Automotive News: Letter to the Editor

To the Editor:

The article, “Small computer vendors still out of the loop” (subscription required, Ralph Kisiel, June 25^th) struck a chord with me, and I think there are other dimensions to the DMS cost/capability problem worth noting to your readers. 

Yes, DMS systems other than ADP and Reynolds are much more affordable.  Yes, some manufacturers won’t work with smaller vendors. Yes, ‘standards’ are making some in-roads. 

While saving dealers money and time is noteworthy, having a competitive DMS market that’s level for all vendors is only a part of the benefit this industry stands to gain from open automakers.  Some automakers recognize this and are acting on it.  Here’s why:

Integrating DMS systems with dealer business partner systems—such as automakers, but also lenders and insurers—saves all parties time and also enables the dealer to deliver a great buying experience for their customers. 

Creating ‘the dealership of the future’ means that not only do computer systems have to talk to each other seamlessly, but they have to do so quickly, securely and over the internet.  Quickly, because the customer needs to know if a lender is going to accept their credit application while they’re sitting in the F&I office, or if they’ll get a part from the distribution center, or claim payment while sitting in the service bay.  Securely, because dealers don’t want just any vendor getting access to sensitive customer information.  And over the internet, because modems and 20-year-old technology only make it harder for everyone involved.

The evolution of dealer systems also means that dealers and automakers have to think about systems other than the traditional DMS.  The proliferation of CRM, F&I and other specialty systems means that more types of integration are now possible between automakers and dealers.  For example, coordinating the sales process for a new customer should mean system-supported incentive matching.  This sort of approach would help both automakers and dealers effectively match customers with the right incentive every time.  The result is happier customers, more profitable dealers and less overall incentives spend from automakers.

Winners in this ultra-competitive market will be determined by not only fantastic manufacturing efficiency or lowest labor costs or great products alone.  Automakers that are open and innovative in the way they work with vendors will win.  Now is the time to demand that retail systems and processes take giant steps. 

Comments

[Vila]

Well said.

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