When it comes to information technology investments, dealers tend to be overly cost-conscious — and for good reason.

Even before the early days of the Internet, many dealers spent money without getting the expected value in return. Typically, dealers that launched web sites didn't adequately support them with trained, dedicated employees, thereby limiting lead generation and Internet customer management. So now, some dealers are leery of the Internet and IT in general.

They're struggling with the IT initiatives that manufacturers and OEMs continue to roll out, searching for the best way to use these tools. Without losing their main focus of selling cars and servicing the customer, how can dealers be sure they're making the right decisions for a healthy IT future?

Focus on the long-term

It's hard to be comfortable with IT because the return takes time. Dealers must focus on selling cars and growing their businesses today. Perhaps this is why it's so hard to spend money on a computer for a salesperson who might not be there next week.

On the other hand, the salesperson who is well equipped with technology tools for confronting increasingly well-educated consumers may become a long-term employee with repeat customers. There's a balance. It's worth investing time to find where that balance works best for the dealership.

Don't be gun-shy

Leadership is at the core of preventing IT disasters. Dealer principals who are gun-shy are not likely to be committed to IT investments and the benefits they provide. To take control and avoid the penny-wise, pound-foolish mindset, consider these key factors in achieving IT success:

  • Treat IT like any other area of the business.
  • Develop a reasonable annual budget.
  • Develop an ongoing plan to implement and utilize IT solutions.
  • Follow through with human change management, despite resistance.

Don't attempt everything at once. For example, start with a high-speed connection to accommodate the tools coming from the manufacturers and OEMs. Then, upgrade the PCs to utilize the next level of technology. At some point, following through on a plan means eventually it will all work to make a dramatic change in workflow and processes.

Consider retaining experts

Dealers at different levels across the country are struggling with IT issues. Not only because all manufacturers and OEMs are going to Internet-based tools, but because they know they need to find a better way to reach customers and improve the workflow of the business.

In day-to-day operations, it's hard to find time to take an enterprise view and plan future IT needs. The truth is, dealers can continue doing what they do best: selling cars. They can also let the IT experts do what they do best: work with information technology. Help is available from IT consulting companies, especially those in the automotive industry who are comfortable with scaling IT applications to grow with the business.

Get help from STAR

STAR (Standards for Technology in Automotive Retail), the information technology standards organization for the retail automotive industry, is a not-for-profit voluntary membership group of dealers, manufacturers and retail system providers. They research emerging technologies and develop flexible, cost-effective standards and methodologies for the exchange, management and integration of information to support the automotive retail sector.

Dick Malaise, co-chairman of STAR and IT director of the National Automobile Dealers Association, explains, “The majority of dealers are multi-franchise, but their IT solutions have evolved over time addressing individual franchise needs.

“The focus of STAR is to establish common IT solutions supporting the exchange of business information between dealers and OEMs. Today, there are 33 vehicle makes and therefore 33 different ways of exchanging information between dealers and OEMs. Implementing a common method of exchanging information will also reduce the time and the effort to develop the IT solutions for dealers, DSP vendors and OEMs.”

The standards documentation posted at the STAR Web site (STARstandard.org) is a good starting point for any dealer trying to get a handle on IT. When selecting a system to handle the flow of information between the dealership, its customers, manufacturers and distributors, it's best to stay away from proprietary tools.

The best solutions are based on using open architecture and open standards to ensure interoperability.

Malaise says, “Dealers should review the program identified by their OEMs, then seek assistance from a vendor that can enhance the dealership's LAN infrastructure and establish a common Internet connection.”

How to make a difference

Once an optimal system is identified, commitment and follow-through from leadership breeds success by improving the effectiveness and timeliness of a dealership's processes, as well as its ability to compete.

For IT solutions to make a difference, they must be far more proactive and strategic than just buying PCs for every desk. Instead, solutions must provide long-term, enterprise-wide benefits.

Intelligent IT solutions are integrative, allowing the entire staff to access customer data they need quickly and easily, whether in marketing, sales, parts, service or customer satisfaction. When IT is integrated into a strategic plan, it will bring the desired benefits.

Chris Fisher is a dealer systems consultant for gedas USA, Inc., an IT system integrator. He's at 248-340-5200.