Reputation at the heart of risk management

June 2002 Security Services & Risk Management

In the transportation sector, risk management was as much about reputation management as it was about protecting the tangible assets of a business.

This is according to Stephen Lunn, managing director of multinational company Global Telematics, distributors of the Orchid Satellite Tracking system in SA. "In the case of a transport company, fleet manager or owner-operator, it was important to not only take out adequate risk cover before carrying cargoes, but to make customers aware that all reasonable steps have been taken to avoid potential losses and protect human capital."

"In an industry where today's operators measure their vehicles and cargoes in the millions, and with theft and hijackings continually escalating, customers want assurances that their cargo will be protected. In most cases it is irresponsible not to institute top calibre management and monitoring systems in fleets. The litmus test in many cases is whether the fleet operator should reasonably put a horse and trailer worth, in many cases, several million rands, onto the road without ensuring adequate controls," said Lunn.

Fleet solution

In order to protect such valuable assets, fleet management company Viamax Fleet Solutions, which supplies vehicles to Spoornet/Transnet on fleet management leasing, installed the Orchid satellite tracking systems into their fleet last year. ViaMax Fleet Solutions marketing director Elias Banda says that to date Spoornet has had six hijackings or attempted thefts with 100% recovery.

"Obviously this reduces the risk of loss of production when vehicles are lost," he says.

The Orchid Fleet Management Software has also been loaded onto the ViaMax server for Depot Managers, Operation Technicians and Technical Engineers to access reports and vehicle positioning in realtime. Not only do we benefit from the normal GPS/GSM tracking system, the Orchid products assist with monitoring things like kilometre readings, fuel usage and driver protection. Systems like this are an invaluable tool to companies like ViaMax, taking risk management to another level," says Banda.

Lunn says there are also insurance issues to take into account. "Owner-drivers in particular are increasingly being held liable for any cargo and vehicle-related mishaps, and they could lose everything should cover for related and personal risks prove inadequate."

"For owner-drivers to make provisions for risks through adequate insurance products which are underpinned by reliable fleet management systems could prove a critical determinant of their future success or failure," concludes Lunn.

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