Oxlo has learned a great deal about dealer communication systems at automakers, so it’s time to share some of the issues, perspectives and experiences that can be applied to the evolving retail marketplace, as well as other types of dealer communication systems that integrate other dealer business partners with the point of sale and service.
Here’s the context: An OEM’s DCS is the backbone of a retail sales and service support infrastructure. A DCS links back-end OEM systems with dealers in a number of ways, handles business process execution, and also delivers a lot of other information to dealers, such as training. These have been developed and managed by OEMs traditionally, with heavy involvement from a consulting firm or an enterprise software company, not to mention a lot of IT staff. DCSs have been expensive for OEMs—expensive to build and expensive to support due to their complexity. In many cases there is a heavy reliance on some sort of web portal, which often works independently of any integration to dealer computer systems. We’ve found that many focus on basic business processes, as opposed to more complex processes. And, most OEM DCSs have a significant reliance on batch processes. Finally, integrating with dealer systems is a highly difficult and time consuming process.
This largely represents the challenge and perspective of the automakers. Compound this with the impact on dealer system providers and DCS becomes even more cumbersome. And, stepping into the dealers’ world only exaggerates the challenge of creating a system that balances retail and manufacturer needs.
As the automotive industry becomes increasingly competitive, the current approaches to DCS are no longer adequate. It’s too difficult to win customers, keep them for service and win them again with subsequent purchases. The fact is that automakers need tighter integration with the point of sale. They need to begin looking at DCS as a source of competitive advantage. Other dealer business partners like insurers, remarketers, lenders and other service providers also need this. And evermore sophisticated dealers and dealer groups need all these parties supported by dealer communication systems because it is the service and additional products sold after the initial car sale drive dealer profits.
Over the next few weeks I’ll be taking a closer look at DCS strategies and the actions and plans of various automakers. I’ll discuss DCS concepts like straight-through-processing, dealer choice, and new, high-value integrated business processes. By thinking strategically about DCS, automakers can not only reduce costs and headaches, but improve business performance through more direct support for the selling, financing and servicing of vehicles.
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