What is Telematics and Why Do You Need It?

What is telematics?

Watch your drivers like you’re in the car with them.

Yes, it may sound like a shocking idea, especially if you believe in enjoying a relationship of trust with your employees. But in a changing world, our ways of doing business are rapidly transforming too. What was once considered unthinkable is now just the cost of doing business.

Not quite convinced? Let’s have a look at the numbers. A recent Frost & Sullivan study¹ showed that 31% of fleet owners will be using telematics in over 75% of their fleets. By 2025, we should expect to see one in three light commercial vehicles and half the lorries on the road will have telematics installed. The growing adoption rate speaks for itself. Telematics is fast becoming a cornerstone of fleet management.

Telematics: A definition

To understand why, we must go back to basics. Coined in 1978, the term telematics broadly refers to the long-distance two-way transmission of data pertaining to remote objects across a wireless network. For our purposes, these remote objects are the vehicles in your fleet. Through a device installed in your vehicles or even through an integrated fleet card, you can monitor the movements of your entire fleet and your drivers’ behavior in real-time, receiving the actionable insights you need to optimise the running of your fleet.

(Surprising) benefits of telematics

 Having the possibility of watching your drivers’ every move from afar may sound like a hugely intrusive thing to do. What ever happened to the days when we just took our drivers at their word? It’s a wonderful idea in theory, but in a changing world, trust is simply not enough for you or your drivers when it comes to running a business. Here’s why:

• A data-driven business landscape: Data makes the world go round these days and all your competitors are getting on board. It is impossible to run a business effectively these days without diving into data-driven insights. Telematics data uncovers valuable opportunities to run a more fuel-efficient and cost-efficient fleet, cutting your fuel costs by up to 35%¹. If you don’t make use of the information you have, you and your fleet will lose out.
• Your drivers will thank you: Yes, monitoring your drivers is as good for them as it is for you. Talent retention has become a major issue in commercial fleets. With telematics data, you will have all the information you need to create an optimal working situation for your drivers. You’ll be able to manage their working hours, plan their schedules and routes effectively, and protect the safety and efficiency of your fleet in real time. With prompt alerts, you could reduce driving time by 30 minutes each day and cut down overtime by as much as 15%¹ .
• So will the environment: Telematics is also applicable to electric vehicles (EV) and will in fact vastly ease your fleet’s transition. With a telematics system in place, you can more accurately assess how much EV range you will need when transitioning your fleet. You’ll also be able to calculate how much you can cut costs and emissions after the switch. After it’s done, you will also be able to benefit from telematics on the road, avoiding unnecessary detours by predicting where and when drivers should charge.

Features of a telematics solution

Watching your driver’s behaviour from afar can sound like an epic task to those who haven’t tried it. We thought breaking the concept down to its specific features would make it easier to digest:

• Vehicle tracking: With this feature, you’ll know exactly where your drivers are in real time. This empowers you to provide your customers with better route planning and delivery ETAs (maybe also added safety?). Some solutions also offer journey history, which shows you a breadcrumb trail of your drivers’ progress and highlights any violations they may have committed on a map.
• Productivity reporting: A robust telematics solution will have a dashboard where you’ll be able to view detailed reports of your driver’s productivity. In many cases, you’ll be able to choose the frequency and type of report you need at a given time.
• Driver behaviour monitoring: Driver behaviour accounts for 70% of Total Cost of Ownership¹. C orrecting their misdemeanors in a clear, timely fashion is crucial to your bottom line. A telematics solution should enable you to provide your driver with instant feedback via customised email and text notifications or even an alert. You should also be able to detect collisions at the moment of impact and customise your rules according to driver and route.
• Fuel card integration: Some telematics service providers do not stop at just vehicle monitoring. They provide added visibility into your fuel spend and consumption by integrating data from your fuel card into your telematics system. You’ll also be able to receive alerts on potential fraud events in real time.

A new solution for a new world

The connectivity and transparency telematics can give you might seem intense, almost uncomfortable, at first. But in the age of information, any business that does not make use of its data is doomed to be left behind. Tracking your vehicles while they’re on the road is good for you, for your business, and even for your drivers. You’ll unearth new opportunities to cut down on your costs, tighten your security against fraud, optimise performance, and create a better working environment for the drivers operating your fleet. It's the definition of a win-win situation.

¹_{Dynamic Data – Telematics Report, Dynamic Data - Telematics Report | Shell Global}