Compliance vs efficiency: spend a little to save a lot 09 September 2013
Compliance, efficiency and cost-cutting – those have to be the watchwords for the vast majority of managers, engineers and technicians throughout the transport industry for the foreseeable future. And, while they may seem mutually exclusive, in many cases closer examination demonstrates a clear dependence.
Look at VOSA's OCRS (Operator Compliance Risk Score). Staying on the right side of that will require investment in training, systems and procedures for some, yet the consequence of not getting a green rating is the certainty of costs – at the very least in the form of delayed journeys, with vehicles hauled over for roadside inspections (page 40).
And then, if one of those vehicles should attract an 'S' marked prohibition, you're in real trouble. Now we're talking about a spiral of potentially damaging expense, with VOSA investigations, possibly litigation and a public inquiry before the traffic commissioner. Serious failings – maybe due to misguided cost-cutting – could see your 'O' licence curtailed, even revoked. Now there's the very real possibility that you'll be forced out of business (page 14).
All of which is entirely and rightly avoidable. Getting your vehicles, drivers and maintenance providers compliant with the mandatory standards is a condition of all operators' 'O' licenses, only because anything less is deemed to compromise road and corporate safety. So, put simply, proper systems and competent people represent the minimum costs of doing business in the transport industry. Indeed, it's staggering that anyone gets away with anything less.
That said, transport, just like the rest of the corporate world, is under pressure, so some judicious belt-tightening is a business imperative today. The issue, however, is understanding what's judicious versus what's reckless. Cutting costs, in terms of fuel consumption and/or insurance premiums, using initiatives that improve driver behaviour (based, for example, on telematics and camera technology) makes perfect sense. Yes, there's an upfront investment, but the payback can be very rapid and then you're into bunce.
Much the same applies to specifying vehicles more closely to match their anticipated function(s), taking advantage of technology improvements that increase operational efficiency without compromising residuals. Or buying into the DfT's (Department for Transport) longer trailers trial, if your operation cubes out before it grosses out. Or getting on board with multi-fuel engined vehicles or hybrids, where the fuel savings stack up against the initial purchase price. It's often a matter of understanding the total cost of your vehicle ownership, including all running and operational costs, and benchmarking those against the industry average to see where best to spend a little and save a lot.
Naturally, if all of the above was easy and risk-free, everyone would have already done it. The issues invariably are understanding priorities, avoiding blind alleys and freeing up resource to make it happen. If you need help from your peers, why not come along to the IRTE Conference on 11 September. Go to www.irte-conference.co.uk and book online.
As the old proverb goes, a stitch in time saves nine. Trite, maybe. Apposite, certainly.
Brian Tinham BSc CEng MInstMC FSOE FIPlantE FIRTE
Society of Operations Engineers
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