Global Positioning Systems are the roadmaps of the 21st century.
With increasing frequency, material handling distributorships with field service operations are turning to the Global Positioning System (GPS), a satellite-based navigation system that can determine the location, speed and direction of a service vehicle anywhere in the world. GPS is made up of a network of 27 satellites (24 in operation and three extra in case one fails), which were placed into orbit by the U.S. Department of Defense in the late 1970s, originally for military purposes. GPS satellites circle the earth twice a day and use small rocket boosters to maintain a precise orbit. The satellites are powered by solar energy but contain backup batteries in the event of a solar eclipse.
At any time, at least six satellites are in line with any point on Earth. To determine a location, a receiver locks into a satellite and reads its position in time and space. The detailed, accurate information available from GPS, along with its ability to maintain strong locks in otherwise poorly accessible areas, have made it jump in popularity for civilian use during the last ten years. The trend has come to material handling, as more and more distributors are turning to GPS technology to help improve their operations.
Early Adoption Pays Off
Toyota Material Handling Northern California (Hayward, CA) was somewhat of an industry pioneer in utilizing GPS technology, having done so for more than four years. The company currently has units in all 75 of its service vans and utility vehicles, helping to service customers anywhere within a 150-mile radius from its corporate headquarters. Being able to cover such a large area efficiently is what spurred the company toward GPS technology. Vice President of Operations Stephen Andres says, “We needed to be able to more efficiently dispatch our technicians, plus we loaded all our Planned Maintenance calls into the system so that we can easily find the closest technician to the need at any given time.”
Assistant Service Manager Brent Burlingame has daily responsibility for the GPS system and says the GPS also offers other benefits. “We use it to spot-check our driving skills because the readout shows approximate speeds. We also can see where delays are, so it helps keep a real close eye on all our equipment.”
GPS can even be used as self-defense. “From time to time, we’ve been involved in accidents, and we’re able to pull up the speed and location to help us defend our case,” Andres adds.
TMHNC’s system entails a dashboard-mounted data terminal and keyboard, with a “black box” housing the GPS. Dispatchers are able to relay text messages through the terminal and have limited response capabilities if needed. “We can send a message to the terminal in their vehicle instead of using the two-way radio, which gets busy with other matters. This is much more efficient,” Andres says. The corporate office has the ability to see everybody, while each branch is limited to its own people. Each technician is represented on the screen by a small icon, color-coordinated based on the certification level of the technician.
Both Andres and Burlingame agree that the technology is helpful, despite initial resistance from a handful of technicians. “Many people were hesitant at the beginning because they thought it would be used as a check up,” Burlingame says. “As we explained to them, what we’re actually using it for is to aid them in their work. Of course, if someone does breach protocol, we have the records that could be used for disciplinary actions. So it does make them a little more aware of driving safely, which pays off in the long run too.”
As with any software, there is a learning curve. Training to use the system was done entirely via online seminars, but many of the features and capabilities are found through trial-and-error as the user becomes more familiar with the system. “It’s taken a while to implement because we have a lot of vehicles,” Andres says. “Once you install it, you have to make sure the dispatchers are utilizing it, because there is a cost attached. But it’s really helped our efficiency and has been a good investment,” Andres says.
Mobility Is the Key to GPS Utilization
At Maybury Material Handling (East Longmeadow, MA), dispatchers had to call each technician on the phone to find out their location before scheduling their next visit. In order to cut down on vocal radio and cell phone traffic, the company purchased and installed global positioning units for its fleet of 20 service and delivery vehicles. “The units are affixed to the vehicles of the service technicians who are out in the field. It allows us to understand where the technicians are by looking at the screen,” says President John Maybury. “When a customer calls wanting to know if our tech is on the way, we don’t have to put them on hold, call the technician and get back to the customer. GPS eliminates the waste in the process.” Maybury’s system is accessible in a mobile environment as well. In addition to service coordinators at the office, Maybury gives access to each of its field service managers, who are in a van equipped with a tablet PC and a wireless card to view where their techs are. “They are online all day in the truck or in the customer’s facility and, therefore, can go to our GPS Web site to see where their team of trucks and service techs is located.”
Maybury says the biggest efficiency gains have come in the reduction of cell phone traffic, but GPS has also helped the company reduce travel times and fuel consumption. The actual return on investment is unclear, but there have been some measurable results since beginning with the GPS technology. “We figured if we could do two more service calls per month per technician, then it would pay for itself,” Maybury says. “We know we’re getting that, not to mention fuel savings and other savings. So basically the cost is less than two service calls per month added to our norm.”
One of the biggest advantages, says John Durham, powered equipment operations manager, is the ability to handle problems in a more timely manner. “We’ve had a couple of instances where a call comes in at quarter to five, and we’ve been able to locate a technician who can easily get there rather than wait until the next day. Customers love it and it hasn’t caused an extra burden on anybody.”
Maybury believes that people who use GPS as a disciplinary tool are missing the point of the technology. “GPS is not about discipline and watching, it is about adding value to the customer’s experience,” he says. “If you use it for discipline, then you have deeper problems to address. Our technicians all understand the intention and it’s working out well.”
Efficiency Gains Take Backseat to Safety
A year and a half ago, Northland Industrial Truck Company (Wilmington, MA) installed GPS in its service vans, aftermarket and delivery vehicles, and mobile tire truck, a total of 80 units. Rick Papalia, vice president of corporate operations, believes that the biggest benefit of GPS is not necessarily in efficiency gains as much as in safe operation of their company vehicles. “The most immediate thing we saw first was excessive speeding. We tracked individuals traveling over 85 mph in our company vehicles, and that’s not acceptable. That behavior has been changed.”
To monitor speed issues, Papalia consistently reviews the “speeds-over” report available from the GPS unit in the vehicle. The speeds-over report essentially gives a list of every time a vehicle has traveled faster than a predetermined speed during a given period of time. “Driving safely is one of the best things we can do to keep ourselves out of harm’s way. To me, avoiding an accident that would result in catastrophic loss, insurance increases and lawsuits has already paid for the system many times over.”
The company also utilizes GPS as a dispatching aid, though Papalia feels it is only one of the many reasons the system was installed. “Obviously we know where our guys are and we know who is closest to a given customer, but in some cases assigned technicians service particular accounts anyway. Even if somebody else is closer, we may not send him in because he might not have the proper training, parts or equipment to service that particular account.”
The company markets GPS-aided dispatching as a value-added service to customers, but Papalia says it’s also valuable in protection against accident claims. “Our vehicles have been accused of causing property damage, and we used the GPS to successfully discredit fraudulent claims.”
NITCO also utilizes the GPS system to focus on potential savings resulting from increased productivity, such as fuel savings from unauthorized use, excessive idling and overtime reduction. “We are able to make better decisions concerning day-to-day operations with more information at our disposal,” says Papalia. “The investment recovery was almost immediate. All of the features and benefits of the GPS system have proved to be an integral part of our operation, and give us another tool to help improve our overall level of service to our customers.”
NITCO’s system also gives the company the ability to plug the technician’s laptops into the GPS unit mounted inside the vehicle to give Internet access via the cellular signal. “It’s a vehicle tracking system, and it also enables us to get to the Web without an additional cellular fee,” Papalia explains.
GPS Transforms Service Charges
Fred Oram, president of Oram Material Handling Systems (Kansas City, KS), began using GPS in 2006 as a direct reaction to the increased price of fuel. However, he offers several more reasons for his company’s turn to GPS. In addition to the desire to know where vehicles and employees were at any given time, Oram wanted documentation in cases where a customer complained that a technician did not spend the amount of billed time on a job.
Another reason is the company’s switch from a dispatching methodology based on travel time to one based on specific zone charges. “We want to get rid of the fuel surcharge and shop supplies, and we want to simplify our invoicing,” says Director of Service Operations Tom Schueddig. “A zone charge is the best way to go, and we’re currently changing our procedure.”
To help with the transition, Schueddig analyzes data from the GPS units. “I can sort the data off the Internet report and import it into Excel. From there, I can sort it any number of ways to determine what the average travel time is to get to a particular ZIP code. Then I can get an idea of what we might want to charge for a zone fee.”
Oram’s system utilizes a box mounted under the dash with an antenna. The box is hooked up to the on-board diagnostics port, and it sends a signal to the satellite at specific intervals. “There are all kinds of bells and whistles,” Schueddig says. “It tells whether the power is on or off, what the travel speed is, where it is located, and who’s who. We are setting up a geo-fence, which means we receive a notification any time a vehicle leaves a specified geographical area.”
The system also performs vehicle diagnostics, allowing Schueddig to check their performance and fuel efficiency. “For example, we can enter an average gas price, and based on the average efficiency that the vehicle normally gets, it will tell us how much we should have spent on gas during the last time period. Then we can compare that to how much we actually spent on fuel.”
Oram learned about the benefits of GPS from other members of his MHEDA-NET group. The company tried a couple of different systems, but couldn’t settle on a provider. Schueddig explains, “We tried the GPS on our cell phones but it was way too cumbersome and didn’t give me the data that I wanted. Now they’re hard-wired into the vehicle and it gives me so much more information.” When eight new service vans came already equipped with GPS, Oram used those as a beta test for the remainder of the mobile fleet. He says, “We concluded that we do want to add more, but we’re just chipping away at a few vehicles per month. We can’t afford to just go out and buy them because they’re about $500 apiece.”
Other than the upfront cost, Schueddig says any other problems are really just minor inconveniences compared to the benefits the system provides. Since the GPS units were just installed in December 2006, there hasn’t been enough time yet to determine the exact return on investment for the distributorship, but Schueddig says the reasonable cost and simple installation would lead him to recommend GPS to anyone with a field service fleet. Oram agrees. “It is now more common than not for GPS to be implemented in a material handling distributorships mobile service operation. It is becoming the norm rather than the exception.”