Converting GPS Fleet Data. Into Operational Savings and Efficiency STORMGPS.COM

Converting GPS Fleet Data Into Operational Savings and Efficiency S TO R MGPS.COM

Converting GPS Fleet Data Into Operational Savings And Efficiency

www.stormgps.com

Are you turning your fleet data into actionable and measurable information? Hardware is now installed in your fleet. Data is flowing into your software application. Now what? This white paper describes in detail a proven methodology developed by Storm Telematics to measure value – the value of the data collected from your mobile fleet, the value of having your fleet equipped with telematics and most importantly the value of what you can do next with the data collected. We understand that managing a fleet is a daunting and continuous task that requires focus and attention - otherwise you are not maximizing the return on investment that you have made. From a big picture perspective, Storm Telematics recommends a structured and phased approach to optimizing fleet assets. Optimize, Analyze, Emphasize…

PHASE –1 OPTIMIZE

≥

PHASE –2 A N A LY Z E

≥

PHASE–3 EMPHASIZE

Install Hardware

Measure Fleet Data (2-4 Metrics)

Best Practices Implemented and Efficiency Trending

COM PLE TED

N OT S TA R TED

N OT S TA R TED

Aligning measurements to corporate objectives

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Converting GPS Fleet Data Into Operational Savings And Efficiency

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Storm’s approach gives you a clearer picture of how your fleet is currently operating, the associated operating costs and where savings can be achieved. From this you will have an actionable plan with quantified expectations of benefit. The knowledge and experience shared in this white paper will help your business operate in a smooth and efficient manner while reducing risk around improvement efforts.

Alignment Achieving optimal performance means alignment with your strategy. Storm Telematics will assess, envision and design your fleet processes to achieve desired results. Our goal is to empower your organization to drive process improvements and business innovation to reduce cost, enhance safety, increase equipment utilization, and maximize efficiencies.

We remain enthusiastically on standby to assist 1.800.309.8354

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Converting GPS Fleet Data Into Operational Savings And Efficiency

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Analyzing metrics that matter

Once you’ve implemented an enterprise solution to manage your fleet, there is a tremendous amount of data that can be analyzed to drive efficiency. Storm recommends measuring 3-4 metrics in the first 6 months. We recommend measuring idling due to the high cost of fuel, speeding as it has a direct impact on the safety of your workforce, and off-hour usage as it may be a taxable benefit concern for your CFO. The following fleet summary is an actual analysis conducted for a Storm Telematics client. It represents the activity of 25 assets over a 90-day period.

SUMMARY

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Converting GPS Fleet Data Into Operational Savings And Efficiency

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Actual speeding costs with measured savings Prior to implementing change within your fleet, you must first understand the current operating state. By analyzing the data collected you will uncover inefficiencies, establish a baseline and focus on the areas that require improvements.

Deciphering the Numbers This client was specifically interested in hard dollar savings (as opposed to soft benefits and cost avoidance costs) from their fleet. As a result, the speeding data is

calculated for instances above 100km/h, rather than over the posted speed limit. The reason is that 100km/h is the speed at which fuel consumption and wear and tear on vehicles begins to rapidly accelerate. Clients most concerned with safety and reputation may prefer to assess speeding over the posted limit only.

S P E E D I N G D ATA O V E R V I E W ( 9 0 D AY S ) # of Assets

Avg. Distance Travelled (KMS Speeding)

Avg. Time Speeding (Hrs.)

% of Speeding (Distance)

% of Speeding (Drive Time)

25

626.40

5 . 57

9. 4 6 %

2.55%

Speeding data analysis is broken into three sections. The first, Speeding Data Overview which outlines the current speeding patterns of the fleet, adjusted to ensure only prolonged travel over 100km/h is calculated. This current fleet data indicates that the average driver is travelling 9.46% of their total kilometers driven over 100km/h. Projecting this behavior to the rest of the fleet and over

the course of a year, we can project the total unnecessary wasted fuel cost that the organization is spending based on drivers travelling more than 100km/h. This has been calculated for the 25 assets over the 90-day reporting period and has been projected annually and over the entire fleet.

UNNECESSARY WAS TED FUEL COS T SUMM ARY 1 # of Assets

Cost of Fuel Due to Speeding (90 Days)

Annualized Cost (25 Vehicles)

Annualized Cost (Full Fleet)

25

$ 3 ,078 . 8 8

$16,964.21

$ 1 3 5 ,7 1 3 .71

The third section shows the Projected Savings Summary. This analysis shows the realistic expected savings in fuel costs, maintenance and vehicle replacement costs due to wear and tear from reducing the speeding in their fleet. The target rate for reduction is 3% of total distance travelled over 100km/h. The suggested target

is consistent with the better drivers that were measured against within their fleet, ensuring it is realistic for how they conduct their business. Moving all drivers down to this level of speeding through targeted programs is projected to save the organization approximately $38,000 annually.

PR O J EC T E D S AV I N GS S U M M A RY Savings

Projected Fuel Savings

Projected Maintenance Savings

Projected Deterioration Savings

New Target % of Speeding (Distance)

25 Assets

$2,515.16 ($100.61 Avg. per vehicle)

$850.98 ($34.04 Avg. per vehicle)

$1,330.30 ($53.21 Avg. per vehicle)

3%

Full Roll-out Annual Savings

$20,121.29

$6,807.87

$10,642.33

3%

Assumptions:

1) Fuel costs are based on $1.05 paer litre and 16 MPG (UK) average fuel economy - and are calculated over 100 km/h 2) Based on 20% increase in fuel costs, 50% increase in average maintenance costs and 5% average reduction in vehicle life - while speeding

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Actual idling costs and measured savings I D L I N G D ATA O V E R V I E W ( 9 0 D AY S ) # of Assets

Total time Idling (Hrs.)

Fuel Used Idling (Litres)

% Idling (Run Time)

25

4 , 676 .70 ( 1 87.07 Av g . )

1 1 679. 3 ( 4 67.1 7 Av g . )

37. 2 8 %

Deciphering the Numbers Idling can be one of the largest wasted fuel costs to an organization, but it also increases wear and tear on a vehicle, increasing maintenance and vehicle replacement costs. To track this costly issue, the SMART-vu Pro platform offers extensive, configurable idling alerting & reporting. For this client, whose vehicles are often on a construction site, prolonged idling over 20 minutes was a primary concern. This threshold is easily adjusted based on business needs. Greenhouse gas emissions from idling can also be calculated, for those clients concerned with maintaining a green fleet.

WAS TED FUEL COS T SUMM ARY 1 # of Assets

Cost of Fuel Due to Idling (90 Days)

Annualized Cost (25 Vehicles)

Annualized Cost (Full Fleet)

25

$ 1 2 , 2 63 . 2 5

$ 6 2 , 8 4 0.1 7

$ 5 0 2 ,72 1 . 36

Similar to the speeding analysis, the current idling behavior of drivers was calculated at an average of 37.28% of total vehicle run time as prolonged idling. Based on this rate, the total wasted fuel cost of all instances of prolonged idling is significant. In this case, costing the organization $12,263 for 90 days in excessive fuel costs, annualized at $62,840.

PR O J EC T E D S AV I N GS S U M M A RY2 Savings

Projected Fuel Savings

Projected Maintenance Savings

Projected Deterioration Savings

New Target % of Idling (Idle Time)

25 Assets

$ 2 ,1 0 47. 63 ( $ 8 4 1 . 9 1 Av g . p e r ve hicl e)

$ 3 5 6 9. 5 4 ( $ 1 4 2 .78 Av g. p er veh i c l e)

$ 3 ,075 .7 1 ( $ 1 2 3 .0 3 Av g . p er veh i c l e)

3 0%

Full Roll-out Annual Sav ings

$ 1 6 8 , 3 8 0. 8 0

$28,556.29

$ 2 5 , 6 0 5 . 67

3 0%

Assumptions:

1) Based on a conversion factor based on the engine size (displacement in litres) of each vehicles, for fuel consumption durint time idling 2) Vehicle woar and toar is based on a conversion factor for idling vehicles - 1 hour of idling is the equivalent of approximately 100 munutes of driving 3) Fuel based on $1.05 per litre

The projected savings from idling are based on a 30% target of total run time spent idling, as it is unrealistic to eliminate idling in its entirety. This high level is based on this client’s specific business and is consistent and in line with what was achieved with its better drivers. The savings analysis is based off fuel savings, maintenance savings and reduced vehicle replacement costs. Similar to the speeding analysis, this is calculated for 25 assets annually (average per vehicle in brackets) and is also projected across the total fleet of 200 assets. We see the potential savings from idling are much greater for the organization than from speeding, meaning programs for changing driver behavior should first target idling.

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Converting GPS Fleet Data Into Operational Savings And Efficiency

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Actual off hour usage costs and measured savings Deciphering the Numbers Personal use can have cost and legal implications to any organization. The SMART-vu Pro fleet optimization platform is configurable to detect personal use bound by the time of day or location, by simply setting landmarks within the application. For this specific analysis, personal use was bound by time of day from 6 p.m. to 4 a.m. With time and better landmark information the analysis of personal use can be greater refined.

P E R S O N A L U S E O F DATA OV E R V I E W (6 P M – 4 A M ) # of Assets

Time Travelled (Hours/Avg.)

Distance Travelled (KMS/Avg.)

% of Off Hour Usage (Drive Time)

% of Off Hour Usage (Distance)

25

9 9 4 .78 ( 3 9.79 Av g . )

5 9 4 8 . 2 8 ( 2 37. 93 Av g . )

1 0. 9 6 %

5 .1 5%

Similar to previous analyses, the current driving patterns of their fleet were calculated. This analysis showed drivers spending an average of 5.15% of the total distance driven for personal use. This number may be slightly inflated due to the lack of landmark information to determine true personal use versus work related driving. We used the total number of Km’s driven for personal use for the 25 assets to project the total wasted fuel cost to the organization from personal use.

UNNECESSARY WAS TED FUEL COS T SUMM ARY 1 # of Assets Reported

Cost of Fuel Due to Speeding (90 Days)

Annualized Cost (25 Vehicles)

Annualized Cost (Full Fleet)

25

$ 1 ,1 0 2 . 6 8

$ 5 ,7 1 1 . 24

$ 57,1 1 2 . 36

Similar to the speeding and idling calculations, we targeted a reduction in personal use to 4% of all Km’s driven, which is consistent with their best drivers. This reduction would lead to approximately $74,000 in annual savings from reduced fuel, maintenance and vehicle replacement costs.

PR O J EC T E D S AV I N GS S U M M A RY Savings

Projected Fuel Savings

Projected Maintenance Savings

Projected Deterioration Savings

New Target % of Speeding (Distance)

25 Assets

$ 27 1 1 . 8 8 ( $ 1 0 8 . 47 Av g . p e r ve h icl e)

$484.90 ( $ 1 9. 4 0 Av g. p er veh i c l e)

$ 6 ,0 8 5 .0 4 ( $ 24 3 . 4 0 Av g. p er veh i c l e)

4%

Full Roll-out Annual Sav ings

$ 2 1 , 6 95 .0 0

$ 3 , 879. 2 2

$ 4 8 , 6 8 0. 3 4

4%

Assumptions:

1) Fuel costs are based on $1.05 per litre and 16 MPG (UK) average fuel economy - and are calculated for distance travelled outside of 6pm-4am (Note: Landmarks for job-specific sites were not set, likely reducing the true off-hours usage 2) Based on a reduction of KMs travelled from reduced personal use

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Measuring the Cost & Savings

The following summary are actual costs incurred associated in measuring impact of the 3 metrics measured for 25 vehicles over a 90 day period. Remember that these costs are measured against the averages established by the better driver within the organization and are the costs above the average, as it is unrealistic to eliminate in its entirety idling, speeding and personal use to zero occurrences.

$16,443

Total inefficiency & wasted fuel usage

Cost of fuel due to 90 days of personal use

$1,102

$3,078

Cost of fuel due to 90 days of speeding

$12,263

Optimize

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Cost of fuel due to 90 days of excessive idling

Analyze

Emphasize

Converting GPS Fleet Data Into Operational Savings And Efficiency

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47.9%

Improvement factor

$333,367

Total savings by achieving targets (baselines establised and measureable)

$695,547

Wasted fuel costs on 200 vehicles (based on the current driving habits of 25 vehicles)

Optimize

Analyze

Emphasize

The data collected during the 90-day period on the 25 assets measured, was later extrapolated against the entire 200 unit fleet to gauge what the impact and costs would be. By establishing a baseline, you can now begin measuring the improvements. By achieving the suggested targets, it is conceivable to achieve a 47.9% reduction in fuel costs, equating to $333,367 in hard dollar savings. We are often informed by our enterprise clients that they do not have the internal bandwidth to conduct this type of detailed analysis on a monthly or quarterly basis, so they opt to outsource the analysis and measurement of their fleet data to Storm Telematics. The deliverable and objective is to leverage the data and analysis conducted by emphasizing and implementing best practices within the organization thus becoming more efficient and achieving an optimized fleet.

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Converting GPS Fleet Data Into Operational Savings And Efficiency

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Emphasizing & Implementing Change

In order to truly optimize your fleet and achieve process improvements, you must implement an enterprise software solution that can achieve the desired results. Storm Telematics recommends the SMART-vu Pro fleet optimization solution due to the advanced mapping engine, infinitely configurable reporting engine and the highly flexible Alerting engine.

One of the proven tools within SMART-vu Pro that has literally saved our clients millions of dollars is the ability to send gentle real-time reminders to your workforce reminding them of speeding instances, or excessive idling occurrences. It takes a concentrated effort to impact change. 10 Storm Telematics

Converting GPS Fleet Data Into Operational Savings And Efficiency

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Other services offered - measured Once the data has been analyzed, the next phase within the value chain is emphasizing and implementing the changes required to optimize the fleet. This is merely a snap shot of what we can to for your organization. To optimize your operations we need to be guided by your strategy and focus on what is important to you. To give you some idea of what this may mean to you and your organization, here is a list of additional services and metrics that we deployed:

1

Route Optimization

6

Maintenance Adherence

2

Workforce Productivity

7

Anomaly Summation, Trending & Benchmarking

3

Invoicing

8

Insurance Premium Savings Analysis

4

Utilization/ Lifecycle Cost Analysis

9

Best Practice Recommendations

5

Fuel Compliance

10

Comparative Analysis vs. Industry Norms

Is your concern not on the list? Call us toll free 877.309.8354 – we guarantee that we can find a solution to your measurement need.

Analyzing & Reporting What happened?

What will happen?

Why it happened?

What do I want to happen?

How do we prevent further occurrences?

What are the savings associated for taking corrective action?

Planning Budgeting & Forecasting

Storm Telematics Implementation & Oversight Services Storm Telematics 11

Converting GPS Fleet Data Into Operational Savings And Efficiency

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Storm Telematics Fleet Oversight & Implementation Services Storm Telematics – we have the expertise to analyze your data to improve your efficiency. We provide fleet insights leading to better, faster, more relevant decisions. Underlying it all we will quantify the value throughout the entire engagement. Could your organization benefit from the fleet process improvement services described above? Contact Storm Telematics today at 877.309. 8354 for a free consultation!

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4964–98 Avenue, Edmonton Alberta Canada T6B 2Y7 Toll Free 877-309-8354 Email [email protected] www.stormgps.com