The Key to Connectivity: Defined KPIs Drive Real Business Value
March 11, 2019
Have any of you started using technology like a Fitbit or Nest and quickly lost interest because it wasn’t set up correctly, the user experience was off, or you weren’t able to see value right away? Oftentimes this happens because you aren’t able to easily see how the data being recorded relates to your life or the outcomes you want to achieve. Whether the stairs you climbed weren’t tracked or your monthly electricity usage didn’t improve, the data carries no significant meaning for you.
As the VP of customer success at Wi-Tronix, I think about data relevance for my customers every single day. In an industry where around 40% of companies have adopted real-time, connected technology into their primary business functions, and many of these are only scratching the surface of the value of data, I feel that it’s my duty to make sure that every piece of rail data collected is relatable and valuable for our customers.
For instance, we recently realized that one of the primary key performance indicators (KPIs) that we track was not resonating with our customers. We knew loss of locomotive connectivity was costing our customers several thousands of dollars per day, but they didn’t feel a sense of urgency to correct it. We knew we had to make the data relevant and actionable to them.
We used to measure when a disconnected locomotive was “out of contact.” But what our customers really care about is when they’re online and working properly. To reflect that important nuance, we pivoted to measure when a “locomotive data center is connected.” It’s crystal clear what we’re tracking, how it’s measured, and what impact it has on cost, efficiency and success. We can easily see trends month over month and quarter over quarter, showing material value to our customers through a KPI that means something to their business.
When a locomotive is connected to the data center, it means that mechanical, operational, functional data is being shared between the locomotive and the back office in real-time. In a perfect world, every locomotive should be connected 100 percent of the time. However, most are only tested every 92 to 184 days, which leaves failed devices in revenue service for months.
This lag in adoption results in challenges for today and tomorrow. Rail companies today experience measurable revenue loss due to connectivity issues. A single 24-hour snapshot shows that, of 350 systems monitored, those that are disconnected account for nearly $20,000 worth of potential value not being realized by the railroads. For the future, it means even more painful transitions to incorporating connectivity into standard business processes. Government mandated deadlines for technology like Positive Train Control (PTC) are imminent, and the expectations around increased efficiency and safety will only get higher as they roll out.
We believe that the mandated implementation of PTC should be used as an opportunity to prepare for the future of connected rail technology. It opens the door for every rail operator to create better business processes for managing operations and maintenance that generate long-term success in the industry. Those companies that embrace digital transformation will begin to take the lead in efficiency, safety, visibility, and more.
As I’ve shared before, without connectivity, rail operators bear the risk of even more problems across their locomotives, like the potential for event recorders or digital video recording to be down in the event of an accident. Connectivity allows for real-time monitoring of fuel usage, which can drastically decrease waste. It increases safety because it increases situational awareness, like quick changes in Form A (slow order) or track issues. It also increases efficiencies, improves operator train handling, provides insight in critical incident scenarios, adheres to government compliance, and the list goes on.
It’s a fact that all of these benefits can help you become an industry leader in rail. However, we also know how daunting it can be to implement new technology and business processes.
We believe that connectivity starts with establishing a well-defined process that is repeatable and that you get value from. One example of how we brought this process to life for our customers and helped them with their transition to more tech-enabled practices was to illuminate the connection between data and results. We created the Locomotive Shop Scorecard. It’s a tool that tracks every time a unit goes into the shop or shows that connectivity should be inspected, frequency of the issue, how long it took to get the locomotive back in service, which activities actually happened, and ties it back to real business processes. This allows us to use data and connectivity to highlight the shops that are highly effective and efficient and acknowledge how well they perform.
We’re constantly looking for ways to help our customers embrace digital transformation and connectivity in rail. It turns out that the most important step in driving adoption is to help our customers see the direct value they’ll receive now and in the future from connectivity. The short-term, upfront learning curve is a minor investment in a strategy that will ultimately redefine how they do business in the long term.
Are there ways you’ve seen connectivity impact your business? I’d love to hear what helped you embrace connectivity and technology in your daily operations.