The construction industry in the 2010s was in essentially the same place as the U.S. manufacturing industry was in the early 1990s: trapped between the declining margins of a competitive environment and a lack of efficient processes needed to grow.
Manufacturing used the same basic methods and processes for planning, tracking, producing, shipping, and selling products that had been in place since the 1960s. Paper and human reporting were everywhere. Critical data arrived at decision makers' desks too late to be useful. Operational control was more black magic than science, and communications were glacially slow.
Then, in the mid-90s, manufacturing companies began to make investments in computer-driven data and communications systems, and the industry’s “Information Revolution” began. Efficiency increased, as did productivity and profit margins. Capital and operational expenditures were leveraged by enormously scalable technology solutions, and variable costs fell dramatically.
Fast forward to the present. With the right choice of technology and process change, construction companies can experience similar increases in efficiency, productivity, and profits. It all starts with effective fleet management.
In general terms, fleet management is the process of maximizing the return on investment construction companies make in their equipment. In practical terms, this means getting as much production as possible from the equipment, at the lowest cost per hour, over the longest period of time, while obtaining the highest sale value at the end of its life.
To achieve this, an owner has to monitor and manage certain activities.
Just as it sounds, vehicle tracking is the process of knowing where a piece of equipment is at a specific time and date, or where it has been over a period of time. Functionally, this means answering questions as diverse as “are they where they can be the most productive?” and “where did they go today?”
Closely related to traditional vehicle tracking, theft mitigation allows a construction company to know if a piece of equipment is being stolen. Data gathered for theft mitigation includes:
Managing productivity means being able to understand when and how much a piece of equipment is running, idling, working, moving, etc. This information should be specific to the tasks the piece of equipment is performing, as well the project on which it is working. For example, a backhoe might be working but not moving about the job. The system needs to account for this.
Knowing how much a piece of equipment has been running, idling, and working allows a construction company to know an equipment’s hour meter reading very accurately and in real-time. In addition, sensors on the equipment can identify when and measure how long or how far a piece of equipment is being run in reverse, how many lifts or dumps have been made and a host of other activities. This knowledge makes it possible to accurately employ a very effective preventive maintenance program.
While you can’t directly measure operator behavior, you can infer it from other data collected while the operator is using a monitored piece of equipment. Knowing when a piece of equipment is started in the morning, how much time the equipment runs during the day, how much time the equipment idles during the day and how much it worked can be interpreted to get a reasonable view as to the operator behavior. This can be particularly powerful when management has the ability to look back over months of data and identify trends.
Construction fleet management software can be used to successfully measure, document, and oversee all of these activities.
There is not, of course, one single technical solution for fleet management that can be instituted for all construction companies. Solutions to fleet management range from the simple to the complex.
The Spectrum of Fleet Technology |
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Simple |
Minimal |
Intermediate |
Advanced |
|
-All data collected by hand |
-Uses basic business practices |
-Uses accounting and business processes |
-Integrated with business processes |
|
-All done with paper |
-Most data is collected by hand |
-Some technology adoption |
-Has adopted and sees the benefit of technology |
|
-All manually done |
-Uses commercially available spreadsheet programs |
-Uses GPS for location (track and trace) |
-GPS used for multiple functions (location, transport, etc.) |
|
-Limited analysis |
-Most is manually done |
-Most data is collected electronically |
-All data collected electronically |
|
-Some analysis performed |
-Uses a custom, locally run (non-Internet) application |
-Uses common internet-based applications with customized reports and interfaces |
|
|
-Electronic data transmitted over the air |
-All data transmitted over the air |
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-Application does some data reduction |
-Application does significant data reduction and information management |
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This spectrum of technology options is illustrated in Figure 1. As can be seen on the “simple” side of the spectrum, keeping paper records and manually entering data is the norm. While it’s simple, it’s also very time consuming, inaccurate, and routinely inconsistent.
At the other end of the spectrum, advanced technology provides a complete end-to-end solution with remote, electronic collection of data, wireless transmission of the data to a back office, and readily available application that converts the data collected into information. Some companies are perfectly well served by using simple technology, and others will benefit greatly from the advanced technology. It ultimately depends on the company, its goals, and its environment.
In the same vein, not all construction companies can benefit to the same degree from technology or, more accurately, not all construction companies are ready to adopt technology. Companies adopt technology in essentially the same way no matter what technology we are discussing. When computers or two-way radios were introduced to the workplace, they followed a technology adoption process. Fleet management technology is no exception. For construction companies, fleet size and company management methods combine to determine how, or if, new technology is adopted into a company’s operations.
In Figure 2, Path “A” illustrates how most construction companies adopt technology. The path is an evolutionary one. As a company grows in size and complexity, its need for processes and methods grows as does its need to adopt new technologies.
Some companies, through acquisition or sudden growth, find that they have a large fleet of equipment but are lacking in methods and processes. These companies follow path “B” in the diagram.
Finally, there are companies that have small fleets and also have either visionary management or an injection of “new blood” into the management team. These companies recognize that adopting new technology gives them a competitive advantage that can compensate for their smaller size. Companies like this follow path “C”.
AlignOps provides telematics solutions exclusively for the heavy equipment contractor. Our wireless fleet management system, Fleetwatcher, is used to help construction contractors get a better look at their fleet and help:
Fleetwatcher provides reports for customers to easily read the data and develop a plan to address any problems highlighted. Learn more about your technological options by scheduling a free construction software demo.