The Technology Trap: Why Dealers Stay with Outdated Systems?

By Marcin Pieńkowski

Even though modern software solutions have many benefits, many dealers still use outdated systems. According to Gartner, only 34% of changes are considered a “clear success”. This indicates that the transition to new technologies can be challenging and uncertain.

The benefits of increased productivity and reduced maintenance expenses often outweigh the challenges of using new technology. In the following article, we will explain this issue.

From Manual Errors to Data Silos: The Challenges of Outdated Automotive Technology

The automotive industry faces significant challenges due to outdated technology, affecting everything from data management to customer interactions.

Manual workflows

One major issue is the reliance on manual processes for entering and double-checking data. For instance, accounting staff often spend countless hours at the end of each month manually verifying inventory figures against sales orders. This time-consuming process is also prone to errors, leading to discrepancies that can impact the entire business.

Too Many Systems

Legacy systems that don’t communicate with each other further compound the problem. These systems frequently lead to delayed transaction postings, making it difficult for businesses to know exactly how much stock is available at any given time. The lack of real-time data can result in missed sales opportunities and customer dissatisfaction due to stock outs or overstocking.

Silos Information

Another critical issue is the inability to connect and utilize customer data effectively. Many retailers manage each channel or store as a separate entity, which results in data silos. This fragmentation leads to duplicate information, incomplete records, and no clear view of each consumer’s preferences and behavior.?

Without a unified view of the customer, businesses cannot design meaningful loyalty programs, upsell, or offer relevant promotions. This lack of personalized interaction diminishes the customer experience and reduces potential revenue.

Costly Maintenance

Additionally, some IT systems are so outdated that they are no longer supported, leading to exorbitant maintenance expenses. Businesses may find themselves spending so much on maintaining these old systems that they cannot afford to invest in newer, more efficient technology. This creates a vicious cycle where companies are stuck with inefficient systems that hamper growth and innovation.

To remain competitive, businesses must invest in modern, integrated systems that streamline operations and provide real-time data.

A recent study by Stripe reveals that almost 70% of UK developers believe these legacy systems are hindering their companies’ progress. The study also found that over 17 hours per week, nearly half of a working week, are squandered on maintenance tasks such as debugging, patching old systems, and fixing faulty code. Stripe estimates that outdated, legacy systems have a staggering negative impact on global GDP, amounting to approximately $300 billion per year.

From Fear to Familiarity: Tech-challenges of dealers

Automotive dealers face several technology challenges, with three main concerns:

• Fear of Change Management

Many dealers worry about the disruptions that come with implementing new technology. The idea of changing old processes can be daunting, leading to resistance and anxiety among staff. It’s important to manage changes well so that everything goes smoothly and there aren’t any problems.

• Fear of Losing Familiarity

Dealers are often comfortable with their current systems, even if they are outdated. The familiarity with existing technology can make it difficult to learn new systems. This fear could prevent the adoption of more efficient and advanced tools, which could significantly improve operations.

• Fear of Installation and Data Loss

The installation of new technology often brings with it concerns about potential data loss or system downtime. Dealers worry that transitioning to new systems could result in lost customer data, disrupted operations, and financial losses. A good data migration plan and good support during installation can help ease these fears.

So, how to address these challenges? What should the dealers do to find the way out of the outdated tech stack and use the potential of innovative solutions? Let’s look into some ideas that may help them achieve better results and say goodbye to the outdated technology:

Make the Users Comfortable with the New Solution?

• Start by providing thorough information about the new system to ensure everyone understands its benefits.?
• Organize training sessions to equip users with the skills they need.?
• Address concerns promptly and explain how the changes will improve their work.?
• Respond to objections empathetically, and use team meetings to gather thoughts and requests, ensuring everyone feels heard.?
• Empower champion users to lead training and onboarding, leveraging their influence to encourage adoption.

Customize to the Needs and Expectations

Extending Salesforce functionality to your sales teams can reduce the likelihood of low login and usage rates.?

• Customize the system to display certain fields, reports, or dashboards, and integrate with other software or devices.
• For stock management, recognize the differences between small and large dealers. Small dealers must be selective and strategic, focusing on high-demand, quick-selling cars to maximize investment. Large dealers can diversify stock to attract a wider customer base, but need to avoid overstocking and ensure they cater to profitable niche markets.
• Implement automatic alerts for low-stock or high-demand models to encourage timely replenishment.?
• Allow your salespeople to select AppExchange applications to boost the efficiency of their Salesforce usage.

Integrate Seamlessly with Existing and New Systems

Salesforce robust integration capabilities allow organizations to connect their existing applications and data sources to the new platform, creating a unified and efficient ecosystem:

• Utilize available systems and their functions to ensure continuity in operations. This includes tools for processing transactions, managing financing and leasing agreements, and complying with financial reporting requirements.?
• Integration with marketing tools allows for dynamic advertising, reaching potential buyers with vehicles that match their search criteria.?
• During each stage of the integration process, perform quality checks for validity, uniqueness, integrity, timeliness, and relevance to ensure data accuracy and reliability.

Take Care of Data Integrity?

Data integrity ensures accurate and reliable information across the organization:

• Salesforce automation allows you to create and update records directly from your inbox or smartphone with just one click, ensuring data is consistently accurate and up-to-date.?
• Properly migrating data from existing systems is essential to avoid discrepancies and maintain continuity.?
• Real-time stock tracking supports data integrity by providing accurate, up-to-the-minute sales data and preventing stock discrepancies.

Look Closer at Security Issues?

According to RapidScale, 94% of businesses reported improved security after switching to the cloud, and 91% found it easier to meet government compliance requirements.

• The Salesforce infrastructure layer comprises replication, backup, and disaster recovery planning.?
• Network services are encrypted and have advanced threat detection.?
• Application services offer authentication, identity management, and user permissions.
• Adjust to compliance rules, including automotive-specific regulations and data protection laws, to avoid legal issues and penalties.

Combine Clear Communication and Continuous Improvement

Implementing Salesforce requires clear communication throughout the process to ensure a smooth transition and maximum benefits.?

• Develop a comprehensive plan and communicate it to all stakeholders. Answer any questions that arise and address concerns promptly.?
• Follow a structured approach, including planning, developing, testing, building the release, testing the release, and finally, releasing the new system.?
• Maintain open lines of communication with your staff to understand what’s working well and identify areas for improvement during the Salesforce implementation.?
• Encourage feedback and actively listen to your team’s insights. Regular check-ins and progress updates will help keep everyone informed and aligned.
• Stay up to date with the latest technology advancements, closely monitor industry trends, and promptly respond to changes.?
• Adapt to new features, tools, and best practices introduced with each platform release.

Invest into a Reliable Salesforce Partner

When implementing Salesforce, partnering with a reliable and competent consulting company is crucial for ensuring a successful deployment and maximizing your return on investment (ROI).?

A qualified Salesforce partner can provide valuable expertise, best practices, and tailored solutions to meet your unique business requirements. Which skills should you look for?

• Comprehensive Salesforce knowledge
• Industry-specific expertise
• Project management skills
• Integration capabilities
• Training and support.

A skilled Salesforce partner can help you unlock the full potential of the system, drive user adoption, and continuously optimize your investment in the platform for long-term success.