This is the third entry in our blog series entitled, "DemandMore from your DMS." Each post discusses the gap between available DMS technologies and the solutions currently being utilized by most dealerships. In this post, John Griffin, Vice President of Performance Management at vAuto, shares his thoughts on the importance of having the right team in place to get the most out of technology.
In the previous two posts within this blog series, Dealertrack DMS Vice President and General Manager Sharon Kitzman, and Dealertrack DMS Director of Strategy and Business Operations Kai Nielsen, discussed how technology has transformed the way dealerships do business. Specifically, the use of open integration and cloud computing technologies in modern DMS platforms has given dealerships a competitive advantage in today's marketplace. Technology alone, however, is not enough. Rather, it is the combination of technology with the right team of people that drives success.
Selling Drills, Buying Holes
There's a saying that people don't buy drills, they buy holes. In the automotive industry, dealerships aren't buying a DMS platform for the technology and information; they are buying improved efficiency and better business results. Investing in technology without a purpose is nothing more than buying a drill for the sake of having a drill. On the other hand, technology can be a valuable tool, if it is used to effect behavioral and strategic change within a dealership. This is performance management.
A Personalized Approach to Improvement
The goal of performance management is to develop a defined, strategic process of bringing about change within the dealership, for the benefit of the dealership. Performance management identifies the biggest risks, as well as the biggest opportunities for growth within a company, and uses technology and information to drive that growth. And, because information and technology provide quantitative, measurable results, they become an indispensable part of the process.
I've seen it proven so many times in my experience with performance management: in order to bring about significant change, dealerships and performance managers must work as a team. Performance managers are knowledgeable, skilled, highly-trained people who have worked in the automotive retail industry. They know what they are doing because they have seen it all before. They view their relationship with each dealership as a trusted partnership—both parties working toward specific goals for the sole benefit of the dealership. They are not client services specialists trying to manage a relationship, pat people on the back, and affirm everything a business is doing. Their job is to challenge with the intention of producing actual operational change.
You Can't Manage What You Can't Measure
There is no doubt that the right technology can give dealerships a competitive advantage. The biggest failing in the automotive industry, however, is that companies don't use technology correctly or effectively, and sometimes they don't use it at all. They plug it in, forget about it, and fail to utilize it to adjust strategies, build processes, and change results. Most dealerships use software to tell them what their business is doing. Performance management transfers the power of technology to the people on the ground within a dealership. Specifically, performance managers work to discover how a business is doing and how it can be doing better through the integration of software. In other words, it's not how much data, but rather how relevant the data is to producing actual results.
Performance management brings technology into focus. By leveraging the skills of experienced people, it identifies the data that drives success, and uses technology to accomplish strategic objectives. In other words, performance management helps dealerships to combine the power of technology with the power of their teams. That combination can bring about actual, measurable change and secure a sustainable competitive advantage.