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What do sensors say about your corporate efficiency?

What do sensors say about your corporate efficiency?

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By increasing its use of telematics in delivery trucks, UPS has found ways to cut fuel use by up to 25 gallons per driver annually.

Before I get to the main point of this post, did you know that UPS people internally call those brown UPS delivery vehicles that bring you fun things "package cars"? I didn't either. I promise there's a point to that observation, which I'll get to in a moment. But the main focus of this post is about how UPS is using an emerging practices called "Energy Informatics" to address employee habits and business processes that could help the company continue to reduce its carbon footprint.

The Society for Information Management, an association of IT professionals, is promoting this idea big-time within its Advanced Practices Council as a way of using technology more effectively to cut energy consumption. The theory is pretty simple:

Energy + Information < Energy

Or, to translate: energy plus information adds up to less energy consumption. That's the main gist of energy informatics.

Richard Watson, the chair for Internet Strategy at the University of Georgia, says that many individuals within the IT function at companies have overlooked the role that properly applied telematics can play in helping them predict usage of resources -- in this case energy. "If we want to change people's behavior, we first have to tell them what they are doing," Watson says.

By showing managers these "signposts," companies can help develop more efficient processes. Those that use a lot of energy right now, such as manufacturers or freight management companies, can reach above the low-hanging fruit to cut energy usage in ways that are more systemic, he notes. When it comes to agricultural uses, energy informatics could help a farm deliver only the water that is precise required to keep crops healthy as opposed to overwatering a whole field.

Watson and his team has shopped the concept around to a number of cities, since often the concept is regionally dependent. One example of the theory in practices is the Electronic Road Pricing (ERP) system that exists in Singapore. ERP is a congestion pricing system that charges drivers more when they are contributing to peak traffic congestion. Tolls are automatically deducted from a refillable debit card; what's more, ERP has been 95 percent accurate in predicting traffic problems, providing information that can be used to adjust traffic lights to improve traffic flow. In San Francisco, the city plans to equip approximately 6,000 of the 24,000 parking meters with wireless sensors to keep tabs on traffic patterns. In addition, the meters will be able to tell you if they are empty! No more driving around the block a gazillion times trying to find a spot, impeding the flow of traffic in the process.

So, back to that UPS truck. Turns out that UPS is embracing an energy informatics solution for all of its vehicles. Chuck Holland, vice president of industrial engineering for the company, says approximately 63 sensors are being added to each package car; that data is combined with the information being collected by that little handheld that UPS drivers carry to keep tabs on packages. There are about 55,000 vehicles in the UPS fleet in the domestic United States, approximately 22,000 will be outfitted by these sensors before the end of 2010. (With another 10,000 trucks on schedule to be outfitted in 2011.)

Holland says the sensors are collecting all sorts of information, such as the time a vehicle spends idling when the driver has left. There are sensors on the door and on the seat belts to tell you when someone has unbelted and left the vehicle. It will tell you when someone backs up, which is a practice discouraged by UPS for safety reasons.

In a way, these sensors are not unlike those monitors you have taped onto your body to help keep tabs on functions that aren't immediately visible.

Holland says one immediate result of adding sensors was tightened policies around idling, which has been reduced by an average of 15 minutes per driver, or 25 gallons of fuel per driver per year. (Drivers are supposed to turn off their trucks when they walk up to your door.) The sensors have also helped UPS improve its seat belt usage rate to 99.8 percent. Moving forward, the sensors will be used to help drivers optimize delivery routes. Information from the handheld containing delivery orders will be married up with traffic information to help drivers navigate the most efficient way to get from location to location.

Holland won't disclose how much it costs to add the sensors to a vehicle (in many cases they can be moved if a vehicle is being decommissioned) but he says the company is confident of the return on this investment.

This comment sort of says it all: "We have had this data all along, we just haven't used it."

The more efficient that UPS can get about its shipments, the more efficient it can help its customers get, says Holland. Here are some case studies related to how UPS has helped use its ever-evolving shipping technology to help other businesses become more efficient.

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Heather Clancy

Section Editor

Heather Clancy has written for United Press International, ZDNet, Entrepreneur, Fortune Small Business, the International Herald Tribune and the New York Times. She holds a degree from McGill University. She is based in New Jersey. Follow her on Twitter. Disclosure