Top 3 Reasons GPS Fleet Telematics Initiatives Fail to Deliver ROI & How to Fix It

Telematics can give companies insights into many aspects of the fleet that they never had the ability to track before. From reducing idling and fuel waste to improving fleet productivity and safety, telematics promises tremendous savings and ROI. So why do many fleet telematics initiatives fail to find lasting ROI? Part of my job is to educate customers on how to utilize their Fleet telematics system to see that ROI. I will help them identify areas for improvement, set goals, setup automated custom reports, and walk through each report by the numbers. Identifying quick returns on investment is easy, and most customers are able to pay for the cost of the system within 6 months. But ensuring lasting ROI won’t come from automation--no matter how powerful the system. Lasting ROI requires company-wide adoption and participation. The three most important factors that cause telematics initiative to fail.

Top-Down, Bottomed Out: Part I

3 Reasons GPS Fleet Telematics Initiatives Fail to Deliver ROI

Telematics can give companies insights into many aspects of the fleet that they never had the ability to track before. From reducing idling and fuel waste to improving fleet productivity and safety, telematics promises tremendous savings and ROI. So why do many fleet telematics initiatives fail to find lasting ROI? Part of my job is to educate customers on how to utilize their Fleet telematics system to see that ROI. I will help them identify areas for improvement, set  goals, setup automated custom reports, and walk through each report by the numbers. Identifying quick returns on investment is easy, and most customers are able to pay for the cost of the system within 6 months. But ensuring lasting ROI won’t come from automation–no matter how powerful the system. Lasting ROI requires company-wide adoption and participation. The three most important factors that cause telematics initiative to fail.

  1. Lack of top-down leadership adoption: Fleet Telematics Systems must be adopted by leadership from the top-down. Safety and productivity reports should be standard reports for organizational leadership. I would argue that it is as important as a company’s accounting system. Risky driving habits can have as much impact on a company’s bottom line as their sales numbers. Company wide adoption hinges on upper management’s leadership and accountability. When the CEO of an organization sets the expectations, and ties telematics key performance indicators (KPI’s) to executive leadership’s effectiveness, he instantly creates a stake in the game for every level of management. Adoption of fleet telematics systems from the top-down of an organization establishes accountability throughout the organization.
  2. Transparency and Driver Participation: This could easily be number one, and almost goes hand-in-hand. While top down adoption is crucial, driver acceptance and participation at the bottom of the organization is equally as important. Companies that choose to secretly install GPS telematics devices, or are just not upfront with their drivers about the system, instantly condemn their telematics initiative to failure. The popular “Big Brother” analogy stems from this lack of transparency.  Drivers are on the front lines of a system’s success and failure. Their improvements in driving behavior relies on their willingness to take feedback. Drivers that feel like they are being spied on or that do not completely understand the reasoning from the system, will be much more resentful of the system and less likely to cooperate and improve.  Lasting ROI will only comes when drivers participate, and companies are transparent about the reasoning for the GPS telematics systems.
  3. Goal Setting and Focus: The final reason telematics initiatives fail to deliver ROI is due to a lack of goal setting and focus. Companies usually identify broad goals such as Improving Driver Safety for example. Identifying how exactly they will improve driver safety, and what specifically they need to measure to achieve their goal is the first step. Maintaining focus on one clear goal at a time is where it becomes tough. If improving driver safety by reducing risky driving behavior by 50% is the goal, then only focus on metrics that reflect risky driving behavior, fuel economy is not a measure of risky driving.

In Part II, we’ll break down each of these factors and their importance.  recommend some strategies to avoid these mistakes. The great thing about telematics is the longer you’re company has a system, the richer the data you have to analyze and identify ROI opportunities. So, if you feel your telematics initiative is sideways and not being utilized to its full potential here is your opportunity to set it on the right path. Join the 7 week email course and receive exclusive tips, reports, and guides for lasting ROI.

 

 

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