Integrating telematics and labor management: effectively managing what’s measured

Aug. 1, 2014

Best-in-class operations managers consider how the functions within the four walls of their facility impact profitability, which often involves vehicle telematics and/or labor management systems.

Business leader Peter Drucker once said, “What gets measured gets managed.” Facility managers know all too well that without measurements of critical metrics and visibility of opportunities for improvement, operations cannot perform to their optimum levels.

Operations management is no longer about a flat number of dollars per hour times the number of hours someone works on a function. The definition has expanded to include all of the costs associated with specific tasks within a facility and how much it costs to service a customer. Best-in-class operations managers consider how the functions within the four walls of their facility impact profitability, which often involves vehicle telematics and/or labor management systems.

Although the desire to gain visibility has been longstanding, disparate software solutions have only provided a partial view to operations. For example, employees may be at 100 percent in terms of performance and utilization, but the material handling equipment they operate may be utilized only 50 percent of the time.

Without a 360-degree view of both the equipment and labor costs, making timely and impactful decisions on process and operational changes can be difficult. And while labor or equipment may appear to be running effectively, the operations manager may not see the negative impact of suboptimal performance and utilization against the budget until after the month ends. At that point, it’s often too late.

For this reason, a solution that clearly identifies opportunities for improvement is critical. A combined solution of vehicle telematics and labor management data can be incredibly powerful and provide the comprehensive visibility that operations managers need. Merging data can uncover new insights, such as the following:

  • Equipment: Learn which employees are operating equipment most productively.
  • Maintenance and repair: Uncover information on how a particular vehicle is performing and how its health is impacted. See if maintenance or repairs are due to employee abuse. Analyze if it is more efficient to repair or replace a lift truck.
  • Labor: Determine if your employees are focusing on productive tasks throughout the day. For instance, if a lift truck operator is spending 25 percent of his or her time on administrative tasks, it is likely not enhancing your company’s bottom line.

When equipment and labor visibility are integrated with cost and budgeting information, operations managers can rectify pain points from not only a tactical perspective but also a strategic perspective. 

Total visibility of operations puts managers in a position to make timely and impactful decisions. In other words, it gives managers the opportunity to effectively manage what gets measured — allowing them to make smart, real-time decisions that positively impact their companies’ bottom lines.

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