The unhappy marriage of Information Technology and Automotive Sales

Last year I took the opportunity to tour many new car dealerships. I have a great deal of experience in working with automotive systems and integration with 3rd party providers like CDK, PBS, Reynolds, End to End, MBNet and many more.  I learned that many dealership teams are uncomfortable with the complexities of technology and are reluctant to invest.   I’ve also had the opportunity to meet with IT companies during the past year, and they are reluctant to engage with automotive dealers. I had hoped that my experience would be beneficial, but as a group they find the automotive sales industry difficult to provide services to given the added complexities of dealing with the 3rd party vendors and the returns on investment are difficult to quantify.  The problem isn’t unique to the Auto industry. Retail integration with technology is difficult and the entire sector has issues but the scale of automotive sales with so many 3rd party vendors has little draw for providers.  IT providers are taxed already and the push is to promote managed service contracts. Cloud based offerings are all the rage today, but this requires a good stable infrastructure and solid direction, which many dealerships are lacking.

Dealers

The Automotive sector is recovering and growing right now. New car sales are up and the highly profitable automotive sector is attracting attention;

http://business.financialpost.com/transportation/from-warren-buffett-to-bill-gates-how-auto-dealerships-are-attracting-a-whole-new-class-of-investor/wcm/61650395-8e33-48eb-be4a-311471240f00

Large automotive groups will likely invest in more efficient technology and this will improve their ability to grow and dominate.  Unfortunately, these larger automotive groups aren’t always efficient in dealing with technology. In fact, it was the Automotive sector I referred to in an article I wrote for www.castanet.net.  Bigger isn’t better. Bigger brings a whole new set of complications.  Technology and more importantly, the effective use of it has significant consequences on any organization regardless of size.  A small, agile organization can be as effective at thriving as a large one.

IT Providers

Information technology providers have their own issues to contend with.  Microsoft dominates the marketplace and are masters of retail themselves, but not everything that comes down from the mountain is sound.  Some of us in the sector skip a version when deploying windows operating systems. Windows 7 was good, 8 was poor and 10 looks promising. This seems to be the cycle going back to early versions of Windows.  Technology is cheap to replicate and margins can be small if volume is high.  The entire sector is notorious for promoting bad technology just for the sake of sales. Many of my friends only need to produce simple documents and have switched to Apache Open Office from Microsoft Office and never know the difference except Apache is, of course, free. The promise of technology fails to deliver for many organizations for the simple fact that it is not produced for the end user.  Technology is often produced simply for the sake of generating revenue.  More features, more problems and a wider disparity in end user experience creates confusion.

The backlash is reluctance in the marketplace to adopt even basic standards. Cloud based offerings are overly expensive. End users are tired of getting bled to death for bad technology.  This is where we can help, because every cloud has a Silver Lining.