Welcome back to Part II in our two-part series on how to harness trucking-related data to enhance your fleet. In our previous post we looked at the many ways data could be used and the technologies underpinning those options. Today, we will look at how data influences maintenance and what blockchain means for the trucking industry.
While data cannot currently predict all part failures, sensors and data can anticipate many routine problems and allow for convenient monitoring of equipment. Data from telematics devices and sensors can give clues as to which parts on a truck are wearing or nearing failure, enabling fleet managers to alert and advise drivers before a costly roadside breakdown occurs. Beyond the cost of the repair itself, unscheduled maintenance costs an average of $79.32 per hour, meaning smart data utilization can quickly pay for itself.
What is the Blockchain?
As far as industry buzzwords go, “data” is hard to beat, but “blockchain” might just take the cake. While the data and blockchain go together—blockchain being a record of data— blockchain is certainly less understood. Before we jump into some of the ways that blockchain might bring change in trucking, let us first define what exactly blockchain is.
To begin with, it is not bitcoin. While bitcoin is an example of a blockchain, blockchain is not limited in application to digital, decentralized currency. Blockchain has been called a “truth machine,” an “instrument of trust,” a record of data, transactional or otherwise, that is not created, owned, protected, or restricted by any one party or centralized authority.
Blockchains allow all users to see an open history of data that is secured by uncrackable cryptography. This is why the bitcoin blockchain, an open-source system with tens of billions of dollars just waiting to be stolen, has never been hacked.
But the reason the trucking industry is excited about blockchain is not because of bitcoin. At its core, decentralized blockchain technology is about establishing trust about data between parties. In the commercial trucking industry, like in most other industries, trust typically comes from long-standing relationships or trusted third parties, like banks. Blockchain changes all that. The data can be trusted, because the network enforces the fidelity of the information.
Many believe blockchain will affect three areas of trucking in particular. The first way is authentication. Basically, blockchain can be used to track goods on their journey through the supply chain. Giants like Oracle, IBM, and SAP are enthusiastically pursuing blockchain for this application. Appealing startups like Provenance are joining in. This seems to be a promising application for blockchain adoption in supply chain and trucking.
The second area is in finance. Blockchain lets cooperating parties verify that each has the money they say they do and will be able to pay on time. Blockchain enables “smart contracts,” which could potentially replace the need for so many lawyers by creating tamper-proof contracts. If you talk to supply chain experts, their three primary areas of pain are visibility, process optimization, and demand management. Blockchain provides a system of trusted records that addresses all three.
The third way blockchain will impact trucking is in process management. Like with payments, process management can also be built into smart contracts. If a task creates data, that data can be used by the smart contract to indicate whether a party has kept up its end of the bargain.
For example, where did a particular truck drive today? That data could go directly from the truck’s GPS into the blockchain ledger—an automated process with guaranteed integrity. Blockchain can track, communicate, and share documentation and information to streamline and secure process management.
What is the Adoption Timeline?
What does the timeline for blockchain adoption in trucking look like? Some, like dexFreight, are already doing it. The current adoption forecast for the technology in trucking is education, case studies, and some early adoption starting now in 2020. Between 2020 and 2025 will be a period of growth. We should see full maturity from 2026 onward.
There are some hurdles for blockchain adoption in fleets. Most blockchains can currently process 3-20 transactions per second. That’s fine for now, but it won’t be fast enough for effective full adoption across the entire commercial trucking industry. The best blockchain codes are almost always open source, which makes commercialization hard and protection of intellectual property rights challenging.
Ironically, many believe blockchain will be transformative in protecting intellectual property in the future. As for the open source code of the blockchains themselves, they can be quite difficult to control. The transparency of blockchain can also provide some concerns with its benefits. The ledger is open to anyone using the network, and while they can’t tamper with it, they can see any information that isn’t encrypted.
It seems likely that blockchain applications will become available to fleet managers and owners in the near future. They appear to represent the future of data storage and communication, although there are still some concerns to work out before blockchain goes mainstream in trucking.
How to Interpret and Analyze Blockchain Data
Blockchain offers an innovative way to store and share data gathered from telematics devices. But the question remains: how can a fleet manager go about implementing this data? The most accurate, efficiently gathered data, stored in the most ironclad software, does not benefit fleets in the slightest if action is never taken based on that data.
What you need to be doing is setting and monitoring specific benchmarks. Developing benchmarks is a critical part of using data to evaluate truck safety, part performance/wear, efficiency, and compliance. Is your fleet performing as well as it could be? How is it stacking up compared with others in the industry? Without benchmarking and monitoring, fleet managers cannot really know; there is no clear baseline, no context for the data being gathered. Prominent consulting firm Bain & Company breaks the benchmarking process into six basic steps:
- Select a product, service, or process to benchmark.
- Identify the key performance metrics.
- Choose companies or internal areas to benchmark.
- Collect data on performance and practices.
- Analyze the data and identify opportunities for improvement.
- Adapt and implement the best practices, setting reasonable goals and ensuring company-wide acceptance.
A critical part of the above strategy is choosing which key performance metrics, more commonly called key performance indicators (KPIs), to track.
Common safety KPIs include measures like speed and acceleration/deceleration, as well as peak times during which unsafe incidents occur. Efficiency KPIs might include total cost per pound of goods delivered, fuel consumption, idling time, rpm range, and shifting habits. KPIs tracking part performance and wear include road calls, parts purchased, cost totals, and maintenance costs. Compliance KPIs are often straightforward and easy to track through ELDs.
Next, you must focus on managing the data. Data just keeps getting bigger, but fleets often lack the personnel to handle all the gathered data in-house. What has happened over the past 10 years is that the analytics support staff that fleets may have had is now gone. So, there are no bodies left and no talent left to do that hard-core analysis that is needed to uncover the magic of that data and the potential of that data.
Still, many fleets can make data-driven improvements with the staff on hand. By defining clear objectives and focusing on a few high-impact KPIs, fleets can avoid getting overwhelmed and make real progress without investing excessive time into analytics. Many ELDs on the market make it easy for fleets looking to leverage a little more data in their day-to-day with dashboards and reporting tools that highlight useful indicators like driver speed, acceleration behaviors, and idling times.
Beyond this sort of “entry-level” data management, translating immense amounts of data into bigger strategies can be an expensive, time-consuming, inefficient task for many fleets to tackle on their own. To combat this challenge, there are a host of data services available to fleets on the market today. Most take the data generated by a fleet and turn that data into an implementable plan with accompanying spreadsheets, graphs, and progress trackers.
There is no shortage of options for fleets looking to leverage data to keep up with vehicle maintenance, driver habits, route optimization, fuel consumption, operating costs, and more—without having to deal directly with an unending flood of raw data. And these days, fleets need every data point that they can get to stay competitive!