In an exclusive interview with M2M Newsdesk, UPS’s Jim Medeiros, vice president of Shared Services, describes the company’s systems and the benefits realized with the broad deployment of telematics technology for fleet management. Real-time vehicular monitoring helped the shipping giant reduce the amount of fuel consumed per package in the United States by 3.3% and engine idling time by 15.4% in 2010. Data sensors track how vehicles perform mechanically, as well as a driver’s route and behavior behind the wheel.
Medeiros talks with M2M Newsdesk just a week before the company is set to discuss M2M standards at the next Global Standards Collaboration Machine-to-Machine Standardization Task Force’s (GSC MSTF) meeting, hosted by the Telecommunications Industry Association (TIA) at the Georgia Tech Research Institute in Atlanta on September 20-21. The theme of the event is “M2M Standards as Growth Enablers.” In his opinion, M2M standards are critical for companies deploying, or simply maintaining M2M technologies on a large scale. Here is an exclusive look into the interview:
M2M Newsdesk: Evidence suggests that M2M adopters are increasingly looking for international coverage for their asset tracking solutions while the mobile phone business essentially has a national focus. I would assume this is also true in UPS’s case. How is this likely to change over the next 3 to 5 years? What are the implications of global versus national solutions for UPS?
Jim Medeiros: What we are trying to do from an efficiency standpoint is create global solutions. Whenever we have solutions geographically specific our costs go up, so we are trying to work on these global solutions. In the mobile space, this industry doesn’t provide a true global solution as of yet. Whether it’s the protocols that are used for data transfer or it’s the certification of devices by country, it becomes much more challenging to understand what countries support what devices, under what protocols, at what price points. Today, we have mobile devices in 45 countries. Our intention is to be able to offer that to well over 100 countries. One of the barriers is not having common protocol and common devices across all of these geographies. I think that will improve over time, depending on how the telecommunications industry evolved and how government regulatory agencies support or don’t support that evolution. But, our desire is to see much more standard devices across counties that we can leverage and be able to support through 7/24 capability.
Newsdesk: So you’re saying it’s dependent on these global standards evolving into a common protocol?
JM: Yes, the standards are an issue, but also providers really aren’t oriented yet to true global support. For example, things like maintenance windows of the telecom providers; they need to start to evaluate their tradition down windows. For example, in a consumer space, a traditional time to do maintenance may be the middle of the night, yet in our world that may be one of the most important times for us. So, the telecoms need to start to evaluate what these traditional down windows are for an enterprise versus the consumer world.
Newsdesk: Right now, the vast majority of remote data requirements for enterprises use 2G networks, yet mobile phone requirements are moving rapidly to 3G and beyond. To what extent are UPS’s M2M enterprise applications shifting toward 3G and how quickly is this shift likely to happen, if at all?
JM: For us its less about that the technology is evolving; it’s more about what’s our business need. Right now, our wireless mobile needs on cellular are not significantly heavy from a size of transition, and the performance needs are not such that we’re feelings that we need to radically jump to 4G or to 3G. What we are finding is that it is more looking at our fairly large deployment of cellular-based devices, which is well north of 100,000 devices, and the lifecycle of that equipment, the radios that are on them and their compatibility with these newer technologies going forward. What we’re seeing is our latest generation of our driver device will be able to take advantage of these faster speeds and will be migrating to leverage those speeds as the new technology rolls out. But at the moment, we’re not seeing a business need that can’t be supported on the existing 2G network.
Newsdesk: Does UPS see a benefit in moving to 3G technology ahead of real need?
JM: There is a technology benefit of speed, but we are not seeing the business driver that causes us to need to take advantage of that speed in order to deliver support to the business. Since it doesn’t drive us to that we are able to use the equipment we have already deployed through its intended lifecycle.
Newsdesk: The concept of the “Internet of Things” is to share data across different application areas, which creates new service opportunities. It’s also about whether interoperability will matter for future M2M market development. Does UPS have (or have had in the past) enterprise solution “islands”? Can you describe these?
JM: Our mobile solutions aren’t mobile to mobile. We don’t interact directly from our mobile devices to a customer’s mobile device. What we do is route our traffic through our data centers and the centralized data centers house these common repositories for interoperability. For example, a driver will collect up scan data, and that routes to our data center that then can be displayed onto UPS mobile apps by the customer. Conversely, the customer can tell us a specific handling instruction or a package for delivery and that can route in the opposite direction through our data center out to the driver to instruct the driver on their mobile device the specific delivery instructions that the customer wants followed. This concept allows us to provide common information between our customer’s mobile devices and our mobile devices.
Newsdesk: Does UPS see a need for interoperability between enterprises?
JM: We’ve been going for many years down a path connecting our customers to us. Our customers have interacted with us to give us package data, allowing us to be more efficient, drive down our cost to operate, allow us to be competitive in the marketplace, but on the flip side, we’ve been able to supply data back to the customer to bring value added services to the customer such as what is the package volume they move worldwide, to where, and at what service level. It’s given them greater visibility into their own shipping business and allowed them to work with us on more and more creative solutions to assist them in meeting their business goals. So, this idea of interoperating, our view is that not only are we providing an integrated package delivery network, but we are providing an integrated data network for them to be able to interact with us as an extension of their own business.
Newsdesk: Data from remote devices is becoming increasingly important for enterprises, both from an operational and strategic viewpoint. In the early days of M2M, this data was mainly used by those directly involved in the operations related to it. Now it is needed throughout the enterprise and that means close integration with ERP backbones. How is ERP integration best achieved and what are the alternatives?
JM: We have a few ERP packages, but a lot of our systems are customer developed. From an internal operations standpoint, what we are looking to do is leverage the data for many purposes to be able to provide value-added data to a manager in a facility to better manage the flow of vehicles and packages in and out of the facility and be able to plan the operational day better. That data is incredibly important to them, yet it’s the same nature of data that’s used by customers to understand the status of their individual package. A common piece is the data model that needs to be thought through so that these various usages of the data will support and give a view of the data back to the individual user- an internal or external customer- to provide them the information that they are looking for. For twenty years we have been working on common repositories that are housed centrally for packaged data and scanning events that allow us to have one common view of these millions of packages we move every day. These are used for our sales force, marketing group, operations group, billing, market research and by the customers. It’s this idea of leveraging the same data many ways to get all the value out of it.