GPS technology is becoming more common and widespread in use. In the last week for example Google have announced the real-time tracking of airplane flights on Google Earth (based on data collected by Flightwise from the Federal Aviation Administration), Casio have announced a geotagging capability on a camera linking pictures and movements to GPS positions and points of interest, while the US military wants GPS capabilities in their Ipads (which stands for Improved Position and Azimuth Determining Systems, not their Apple gadgets). So for organisational and business use is all this GPS stuff gimmicky or can we get more use from the technology?
If any logistics business completes an equipment audit would they be satisfied with the utilisation rate of every piece of equipment or vehicle? Or would some be seen as under utilised? In the current economic climate if less labour is employed than when the equipment was bought then you’d expect utlisation rates to drop as the labour may not be available to use the equipment and raise the usage rates. This however is not the point. The point is whether it useful or not to keep the equipment any longer as opposed to hiring it out, selling it or re-negotiating lease terms? As GPS systems provide utilisation rate data could they help businesses also generate extra revenue or reduce costs?
But we need the equipment..
For specific contracts, jobs or peak times of the year the under utlilised equipment might be needed. For example snow ploughs in the winter or having spare logistics fleet capacity for the build up towards Christmas. This however raises the same question about what to do with under utilised assets. For example if you own a sports car that you only ever drive for an hour or so on a Sunday morning occasionally throughout the year, your utilisation rate for the year will be low at say less than 10 percent (2 hours for 40 weeks). The question isn’t whether you enjoy driving the car or not, or even whether it is necessary? Rather whether it is more cost effective for you to hire a car when you want to drive it or even a chauffeur to drive you! This is as opposed to buying a car for occasional use. It is understandable if sentiment and “this is what I’ve always done” get in the way. In business however this is not strong reasoning, because you need to ask if it is worth the cost of continuing as you are? You could just simply hire in equipment when you need it or hire out under utilised equipment to generate money.
So if you use GPS equipment are you getting the most from it? Or can you use it in your business more effectively?