In the first blog in the AI transportation and logistics series, I featured the AI transformation innovations at Purolator, this second blog will focus on the acceleration of smarter AI telematics infrastructure in fleet management, and will challenge CEOs and Board Directors to accelerate their knowledge of AI filtrated business models to modernize and remain relevant.
Change starts with asking the right questions?
First, the speed of change in the transportation and logistics industry is accelerating. Did you know that artificial intelligence in this market is projected to grow at a CAGR of 17.87% from 2017 to 2030, and the market size is expected to grow from USD 1.21 Billion in 2017 to USD 10.30 Billion by 2030?
The latest Gartner forecast on Transportation management Software (TMS), worldwide, estimates that the market is expected to grow from $1.32 billion to $2.11 billion (from 2019 through 2024). That is a growth of 60% over a five-year period.
All you need to do is look around you or beyond you to see the AI innovations with smarter sensor light traffic systems monitoring grid traffic, telematics software tracking your fleet vehicles every human movement to looking beyond to the future where autonomous fleet trucks will steadily emerge, increasing droid shipping delivery systems to appreciate the realities of the minority report, a movie that Tom Cruise starred in are not that far away. Hollywood has an uncanny way of visualizing our futures to ignite innovation in the technology sector to unlock what we thought was impossible to become possible.
AI in Telematics Software
Fleet Management is big business and it’s very expensive.
According to a study by NHTSA, more than 94% of collisions are attributable to driver error, and of those incidents, a majority stem from risk factors that include distracted driving, speeding, tailgating, and improper turns. Many of today’s telematics-based systems track the ABCs of driver risk: acceleration, braking and cornering, these and other solutions do not provide the full measure of risk, which means fleets and their insurance carriers are relying on lagging metrics and after-event reviews. Building in predictive alerts to provide real time coaching is what is needed, and companies like Nauto are innovating rapidly in fleet predictive intelligence looking ahead vs analyzing statistics alone. This thinking is a big leap forward to actionable insights.
Being able to track all your assets, monitor carefully their routes, speeds, safety behaviours and reduce operating costs with smarter telematics software solutions is a must have vs. not have to stay competitive. Leading companies like: Descartes, Geotab, GoComet, KeepTruckin, Logixboard, Nauto, Peoplevox, Sperion, Suvoda, to name a few that I am watching closely. One also must track the transportation platform software market leaders that Gartner which has recently identified companies like: Oracle, BlueYonder, and SAP in the leader category in their magic quadrant.
Telematic intelligent truck scores allow transportation and logistic operators to monitor driver behavior, track the wear and tear on fleet trucks, knowing fuel expenditure, idling time, speed, breaking habits, even pressure on the steering wheel or body posture from car part sensors all can be correlated to determine not just the risks of the vehicle, but also the health risks of driver behavior. Looking ahead even the gait of the driver can be monitored evaluate physical stress and health risks.
Geotab, for example, a leading Canadian telematics company has research has validated that truck fleets can and have cut idling by up to 30% or more through telematics. Spotting and addressing driver habits alone can reduce fuel costs by 4%. In other words, telematics is big business.
Nauto’s solutions combine predictive-AI technology, data science, and more than 1.3 billion AI-processed driving miles to help predict and prevent collisions before they occur. This unique approach can improve driver performance and help reduce collision loss, providing rapid ROI while mitigating risk factors of greatest impact. Trusted by nearly 800 fleets worldwide, Nauto helps customers reduce up to 80% of collisions with predictive driver alerts. The user interface experience on driver alerts however, has to be incredibly well designed for driver safety, so I am going to do a demo of their software and appreciate how this is visualized more, and will report back in a future blog.
What percentage of your fleet infrastructure is equipped with advanced telematics intelligence?
The U.S. House of Representatives passed a $1.5 trillion infrastructure stimulus bill in early July 2020. This stimulus enables opportunities for off-road fleets to advance digital fleet telematics and reinforces how important this industry sector is. In Canada, the Ontario Center of Innovation (OCI) has introduced a AVIN stimulus program to harness Ontario’s automotive and mobility ecosystem, including regionally located technology development sites, demonstration and testing zones, leading industry expertise, and more: start-ups, small and medium-sized enterprises (SMEs), and global leaders to tap into a wide range of resources, capabilities and opportunities.
Looking beyond, we will increasing see telematics software fleet management solutions integrate with automative manufacturing companies further pushing the smarter vehicle modernization further ahead.
Already you can see how fast Samsung is bringing more vehicles into their branded SmartThings ecosystem. Although focused on car innovations currently, where you can be able to start or stop the engine of compatible vehicles with your SmartThings mobile app, and activate the heater or AC before you step inside your car, these earlier innovation projects create a future vision of only what is to come. Already Samsung has teamed up with Google to bring a SmartThings dashboard to Android Auto. As such, you’ll be able to control your smart home products or open your garage door from your dashboard after connecting it to a Samsung phone.
In October, Samsung announced that SmartThings support was coming to Mercedes-Benz’s MBUX Voice Assistant for hands-free smart home device control.
In summary, smarter AI driven fleet telematics software systems:
- enable the complete visualization of asset locations allows managers to set up deployments across fleet operations,
- monitor the current status of assets at each worksite and allow unused equipment to be quickly identified and directed to other sites where they are needed, thus maximizing up-time of what would otherwise be an under-utilized asset.
- simplify maintenance scheduling for assets to minimize disruption. Asset uptime is also impacted by how often a given piece of equipment is down for unexpected maintenance.
- provide insights on driver behaviours in fleet vehicles in terms of speeding, breaking, # of stops in a day, location, etc
The increased connectivity and awareness provided by telematics has the potential to cut unplanned downtime by up to 80%, and also help improve the health and safety of drivers.
From Data to Predictive Precision Insights
As discussed, telematics software collects a lot of data. From speed, distance, fuel usage, idling, harsh braking are just a few of the many data points, but what do you want do with the data to ensure key insights/ outcomes can be actioned is what is really important.
Answering questions like:
1.) Which of the fleet trucks is being under-utilized to reduce idle assets?
2.) Which drivers are likely to experience accidents in the future, given their driving habits or by terminal center patterns for increased health and safety training needs?
3.) If using video to provide proof validation insights such as loading dock blockages, how the vehicle was parked to analyze risks, have risks been reduced and coaching programs improved?
The telematics industry will continue to evolve with more unification to a complete business platform system connecting not only fleet performance, driver performance but also increased intelligence from third party data sets such as traffic, weather, construction blockages, overtime labour dynamics, and even heart monitoring and stress monitoring as intelligent uniforms start to come into the picture. Let’s not overlook the innovations in driverless trucks driving on sensor transportation driving lanes – as these visible developments proven out more will be one of the most significant shifts in history in transportation logistics, since man developed the wheel and buggy. We have clearly come a long way with human ingenuity.
If you are a CEO or a Board Director of a transportation and logistics company, small, medium or large, you need to think harder about your company’s investments into AI telematics infrastructure and be rapidly transforming your fleet operation to remain relevant in the digital intelligence era.
Here are five key questions I recommend you discuss in your next board meeting or as a CEO/CIO in your leadership team:
1.) What percentage of your technology budget is currently supporting AI driven applications overall, and in which area(s) are these investments in and what is their value realization (ROI), etc?
2.) Do you have a robust AI technology investment and architecture blueprint plan for your entire supply chain infrastructure from sales, fleet operations, customer service and supply chain management, etc?
3.) How do your AI investments compare to your top three major competitors for increased benchmarking intelligence?
4.) Does your AI strategy enable both management and employee to see the telematic dashboards of driver/vehicle performance to enable transparency and increased unified collaboration of all stakeholders?
5.) Does your AI strategy for your fleet also include the physical health and well being of your drivers?
If you want to read the first blog in this series, please go here.
In summary, the transportation and logistics industry is undergoing tremendous change. Is your organization ready?