Use your fleet wisely: Leverage analytics to optimize your equipment
It’s critical that heavy highway companies manage projects effectively. When it comes to managing equipment fleets, many make decisions using intuition but have poor information to validate or challenge those decisions. How should we manage this precious resource?
Optimize your equipment through data-driven decision-making
Heavy highway/civil heavy construction companies’ skill at managing projects and job costs is vital to their success and profitability. Labor costs are very commonly dialed in, but when it comes to managing their equipment fleet, many companies make decisions based on intuition or poor systematic information. Or your veteran equipment manager has left or retired and there’s no institutionalized knowledge to make those same veteran, smart decisions. When made consistently, these decisions can lead to subpar utilization, which leaves money on the table. It’s better to ensure success and profitability through the years and with more accuracy. By harnessing the power of business analytics and focusing on the right key performance indicators (KPIs), companies can make effective and timely decisions that consistently improve utilization and profits.
“It is what it is” isn’t enough
In our experience, civil construction companies often set targets for equipment utilization, only to put little effort into tracking actual utilization. Companies also take a similarly relaxed, “it is what it is” attitude toward tracking maintenance, repair, and upkeep time and costs for their equipment.
So, what do fleet managers base their decisions on? They rely on their experience and gut instincts. They talk to their project managers, salespeople, maintenance staff, and other personnel across the business for qualitative insights. And they collect what data they can access, enter it into a spreadsheet, and perform a time-consuming, one-time analysis. Unfortunately, this data may not be very well-timed or accurate.
Without clear, accurate, up-to-date data, it’s difficult for fleet managers to make decisions that truly optimize equipment usage and other resources. Yet, in this industry, companies are often so well capitalized and profitable that they hardly notice that they’re not making the most — or best — use of their fleet.
But best-in-class heavy highway companies don’t take this approach. Instead, they leverage all the data and analytics tools at their command to manage their equipment utilization to the finest margins. They set high utilization targets with realistic rental rates and meet them. They maximize the profitable, productive output of each piece of equipment while ensuring timely preventive maintenance and repairs. They experience fewer job productivity delays due to equipment downtime. They sell old equipment at the right time in its life cycle — and for the best price. And they don’t leave money on the table.
Telematics and analytics: A winning combination
With better data and powerful data analytics, any heavy civil construction company can improve equipment utilization and achieve operational efficiencies and stronger profitability. Telematics devices can wirelessly and continuously gather and transmit a range of data about vehicles and equipment, and this data can be combined with maintenance and other data as required. Business analytics tools can ingest and analyze all of this data to derive timely insights that support fleet managers’ decision-making.
Unlike more “traditional” methods, relying on timely data and analytics tools enables companies to automate maintenance, inspection and utilization tracking, monitoring, and reporting. Insights can even be visualized in a mobile dashboard application, providing decision-makers with an at-a-glance, real-time view of equipment utilization, maintenance requirements, and more. This frees fleet managers and others from tedious manual processes and allows them to manage the fleet and their shop much more nimbly and responsively.
Choose the right KPIs and collect the right data
To optimize equipment utilization with data analytics, companies must ensure they’re focusing on the right KPIs and collecting the right data. While these may vary slightly for each organization, the following are good places to start:
- Fuel usage. Companies often opt to track this on a fleetwide basis, but with telematics devices installed, they can instead track fuel input and use by individual vehicle or piece of equipment.
- Mileage and meter hours. Keeping an eye on odometer readings, and/or monitoring how many hours a piece of equipment has been operating are critical data for managing utilization and scheduling preventive maintenance.
- Diagnostic indicators. Telematics devices typically connect to the sensors and onboard computers of vehicles and equipment, allowing fleet managers to access a steady stream of data about engine temperatures, fluid levels, and other alerts or warnings. This helps them identify when it’s time to bring some equipment in for repair — or move it out of the fleet.
By pulling such data directly from vehicles and pieces of equipment into their analytics tools, fleet managers can be confident that they’re basing decisions on what’s really happening with their fleet. And that helps companies maximize the value generated across the lifetime of their equipment.
Start small and build on early wins
Business analytics can help your company optimize equipment utilization, operational efficiency, and profitability. When you’re ready to start, start small; pilot the new approach, achieve some quick wins, and expand from there. An experienced advisor can make sure you’ve got the data, tools, and processes you need to succeed.