The fleet management industry, which is set to grow to about USD 30 billion by 2022 from current sub-USD 15 Billion levels, is growing at about 16% CAGR. Its growth is primarily driven by the technology and will continue to do so at a much higher rate in case of a successful and quick adoption of all the relevant upcoming technologies.
Fleet management is much more than just owning and operating a fleet. It’s in fact a business-critical function when it comes to cost reduction, handling risks and increased efficiency of transportation. It utilizes advanced technologies such as multiple sensor integration to get data on a number of vehicles and derive meaningful insights from it, which can then be utilized in optimizing the fleet operations.
Key technological and performance parameters driving the growth of the fleet management industry
Efficiency is paramount!
- For fleet companies, larger the number of vehicles managed and higher the territory covered, greater is the need for efficient operations. Not only in terms of route optimization – which comes first to the mind – but also in terms of tracking driver behavior, vehicle condition monitoring, etc.
- Slightest of improvement in the efficiency can have a major impact on the bottom line.
- Efficiency optimization is a function of multiple technologies such as sensor fusion, AI/ML, live tracking and monitoring, etc. coming together to provide an integrated fleet solution.
There’s no alternative to cloud enablement.
For larger fleets, humongous data is generated every minute. The data could be related to driver behavior, shipments, vehicle tracking, vehicle condition monitoring and data related to clients/vendors.
- With technology adoption, especially on the multimedia front, the size of data packets generated is large and needs high amount of scalability and flexibility for effectively managing (maintaining and utilizing) the data.
- This can be made possible only with cloud adoption, given its dynamicity, facility for ramping up and down, as well as flexible pay-per-use costing models.
Declining hardware and connectivity costs leading to the increased deployment of fleet management solutions.
- Connectivity and internet costs are dropping fast. This makes holistic fleet management and remotely controlling the key business parameters a reality.
- When it comes to hardware, numerous cheap sensor options to capture and transmit the data from various vehicle sub systems are now available. These can help to keep a track of the key values, allowing businesses to manage the repairs and maintenance predictively, significantly reducing the cost of field failures and inventory.
Rugged and optimized designs are a must.
- When the fleet is operational, you have minimal control over the harsh conditions around and the availability of resources such as gas, charging stations, roadside infrastructure and whatnot. However, any downtime in the fleet management solutions resulting from these factors is unacceptable. Hence, rugged designs and low power, low footprint hardware design takes the driver’s seat when it comes to developing solutions for the fleet industry.
Challenges in acceptance and adoption of technology
1) Return on Investment
Fleet managers operating large fleets successfully, and who are seemingly masters of the trade are quite reluctant to adopt too much of technology. Why? Because only half of the benefits are directly visible and it takes a lot of analysis to actually foresee the indirect effects and hence ROI impact of technology adoption.
2) Complexity, usability and security
Fleet operators, typically maintaining the data and processes manually, are not too keen on leveraging the data explosion. They may not want to invest in learning how to manage the wealth of data, switching over to the new complex technologies and taking actions based on the insights provided.
User experience, hence, becomes critical for the non-tech savvy fleet owners. Additionally, few fleet companies have an R&D or engineering department of their own and this increases their dependency on external vendors and the cost of maintenance. They are also worried about exposing critical business data to an external party and making it vulnerable to security and privacy breaches.
3) Acceptance and utilization by the drivers
When it comes to the measuring the effectiveness of the technology after transition, finally it all boils down to how the technology is leveraged after it is deployed. The fleet owners are the primary stakeholders of all the solutions deployed; however, they are primary users of only a few, viz. ‘remote monitoring and route optimization’, ‘driver behavior and management’, and ‘business intelligence data generated’.
However, there are several technology-enabled features which are helpful to the drivers and the teams on the field. It also applies to the warehouse workforce and people in other departments. But there is an undeniable resistance from these end users as they may view close monitoring and behavior analytics as a threat; this could simply be because they just want to focus on their basic work in a conventional manner instead of utilizing real-time insights provided by the technology and take actions accordingly.
For a comprehensive fleet management solution, various technologies need to cooperate. These include sensor development and sensor integration, communication and networking, cloud enablement and CloudOps, business analytics, video and multimedia processing and usability engineering. Currently the technology adoption is limited to location tracking, limited vehicle parameter tracking, and enterprise software for data management.
However, product engineering specialists such as eInfochips can actually help the fleet owners with connected transport and logistics solutions, right from sensors and communication to analytics and beyond. Typically the differentiated service offerings involve on-edge video analytics powered by deep learning for driver safety and behavior, sensor fusion for predictive maintenance and end-to-end product development (vehicle black box) for telematics. To know more, please get in touch with us.