What Is Telematics? The Beginner's Guide
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Go-To Guide: What is Telematics? Part 1

Have you ever wondered what telematics is? Or maybe: What's the history or telematics? What does GPS have to do with telematics? Who uses telematics? We've answered all these questions and more.

Telematics is a blend of two fields: telecommunications and informatics. While it technically refers to a wide range of technology, it’s most commonly used in reference to vehicle telematics. More specifically, commercial vehicle telematics, which organizations use to manage their trucks, vans, and other vehicles.


This guide is a crash course on telematics. Whether you just want to explain it to a colleague or you’re considering using it for your business, we’ve got you covered.


By the time we’re finished, you’ll have a solid grasp of:

  • What telematics is
  • What kind of data you can collect with telematics
  • How telematics benefits companies
  • The key to making telematics work for your business

Let’s start with a definition.

What is telematics?

Telematics is digitally transmitting and accessing information. That information might be transmitted through radio frequencies, cellular data, the Internet, or other digital channels. It can come from all kinds of devices, and it may be viewed or managed in an app or software program.


Since telematics is a blend of two fields, it helps to understand what’s being combined. Telecommunications is the field of using technology to exchange information. When a GPS tracker sends location and positioning data to an app or software, that’s telecommunications. Infomatics is the process of digitally interacting with information. When you use an app or software to view, manage, or use data (such as a vehicle’s GPS location), that’s infomatics. 


So telematics is basically a two part process: digitally transmitting information and digitally accessing it. It’s one experience that requires two key pieces of tech: one that can transmit data and one that can translate that data into a format you can use.


Vehicle telematics is digitally transmitting and accessing information about a vehicle. Tracking a vehicle with GPS, using a dash camera, monitoring fuel usage and other diagnostic information, or even using roadside assistance to unlock your car all fall under “vehicle telematics.”


But most often, telematics refers to the way companies use data to optimize, protect, and manage their vehicles, equipment, and drivers. That’s what we’ll be focusing on throughout this article.


Fleet management is almost impossible to do at scale without telematics. It allows you to see detailed, real-time information about all your vehicles at once, wherever they are. For operations managers, it’s like being able to sit in the back seat of every company vehicle at once. You can zoom in on particular vehicles or drivers to identify problems, or zoom out and see patterns and trends in vehicle usage and driving habits.

What kind of data can you monitor with telematics?

The kind of information you can monitor with vehicle telematics depends on the devices you have and the means by which you access their data. Some fleet management software programs combine data from very different devices, such as GPS trackers and dash cameras, but you don’t have to have an all-in-one program to benefit from telematics, and as we’ll discuss later, one of the biggest challenges with these all-in-one solutions is making all that data usable. 


Here are some of the things you might monitor with telematics.

Location

Your vehicles are valuable assets and important tools. You need to know where they are at all times. Maybe you want to see which vehicle closest to a last-minute stop. Or you’re using a geofence to ensure your excavator stays at the construction site. Tracking your vehicles with GPS is essential for optimizing and protecting your assets, and it’s as easy as installing GPS trackers. GPS trackers transmit their coordinates, and most GPS tracking apps and software will overlay those coordinates on a map.

Speed

You want your drivers to get where they need to go quickly--and safely. Especially in industries where time is of the essence (like delivery services), drivers may go over the speed limit to make up for lost time if a stop takes longer than expected, or traffic and other circumstances cause delays. It’s not malicious--they’re trying to stick to the schedule and meet deadlines--but it is dangerous, and it puts your company at risk. Quality GPS trackers should be able to monitor your vehicles’ speed.

Direction

If you want to make sure your vehicles are en route to where they need to be, it helps to have some kind of indicator of the direction they’re heading, not just where they are. This is another basic GPS feature. The Global Positioning System uses your tracker’s most recent locations to determine the direction it’s heading. Most GPS tracking apps and software will use an arrow to indicate the direction your vehicles are going.

Stops

When your GPS tracker transmits the same location for several seconds, a good GPS software will record this as a stop, ideally with the stop duration. If your drivers regularly stop at the same destinations, then over time this helps you see how long each stop should take on average. It also helps if you need to call ahead to let a client know their appointment is behind schedule. You may also discover unauthorized stops that could be impacting your business.


Some GPS trackers connect to your vehicle’s on-board diagnostics port (OBD) or CAN bus port and give you additional information, such as whether or not the engine is running, so you can tell when a stop is probably traffic-related.

Fuel usage and mileage

Monitoring your vehicles’ fuel usage and mileage helps you use them more efficiently and keep records for tax purposes. An OBD GPS tracker should be able to give you this information, and a good GPS tracking platform will make this information easy to organize and view.

Fault codes

When the check engine light comes on in one of your vehicles, you need to know right away what’s wrong and how it will impact your business. Some OBD GPS trackers can transmit vehicle fault codes--and even send alerts--so you can immediately see what’s wrong. This allows you to quickly communicate the problem to your drivers, so they know if they need to return to base ASAP, pull over, or simply take their vehicle to maintenance at the end of the day.

Braking force

Sometimes something unexpected happens, and a driver needs to brake suddenly. This is bound to happen occasionally, but every time it happens, it’s a safety risk. It increases wear and tear on your vehicles, and increases the likelihood of an accident. Plus, keeping the brake force low can positively impact your insurance premiums. If a driver has a habit of braking too hard, that’s an issue you’ll want to correct. 


Without telematics, the only way you’d see this is by constantly riding with your drivers--and even then, you’d only see how they drive when their boss is watching! Some OBD GPS trackers can monitor brake force.

Acceleration force

Similarly, you want to be sure your drivers aren’t flooring it every time they stop or slow down. This is hard on your engines, and increases the likelihood of an accident. Depending on where it happens, it can also make your brand look bad. And as with braking force, keeping acceleration force low can help lower your insurance premiums. OBD GPS trackers can show you this data and related date like RPMs.

Video feed

If one of your vehicles is ever involved in an accident, having a dash cam can help protect your drivers from fraudulent claims and ensure you have a speedy resolution with insurance companies. It’s a lot harder to have a lengthy (and costly) back-and-forth dispute when there’s video evidence of what happened. 


Alternatively, if you’re ever concerned about someone’s driving habits, some dash cams may allow you to hop into a livestream, so you can keep a closer eye on a driver who frequently brakes too hard or accelerates too much.


Those are just some of the data points companies may want to monitor. Now here’s why all that data is so important.

How vehicle telematics benefits companies

Any organization with company-owned vehicles can benefit from telematics. But the tech you need will depend on what you hope to achieve. Not every business needs a full suite of fleet management tools. But if you have vehicles, you’d probably like to see some of these benefits.

Vehicle optimization

Sometimes you have to actually see your drivers’ daily and weekly routes on a map to see ways they could be more efficient. Every mile and every minute you shave off can make a big difference in costs and your ability to serve your customers. And by tracking fuel usage, mileage, and other data points, you can easily identify areas where you (and your drivers) have room for improvement. It’s a lot more work to report, review, and act on that information manually, and with a digital dashboard, you can see it all at any time.


Additionally, telematics can help you track when vehicles need to be serviced to help avoid unscheduled maintenance. And with better tools to quickly recognize problems, you can schedule maintenance the moment something comes up. 

Improved safety

Every time your drivers get on the road, they’re at risk. But you can reduce that risk by monitoring how hard they brake and accelerate and recording how fast they drive. Keeping your drivers safe means enforcing good driving habits. By tracking how people are driving, you can reward your best drivers, provide gentle reminders to those who slip up, or introduce other systems to incentivize safer driving.

Better security

If you can’t track your vehicles, it’s a lot harder to recover them if someone steals them. Not only do GPS trackers let you see exactly where your vehicles are, but you can set up geofences around your company campus, maintenance shop, or parking garage to ensure that if a vehicle leaves when it isn’t supposed to, you’ll know. Some GPS trackers can also be programmed to notify police if a geofence is activated to encourage a faster law enforcement response.

Legal compliance

Some companies need to pay special attention to laws regarding vehicle usage and driver management. Telematics makes it easier to generate reports for International Fuel Tax Agreement (IFTA) by automatically tracking all the relevant data in one place. You can also conveniently track hours of service and see when your vehicles are due for inspection.

Lower insurance premiums

Some insurance companies offer discounted rates if you can demonstrate safe driving habits. By tracking data like brake force, acceleration force, and speed, you can show insurance companies that your drivers are at a lower risk of being involved in an accident. And with better visibility into this information internally, you’ll be equipped to promote the safe habits necessary to lower your premiums.


Regardless of your goals for using vehicle telematics in your business, there’s something you need to know: not all fleet management software and GPS platforms are created equal.

The key to using telematics for your business

With telematics, you can tap into a wealth of data to make your vehicle fleet more efficient, more compliant, and safer. But depending on the platform you use to access that data, it may feel like getting hooked up to a firehose. There’s more information than you can possibly use, organized in a way that makes reporting and managing your data feel like more trouble than it’s worth.


You need a platform that balances functionality with accessibility, giving you convenient ways to filter out the information you don’t want and home in on the things you want to see. Your GPS tracking software should empower you to make discoveries about how you’re using your vehicles and where you can improve. And that depends as much on what you experience in the software as what you can track.

Start tracking your vehicles

At SpyTec GPS, we’ve made usability one of our top priorities. We build first-class GPS trackers and highly accessible software to manage your vehicle fleets. Take a look at our GPS trackers, and schedule a demo of our platform.


It’s time to put vehicle telematics to use for your business.