation, Accountability, and Amalgamation. These pillars describe much more than the
services and products developed over the past twenty-seven years, they describe the
founders’ values. Moreover, each of these five “A”s have driven their vision since the exciting
call for help from their first and oldest client. It was this client that gave the founders the
opportunity to build everything around their core values: People Centered, Quality Driven,
Whenever a firm lists its requirements for any system, be it for the management of fuel, maintenance, or real-time tracking of assets in the field, that list typically revolves around two basic ideas: record keeping and control. We want to make sure certain things get done at certain times, some things only happen under specific conditions, and reports exist to account for whatever has already occurred. Spec requirements often specify the exact reports the fleet managers look for and how operations are to be conducted, but they rarely detail how exceptions are to be handled.
Many fleets spend tens or even hundreds of thousands of dollars to implement a vehicle maintenance management system. They pay recurring license fees to use that software to handle crucial maintenance related areas such as parts, maintenance plans, vehicle recalls, and work orders. However many of those companies then turn around and act as though all the time and money they spent putting those maintenance systems in place was just burning a hole through their pockets!
The importance of a preventive maintenance system in any fleet operation cannot be overstated. Repairs tend to be much more expensive than maintenance, and unforeseen breakdowns can have a direct impact on the bottom line.
However, there is one benefit of a PM system that doesn’t come up as often and yet has a potentially significant financial impact. Good maintenance management software can help you decide when to stop maintaining a vehicle in favor of a replacement.
Anyone who has had an old car has come to a point where repairs became more and more frequent and expensive. This situation typically leads to yet another expensive repair that begs the question: “should I repair this old thing and keep it alive, or bite the bullet and invest in a new car?” The answer to that lies within the repair history of the vehicle versus its capital cost.
In this context, what is capital cost? Here is the short version: when a business acquires a vehicle, that vehicle’s value depreciates over time. The depreciation amount over the course of a year is tax deductible. Also, the dollar value of that depreciation goes down from one year to another since it is calculated as a percentage of the remaining value of the vehicle.
In parallel to a vehicle’s capital cost, the total cost of maintaining a vehicle tends to increase from one year to the next, as it gets older and needs more and more TLC as a result.
Capital cost goes down over time; maintenance cost goes up over time. Inevitably, those two curves will intersect at some point. Once that point of intersection is passed, it is time to sell the vehicle and get a new one because now the cost of maintenance is greater than the savings derived from the tax deductible cost of capital.
None of that analysis would be possible without tracking the maintenance history and cost of a given asset. This is another example of how crucial measurement and tracking are to proper management. Implementing a proper PM system is essential to anyone managing a fleet, not only to avoid breakdowns and extend the useful life of vehicles, but also to properly assess when to replace a given asset.