The pain of losing money in a business is softened only by the fact that it’s rarely seen leaving. Making it is a bit clearer; you get that payment, and it sure looks a lot like profit.
That’s little consolation, though. Losing money is painful, perhaps even more so because it does happen so stealthily. It takes flight on many wings: inefficiencies, waste, soured investments, missed opportunities, client credits, inventory shrinkage. They all chip away at the bottom line.
Part of the solution is getting a clearer, more detailed picture of day-to-day operations. That’s often where small costs are incurred that begin to pile up, only becoming visible when revenues are compared to expenses. Examining and dissecting operations more closely can produce the insight needed to chart a course to greater efficiencies.
But that can be challenging for companies in the professional services sector such as electrical contractors and other skilled trades businesses. These are labor-intensive operations that make their money out in the field, relying on solo technicians or work crews to be highly productive in industries that exact stiff penalties for jobs done poorly, missed deadlines, cost overruns, delays and errors. Workers’ ability to be deliberate, smart, attentive to detail, competent, safe and reliable in their work goes a long way to determining a company’s profitability. To the extent they can’t, costs will be incurred and money will be lost.
Much of those costs have remained hidden, however, because keeping detailed tabs on and exerting control over what happens in the field has long been a physical impossibility. But thanks to advances in telecommunications and informatics ― telematics ― that’s starting to change.
The growing ability to use information technology to track and monitor people and physical assets in the field, communicate and share information in real time, access databases and analyze and manipulate data puts game-changing operational improvements within reach. Now, with the help of GPS tracking products, mobile apps, cloud computing and specialized software, businesses with service fleets and field labor operations can better understand operations, target areas for improvement, and take action.
The possibilities are endless, but recognizing where money is being lost can be a primary focus. Money slips through a business’s hands every day, often undetected. Some culprits are in plain sight; others require more digging to reveal. A sampling:
- Excessive fuel consumption. Idling vehicles, inefficient routing, underinflated tires, excessive speed, braking and jack-rabbiting waste fuel. This is low-hanging fruit for cost-cutting for businesses that live on the road.
- Lax vehicle maintenance. Businesses with fleets of service trucks are vulnerable to big outlays if maintenance is delayed. Moreover, out-of-service vehicles translate to lost opportunities to deploy crews and make money.
- Inflexibility. Being able to scramble personnel and assets quickly is essential in businesses that basically sell skilled labor. When you can’t quickly locate a technician or crew to respond to emergencies or urgent customer needs, your cost is lost revenue and credibility.
- Too much paperwork, manual processes. Clinging to hard copies of field-produced job tickets, reports, time sheets, service calls and invoices ultimately incurs labor costs in entering data into computer databases. And it also increases the chance of data-entry/transcription errors that can mean lost information and money.
- Miscommunication. Relaying information verbally carries all kinds of risks. Key information may not be heard or expressed correctly, voice mails can be overlooked, key decision makers may not be in the loop. Relying on voice for field worker-home base communication is also time-consuming.
- Worker productivity gaps. Businesses need employees to not waste time and move deliberately between job sites and duties during the workday. But it’s hard to know exactly what field workers are doing at any given time. Time wasted ― on excessive breaks, long meal periods, slow moving tasks ― cuts into productive man hours, revenue, profit and reputation.
It’s a grab-bag list, but these profit-robbers have a common denominator: they occur in the regular course of conducting “business as usual.” Over time, they may have grown invisible to varying degrees and highlight a fundamental problem that all businesses should address: “If you can’t see it, you can’t manage it.”
But fortunately, both seeing and managing these and many other hidden costs is becoming easier with advances in the broad area of telematics:
- Able to better track and monitor vehicles in near real time with GPS, companies know exact crew locations and how vehicles are being operated;
- Equipping crews with mobile devices that enable instant digital communication, they can message more efficiently and effectively;
- Utilizing field service management (FSM) software, businesses can sync their field workers’ inputs with back-office functions, and transition from paper to the digital realm in multiple areas, including invoicing;
- With cloud-based apps, data entered from or captured automatically in the field can be readily accessed and available for analysis, providing potentially valuable insights into operations.
To fully leverage telematics, businesses must adopt highly robust platforms capable of integrating easily with existing IT systems and delivering a range of capabilities. Helpfully, the telematics vendor universe is rapidly expanding as the technology improves and prospective users begin to understand the value proposition.
One of the newest providers in name, but one of the more established in capabilities is Verizon Connect, a new stand-alone enterprise comprised of a former business unit, Verizon Telematics, and two newly acquired companies, Fleetmatics and Telogis. Bringing more than 20 years’ experience in the fleet and mobile workforce management space to the table, Verizon Connect is well positioned to take telematics to the next level. Learn more about how Verizon Connect can help reveal and control hidden costs in a field services business at here!