Who on earth car afford a computer?.
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JUST LIKE pocket calculators and digital watches, the price of computers has tumbled over the last decade and micro and mini computers are now within the scope of many companies.
In the road transport world, it's mainly the large own-account operators who have gone furthest down the computer road. They've got the capital but more importantly, they've also got the chance to make the computer really viable.
Production planning, inventory control, sales records, accounts and invoicing, are the bread-and-butter work for the computer, which can then also Pe used for some of the transport functions.
For haulage companies, the Possibilities are rather more imited and the still-substantial .:apital cost of the computer may Pe hard to justify. Which is why nost haulage companies will urn to the many computer Pureaux services available. Liquid, Powder and Gas Trans Port of Batley, West Yorkshire, irst investigated the viability of computer 18 months ago. As ts name implies, LPG is a iaulage company specialising in anker work and its main cusomers are oil and chemical ompanies.
With 150 tractive units, two gain depots in Batley and Falirk, plus numerous sub-depots, PG is in the top five or six auliers specialising in tanker tork.
Explains financial director loward Robinson: "We were roducing masses of cost gures and I needed a way of Jrnmarising them so that we puld analyse them and act on le results."
The company considered the ureaux services and compared tem with the economics of 'vesting in a computer of its Nn. Bureaux offer a readylade level of service aimed at le haulier; if your needs Ancide with this, that's fine. But the bureaux didn't offer cactly what LPG wanted, and Dward Robinson wasn't entity happy about the security ane — he didn't necessarily want I the company costs and ac
counts information going out of the building.
When LPG did come up with a bureau which fitted its requirements, the service offered, at £5,000 a year, wasn't exactly cheap.
So LPG decided to opt for an in-house computer but its feet were firmly on the ground. "We weren't trying to do it on a shoestring but we weren't going to spend too much money on an elaborate system", explained Howard.
This is an important objective: if you're not careful once you get involved with computers the costs can quickly get out of control.
LPG wanted a system which was relatively simple and flexible and could easily handle fleet costs and statistics, and the system he eventually plumped for was by Systime, a local company. This can be very handy, particularly in the early stages of "de-bugging".
The Systime 700-Series computer comes under the "mini" classification, using the more expensive hard discs rather than the floppy type for storing the database.
As well as the actual computer, the system comprises a printer, a vdu screen and a keyboard. Like most modern small computers it's quite hardy and robust and does'nt need any special working environment — an airconditioned room for instance.
The total cost of the system, including programming and other miscellaneous charges, has been £17,000 — the maintenance of the hardwear costs around £1,600 a year.
So what does LPG get for its money?
The computer handles the company's payroll, accounting system and credit control. Howard Robinson reports that a great deal of time and effort has been saved in the compilation of the payroll, and the cashflow has also been improved with the credit control function.
But it's the fleet cost applications that separate the system from the run-of-the mill computer package.
First, there is the fuel con
sumption analysis. Inputs into this are mileage and the amount of diesel drawn from the company's own pumps, plus fuel bought at roadside garages.
As well as calculating exact mpg figures, the computer gives actual costs in pence per mile, and so highlights when diesel is being bought away from the depot at high prices — the mpg. figure may still be good but the pence per mile is high.
The consumption is calculated to two decimal places. So whereas most haulage companies would say they average between 7 and 8mpg, Howard Robinson could say for instance, that his fleet averages 7.12mpg. And this figure can be quoted for an individual vehicle, all the vehicles on a particular contract, or for the whole fleet. It can also refer to a single month or the year to date.
Howard and his assistant Paul Manning (who has special responsibility for the computer) are getting together with the LP( engineers to see what else ca be learnt from the fuel consump tion information.
Though it's early days yel they suspect there is Oftei some correlation between slight increase in fuel consump tion and an approaching engint malfunction. If this proves to bi right, then the computer coul( virtually pay for itself on thit alone. By careful monitoring o
"ie mpg figures a costly reakdown could be prevented. If a unit is always kept with the ame driver, then differences in riving styles can also be regis;red in the mpg figure, bearing p mind the other variables such s the type of load being pulled, le road and the traffic condions.
The anti-computer brigade lay point out that these concluions could always be drawn beme we had these automations. rue, but it took so long to ather and analyse the figures, it /as rarely attempted. The cornuter does it much more quickly nd accurately.
The cost of fleet maintenance ; another major sphere of inrest on the LPG computer. lere, the system gives a cornirehensive analysis and sumlary including routine servicing osts, maintenance carried out the company workshops, relainting and work done outside. Once again, this data can be liven for a particular vehicle, hose on a certain contract, or he whole fleet over various leriods. The costs quoted are in pence per mile and then compared with an average figure to .ee if a particular vehicle or group of vehicles are costing above or below average.
This comparison is made manually by reading down the column of pence per mile figures. It is possible for the computer automatically to highlight these "star performers" or "rogue" vehicles but the necessary programming would cost another £400 or so, which LPG understandably considered excessive for something that can be done so easily by mere mortals.
This is typical; there are a number of little luxuries and features that can be built in, but the professional programming can be expensive. With this in mind, Paul Manning has been working at the programming and is gradually introducing these refinements.
The cost per mile figures for maintenance can be very illuminating, giving some statistical evidence on which to base a vehicle replacement policy.
Broadly speaking, LPG had previously found that when the unit was three years old the maintenance cost per mite rose significantly. The computer confirmed this, with some precise statistics.
But one thing the computer can't do is to group all the units of the same manufacturer together, so that LPG can compare the average cost per mile of all the DAFs with that of all the Volvos and all the MANs.
This sort of back-to-back comparison is useful when buying new units, and so LPG takes up where the computer leaves off and calculates the marque averages from the individual units' cost figures.
This is one refinement that LPG is considering introducing — it just needs the right programme to extract the information.
Tyre costs are also carefully monitored and summarised by the computer but here the scope for actual savings is more limited.
Another major function of the computer is its record-keeping ability. Just by keying-in the fleet number onto the keyboard, the screen displays a complete life history of any unit or trailer in the fleet.
This gives details such as the make and model, date bought, mileage covered, total fuel and lubrication costs to date, maintenance costs, price of the road fund licence, insurance cost, total earnings to date, and its current value. All this information, plus a lot more is stored on just two discs.
To have that sort of information readily available in files would mean countless cross-referencing, a team of filing clerks to update the figures, and a bank of filing cabinets stretching across the yard. Said Howard Robinson: "We were already producing the information before we had the computer, but by the time we had got it together and analysed it, it was three months too late to do anything about it!"
In future, LPG will be putting its yearly profit and loss accounl on the computer, while in thE longer term it will be examininc the possibility of computerisec tachograph analysis on thE system.
But Howard doesn't see hoo the computer can help LPC when it comes to traffir planning. He believes that thr traffic planner carries too mud of the relevant information in hi: head — local knowledge, trick: of the trade, and so on. To ge this onto the computer, even i possible, would be too costly.
LPG Transport has kept th, cost of computerisation down t, a practical minimum by not err playing a data processing mar ager and also resisting the temp tation to take the easy way ou and leave it all to Systime to so: out.
Neither Howard Robinson nc Paul Manning has any real fo mal computer training, bu they're learning the rudimeni and programming in the modit cations to the basic Systirr package to suit LPG's requin ments.
They both told me that it hi. entailed hard work and or hours, but it has reduced a goc deal of the peripheral costs.
The Falkirk depot and the su depots do not have comput terminals of their own; their st tistical throughput is not gre enough and LPG can servil them more cheaply by havir the input data sent down to M ley for processing.
Howard estimates that in pu monetary terms (time savings compilation of the payroll al other clerical economies) it VN take LPG Transport five years recoup the cost of the compute But that is ignoring all the u quantifiable benefits such as dated easily retrieved inforrr tion, improvement in mpg a maintenance costs throw closer monitoring, as well having the information so enough to take appropriate tion.
When all these are taken ir consideration, Howe Robinson believes that the co puter's payback period could as short as one year.
So maybe an in-house comi ter isn't so much of an expens luxury as you might think. Th aren't many items of capital penditure that can pay for the selves in just twelve months,