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Things to consider when buying a DMS

A Dealer management system (DMS) can hinder your processes or it can propel your business forward. With insightful data at your disposal, your management team will be able to make better and more informed decisions. However, if the capture of this data and the effort required to extract the data from your DMS is too cumbersome, then the most advanced system will only be a sore topic in your business and a source of resentment.

Therefore it is important to take the time and consider the following items to better understand which DMS solution is most suited to your industry and your business in particular.

1. Understand your problems

Evaluate your current business processes and identify the key problems you wish to solve through a DMS. Examples of these could be unreliable or little real-time data on the financial health of your business, inability to determine profit centers and excessive expenses, or bottlenecks in the workflow which could easily be resolved through better information distribution throughout your business.

Once you have identified the key problems you wish to solve, determine how to measure productivity and effectiveness within these areas, these are typically called Key Performance Indicators (KPIs). We will use these measurements to evaluate their improvement throughout the implementation process. Examples of KPIs are monthly sales growth, inventory turnover, and average days to sell inventory, to name a few.

What would solving these issues mean to your business and to your to team? Understanding your problems and being ably to measure their improvement will be key in gaining buy-in for your team, and stacking the odds in favour of a successful implementation.

2. Involve the team and get buy-in

Change is hard, very hard. Making a change from what we have become accustomed to over many, many years is one of the most challenging feats known to man. However, change can also be  very exciting and increase moral throughout your business if done right.

Employees will fight change because fear of losing control, potentially losing their jobs done the line, or becoming redundant. Involve key stakeholders and help them recognise their importance in the transition and implementation, and they will help reduce hold ups.

When tackling a project aimed at changing how people do their jobs, a stubborn employee will add significant pressure and conflict to an inherently challenging task. Planning for team engagement in the decision making process of the project will increase buy-in among employees who would ordinarily be against change within their immediate working environment. Helping these employees understand their role in the future of the company, and how the system will potential empower them to succeed, will go a long way to discourage any initial scepticism in the success of the project.

One such step would be to involve stakeholders in evaluating their daily processes and responsibilities, and identifying areas of improvement. If these improvements could be achieved through the new system, and the stakeholders are more likely to have an invested interest in the project and will form part of it’s champions instead of those opposed to it.

3. Partner with tried and tested implementation team

When choosing a DMS, partnering with a team with implementation experience in your industry is key to a smooth transition and speedy implementation. Therefore it is important to consider each system not only as a software component but also a human element in terms of design, implementation, training, and support.

Work to partner your expertise and in-depth knowledge of your business needs with an implementation team with extensive knowledge of DMS implementation and long-term support.

4. Training is the key to success

Being an expert in your industry was not achieved overnight, instead through training and experience. To make your employees successful in their current positions took training and investing in them through time and effort, the same will be true going forward.

Through showing trainees the career path afforded to them within the new DMS, training decreases fears of jobless and encourages employees to work towards a successful implementation.

Training will be crucial in providing your employees with the tools to excel during the transition, and to achieve buy-in into the long term viability of the project. Sufficient project resources should be allocated to providing comprehensive training to all employees not only at the end of the project, but through proactive training throughout the project’s lifespan.

5. Consider the Total cost of ownership

A project costs rarely comes down to the quotation cost provided for implementation and licensing costs. Inaccurate data, unproductive time, stability and connectivity issues, and loss of moral are all forms of hidden costs which could occur during an implementation project. A project should therefore note only be considered on the project budget, but in terms of the total cost of ownership.

With proper planning and an experienced implementation team, a lot of these risks can be managed.

Ways to manage risks within a project are proper documentation of issues/bugs, timely project feedback meetings, risk and action registers, and reviewing lessons-learnt after each incident, to name a few.

6. Real-time or out of date

Having real-time information about your products, where in process they are, the cost to company of these products, and turn-over rate of similar products is essential to determining profit margins – which could mean the difference a good sale and a bad one. Accurate data dramatically reduces costs due errors based on bad information, and gears your business towards making profitable decisions.

With each market becoming  ever more competitive, staying ahead of the competition in a global market is afford based on the information you have at hand. The more information you have about your business, your products, and your customers the better chance your business has in not only succeeding but thriving.

Many major industries such as airlines, postal delivery services, and defence forces depending on accurate and up-to-date information in meeting their responsibilities. How is your business any different?

7. Streamline and waste finding

A major portion of increasing profitability within a company is by cutting down unnecessary costs and increasing productivity. Using the appropriate DMS for your business will allow you to pinpoint areas of concern and wasteful departments through insightful data.

Make your DMS work for you by streamlining crucial workflows and daily routines, and by scheduling reports to identify wasteful spending or areas of your business which are underperforming.

Through a well-suited DMS solution you are able to take control of the issues at hand, and proactively investigate and resolve any problems. Instead of having issues snowball, only to have them discovered much later when the damage is considerably more than had it been fixed much sooner.

Examples of features which could be used to streamline your business are intelligent workflows, real-time notifications, and efficient integration.

8. Long-term ROI

Growing your business takes time and money, and saving you time and money should be the priority of your DMS. Short term profits which could cause you harm in the long run should be avoid where possible, as these decisions do not have the longevity of your business in mind.

It is therefore important to think about the return on investment associated with the proper implementation of a DMS solution. Although the price of implementation of such a project can be daunting, one needs to consider the software and systems you have in place and whether these still meet all the current needs of your business. A lot of the time, many of the issues your business is currently experiencing is due to outdated systems which no long cater for your individual industry needs, or have not been able to keep up with the progression of software over the years.