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Is Your Dealership Ready for an Automated Data Management Solution?

Written By: David Spisak
Posted on July 09, 2015

Dealership data management systems collect and maintain mountains of data about your operation, your customers, and your market. There is no doubt that the value of the information contained in those systems in enabling you to make the best possible decisions for improving your sales, retaining your customers, and increasing your dealership’s profitability.

What confounds many dealers, however, isn’t an issue of having data … it’s how to ensure the data is accessible, accurate, and is presented in such a way that it allows you to focus on the areas of your operation that need your attention. No dealer would willingly give up the data his dealership holds, because he knows it is absolutely vital to knowing what’s going on in the dealership and how effectively that activity is driving the sales it needs to sustain the operation.

If you can’t get to the information you need, when and how you need it, it’s not going to help you drive maximum sales, efficiencies, and profitability in your dealership. When you consider the implications of this across multiple locations with multiple systems, the problem seems almost insurmountable without hours/days/weeks spent compiling this data into useful reports.

So you’re hearing about automated dealership data management and think this may be the solution to a big chunk of your problems. And just so you know, I’m a huge advocate for using smart systems to get a handle on all the information, especially when it gives me an out-of-the-box reporting solution that will help me spend my time managing intelligently, rather than creating spreadsheets and seeking out and inserting the data I need. But how do you know if you’re ready to take that leap? Here are a few thought-starters to help you determine if you’re ready … and to consider the risks if you aren't.

Does your data give you complete transparency to your operation?

If you’re one of the few dealers who feels very confident that the information you are using to keep your finger on the pulse of your operation is as timely and accurate and gives you the information you need to make immediate adjustments in your daily operation, you’re one of the lucky ones. However, most dealers do not have the confidence that they're seeing everything that’s happening in their dealership. What’s more, many worry that the information they do use is not accurate either because it’s been filtered or because the data in the DMS or other systems from which they are being pulled isn’t as “clean” as it should be. The risks? The worse scenario is that you’re dealing with manipulated data and the possibility that someone is intentionally trying to misdirect you. At best, you don’t have a complete picture because you or your managers haven’t thought to bring some of the most critical pieces of information into consideration.

How easy is it to access the information you rely on?

Even more troubling is while dealers and general managers do not have formal training in information systems or database management, they take it upon themselves to acquire, maintain, and utilize their system resources to the best of their ability. In their defense, the basic functionality of most DMS platforms hasn’t changed that much over the past several years. Thoughtful dealers will study reviews, talk with their peers, and sit through hours of features and benefits presentations where they are shown all the bells and whistles of this system or that, with the expectation that the vendor knows what they need and will deliver on its promises.

What do dealers need from their systems? They want easy-to-use systems that collect data they need and present that data in useful reports to help them make great decisions. It’s a simple, straightforward objective, but what we’ve found to be consistently problematic among all DMS platforms is the part about getting the data out of the systems in usable formats for making great decisions. It’s your data, but there is a risk that the vendor does not offer you complete access to the information you need. And decisions made on incomplete information can be worse than making decisions with no information at all.

How confident are you in the accuracy of your data?

“Garbage in, garbage out” is another common problem business owners and their managers deal with continuously … the information you get out of your systems is only as good as the data that’s going in. I’m sure there have been many times when you found yourself questioning whether the information in your reports was correct. It’s frustrating, but it's essential that the information you’re using is “bullet proof,” so you find yourself going back and forth with a manager; questioning, discussing, and reviewing the data until you’re eventually satisfied that the information is accurate enough that you can make a good decision. That could take several hours or days for each report you question. It’s a drain on your time and energy, and you probably still don’t have complete confidence in the information you’re using. In terms of your time and attention, your manual reporting processes could be costing you much more than you realize.

Can you get updated information quickly and as often as you need it?

Even if the data going into the dealership’s system is as accurate as it can possibly be, there is yet another problem that some dealers may not admit they have: They simply don’t have an effective data analysis discipline. Relying on standard reports and what’s "always been done," some don’t know that other information will give them better insights to make the critical adjustments that can result in the most net profit by month end. And they don’t know how often they should be watching that information. And even if they wanted to keep their eyes on the dealership’s daily operations, they quite likely wouldn’t (or couldn’t) get the most up-to-date, reliable information as quickly as they would need it.

In fact, our data suggests that the average dealership report usage is 800 report views per month. When you consider the average time managers spend preparing and updating a report is about 15 minutes, that’s a lot of manager productivity lost to manual reporting. A more efficient and effective discipline would be to have all the updated information you need in a matter of seconds … not hours or days. The risk associated with the reporting lag-time described here is that you aren’t effectively making the adjustments you need to have the greatest impact on the month-end net profit of the dealership.

Does any of this resonate with you? Are you feeling called-out a bit?

You are not alone. In fact, you’re in the majority. As I said, most dealers we talk with about data management best practices are experiencing one or more of these problems, and most are feeling the pain of all of them. Schedule some time for a demo with a data management solutions provider, like NCM axcessa, today.

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