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Vehicle tracking and monitoring are being billed as management lifesavers. But are contractors prepared to take advantage of what's out there? By Penelope Grenoble O'Malley |
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"It's a matter of controlling operational inefficiencies," notes Tim Lewis, senior director of construction equipment operations for Qualcomm Wireless Business Solutions based in San Diego, CA. "The ability to monitor equipment is a management tool." John Marshall, director of sales and customer support for Case Construction Equipment in Racine, WI, bills his company's FleetLink tracking system as "a flight data recorder" for construction equipment that also helps customers improve their return on assets. Peoria, IL - based Caterpillar promises "maximum uptime, minimum repair costs" with Product Link, and a host of global positioning system (GPS)-based recovery systems, along with the long-established LoJack, promise no more thefts. But are contractors using all this firepower? It depends. Technology-savvy corporations are incorporating sophisticated machine diagnostic systems that use data-logging units combined with report and analysis software to integrate feedback on a range of machine functions, from engine coolant to brake pressure, into existing information management systems, thereby setting an industry standard. Dealers are using these systems to track and facilitate maintenance, but in general the construction industry is where trucking was 15 years ago when Qualcomm introduced itself. Lewis hits the nail squarely on the head when he describes his company's construction industry marketing as aimed at technologists - what he calls "the early majority" - leaving the bulk of the market to follow as "late adapters." "Anytime you incorporate technology, it can be painful," he remarks. "It requires a willingness to change the business process." The wireless executive has been studying the construction industry for the past four years and estimates that as much as 60% of the factors that affect a contractor's bottom line are beyond his control. But not to worry: Vehicle monitoring and tracking can help whittle down the remaining 40%. The Challenge Inefficiencies that typically have frustrated dirt contractors include equipment location and logistics, machine-by-machine operation and productivity, service and maintenance, and - most recently - security. And while Qualcomm has just begun to ease its way into grading and excavation, original equipment manufacturers (OEMs) such as Volvo, Case, John Deere - Hitachi, and Caterpillar are doing the yeoman work of providing heads-up on tracking and monitoring with a range of in-house fleet management and machine diagnostic options. In the wings are a host of enthusiastic independent providers. With a few exceptions (notably Volvo and Deere-Hitachi), current monitoring and tracking systems are based on wireless technology that makes it possible for owners to communicate with their equipment from a central location via satellite or cell phone link. For $500-$1,000 per individual machine and a per-unit monthly access fee, an equipment manager can establish, at a minimum, each unit's whereabouts in addition to its hours of operation. With adds-on he can monitor details of machine function and performance. "Over the last couple of years the cost of vehicle tracking solutions has come down significantly," observes Steve Stillman of eTracker Inc. (recently acquired by On-Board Communications Inc. in Dallas, TX). "Plus the Internet has made tracking easier. Traditionally you needed to purchase and install software, then train someone to use it, or lease it and pay recurrent licensing fees. With the new systems, you access the data through a password-secure Web site. The third factor in making these systems more viable is the extension of wireless coverage. Previously if a unit was out of coverage, you had to wait to retrieve the data." "I came out of mobile communications for the trucking industry," relates Ron Richardson, director of marketing for Hoss Equipment Co. in Irving, TX. "If you wanted to haul for a company like Procter & Gamble, you had to be able to track your loads. In the construction industry you don't have that kind of push from the end-user base." Hoss specializes in heavy earthmoving equipment, and Richardson says so far the most active application of monitoring and tracking systems has been in the mining industry and among the large contractors that do the heavy lifting of infrastructure projects and often contract with their dealers for maintenance. Don Kramer, service manager for Rudd Equipment Company, a Volvo dealer in Evansville, IN, doesn't consider mining companies deliberate pioneers. "It was a matter of survival," comments Kramer, who projects that much the same is in store for the construction industry. "Every year we've been in business, our margins are less and our competition increases, and it's the same for contractors. They're going to be forced to take a very close look at everything they do, from maintenance to management. Right now squeezing an extra thousand hours out of a machine may not seem like such a big deal, but in the future it's going to be the only way to compete." A Matter of Time One challenge seems to be finding time to manage the data that tracking and monitoring systems generate. Al Colter manages 2,500 pieces of construction equipment for Jones Bros., headquartered in Mt. Juliet, TN. "Information is great," says Colter, "but you have to use it. Take something simple like oil samples. An oil sample is good if you know what you're looking for and if you actually look at it. It used to be we'd get in a big stack of oil samples and nobody would respond. If you're going to develop a system, develop it to deliver information you're actually going to look at." Time is one factor, states Kramer, but so is expertise. "Customers call us when they need help. Maybe they've had a repeat failure with a component or an unusual duty cycle. We go out and download their machine using Volvo's Machine Tracking Information System [MATRIS] and explain to them why the component failure or the machine isn't performing the way it should. But the more often you download a machine, the more time it takes for someone to sit down and evaluate what you've got. For a small contractor, using this kind of system can also mean a fairly substantial financial investment. In our case, first he has to have a way to retrieve the data from the machine, and if he has equipment from multiple manufacturers, he's got to buy the system for each one. So at this stage they're a little more comfortable picking up the phone and calling the distributor or manufacturer. "On the other hand we have a sand and gravel supplier whose maintenance manager takes a personal interest in technology. He takes his computer home at night. This is the kind of person who takes advantage of what a system like MATRIS has to offer." "It's quite a step up," says Bob McAnallen, mechanical supervisor for Lane/Granite/Slattery, a joint venture working on the Washington, DC, Blue Line. McAnallen has been using the Machine Information Center available on John Deere and Hitachi excavators through a Deere-Hitachi partnership. "I can tell how many times the machine moves and how many times it starts and stops," he adds. "Pick any hour of the day. But the problem is a cut-and-cover tunnel job is not the kind of operation where you can really benefit from this information. Although the data can be really beneficial, you've got to look at it with a knowing eye. Let's say the data indicate the machine ran for 10 hours one day, but it looks like it only worked for three. That's because it was sitting there holding a strut. "The other thing is, I'm so busy on this job, I really don't have time to sit back and analyze a lot of what the system generates. On this job, that kind of analysis is just not a priority." When McAnallen does have time, he checks the excavator's overall condition, which means he goes first to the history of alerts, which tell him how often and when the machine was operating outside of programmed parameters. "I want to make sure the equipment is not being abused," says McAnallen. "Then I look at machine productivity. The information takes two to three minutes to download; you can put it in your pocket and transfer it to a PC when you have time. I can see if I were going to be buying a piece of equipment, this would be great - I could go in and see every time the machine was running hot, for example. This kind of asset management is new, but it's definitely the wave of the future." Machine size and function has a lot to do with how much information contractors think is enough. "Machine function monitoring hasn't caught on yet with contractor-size machines," notes Kramer, "but on 100-ton-class trucks and 9- to 10-ton-capacity excavators, the companies want it." Chad Bagnell, product support specialist for Hoss Equipment, which recommends the MobileNet (formerly FleetEdge) aftermarket generic tracking and vehicle diagnostic system to its customers, agrees: "The more expensive the equipment in terms of engines and transmissions, the more contractors want the vital component sensors. Sometimes even if the operator sees a light go on, he ignores it because his foreman is pushing him to get the job done. The sensors send out an alert whether the operator notices the problem or not." As with most systems, MobileNet comes in basic and plus packages, and Bagnell reports that large fleets typically install the high-end version only on key pieces in a class and use the basic package on the remaining equipment. "One of our mining customers has hour and location tracking on 90% of its vehicles and the diagnostic package on the other 10%." The Maintenance Tie-In
John Van Ruitenbeek, vice president and chief operating officer of Briggs Equipment in Charlotte, NC, thinks that more and more large-equipment owners are doing their maintenance through dealers, which now are featuring system health monitoring as part of their service contracts. Van Ruitenbeek uses Case's FleetLink. "The way we've set it up, the system tells us within a day or two which machines need service and even provides a map of the fastest route, which gives us driving time." Yancey Bros. in Georgia, which is overseeing the maintenance of 65 Cat machines at the Hartsfield Atlanta 5th Runway project, offered three key payoffs from using the PL201 version of Cat's Product Link. These include the ability to track each machine's location in close to real time, the ability to accurately predict preventative maintenance periods so the equipment is not overserviced or underserviced, and remote monitoring of machine abuse. Both dealers and contractors report that GPS technology makes tracking service schedules easier. "If you rely on the customer," says Van Ruitenbeek, "you can drive around for hours looking for a machine, then you find out it's only got 50 hours on it." Just the kind of program that Case's FleetLink was designed to address, remarks Marshall. "It would be difficult and highly administratively intense to sell a maintenance contract without FleetLink. You can imagine how many phone calls it would take: 'Do you need service?' then "Where's the machine,' then 'Is it being used?'" Similar to other OEMs, Marshall thinks it takes a fleet of at least five machines to take advantage of what FleetLink offers because five seems to be the cutoff between whether a contractor will maintain his equipment and whether he'll contract it out. HeavyTrack (San Antonio, TX) President Alan Day, whose monitoring system clocks hours and basic machine location, agrees that dealers are using tracking systems from independent providers for better service. "Because the HeavyTrack maintenance program counts hours and flags when it's time to go service the machine," points out Bill Kammer at the Holt Caterpillar dealership in San Antonio, "you make the call, locate the machine, go out and change the oil, then come back and enter the information, and in another 250 hours it tells you when it's time again." Individual contractors also are picking up on the feature. Colter, for example, originally installed HeavyTrack as an antitheft device on 117 pieces of equipment Jones Bros. owns in Texas but now says he plans to use the hour-tracking feature to schedule preventative maintenance across his 2,500-unit fleet. In contrast, Keith Collinsworth, vice president of Anderson Concrete Construction in Lewisville, TX, reports that he initially bought HeavyTrack for maintenance and only secondarily for theft detection and recovery. "You can set an alarm at, say, 1,900 hours, and 100 hours before that next service interval the machine will send an alert to your e-mail or cell phone. This way you're always servicing the right vehicle." Productivity and Unauthorized Use "People can't lie to you anymore," says McAnallen, who uses the Machine Information Center on his Hitachi excavator to check start times and shift operation. "If you have doubts about what an operator is telling you, it's easy to verify that the facts don't add up with what the employee says." Bagnell thinks contractors consider MobileNet's hour-clocking capability to be one of its most important features. "Without it you don't really know. An employee can come back and say he worked for 10 hours and, yes, the machine has been running for 10 hours, but has it been working?" Van Ruitenbeek relates that Case's logging function alerted a contractor that his equipment was clocking hours beyond what jobs required. The dealership tracked the unit and discovered that an employee was borrowing the machine to dig swimming pools on the weekends. Deere reports that at least one contractor uses the hour-logging function to bill by the hour, a practice being heavily marketed to the rental industry. "It's like an electronic time clock," describes e-Tracker's Stillman. "And because you can note start and stop times and where a piece of equipment is being used, you can reduce maintenance and control fuel costs. And with reduced maintenance comes a better return on investment. It's extremely attractive to be able to provide these opportunities to small and medium-size companies." But Richardson of Hoss Equipment thinks it goes beyond tracking employee accountability. "Systems that monitor machine health allow you to view how each operator is using the equipment, and if there's certain operational procedures that can save you wear and tear and fuel, you can point these out as they benefit the operator and the company. And if you build in an incentive or bonus, it's a way to get around the apprehension that big brother's watching. In the trucking industry, once we started putting money in their pocket, they started getting onboard." "At Volvo," says Field Product Support Manager Randy Bushelli, "we present MATRIS to our customers and our customers present it to their employees as a tool to help them get the maximum performance out of the machine, especially when it involves comparing how a piece of Volvo equipment operates compared to another machine. Maybe an operator is routinely in the wrong shift or rpm range, maybe he's idling too much. We never use the software to find fault with how an operator is performing but as a way to make sure the machine is doing everything it's designed to do." Fleet Management is high on Stillman's eTracker function list, and some contractors report that knowing the location of their equipment so they can move it around more easily is as important as tracking hours. Case's Marshall describes how a customer uses FleetLink on trenchers and excavators to monitor how much pipe his crews lay. Ditto for Van Ruitenbeek. "One of our clients sits down at the computer at 5:05 every afternoon, and by the machine's location on the map - and without talking to anybody - he knows how much pipe his crew has laid that day. He just watches the dot move down the map." Cat dealer Kammer says he's used the locator function in rental disputes. "In many cases, you have got to prove the machine was on a job. With HeavyTrack you can show where the machine was exactly during any given period." Likewise, Van Ruitenbeek used Case's FleetLink to prove to a bonding company equipment was on-site when he said it was. "We showed them page by page where the machine was every single day and how many hours it ran each day. The next week we picked up a check, and the bonding company was considering a tracking system. "We're early in the process," says Van Ruitenbeek, "but I think it's inevitable. More and more contractors are going to want to know where their equipment is and how it's operating." Security If there is one incentive that causes contractors to investigate vehicle tracking, it's theft - and post-9/11 security. "Everybody's got a theft problem," notes Tony Nicoletti of DPL America in Mountain View, CA, which markets the Titan Anti-Theft System as one of the new generation of wireless tracking and alert systems. "In California alone, the recovery rate is only one out of every three machines. Nationally the rate is between 10% and 15% with over a billion dollars of equipment stolen every year." "What we lose most often is loader backhoes and skid-steers," relates Kammer. "They're easy to transport, easy to hide, and just about anybody can start them. I can't imagine why anybody who owns a piece of equipment they have to leave unsecured on job sites wouldn't have one of these theft-deterrent systems. You've got a $50,000 to $60,000 machine that you probably haven't paid for, and you're going to get a massive hit on your insurance if it leaves. But if it leaves and comes back, you've made money." According to a study undertaken by LoJack Corporation in 17 states where LoJack-equipped construction equipment was stolen and recovered, skid-steers/skip loaders were the number-one target for thieves and combination backhoe/front-end loaders tied for second with compressors. Most thefts occurred on weekends, and - more bad news - professional theft rings are on the rise in the construction industry. In the one-year study period, the recovery of 16 LoJack-equipped units led police to an additional 41 pieces of stolen equipment. Texas, Florida, California, and Arizona lead the nation in thefts. The LoJack study indicated that these four states accounted for 81% of recovered equipment. LoJack technology uses radio towers to relay signals from vehicle-mounted silent transponders, which are tracked through police tracking computers. Once you report your equipment's stolen, the gendarmes take over. In contrast, GPS wireless systems use the signals produced by global positioning satellites to determine precise latitude and longitude coordinates to establish a "geofence" around individual pieces of equipment. A covertly installed radio unit communicates via cellular or satellite technology. If the vehicle is removed beyond the customized boundary, if it moves at night or leaves the area to which it was assigned, or if it's started during a time when it's supposed to be inoperative, the owner is alerted via pager, e-mail, or cell phone (the same way machine health diagnostic systems issue an alert when operational parameters are exceeded). In some cases the alert goes first to a data management center (what one HeavyTrack customer calls the "war room"), which notifies the customer that his equipment is on the move, then coordinates with law enforcement. Nicoletti explains that the Titan Anti-Theft System incorporates a full suite of capabilities - theft prevention, notification, and tracking - that activates if any of several alarms is tripped. Chuck White, executive vice president of E.E. Reed Construction LP in Sugarland, TX, knows what it's like to lose - then recover - a piece of equipment. White's Cat dozer was recovered three hours after the machine broke its geofence. The thieves were apprehended pulling the stolen machine on a flatbed trailer behind a pickup on their way to Mexico. "We've lost heavy equipment we've rented," says White, "but this was our first experience with losing something we own. The unit was stolen at midnight on a Sunday; the call went into HeavyTrack's monitoring center, which called our supervisor, who verified the dozer shouldn't be moving, and the monitoring center took it from there. It didn't take any effort on our part other than the superintendent getting a phone call at one o'clock in the morning." In Lewisville, TX, Collinsworth relates that his insurance company canceled coverage when two pieces of equipment were stolen in one month, but except for LoJack, insurance companies haven't been quick to acknowledge the capability of vehicle-tracking systems. Scott Nilson, senior manager for commercial channel at LoJack in Westwood, MA, reports that his company has had success convincing insurance companies to make adjustments for clients who install its theft deterrent systems. "Chubb offers premium discounts if you install LoJack; Atlantic Mutual offers a deductible waver, and St. Paul has actually purchased LoJack units for their at-risk policyholders." Also, in Texas the state chapter of the American Rental Association considered endorsing the tracking system offered by GPS Management Systems in Louisville, KY; however, despite the fact that the system helped bust a major theft ring in San Antonio, the association decided not to take official action. What's ahead: better service coverage once Qualcomm gets up and running in the construction industry, says Lewis, and a better interface between tracking/monitoring systems and existing accounting, maintenance, and productivity software to make systems easier to use and data reporting and management more customized. Volvo and Deere-Hitachi report that they're investigating whether to add GPS to eliminate the need for onsite data downloading. HeavyTrack anticipates adding more diagnostics to its basic locator-hour package. And if Lewis is correct, in as little as four years, OEMs will be partnering with communications companies to deliver the kind of hardware and tracking systems that, by then, will be standard equipment on construction vehicles. "The first thing you want to use these systems on are machines that go out and that you don't touch every day but you need to know about, or equipment that needs to be touched and maintained a lot," says Lewis. "But the truth is that eventually they'll be on almost every machine that has an engine." Sample Monitoring and Tracking Systems eTracker Inc.: Hour/location tracking; can also monitor key machine parameters FleetLink from Case Construction: Hour/location tracking and machine health alerts; used by dealers to facilitate maintenance contracts GlobalTRACS from Qualcomm: Builds on wireless tracking systems now standard in long-haul trucking; currently marketing hour/location tracking to the construction market GPS Management Systems: Hour/location tracking; info direct to your PC HeavyTrack: Hour/location tracking and maintenance alerts; war room handles thefts LoJack: State-of-the-art radio frequency - transponder tracking Machine Information System from Hitachi: Hour/location tracking and machine health alerts; requires a Hotlink download Machine Tracking Information System (MATRIS) from Volvo: Hour/location tracking and machine health alerts; requires a Hotlink download; available to individual users but also bundled in dealer maintenance contracts MobileNet: Hour/location tracking and machine health alerts from the field (low engine oil pressure, high engine or transmission operating temperature, high hydraulic oil temperature); cell phone or satellite technology Product Link from Caterpillar: Hour/location tracking in version PL151; machine health, fuel consumption, and Product Watch alarms in PL201 Titan Anti-Theft System from DPL North America: Hour/location tracking Penelope Grenoble O'Malley is a frequent contributor to environmental publications.
GEC - July/August 2003
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