More than 70 percent of all freight tonnage moved in the U.S. goes on trucks, according to the American Trucking Associations. With 3.6 million heavy-duty Class 8 trucks on the road and 3.5 million drivers, safety and efficiency is of the utmost importance.
Telematics is one solution that will continue to change the transportation and supply-chain industries. A subset of the Internet of Things (IoT), it collects vehicle information such as location and speed — how hard a driver brakes, engine diagnostics, fuel consumption and more. It acts as a type of communication hub, providing data from different sensors and systems on the truck. Drivers can receive trip-by-trip feedback on risky behavior and performance. The information can then be utilized to reduce crashes, negotiate insurance rates and more. The result is less vehicle downtime, higher profit margins and lower premiums.
The benefits are many. However, maintaining a successful and compliant system once the devices are implemented in trucks can be challenging. Whether owning a transportation company or working with one, here are five telematic best practices that should be incorporated into a risk management program.
Measure driver speed. Speed tracking is the most critical and beneficial component that telematics systems provide. Not only will the system track the speed of each driver, but it will also track how often the vehicle is stopping, how quickly there is acceleration from a stop, and time spent in traffic. This function ensures the safety of drivers and those around them, as well as identifying future time-saving efficiencies. Lastly, make sure that safety requirements and expectations are clearly communicated when discussing speed protocol and policies.
Make it mandatory. To optimize the use of this equipment for loss prevention, identify how the technology can impact the company’s risk management program and set performance expectations, and make it mandatory for all drivers. Otherwise, it will be difficult to measure and compare driver performance, discover trends and calculate a true return on investment.
Adhere to a disciplinary action program. It is important to react to dangerous driving habits being captured through telematic devices. No one wants to be in a position of potentially willful and wanton conduct. Accordingly, it is critical, as with any other safety program, that behavior modification and strict adherence to the policy are followed on a consistent basis. In that same scenario, if dangerous driving is captured and a progressive discipline program is followed consistently, the driver should either change behavior or be replaced by an individual who is less likely to expose the company to loss.
Use cameras. Whether the driver was involved in an accident, driving dangerously or a victim of cargo theft, cameras provide an advantage for the risk-management claims process. Pair forward-facing cameras with telematics to help during accident investigations. Video can show the behavior and reaction of the driver immediately before and after an incident, as well as the behavior of other vehicles, current road conditions and cargo status.
Camera telematic functionality has evolved over the years. Previously, capabilities were limited to only basic information about where and when the incident occurred, but now video competencies allow organizations to understand why it occurred. Frost & Sullivan, a research consulting firm, has stated that the power of video telematics will continue to be critical in the creation of long-term solutions. In fact, the global market for video telematics is expected to grow 23 percent every year through 2023, as more companies adopt the technology.
Improve dispatcher and driver performance. Telematics devices were not only created to protect dispatchers, drivers and their surroundings, but also to generate efficiencies and save money for organizations nationwide. Start tracking specific drivers who seem to be taking more time than needed to complete a shipment. Through telematics, evaluate the amount of time that vehicle was sitting idle in traffic, and brake usage. Then use data analytics to create a more efficient route or departure time, or train the driver and dispatcher to make quicker time-sensitive decisions.
In 2018, the U.S. Department of Transportation Motor Carrier Safety Administration’s Regulatory Impact Analysis projected that the industry would save 31 lives and $2.44bn in administrative costs through the use of telematics. Given the scope of information that telematics systems are capable of tracking, and the scale of their adoption, dispatcher and driver improvements are inevitable for years to come.
Telematics was developed to increase job satisfaction, reduce fuel costs, transform safety, improve driver and dispatcher performance, increase mechanical alert functionality, and retain or attract quality drivers. Using the five considerations discussed, transportation and supply chain-focused organizations will position themselves for future success.
Chris Reardon is a vice president at Assurance, specializing in providing insurance to the transportation, warehousing and logistics industries.
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