By Steve Johnson
Of all the tools in the automotive retail business, dealer management systems stand almost alone in their importance. A modern, functionally rich and well supported system is a must-have asset that is integral to every aspect of operations in the modern dealership.
Keeping up with business requirements and market conditions is therefore vital and dealers require a trusting and long-term relationship with their suppliers to progress and update their use of IT.
So how often should a dealer carry out an ‘IT MoT’ and review its systems? There is no one-size-fits-all answer, unfortunately.
If a dealer is contemplating the most drastic change – a move to a brand-new system – there have to be compelling arguments to justify the costs, complexities and stresses of changing supplier.
Top of the list of triggers for such a move is the need to meet a manufacturer’s requirements. Others may include a change in business needs, systems reaching the end of their life or no longer being supported, or the lack of a development roadmap.
Dealers also occasionally lose confidence in the ability of a supplier to deliver long-term security or to embrace new technologies. Despite many dealers preferring to upgrade with incumbent suppliers, there are times when a switch is unquestionably the right thing to do.
James Martin, managing director of Budgen Motors, a Peugeot, Citroën and Alfa Romeo dealer that is moving to Pinewood Pinnacle, said: “We have outgrown the capabilities of our current system and in making the change, we will also remove the need for a stand-alone showroom product.”
IT companies appreciate that they have a key role to play. ADP international marketing manager Nick Chudleigh said: “By positioning our account managers as trusted advisers, we give insight into processes, tools, techniques and solutions, which dealerships might not have time to research. We have to set the agenda”.
Ebbon-Dacs head of operations Michelle Benton said it is important to support dealerships in making the most of their DMS investment.
“The necessity to review the DMS is dependent on the systems in use. Dealers still using products which require local servers and incur high maintenance costs are more likely to be evaluating systems. A hosted solution, which evolves with regular updates, reduces the need to review systems.”
Gemini Systems head of business development Jon Skinner said dealers wanted ‘quicker and smarter’ connections with their customers, using as many digital channels as possible.
“Our proactive account management is born of our understanding that if our customers fully embrace the tools they have, they will save money on third-party systems and services,” he said.
Everything seems to indicate that the DMS sector is keen to help customers get more performance, value and benefits from its systems.
DMS CASE STUDIES
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However, where there are gaps in DMS functionality, it starts to get a bit trickier. Despite the obvious desirability of an all-singing, all-dancing DMS, specialist systems have made their mark, particularly in sales/customer relationship management areas. The lack of effective two-way integration can lead to a difficult and frustrating position for dealers.
Barry Cooper, of Cooper Solutions, said: “Every dealer knows that their DMS can never meet all their IT and business process requirements. DMS providers do what they can to make data difficult or expensive to extract and have little or no interest in working with external suppliers unless they are pressured to do so by a major customer or manufacturer.”
Moving the focus toward retail customers
The DMS sector is continuing to press ahead with product developments, including integrated vehicle health checks, mobile device capability, enhanced showroom sales and campaign tools.
ADP has introduced real-time online service bookings and campaign return-on-investment reporting, while Ebbon-Dacs’s most recent innovations include finance renewal and an appraisal builder.
Sitting alongside its Power DMS, Reynolds and Reynolds says its RMS (Retail Management System) brings together customer contact management, telephony, F&I and marketing facilities.
Pinewood’s Pinnacle now includes a meet-and-greet iPad application, integrated two-way SMS, Outlook connector to provide dealers with intelligent mail-server DMS interaction, vehicle video tours and social media connectors.
In a similar vein to Reynolds and Reynolds, developments at Pinewood indicate a change towards a system that is much more focused on retail customers.
As well as getting the most from their systems, dealers are also looking to keep their IT costs down and streamlining how their systems are managed. This goes beyond support for software applications tools to the whole IT infrastructure, including networks and desktop support. Dealers generally want to run their businesses without the concerns of looking after IT.
Hosted ‘cloud-based’ solutions are growing in popularity, and although several DMS companies meet these requirements, some dealers are choosing specialist suppliers.
Lee Webster, sales director of Derby-based RDS, said: “Dealers are looking for best value for in every area of their IT. With networks, internet and email facilities, PC support and server management to take care of, it’s often much more cost-effective for small to mid-sized dealer operations to outsource.
“Dealers don’t want the hassle of looking after their computer system. They want the best advice and support, and to know that their IT is being well managed by experienced professionals delivering a high-quality service.”
Vince Powell of DCML, which provides a range of software tools, believes the key thing is to encourage dealers to embrace new technology: “In some cases, we’ve witnessed dealers using only 10%-20% of the DMS functionality they have purchased, having had many bundled extras they were not using, but paying for.”
There is growing recognition that dealer management systems should move further towards becoming fully integrated retail, customer-focused systems, but it’s still behind other sectors.
The need for technology providers, dealerships and manufacturers to work more closely together is greater than ever.