Web-based software applications slowly making inroads with small fleets
More and more software applications are moving out of the office and into the online world. Instead of the software residing in your desktop computer, it is held at a remote server with your desktop commands telling it what to do and when to do it. For example, many companies keep scheduling calendars on the web where they can be accessed by the appropriate people. The same goes for word processing software, which allows easy document alterations and sharing among designated readers no matter where they are located.
Although many fleets have embraced web-based services such as dispatch, communications and location services, they have been slower to appreciate the benefits of back-office software applications such as accounting, personnel records, maintenance and payroll. Indeed, while many larger fleets have taken the on-line plunge, smaller fleets have been slow to accept it despite the benefits.
HIGH-SPEED INTERNET A MUST
One reason is that many smaller fleets are in remote areas without access to high speed Internet. “Carriers tend to be in rural areas because real estate is expensive,” says Ernie Betancourt, president of Innovative Computing Corporation, a Brentwood, TN, company that offers enterprise software solutions for truckload carriers. “Yes, you could do it with dial-up, but realistically, you need at least DSL, and you can't get that everywhere.”
Adds Jack Boetefuer, president of Arsenault Associates in Burlington, NJ, “Some fleets that don't go web-based are concerned about the safety of their data. It's a general fear that their data is not under their control, and they have an unfounded fear of someone using the data.” While high-profile cases of bank and even government data stolen by hackers have occurred, these instances are rare and the chances of someone stealing a fleet's data are very small.
Advocates of web-based services say that simply connecting your computer to the Internet makes you vulnerable if you don't take simple precautions when surfing the web or exchanging email.
“We get a chuckle when we talk to some fleets who are concerned about their data,” says Boetefuer, whose company currently has about 3,500 customers with a half-million units under control of Dossier, its fleet maintenance management software. “We ask them: ‘Is your PC hooked up to the Internet? Do you have a firewall?'” He and others point out that from a competitive point of view, information that a competitor would want to steal from another fleet, such as location tracking and dispatch, is even more valuable and that data routinely whizzes through the Internet undisturbed.
Another reason for small fleets' slow adoption is that they may not believe that the technology can make them more efficient, notes Jack Patterson, marketing analyst for Eaton, whose Fleet Resource Management website (a collaboration among Eaton, Dana and others) offers online reports on items such as trip-by-trip statistics, real time location, route compliance, idling time, fuel usage, driver statistics, brake usage and tire maintenance — all through a web browser. “The biggest challenge we're facing is to convince fleets that it will make them more efficient, “ says Patterson. “We offer online training where we train people to use the website…Some smaller fleets are technophobes. They're afraid of the technology.”
Another sticking point is that online services can be more expensive than office-based software because of the additional services, such as data backup and security. “You're paying extra for peace of mind,” says Boetefuer. “It's someone else's responsibility, and even large carriers with IT infrastructure are willing to pay extra for that service,” he adds.
“The buzzword in the industry is SAS, Software as Service,” says Betancourt, “We deliver the functionality of the software as a service.”
Most web-based software service providers base their fee on the number of users. For example, Arsenault's breakpoint is 55 trucks; its ‘Silver’ basic services cost $1,000 up front and $150 a month.
Compared to PC-based software, web-based services have many advantages. For example, upgrades are done immediately and transparently, services are available anywhere an Internet connection is available, databases are maintained and backed up at several locations so that data is not lost if you have a fire or other major catastrophe, and local hardware never needs to be upgraded to handle newer, more sophisticated software packages.
Many providers have observed that even when smaller fleets take the plunge into the web-based world, they underutilize services that are available to them, preferring instead to stay within their comfort zone. “I'm surprised that with all the information available, all some fleets want to look at is idle time,” Patterson says.
“We have a maintenance product, but few smaller fleets use it,” adds Betancourt, who suggests that many smaller fleets don't do adequate maintenance programs anyway, so they certainly wouldn't do it using software. He also notices that many smaller fleets don't understand accounting, and that some of the more commonly purchased off-the-shelf accounting software can produce more complications if fleets don't know how to use it. Going to a web-based product probably will not change the situation.
One fleet that is not afraid of web-based services is Sky Transportation Services in El Paso, TX. The carrier has 35 OTR trucks operating mainly in the northeast, southeast, midwest and southern California, and they have been in business for about seven years. According to company president Albert Luna, the carrier prides itself on using innovative technology. “There is a false perception that it will cost too much to use software, especially web-based services, but in long run the ROI is really huge because you're able to be more lean with staff.” He adds: “Lots of fleets use [paper] spreadsheets, but if you want to remain competitive, you have to use the latest tools.”
Luna said that the main benefit of web-based services is that they all integrate into ‘one-stop shopping.’ For example, he uses Innovative's services along with those from Skybitz and Peoplenet. Data from operational reports are used to produce accounting and other financial reports which can then be used to generate tax filing data.
“We used to use [PC based accounting] software like QuickBooks in house but now we're able to tie it all [web-based services] into a system that's more advanced and streamlined.”
He notes that he likes web-based software because he can access any information about his fleets from anywhere. “If I'm traveling or my operations manager is traveling, we can check how things are going.”
He concedes, however, that the startup with tough. “The learning curve was huge, but it was worth it.” Luna hired a part-time IT person to be a trainer for his office personnel, which made learning and exploiting the system easier. He adds that his old software systems were ‘just kind of there’ and they weren't challenged to go beyond the basics. “Now we're forcing ourselves to use the modules so we're discovering a lot more things that are making us more efficient.”
The outlook for web-based services is positive. “In general, ASP web-based applications is growing dramatically, by orders of magnitude,” says Boetefuer. He notes that he is seeing burgeoning interest from local government fleets and private fleets. “About 90% of our customers are still PC, but the web-based services have been growing very strong for the last 18 months.”
He concludes: “Don't be afraid of software. If you're finding that you're not able to keep up on your maintenance with spreadsheets or if you don't know your actual costs per mile, you ought to invest in some kind of system. You will get a financial return doing it.”