The Value of Telematics in a “Post Throw-Away” Economy

I guess starting sometime around the early eighties, we in the western world (mostly) had developed a knack for throwing things out when they either broke, or we perceived them as obsolete. This behavior was mostly fed by the rate at which new, cheaper and more feature rich products were introduced in to the market. It seems that “throw away and replace” attitude percolated into our business actions. We replaced needs with wants, and we became more likely to take a time/cost/feature approach towards capital expenditure and assets.

Before 2009, companies with many assets to track were generally focused on the bottom line, and maybe not so much on the efficiencies of their organizations and operations. Most of those companies would have a difficult time stating precisely where, and under what conditions their assets were at any given moment, even though the Sarbanes-Oxley act put into legislation that publicly traded companies must provide visibility to all their assets at any given time.

Tracking large volumes of fixed and mobile assets is a considerable challenge, ignoring the costs associated with operating those assets; well that’s basically saying “I know I could spend less, but I just don’t have time for it right now”. At least that’s the way it was over a year ago. But now, times are different. Welcome to the “Post Throw-Away” economy.

These days the big questions are: Where are my assets? Is it where it should be? What is the condition of my asset? Does that asset even exist? The first two should be obvious; the last two need a little more explaining. “Knowing the condition” means more than is it working or not. It means is it operating sub-optimally, such as wasting fuel by idling unnecessarily, or is it due for maintenance and I need to start planning for when and where that will take place. It means I’m being proactive and not reacting when, not if, something goes wrong. And believe me something always goes wrong, usually at the worst possible time.

This last year was real wake up call for many corporations, the effects of the “great recession” left no industry untouched. To that end all eyes turned inwards, and many were in fact scrambling to do more with less. I would argue that it was the reverse; we started to re-learn how to be more efficient and effective with what we have. Now more than ever, greater attention is being paid on maximizing the utility of our assets. It is no longer acceptable to just replace or ignore it.

Think about that for a moment, would you be okay with paying car insurance on every car you have ever owned, even after you sold them? What about if every time you forgot where you parked your car, you went out and bought a new one? Sounds ridiculous doesn’t it? Unfortunately that is precisely what is going on with shipping containers and railcars. I’m not even going to go into the cost of contents of those vessels and the amount of lost revenue, or on the impact to customer relations. It’s happening right now, and sadly for some it will keep on happening. The scary thing is we have the technology, it exists today and it is called “Telematics”. It’s not the “silver bullet”, and it won’t solve the financial crisis, but it works wonderfully and for those who have embraced it, it has paid off handsomely. In some cases even generated a significant profit.

So I guess the big question is who are going to be the guys who connect the dots and realize the tremendous potential and cost savings by adapting telematics, and who will be left behind wondering where they went wrong. Either way, whoever figures it out first will reap the rewards and gain a significant advantage over their competition. It’s not a question of if but when. Where do you want to be?

More later…

73,

Emad Isaac is Chief Technology Officer for MOREY. He is the author of “TechKnowledge”, a MOREY blog dedicated to market-relevant technologies, trends and product innovations in the electronics industry.