The benefits of digitalisation
The typical benefits that early adopters of digitalisation are seeing within their businesses
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THE FIRST STEP IN RENTAL DIGITALISATION IS THE AUTOMATION OF THE RENTAL PROCESS WHICH ALONE DELIVERS A SIGNIFICANT
SET OF BENEFITS
Digitalising the rental process involves eliminating paper and implementing a full digital end to end rental process, from a customer enquiring on asset availability and price to being notified of delivery, any maintenance required on an asset and off renting an asset when the customer has finished with it. Critical to achieving full digitalisation of the end to end rental process is the implementation of telematics on assets, to access data on location, status and use. However, many of the process benefits can be realised without full implementation of telematics.
Digitalising the rental process typically delivers the following benefits:
1. PROCESS EFFICIENCY
- Paperless contracting – customer acquisition, customer financial evaluation, contracting, extension of contract, delivery notes.
3. EFFECTIVE SALES MANAGEMENT
- See a huge change in sales behaviour based on occupancy reports on equipment linked to effective sales management.
- Systems to provide a customer dashboard to sales staff.
- External data (for example on construction starts).
- Dynamic pricing based on availability and demand.
- Lead allocation and follow up tracking
Customer profitability analysis. - Solution sales (e.g. training) based on site usage data.
2. EFFECTIVE STAFF MANAGEMENT
- Reduction in staff spending time on paperwork or exceptions which are non value added.
- Lead time at the counter – spend on paper and reduce on admin work.
4. EFFECTIVE CUSTOMER MANAGEMENT AND ENGAGEMENT
- Accurate usage data enables full service billing (e.g. outside hours operation).
- Accurate invoicing supported by accurate data in areas such as fuel, damage, etc.
- Customer wants to know: cost, safety, productivity, carbon footprint.
“40% of enquiries rejected during automated credit and history checking (compared to historic manual approach)”
“Credit decrease – Credits posted to customer
decreased by 40%”
“Reduction in time to process service /
maintenance – Reduction of 32%”
FOLLOWING DIGITALISATION OF THE RENTAL PROCESS, IMPLEMENTATION OF TELEMATICS ON RENTAL ASSETS FACILITATES THE NEXT SET OF BENEFITS TO BE DELIVERED
Implementing telematics on assets provides data on asset location, status and usage which enables an additional set of operational benefits.
Digitalising the rental process typically delivers the following benefits:
1. DATA ON THE USAGE OF THE ASSET
- Avoids revenue leakage – e.g. evening and weekend working, damage, fuel levels / usage.
- Usage alerts – knowing when and how used.
- Pricing – adjust prices according to location of equipment and occupancy (for clients out of negotiated rates).
- Sustainability data – emissions from use of machine reported to customer.
2. EFFECTIVE AND EFFICIENT MAINTENANCE PROCESSES
- Machine data enables predictive maintenance and efficient scheduling of servicing and repair activity.
- Elimination of staff undertaking administrative functions – i.e. automatic ordering of spare parts in advance of site visit based on machine telematic data (for servicing or repair).
- Digitalising machinery records and repair / maintenance activity.
3. LOGISTICS
- Machine location to facilitate pick up, delivery and collection.
- Real time delivery information to customer.
4. ASSET MANAGEMENT
- Machine utilisation data to input into purchase decisions.
- Machine location and fleet optimisation to feed into purchase decisions.
- Machine utilisation data to optimise disposal decision.
- Breakdown and maintenance data to inform optimal disposal timing.
“Customers are asking for digital invoicing, want to see fuel levels, etc.”
“For us, digitalisation enables automation and excellence, which releases our people from non value added administration, for example, to more customer facing, value added activity”
“Sustainability development
cannot really exist without digitalisation”
TELEMATIC IMPLEMENTATION EXAMPLES
- Toilet calls for emptying when required.
- Environmental guarantee – guarantee no site closures due to environmental issues caused by over full site toilets.
- Servicing costs cut by 30%.
- Business grown by 50% due to
environmental guarantees.
- Road toll charges billed at time of asset return.
- Based on GPS tracking of asset > Evidence available on return$60k / month revenue recovered.
- Customer disputes eliminated.
- Asset calls for service when needed.
- Breakdown reported when happens,
report includes diagnostic analysis. - 32% reduction in time to process service / maintenance.
- Realtime asset location.
- On / off rent automation.
- Interface to billing and invoicing > Delivery tracking.
- Turnround time improved by 50%.
- Scissor lift battery charge text reminders at end of day.
- Increase in scissor lift availability on site.
- Elimination of flat battery service requests.
THE FINAL SET OF BENEFITS FROM DIGITALISING THE RENTAL PROCESS IS SERVICE AND BUSINESS MODEL DEVELOPMENT BASED ON DATA ANALYSIS
It can support transformation of the propositions made to customers, it can assist customers to transform their own businesses and it can deliver transformation of the rental business itself…
Digitalisation of the rental process delivers the following benefits:
1. MARGIN ENHANCEMENT
- Generally higher prices online as selling other benefits – service, availability, solutions, etc.
2. COMMERCIAL PROPOSITIONS
- Historically everything was sold as an “availability based rental proposition” if it’s on your site we charge you for it.
- Now offering hybrid lower availability charge and higher usage charge based on telematics usage data – how many hours the asset actually worked / moved.
- Many rental companies are looking at pure usage propositions for the future.
3. DELIVERING VALUE BEYOND ASSET RENTAL
- Health and safety and damage avoidance – Incident analysis, root cause identification and future avoidance (for example via training) – in one example machine damage was caused by a failure of users to operate the machine correctly, the rental company sold training which reduced the customer damage charges, increased machine availability and improved health and safety.
- Analysis of usage information (for example hours worked and load factors) and reporting of carbon emissions to meet customer sustainability requirements.
- By interfacing directly with the customers ERP systems the rental company can deliver customer
cost benefits by avoiding exceptions, invoice reconciliation, reducing contract management activity.
4. ONLINE TOOLS TO HELP WITH THE RENTAL PROCESS
- E.g. workplace design such as scaffolding.
“Customer driven KPIs showing impact of digitalisation are the main benchmark – like the fact that we are viewed as the safest (cyber wise, Health and Safety, etc.) and most reliable company in the market means digitalisation has succeeded”
RENTAL COMPANY DIGITALISATION – CASE STUDY
THE CHALLENGE
The rental company set a goal to be the rental industry’s best-performing supply chain. They wanted to replace manual processes with a range of integrated digital apps.
To achieve this demanded a step- change improvement in equipment availability, delivery accuracy, logistics, and servicing efficiency.
The supply chain team embarked on a mission, to replace all manual processes.
THE APPROACH
The rental company customised an off the
shelf digitalisation solution. In under 12 weeks, a customised pilot solution was delivered which automated the receipt, servicing and delivery of rental equipment and consumables.
Following a successful pilot, the solution was integrated into the rental company back-office systems and was rolled out across all locations. Another logistics process transformed was reclaiming damaged equipment. The integrated ‘damage recording’ capability allowed technicians to take and mark-up photographs of damaged equipment and instantly trigger the damage reclaim workflow.
Simplifying and speeding-up this process has significantly increased successful damage reclaims. The new digitalised process delivers a ‘single source of truth’ to customer service and logistics planning teams. All equipment interactions and service data are presented in an easy-to-use web portal that provides complete transparency to internal and external customers.
THE RESULTS
Equipment availability is a key driver of profitability, and it is driven by the speed that rental equipment can be made available (or turned around) on return from a customer site.
Digitalised processes allow depot logistics teams to instantly receipt and prioritise equipment the moment it arrives in the yard. This real-time receipt capability has halved the turnaround time of equipment and significantly increased availability.
Instant equipment receipt has also slashed customer credit notes by 40%. The rental company offers cleaning and refueling services to customers. However, details of the services performed were recorded on paper and sometimes illegible or even lost.
The digitalised processes ensure that all services, parts, labour and consumables are correctly recorded and updated to the back-office systems in real-time to ensure quick, accurate billing.
The time to record service inspections reduced by 32% because the service information is easier to capture in electronic forms.
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DIGITALISATION READINESS CHECKLIST
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Strategy
Clear link between business strategy and digitalisation strategy (business strategy leads) |
See |
Digitalisation strategy matches customer drivers in target segments | See Chapter 1 & Chapter 3 |
Implementation strategy (in-house, COTS, platform, hybrid) matches capabilities and resources in the business | See Chapter 3 |
Understanding the impact of digitalisation on your business mix, profitability, and ability to service non platform customers | See Chapter 1 |
If relying on platform partnership for your delivery strategy, do you have a plan for what happens if the platform arrangement goes sour | See Chapter 3 |
Digitalisation delivery strategy
Does the digitalisation delivery strategy – inhouse, COTS, platform, hybrid - match your strategy in terms of budgeting, “ownership” of customers, capabilities and likely development of digitalisation within your business over time? | See Chapter 3 |
Does your IT delivery strategy and in particular budgeting over time, considered a transformation journey that is likely to include ERP replacement, telematics roll out and data analysis? | See Chapter 4 |
Do you have the skills and capabilities required to deliver your digitalisation delivery strategy and journey over time, or you have a plan to address any skills and capability gaps? |
See |
Organisation of your digitalisation effort
Is the business (relevant functions, operations, sales etc) involved and leading the strategy development and decision making for digital transformation? | See Chapter 4 |
Are you running the digital transformation project as a business transformation project and not just an IT project? | See Chapter 4 |
Do you have a clear business case for the digitalisation transformation? | See Chapter 4 |
Have you aligned the tracking of benefits and results with business KPIs | See Chapter 4 |
Process digitalisation
Do you have a strategy to bring your staff along with you and manage change and business transformation as you digitalise your business processes? | See Chapter 4 |
Does your business process digitalisation strategy cover integration with operational aspects such as sales management, credit control, HR, QHSE? | See Chapter 4 |
Does your process digitalisation strategy consider if, and when, you will need to update your ERP system? | See Chapter 4 |
Telematics implementation / data strategy
Do you have a telematics implementation strategy – which assets, linkage to business processes and how to talk to different telematics solutions? | See Chapter 4 |
Does your digitalisation strategy cover creation of a data lake / warehouse, analysis of data and development of new services and solutions? | See Chapter 4 & Chapter 5 |
Does your digitalisation strategy cover the use of data to transform your business model in areas such as commercial offers, service delivery (depots) asset / fleet management etc? | See Chapter 4 & Chapter 5 |
Go to market / customer engagement
Does you digitalisation strategy align with the different needs of different customer segments | See Chapter 1 |
Have you engaged your digitalisation strategy to empower and transform your sales organisation (see implementation case study) | See Chapter 4 |
Does your sales front end still allow for traditional (phone and in-depot and sales staff engagement) as well as digital engagement (Multi-channel engagement) | See Chapter 4 |
Have you developed the customer journey and support you provide to educate and migrate customers onto digital platforms from traditional servicing |
See Chapter 4 |
Asset management
Does your digitalisation strategy enable efficient and effective fleet management via data analysis and effective forecasting | See Chapter 2 & Chapter 4 |
Does your digitalisation strategy provide data which will inform and drive your procurement decision making | See Chapter 2 & Chapter 4 |
Does your digitalisation strategy deliver increased fleet availability via effective and efficient fleet maintenance | See Chapter 2 & Chapter 4 |
Does your digitalisation strategy use data analysis to drive asset disposal | See Chapter 2 & Chapter 4 |
Proposition development
Does your digitalisation strategy cover how you will reach and engage target market segments and drive customer acquisition | See Chapter 1 , Chapter 2 & Chapter 4 |
Does your digitalisation strategy cover how you will drive customer retention and lock customers in | See Chapter 1 , Chapter 2 & Chapter 4 |
Does your digitalisation strategy cover how you will develop added value services and propositions and develop additional revenue streams for your business | See Chapter 1 , Chapter 2 & Chapter 4 |
Business model development
Does the digitalisation strategy go beyond customer engagement and sales, process transformation and solution development and create a vision of how the business can transform to capitalise on data and customer and market understanding | See Chapter 5 |
Does the business strategy include scenario’s for how competitors may transform their business through digitalisation and how your business will respond | See Chapter 3, Chapter 4 & Chapter 5 |
Does your digitalisation strategy align with the strategies of key customer segments and how digitalisation can support and enable your customers strategic development | See Chapter 1 , Chapter 2 & Chapter 4 |