"With many contractors, the total hours on the machines are reported on a weekly basis," McCrady notes. "In some cases, finding out a week later that you are not getting the utilization and performance you are expecting out of the equipment is not good."
Equipment tracking systems provide the data in real time. "You can manage your job costs better because that information is current," says McCrady.
Zachry Construction, San Antonio, TX, uses Qualcomm GlobalTRACS as a way to more accurately assess job costs. "One of our goals in using GlobalTRACS was to capture up-to-date information about equipment hours to help us accurately track the budget for each project," says Mike Monnot, director of Zachry's Equipment Department. "Because GlobalTRACS enables us to track engine hours, we can spot over use and under use, so we can manage our resources more proactively, and thus more effectively. It also helps us bid more accurately on future jobs, since we know what the demands on our equipment will be based on project histories."
Thoutt Brothers Concrete Contractors, Denver, CO, also turned to the GlobalTRACS system to keep track of its scrapers, graders, backhoes and loaders. Before the system was implemented, a lot of time was wasted trying to locate certain pieces. "Sometimes, we would be nervous for days because we couldn't find a piece of equipment," says C.J. Thoutt, equipment manager. "You couldn't tell if it was around the corner or in another state."
Now the company not only has accurate location information - complete with maps and directions - it has records of when the equipment has been running.
"Shortly after GlobalTRACS was up and running, we noticed that a tractor hadn't been used for three weeks," says Thoutt. "The supervisor said he thought it was used every day; but when he called the site foreman, he discovered it wasn't used at all. Without GlobalTRACS, the tractor would have sat there idle, not allowing us to earn revenue on that piece of equipment."
The system has shown a definite ROI. "With the savings in time and expense, we not only save money but ensure customer satisfaction," says Thoutt.
Automation adds accuracy
Automating the collection of utilization data can lead to increased accuracy.
For example, let's assume the break-even for utilization on a particular machine is 70%. "A lot of guys think they are hitting those numbers or better. They think they are profitable," says Tony Nicoletti, director - North American sales, DPL America. "But after the Titan Equipment Monitoring Systems are installed, they come to realize they are getting rates in the 40% to 50% range or worse."
Equipment "hoarding" is one of the biggest reasons, Nicoletti elaborates. A foreman may misrepresent the numbers on a piece of equipment to keep it available on a jobsite. This results in another jobsite having to rent a similar piece of equipment, which is a double hit to the company.
Equipment tracking can reduce or eliminate this problem. "We have one contractor that goes into the Titan software on a daily basis. And if a piece of equipment is not hitting a certain utilization benchmark, he has a lowboy come and take it off the jobsite and redistribute it to where it is needed," Nicoletti says.
The rising cost of oil is also creating a strong demand to track and curb unnecessary idle time. "Numerous contractors have found their equipment will be turned on in the morning and just left idling throughout the workday. That burns a ton of fuel, plus puts unnecessary wear and tear on the machine," says Nicoletti. Equipment tracking systems are able to differentiate idle time from productive time, which allows you to set benchmarks and reduce unnecessary idle time.
You can also track productivity. "For example, managers can remotely track the loads on dump trucks and scrapers, so now they can see how many cycles are being done per day or hour," Nicoletti points out. "It helps when you go to bid and with all of your estimates. When you have that information, it is definitely gold. Before this, it was all second-hand information - manually collected data. Now you have an objective, automated log. It takes out all of the guesswork."