The Dealer Management System (DMS) is no longer just a warehouse tool, vehicle sales orders, or service planner. Occasionally, I hear it is a good tool for printing invoices.

In fact, a modern DMS is a dealer’s Digital Asset Management platform, and dealers should treat it accordingly.

From nuts and bolts to bits and bytes

The automotive industry is shifting from hardware to software, becoming increasingly software-driven as both vehicles and their components evolve rapidly. New electronic part types and their associated data must be effectively managed and integrated into workshop processes to enable accurate repair analysis, estimation, installation, and updates.

Robust Dealer Management Systems (DMS) are continually (blindly) evolving, adding new features and adapting and fine-tuning existing processes to meet emerging automotive needs. However, the most effective DMS is streamlined and built on modular functional frameworks, allowing features to be turned on or off as needed without altering the core codebase. This ability is the difference between a “Monolithic” and a “Composable” DMS.

DMS Modularity enables dealerships to adapt quickly to an ever-changing automotive environment.

. . .

The ability to adapt quickly is the reason I want to start my next article with Heraclitus’s quote: “The only constant in life is change.”

I want to break down how a modern composable DMS must handle new “Software (Soft) Parts” using an architectural approach, so-called functional frameworks, instead of adding new fields and functions on top of the existing core layer. Let’s answer the following question.

Does tracking software parts in dealers’ inventory make sense?

Short answer: Yes, absolutely, but not in the way we track brake pads.

Vehicle Parts are no longer just physical components you can store on a warehouse shelf; they can be a line of code, a digital certificate with an expiry date, or a license key.

What do we know about software parts?

Software parts include part numbers, associated costs, retail price, essential data (digital license key, software version, or tokens), and vehicle compatibility rules.

Let’s summarize the most common Vehicle Software Parts.

Digital Key Code to unlock Feature-on-Demand (FoD)

A customer purchases a vehicle with heated-seat hardware installed, but the software required to enable it is locked. The “part” the dealer sells is the digital unlock key.

Firmware & Calibration Files

Specific software versions are required for a hardware-based Electronic Control Unit (ECU) (e.g., a transmission control module).

Cybersecurity Keys & Digital Certificates

Modern vehicles require encrypted “handshakes” to install new parts (Gateway Security). These digital certificates are consumable and must be tracked.

Update Packages (OTA Over-the Air)

Large data packages that fix bugs or add new features.

New types of vehicle software are added daily; the list of vehicle software components is dynamic. This also reflects the need for a dynamic approach to DMS management.

. . .

We can now begin with DMS and its role.

Historically, software updates were hidden in “labor hours” (the technician’s time). But if a software update adds 50hp to an electric motor, it is a product with a retail price; it cannot be handled as a service anymore. It must be in inventory to be sold.

If dealers don’t track it, they often forget to charge for it. Tracking it ensures the dealership gets paid for the value it delivers to customers. Other reasons to track software parts in DMS are Warranty & Inventory History, Software Compatibility Rules, and Security.

In detail, Software Parts are managed in DMS under a new parts category (Digital Parts) but share the same data structure as physical parts (Parts Number, Cost, Retail Price, and Vendor Information).

See a real-life example from DMS below:

Secondly, instead of a physical shelf, dealers should use a “Virtual Bin” in their “virtual warehouse “ to store licenses for deployment.

Lastly, for me, the most interesting aspect is how software components are delivered (shipped to repair orders): when a software part is “sold,” the DMS shouldn’t print a picking ticket for a warehouse runner; instead, it should trigger an API request to the software manufacturer to release the license or download token.

Two more practical examples of software parts:

A dealer pre-purchases 50 “Full Self-Driving” licenses from the OEM. These sit in a digital inventory account on the dealer’s virtual warehouse bin until sold (deployed) to customers.

Another good example is the so-called TRP Parts (Theft-Relevant Parts), which are, in fact, a combination of a physical item (a vehicle key) and VIN-specific software that unlocks the key. I named such items and the Coded Parts; the DMS must be smart enough to handle all data properly during the repair process.

. . .

Did you find it interesting to read?

If yes, please follow my next article, scheduled for publication on 31.01.2026.

In my next article, I want to continue covering software components for vehicle systems and delve deeper into DMS configuration logic, using real DMS examples.

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post Stop Giving It Away. Why Dealerships Must Treat Software Updates as Inventory appeared first on TaXaPa.

Throughout my professional career, I have been fortunate enough to visit various workshops, ranging from small, independent businesses to large dealerships and dealer groups, as well as several Original Equipment Manufacturers (OEMs) in different countries worldwide. This experience enables me to articulate the differences in how dealers utilize workshop resources. I have observed various approaches to organizing workshop resources and managing resource utilization. This is the focus of my article today.

Let’s start by asking questions.

What is the recommended planning model for organizing workshop resources?

What are the essential criteria for selecting the right way to utilize workshop resources most effectively?

What are the pros and cons of each organization’s techniques?

Before we begin, explaining the terminology will ensure we are on the same page. This is important because there is a lack of documentation and alignment in the field.

. . .

Workshop Resource Management

We have a mathematical equation: On the one hand, there is a demand for workshop activities such as vehicle repairs, inspections, and diagnostic services; on the other hand, there is limited resource capacity to perform these services.

The primary responsibility of Workshop Resource Management is to effectively balance workshop demand with minimal waste while maximizing resource utilization.

Workshop Resources

Typical workshop resources include people, machines (tools and accessories), work bays, and mobility vehicles. Each technician can possess different skills, available capacity, and Efficiency (Resource-Efficient Potential(1)). We should not forget that service advisors are also workshop resources. They handle receptions and handovers, conduct Vehicle Health Checks (VHC), or organize courtesy car pickups. Planning their involvement brings extra benefits to the workshop organization.

Personal Notes: Unfortunately, many dealers still underestimate and overlook the fact. Missing critical resources as service advisors during peak hours disrupts the workshop flow, creating “Bottlenecks,” negatively impacting workshop performance, and losing after-sales opportunities.

Resource Groups Planning

Resources are typically categorized by type, skill, and allocation. Common resource skills include mechanical, bodyshop, painting, cleaning, diagnostic, and electrical skills. Grouping Resources makes workshop organization and planning more effective, especially if the workshop has many resources (20+) and we need to control available capacity at the skill level.

Service Work

Workshop resources provide service work (mechanical, diagnostic, electrical, body, and painting work, etc.). To allocate their capacity, we need to estimate their involvement using either

> OEM Catalogs (Standard time)

> Workshop estimates (Best-Practice Estimation)

> External applications and catalogs (E.g., Audatex, DAT, TecDoc).

Resource Efficiency Potential (REP) and Planning Work Level (PWL).

Further, to choose an appropriate workshop planning model, two factors are essential:

> Resource Efficiency Potential (REP)

> Planning Work Level (PWL).

Resource Efficiency Potential (REP)

Resources possess skills, but how well they perform determines Resource Efficiency Potential. It is a dynamic coefficient that must be updated and calculated regularly (typically quarterly) for each resource in the workshop. Modern Dealer Management Systems (DMS) provide functional support for this.

Example of REP: Henry is a senior mechanic; he can perform a service inspection in 90 minutes, which usually takes 2 hours (Henry’s REP ≈ is approximately 130%). Therefore, we need to utilize his capacity differently to maximize his experience.

Planning Work Level (PWL) indicates the planning level at which the workshop operates to allocate resource capacity for service work.

Example of PWL

Level 1: Order -> Regular Maintenance after 30.000 Km

Level 2: Job -> Oil Service

Level 3: Task -> Change Oil and Oil Filter

Generally, PWL Levels 2 and 3 require more precise planning, better workshop organization, and increased DMS functional support.

Workshop Planning Models

Now, let’s connect all the points within the planning process context. Here, you can see two different traditional approaches to planning resources in the workshop.

Two-step Planning Model (Scheduling -> Assignment) and One Step Planning Model (Dispatching)

The Two-Step Planning Model is like reserving a table at a restaurant (you know you’ll get a table, but not which specific one yet). Upon arrival, the host assigns you to a specific table. This approach helps with planning ahead for resource workshop groups.

The One-Step Planning Model is akin to entering a coffee shop and being immediately assigned to a specific barista who starts preparing your coffee. This approach is practical for immediate, ad-hoc tasks where you directly assign a service job to a particular individual or work bay.

Now, let’s return to automotive and summarize it using proper terminology:

Which key criteria must be considered before choosing the preferred planning model for the workshop?

As you can see, both traditional planning models present distinct advantages and disadvantages. Like every coin, there are two sides, and there is a solution for every challenge.

Flexibility in adjusting the process flow based on the expected workshop load and circumstances is so important. Here, counting decision points and identifying potential bottlenecks can help determine which models best fit the dealer’s DNA and work style. The process flow visualization will spot such issues.

With the increasing availability of modern scheduling software tools powered by AI, which provide access to scheduling data, dealers can now analyze trends more accurately and automatically. They can consider planning for numerous factors such as expected no-shows, predictable absences, seasonal trends, and, most importantly, utilizing customer preferences and bases.

AI scheduling algorithms will soon support (but not replace) traditional planning models in many workshops, thereby reducing human interactions and opening a whole new dimension for service excellence.

Author note:

This writing builds on my previous article, and I wanted to update it with new experiences, add more details, and simplify it for a broader audience to emphasize the benefits better. I hope you find it helpful.

. . .

Besides resource group and resource planning, I included a couple of other planning models I learned.

Team Planning Model

Besides the “mainstream” planning methods, I noticed one interesting organizational style. Different resources were arranged into teams with predefined skill sets. This makes sense if the workshop operates with shift models, where teams operate independently, AND one person (usually a service advisor) serves as the team manager. Another observation is that some senior resources, primarily diagnostics, are shared among different resource groups, which makes workshop planning somewhat more complex.

End-to-End Planning Model

Another interesting planning style I observed was a distinctive model in Latin America, where the resource operates independently, including its work bays, and can handle the entire repair process alone, from reception to repair to handover. Surprisingly, this involved a large, multi-brand franchise dealer rather than a small, independent workshop. I refer to this style as the “one-man show”; sure, I can share more details about this unique approach.

Work Bay Planning Model

In specific markets, particularly in Asia, where human resources are not limited, I can observe a distinct planning model: managing at the workbay level. Here, dealers primarily plan work by work bay, with each work bay assigned to technicians. This approach is often favored by small and medium-sized dealers, especially when their Fixed Ops activities involve repetitive services like seasonal tire changes, quick repairs, inspections, and Pre-Delivery Inspections (PDIs). This model also lends itself well to time-boxed planning, leveraging the consistent skill levels of their resources.

[L1.]“How to distribute working hours in the Workshop #DMS“ Dr. Juraj Hanus, Technical Article, April 20, 2017, How to distribute working hours in the Workshop #DMS

[L2.]“No More No Shows“ Dr. Juraj Hanus, Technical Article, December 11, 2023 https://medium.com/@jurajhanus/no-more-no-shows-eccb3b2d4c17

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post The ART of Workshop Resource Planning appeared first on TaXaPa.

Proactive dealers have already recognized service advisors’ time limitations, as they can only manage a certain number of customer interactions. Today, messaging apps, email, and texting have significantly increased the volume and immediacy of communication, transforming what was once a manageable aspect of their role into an overwhelming workload. The digital era poses the following question.

Can the traditional dealership model for customer communication still function effectively in this modern, digital era?

All parties involved -> dealers, OEMs, and DMS providers must understand that the key task is to refocus on core (Fixed Ops) while keeping pace with digital communication and interaction growth. With the aftersales mantra, “Never miss a lead and sale again,” dealerships initiate their cultural shift and build specialized dealership departments known as BDC.

I was fortunate to learn how BDCs were practically established, began operations, and rapidly expanded their scope, creating momentum to build a future business for many dealers.

Key takeaways:

• BDC is no longer described as a “call center”; its scope has quickly evolved and expanded, particularly in after-sales.
• BDC bridges Fixed and Online Ops gaps in the dealership’s processes.
• BDC should operate as a specialized, autonomous “task force group” within dealership departments, primarily managing customer communications and interactions.
• BDC helps maintain regular communication with customers, proactively reminding them of services and scheduling appointments to boost the future business stream and keep the workshop busy.
• Generally, large dealers and dealer groups aim to establish their own BDC to gain better control over the processing. However, a BDC is costly for small dealers, and therefore, they look for alternative solutions, such as outsourcing those activities to professional third-party providers. Both solutions have clear pros and cons.
• I confirm that there is no single best winning recipe for building an effective BDC; it is more about how effectively dealers can tailor, articulate, and implement their after-sales strategies using the power of BDC.
• Creating the BDC department is one of the most effective strategies for achieving service excellence. Nevertheless, it must be appropriately implemented.

All those small steps, one by one, will contribute to customer retention and loyalty overall.

So, let us move back to service personnel. Historically, service advisors primarily handled customer interactions through phone calls or walk-in visits, with the ability to schedule outgoing calls and appointments as needed. However, customer habits have changed in this digital world, and dealers must remain highly responsive.

The BDC centralizing communication tasks decreases the chances of duplicate customer outreach, allowing service advisors, technicians, and other Fixed Ops people to focus on their core responsibilities, such as diagnosing, repairing, and maintaining vehicles, which are essential for effectively operating the core business.

In addition to gaining experience implementing BDC, I researched various sources to identify the scope of BDC after-sales operations within dealerships. I have created a detailed overview to illustrate its scope.

BDC for After-Sales

In addition to enhancing customer communication and interactions through closer collaboration with customers, dealers have recognized new business opportunities and cogently focus on building customer retention and loyalty.

In my research, I identify another shift: the scope of the BDC is expanding rapidly due to the evolving use of AI, and the trends and activities of the BDC are aligning more closely with the Service Excellence department, as observed in other industries. However, dealers have yet to embrace this perspective.

There are many other topics, such as how to review BDC KPI effectively, the pros and cons of internal vs external BDC, and the role of the dealer management system and AI. I will keep those for further discussion.

I will end my article with a Roman Proverb,

“The man who is everywhere is nowhere.”

Focus drives results. That is what BDC excels at.

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

Sources

Mitchell, S. (November 06 2020). How dealers can improve their BDC processes. CBT News. Retrieved May 06, 2025, from https://www.cbtnews.com/how-dealers-can-improve-their-bdc-processes/

How to Improve Your Dealership’s BDC Experience. Automotive Mastermind. Retrieved May 18, 2025, from https://www.automotivemastermind.com/blog/uncategorized/how-to-increase-dealership-bdc-effectiveness/

The Pros and Cons of an External BDC for Auto Dealerships. CDK Global. Retrieved May 21, 2025, from https://www.cdkglobal.com/insights/pros-and-cons-external-bdc-auto-dealerships

6 Key Ingredients to Build a Successful Car Dealership BDC. Volie. Retrieved May 22, 2025, from https://volie.com/6-key-ingredients-to-build-a-successful-car-dealership-bdc/

What Is a BDC? Retrieved May 22, 2025 https://www.acvmax.com/blog/what-is-a-bdc,

The Lost Sales in Aftersales, Dr. Juraj Hanus, https://medium.com/@jurajhanus/lost-sales-in-aftersales-ffe7238f61b9

The post The Evolving Role of the Business Development Center (BDC) in Automotive Aftersales appeared first on TaXaPa.

In my writing, we plan to explore the significant shift occurring in the automotive industry: the transition from traditional paper-based checklists to cutting-edge, AI-powered solutions. I will focus on three key workshop processes: reception, inspection, and pickup, and how service checklists are utilized within each.

You may find a comprehensive description of these processes in the table below, detailing their primary goals, scope of checklists, time requirements, and the various challenges that dealerships face. To illustrate this evolution, I will also explain the checklists employed at each stage, from “static” paper forms to “dynamic” digital tools and intelligent systems driven by AI and OEM telematics.

Throughout my explanation, I included my observations and insights I learned, particularly on the transformative potential of AI and smart gate technology in revolutionizing vehicle inspections and data capture, + include real examples of that checklist for a better overview.

I hope you like it. So let’s start with it.

Summary, key insights.

Automating repetitive tasks presents a significant opportunity for dealers, as it would allow service personnel to focus more intently on customer needs. AI tools, such as license plate recognition, scheduling systems, smart gates, and other digital applications, are key enablers that help workshops achieve this.

Every part of the service process, including vehicle pickup, is crucial to the overall customer experience. Dealers should not underestimate its importance and focus on details that make THE difference.

Recognizing the limitations faced by busy service advisors who can only handle a limited number of tasks, we can observe that proactive dealers have begun establishing what are known as Business Development Centers (BDCs) for their aftersales operations. All involved understand that the key is to get the FOCUS, and I learned how BDCs operate, have evolved, and expanded their scope rapidly, creating momentum to build future business. BDC is one way to go. I plan to go deeper into BDC topics in my next writing.

Initially, I wanted to give you a quick overview of the various checklists we use in the automotive world. However, as I started writing, many additional details came to mind that I couldn’t help but share with you. I genuinely hope you find it interesting, and I appreciate you taking the time to read it.

Please feel free to leave any comments, questions, or remarks here. I’ll be sure to read and respond to each one. Thank you!

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

Additional Details on terminology.

The term “static” means that the given report has a predefined layout and checkpoints, and does not include answers or results that suggest the next steps. On the other hand, dynamic reports are now possible due to their digital forms. Tools can automatically suggest the following steps based on the collected and recorded data. For example, a vehicle diagram is proposed automatically based on the vehicle type.

The post Shift from Paper to AI appeared first on TaXaPa.

Once the decision to overbook workshop resources is made, it becomes essential to understand how to distribute booking hours effectively and automatically among workshop personnel. This is a critical step in ensuring the right overbooking workshop strategy is implemented without causing disruptions.

One of the best practices is to utilize resources based on skill level, with the most skilled person being only slightly overbooked.

How would one practically calculate that?

This is the topic I want to describe in my next article.

There are different algorithms available for overbooking. These algorithms include “proportional,” “sequential,” “progressive,” or “conditional” overbooking methods. There are many options to choose from, which means that one can write a book on this subject.

Based on personal experience, the ‘spread’ algorithm is a popular choice that best fits dealers’ demands. This method focuses on distributing booking hours among all resources, considering the skills each resource possesses. It ensures that less skilled resources are booked more, while more skilled individuals are booked less. As a result, more skilled mechanics are available, a crucial point in efficient service scheduling.

Does it seem complicated?

Well, let’s delve into the specifics, and I’ve created a practical example for you to follow.

Assuming the following scenario:

One workshop has four technicians with four different types of skills.

· Mechanic (MECH),

· Diagnostic (DIAG),

· Painting (PAINT),

· Body shop (BODY).

See example below:

Now, let’s get to how to distribute booking hours if, for example, 7 MECH Hours are booked for doing a service task, but the workshop lacks MECH available skills.

The spread overbooking algorithm takes into account a mathematical formula to determine the optimal overbooking amount.

Conclusion: Thanks to this automatic algorithm, John, the most experienced person, is now less overbooked than others.

As a result, some decimals can be seen, but it does not really matter. These numbers do not bother end-users but are crucial for dealer management systems or scheduling systems to manage overbooking effectively on a skills level.

I hope my article provided you with valuable insights. I am waiting to receive your feedback!

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post Overbooking Workshop Strategy appeared first on TaXaPa.

During one of my visits to dealerships, we discussed challenges related to resource workshop planning with service managers and how to optimize service processes to achieve the best outcomes and high resource utilization. We particularly examined whether local or centralized workshop planning fits their DNA and the pros and cons of each (Later, I wrote an article about it (*)).

At one of the management meetings, we discussed the frustrating effect of no-show customers on their resource workshop planning. According to the Service Managers, around 10% of customers fail to attend service appointments. It made me more aware of that issue and encouraged me to examine it more deeply.

What steps must dealers take to reduce the probability of no-shows?

Do good practices exist to handle such situations effectively?

Can we measure the impact and forecast it?

In my next article, I would like to talk about that. I have added a few genuine examples to make the article more engaging.

What is a no-show?

First things first, a no-show refers to a situation where a customer fails to attend a scheduled service appointment without prior notice. Such situations disrupt workshop scheduling and negatively impact productivity and effectiveness if not managed actively.

Understanding the problem’s scale, size, and impact is crucial before tackling it. Data is the KEY because dealers can build their “no-show algorithms” and utilize their processes accordingly.

Here, Dealer Management Systems (DMS) must provide a functional base to support background tracking of no-show customers quickly, intuitively, and with minimum user interventions.

The exercise aims to gather dealer data and generate a forecast. Secondly, dealers should establish and monitor criteria.

What are the options?

• Comparison between show-up and no-show customer visits.
• Lost Sales Revenue, causing no-show.
• Lost (Sold) Time causing no-show.

Variables:

• Day or Time of visit,
• Booking Lead Time BLT (Time needed to get a service appointment).
• Type of service appointments
• Seasonal factors
• Type of the customer, car, and other details.

After setting the criteria, dealers must focus on effectively implementing measures to control them.

Dealers rely on service appointments and must actively maintain them.

There are two distinct categories of methods available. Let me explain them.

Active features are those that prevent no-show situations before they happen.

Passive features — reduce the impact of the event.

Active features to maintain service appointments.

These are the most popular ones:

• Booking Confirmations

Regardless of the booking channel, dealers should send an online appointment booking confirmation with all important booking details.

• Service Reminders

It’s common for customers to forget their scheduled service appointments if they book them too far in advance. Automated service reminders assist dealers in reminding customers about upcoming visits at the optimal time, mostly electronically, using messaging applications. Dealers should include the appointment time, location, and special instructions.

• Multiple Communication Methods

Although messages are a commonly used option, some customers have better choices. Offering multiple communication methods, such as email, SMS, or even phone calls, dealers can reach customers in the way they prefer.

• Service Confirmations

After sending automated service reminders, dealers should examine service appointments that the customers still need to confirm. A simple rule can be applied: no call (no confirmation), no show.

• Rescheduling Online

Depending on the messaging app or communications channel, it is beneficial to include links to “Confirm,” “Reschedule,” or “Cancel” the service appointment. Some messaging applications offer an option to call: “I am late,” which is a superb idea to include.

• Online Prepayment

With access to modern digital technology and electronic payment, this is one of the excellent ways to reduce the risk of not showing up. Dealers should offer discounts for prepayment, which encourages booking appointments in advance and paying attention to them.

• Key Lookers

Customers can drop off and pick up their car keys 24/7 using a contactless tool. This service offers added convenience for customers who prefer out-of-hours assistance.

Dealers may look for other options that are worth considering.

• Pick-up vehicle service.
• Late cancellation or missed service appointment fees.
• Flexible cancellation policy.
• Motivate customers to visit the dealership by offering a replacement vehicle one day prior to their visit.

Despite taking preventive measures, some customers still miss service appointments. That’s life. Dealers must measure it and get it under control. Here, I called them “passive” features, which are utilized to maintain service appointments.

Passive features — reduce the impact of no-shows.

• Managing the reception process and mitigating potential delays

Get early indicators of no-shows; every potential customer delay increases the probability of no-shows. Contact customers, validate their situation, and be ready for plan B. Visualization, like a Status Board, helps dealers quickly identify delays and take necessary actions by displaying customer appointments on a digital board.

DMS>Status Board

• Overbooking or double-booking rule

During my visit to a large truck workshop, I observed how they efficiently manage their resources. They typically overbook their daily workshop capacity by 15–20%. I discovered a double-booking rule was in place to combat no-shows.

• Diversity of service appointments

A certain percentage of workshop capacity, usually around 5–10%, is typically reserved for walk-in customers. Other dealers allocate workshop capacity for internal vehicle work. It is essential to plan and manage the size of the internal work pool proportionally, as it serves as a buffer for no-shows that can be utilized if necessary. The variety of service appointment types per day allows flexible scheduling adjustments to recover from no-shows faster.

• Find the reason

The most critical aspect is determining the reason for the no-shows and adjusting preventive mechanisms. Some dealers keep track of customers who frequently do not attend their service appointments and enforce rules such as requiring prepayment in advance.

DMS>No show tracking

• Inform customers that “they have missed it.”

Send a message to the customer who missed their service appointment with an option to reschedule.

As I mentioned, Dealers rely on service appointments and must actively maintain them. My article outlines active and passive management options.

Thank you for taking the time to read the article. If you require any additional information, please do not hesitate to contact me.

Stay in touch.

(*) https://medium.com/@jurajhanus/how-dealers-operate-with-workshop-resources-f90d3c346d11).

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post No More No Shows appeared first on TaXaPa.

Throughout my professional career, I have been fortunate to visit various workshops, ranging from small independent businesses to large dealerships and dealer groups, as well as various original equipment manufacturers (OEMs) in different countries. This gives me the perspective to articulate and observe criteria on how dealers operate process-wise with workshop resources.

Let’s begin by addressing some important questions:

• What is the recommended process and technique to plan workshop resources effectively?
• Can we clearly articulate process dependencies, limits, and pros and cons?
• What is the impact of different booking processes on workshop utilization?

I want to answer those questions in my next article and explain the details and my views.

My note: The article and information I have provided are based on my observations and involvement in a software design group. Our team was responsible for creating workshop planning tools tailored to dealer processes. I used this experience extensively. I have added notes for each topic to clarify essential details further and highlight key points. These notes may be helpful to you.

Terminology

Let’s start with basic definitions to ensure we’re on the same page and using the correct terminology. This is important as there is a lack of documentation in the field. Secondly, to understand the concept, we must introduce the main players in the “game.”

There is a simple equation. On the one hand, there is a need to schedule multiple service appointments for various service jobs, while on the other hand, the workshop has limited resources to carry out the work. The primary responsibility of Workshop Resource Management is to efficiently utilize, organize, schedule, and dispatch workshop resources and balance available resources against demand.

Workshop recources

Typical workshop resources are people, machines (including tools and accessories), work bays, and mobility vehicles. Every resource has different skills, available capacity, and efficiency potential or level [L1].

My note: Service Advisors are also workshop resources; they perform reception and handover tasks, VHC, or pickup courtesy cars. Planning them brings extra benefits. Unfortunately, many dealers underestimate it, which causes issues with the workshop flow; I called those issues „Bottleneck Points.”

Resource groups

Resources are typically used in groups to organize workshop activities effectively. Grouping can be done differently, and the main factors are the number of available resources and their diversity (type, skill, qualification). Typical resource grouping in the workshops is based on the following:

Location (Dealer Site, Branch, Building, Facility…)

• Resource Skill (Mechanical, Bodyshop, Painting, Diagnostic, and Electrical …)
• Vehicle Brand or Type (OEM Make, Passenger Cars, Truck, Motorcycle)

or

Team (Every team has a predefined skill set)

• Planning Shift (calendar planning, morning, afternoon, short and long shifts)
• Service Advisor (Service Advisors serve the role of team manager)

My note: Each resource group has available capacity, and things become more complex if one resource is shared between different resource groups, which is expected in the workshop. You may find information related to it here [L1]. The standard is to group resources based on their location and the type of work they can produce (mechanical, body shop, painting, diagnostics, electric….).

Service work

Workshop resources perform service work, and the required resource capacity is typically booked on order, job, or labor (task) level. These booking levels we can call the Planning Work Level (PWL).

Also, service work has different types (mechanical, diagnostic, electrical, body, and painting), required capacities (based on OEM standard time or workshop estimate), and required skills (based on resource group).

My note: Example of Planning Work Level (PWL)

• Order Level: Regular Maintenance after 30.000 Km
• Job Level: Oil Service
• Task: Change Oil and Oil Filter

Identifying the suitable Planning Work Level to which the workshop allocates its resource capacity for service work is important.

Scheduling process

The scheduling booking process allocates resource capacity for service work on the resource group level without the need to assign specific resources.

My note: Let’s imagine a pool of available resources per group reduced by the demand to perform service work. Such an overview helps dealers manage the workshop load. Dealer Management Systems (DMS) and Software Workshop Planning Tools (WPT) should assist. Assigning the required capacity and skill to PWL is a crucial detail to consider.

Assignments process

Assignment booking relocates already booked (scheduled) resource capacity for service work from resource groups to a particular resource (two-step planning process).

My note: Some dealers only manage scheduling in their Dealer Management System (DMS) and Workshop Planning Tools (WPL) and assign service work manually (using a physical planning board). If so, they cannot fully leverage the benefits of a two-step planning process.

Dispatching process

Dispatching booking allocates resource capacity for service work on the resource level (one-step planning process)

My note: Dispatching is necessary to allocate resource capacity for ad-hoc service work and walk-in customer visits, where the scheduling process is unnecessary.

Planning process

Now, let’s have a look at it all in one context.

Dealers use two main types of booking processes to allocate workshop resources for service work.

• One-Step Planning Process (Dispatching)
• Two-Step Planning Process (Scheduling and Assignment)

Let’s examine the main criteria for choosing a one or two-step planning process.

1. Type, size, and organizational structure of the workshop.

2. Centralized vs. locally planned resources.

3. Size of workshop load, types, and a variety of service jobs.

4. Preferred Planning Work Level (PWL).

5. Booking Lead Time BLT (Time needed to get a service appointment).

Other criteria: The presence of after-sales lead management, booking centers, online appointment booking platforms, etc.

See the recommended type of booking process depending on the type of Planning Work Level PWL.

Let’s examine the pros and cons of choosing a one or two-step planning process.

One-step planning process

Pros

+ Quick dispatching or re-dispatching of service work to resources.

+ Visibility of available resource time slots (calendar or agenda planning).

+ Flexible to manage Work in Progress (WIP), walk-ins, and ad-hoc planning.

+ Workshop controllers or planning centers are not required.

+ Suitable for “ticktack” and time-slot planning.

Cons

– A quick overview of available capacity (pool) is often absent due to missing resource group planning.

– Managing work overload and rescheduling required many steps and decisions.

– Complex repairs with multiple service jobs or repair days need precise planning and often cause planning issues.

– Long Booking Lead Time BLT or unpredicted resource absences cause regular planning changes and issues.

– Since service work is allocated directly to particular resources, only limited-service personnel book service work.

Summarization:

The one-step planning process efficiently dispatches service work directly to workshop resources, suitable to manage resources locally, where a fixed number of resources are present and not shared between groups. The planning center or Workshop Controller is unnecessary because limited-service personnel, mainly service advisors, manage service appointments. The visibility of available resource time slots creates good conditions for booking repeated service work with a short repair time (mainly one-day service appointments) and enough flexibility to handle walk-ins and ad-hoc tasks.

Two-step planning process

Pros

+ An organized workflow-driven booking process can significantly improve the organization of workshops and increase the level of workshop load.

+ Resource Capacity is allocated to the resource group level, making scheduling or rescheduling processes quick without allocating particular resources.

+ A two-step planning process enables less qualified service personnel and external applications (online booking platform) to schedule workshop capacity (Step 1).

+ Planning changes occur less frequently because scheduling is done in the first step on resource groups rather than individual resources. This makes booking service appointments with Long Booking Lead Times — BLT uncomplicated.

+ Resource group planning helps to effectively manage higher workshop load, complex repairs, and rescheduling processes that require fewer steps and decision points.

Cons

– Requires a second step to reallocate resource capacity for service work. If not managed correctly, it may cause a bottleneck point in the service flow.

– Higher workshop organization, coordination, and administrative efforts. For instance, resources must be organized and managed in groups.

– Role: Workshop Controller or Resource Planner is highly recommended, where their main task is to assign service work to resources (Step 2).

– Available time slots due to Long Booking Lead Times (BLT) are hard to detect due to the resource group (pool) planning.

– Due to the capability to manage a higher daily workshop load, the two-step planning process is less flexible for ad-hoc planning or walk-ins.

Summarization

The two-step planning process (Scheduling + Assignment) is workflow-driven and offers a clear overview of available workshop capacity. It requires good workshop organization and defined roles and responsibilities. Assigning resources at the wrong time (too early or too late) can cause planning changes and bottleneck points, so workshop activities must be well coordinated (the main task of the workshop controller or planner).

Resources are assigned and managed in groups, and more individuals, including external applications (online booking platforms), can contribute to the booking process. For large dealers and dealers’ groups where planning centers are present, they can effectively manage workshop load and capacity from a central point. Group resource planning creates good conditions for managing a higher workshop load with Long Booking Times — LBT where potential changes are uncomplicated to master.

Result

As you may see, both planning process types have pros and cons. And every coin has two sides, and every problem has a solution.

For instance, dealers can effectively manage walk-ins and ad-hoc service jobs by allocating a specific resource capacity (10–15% middle-side dealers). OR, on the other hand, to utilize workshop resources most effectively, dealers need to detect early indicators of no-show customer visits and respond proactively.

What matters is adjusting the process flow according to the expected workshop load. Counting the number of decision points and detecting potential bottlenecks will help determine which process best fits the dealer’s DNA and style of work.

I created the following table to summarize the findings and preferences.

I hope you like the insights and information provided. In the end, I want to mention another emerging trend to make workshop resource planning and utilization effective. Namely, complex resource allocation in service planning can be improved with AI. This is one of the topics I want to focus on next. Please feel free to contact me for further details.

Stay in touch!

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

References

[L1.]“How to distribute working hours in the Workshop #DMS“ Dr. Juraj Hanus, Technical Article, April 20, 2017, How to distribute working hours in the Workshop #DMS

The post How dealers operate with workshop resources appeared first on TaXaPa.

Sure, dealers can see it as an excellent upselling opportunity, and showrooms are shaping into shopping malls. On the other hand, the high number of waiters puts much pressure on the dealer organization and workshop planning and creates additional costs, especially during marketing service campaigns or tire seasons.

What more do we know about the waiters?

In fact, waiters are more “allergic” to potential service delays than customers who are out of the workshop following their daily routines. AND waiters are less likely to approve additional work because unexpected extra time without their vehicles may significantly affect their schedule.

What I see as the most challenging experience for dealers is to start to control and manage the “right” number of waiters in the workshop during peak hours. How good (or bad) one can handle it has become trendy again.

Dealers are proposing better access to loan vehicles, introducing express services for loyal customers, and motivating them to visit their dealership in the afternoons. The call centers proactively ask if the customer wants to wait during their vehicle inspection and inspire them to refrain from doing so to keep the balance. In addition, dealers’ online booking platforms contain a new option if a customer wants to wait or needs a shuttle. Those simple policies help dealers manage the workshop utilization and balance it with the maximum number of waiting customers.

Dealers should know that modern dealer management applications can provide a simple way to track and visualize that information per day, per hour, or per dealer location. For instance, check the screen below. It can be a simple chart with a track function, BUT carefully integrated into the service booking process. While finalizing service appointment booking, with information on hand, dealers can quickly understand the situation and plan further steps accordingly.

See an example of such functionality that is popular in the market, like Benelux.

I look forward to your feedback and am genuinely interested in your experience.

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post How to balance workshop utilization with the right number of waiting customers appeared first on TaXaPa.

We can identify Original Equipment Manufacturers (OEM), Dealers (Dealer Groups), Car Insurance, Fleet and Car Rental, and a dozen other legal entities active in our rapidly transforming segment. AND there is one member uniquely positioned between OEM and Dealers in the whole industry chain. Their performance is crucial for seamless cooperation in the everyday automotive business. We will discuss Importers, their roles, and functional requirements for software solutions, plus I plan to focus on what could ensure seamless collaboration within this business triangle (OEM, Importer, and Dealers).

The importer business has its own specific needs and complexity. The importer stands between the OEM and the dealer in getting vehicles or parts produced in a particular place into the hands of a customer, possibly thousands of miles away.

The dealers rely on importers to serve their customers at the highest standards, from vehicle sales and delivery to warranty management, not forgetting parts and service.

The OEM counts on the importer as the intermediate between them and an often considerable number of dealers for these same business areas. However, it will also rely on market data that the importer will provide to make strategic decisions and forecast their business.

“Let’s cover some software terminology used for it now. In the same way, we call software that manages dealer business activities a Dealer Management System (DMS); we can also name importer applications Importer Management Systems (IMS). Because dealers in some markets must take the role of importers, this could prompt us to ask the following question:

Is there an actual difference between DMS and IMS applications?

To answer such questions, one must understand the importer’s primary task. The importer holds a unique position between dealers and the original equipment manufacturer (OEM), and is at the center of getting vehicles and parts produced by the OEM to end customers. So, excellent collaboration with a dealer network and OEM means effective relationships, communication, and inventory management. Importers need the right software tools, modules, and functionalities to effectively coordinate those business operations in IMS.

There is a difference in functional requirements between dealer and importer applications due to the additional role they must take as importers. AND if the importer is a dealer, we can extend the standard dealer management system’s functionality to cover the importer’s needs. Importer Management Solution becomes an extension (module) of the Dealer Management System, but not vice versa. Besides standard DMS functionalities like Inventory Management, Accounting, and Reporting, one may identify other areas in the schema below related to IMMs.

So, let’s focus on IMS (IMM) specific processes, modules, and functionalities.

Vehicle and Parts Ordering Management enables the importer to manage the vehicles and parts inventory, including those in the pipeline, from a central place. The focus must be on automated processes, updates, and data consistency to plan orders efficiently. Access to the vehicle stock list, including ordered, importer, and unsold dealer stock, will, on the one hand, optimize vehicle inventory inquiries and, on the other, provide transparency in ordering, tracking, and dispatching. Supporting eBusiness transactions within the business triangle, automatic status and notifications are must-have software attributes.

Sales Budget & Quotas functionality supports creating flexible sales models or parts budgets with sales quotas (rules) to make the planning process more detailed, transparent, and under control. Therefore, potential delays or unpredictable situations can be communicated early. Sales budgets are shared as a forecast for the factory (OEM). The sales quota functionality may limit the dealers’ ability to place further orders if required.

Import Costing Management must cover highly complex scenarios from import management of vessels and containers to customs and freight costing in real-time for a contingent of parts and vehicles. Import costs are also known as shipping, landing, and additional costs like freight, duty, wharf charges, customs, internal freight, tariffs, documentation charges, and any associated internal company costs.

The primary role of Import Costing Management is to oversee the costs of transport of goods and import costing in shipments, and assist in compiling all shipment details and contents. It will secure the correctness of import costs calculation and establish an option to forecast cost budgets (planned vs. actual) with an audit trail and visibility of cost details.

Dealer Claim Management must support standard, additional warranty, and service contract processes for all dealer and factory claim types with effective payment management. The claim process must be managed brand (make) independently to ensure OEM-specific rules are in place. Dealers can place warranty and service contract claims in the Dealer Portal. The importer must register, validate, and approve (or reject) claims submitted by dealers. Once the credit memo from OEM is received, the importer can apply the credit to the open account of the dealers. Dealer Claim Management must provide automated payment management from the importer to the dealers. This single process must be manageable for all claim process types (warranty, service contracts, third-party, and goodwill) with the electronic exchange of business transactions.

The Dealer Management facilitates the comprehensive management of business transactions between importers and their dealer networks with a flexible integration platform and complete control of dealer access and their business activities. There are two options for accomplishing it: direct access to IMS with all settings related to it, or using the Dealer Online Portal platform and integrating it with IMS respectively. DMS.

Dealer Management must guarantee online/real-time 24/7 access to the importer’s database, providing real-time parts or vehicle information and ordering with Electronic Data Interchange Management (EDI).

Excellent cooperation between the importer and dealers is essential to driving more prospects into the dealerships and boosting dealer network profitability. Wholesale CRM must streamline collaboration between dealers and the importer via automated customer (prospect) data transfer while keeping the data quality high and synced.

Wholesales CRM supports the importer in carrying out their marketing activities and campaigns accurately and efficiently (either for dealers or retail customers), encouraging the importer to help dealers, for example, during market launches of new vehicle model lines, etc.

The last functional area in the context of a large pool of IMS functionalities today belongs to OEM Integrations. Each car brand has business rules, processes, and interfaces that are continuously improving, adapting, and scaling to follow new digital trends. To succeed, IMS must contain concepts highly adaptable in handling multi-brand rules to effectively meet diverse OEM functional requirements without regularly changing the core part. IMS Master Data and Data Exchange (API) modules with a standardized integration platform will ensure seamless system and interface integrations with OEM applications, Dealers, and third-party systems.

This is all for now related to IMS functionalities. I hope you understand from my article what matters for IMS, and ensure good cooperation among the business triangle Oof EM, Importer, and Dealers. I look forward to your feedback and am genuinely interested in your opinion.

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

The post Dealer Management System (DMS) vs. Importer Management System (IMS) appeared first on TaXaPa.

Besides adding powerful DMS tools to refresh the aftersales processes, dealers must manage their sales and aftersales opportunities effectively, track their progress, and evaluate results.

Sales Opportunity Management is typically part of dealers’ Contact Relationship Management (CRM) tools as a component of existing DMS or integrated third-party applications (e.g., Salesforce Automotive CRM, DealerPeak, DealerSocket…). Due to a long tradition, CRM can immensely support vehicle sales, assisting salespersons in tracking opportunities for potential sales across the pipeline and converting them into recurring revenue.

But how does it look in Aftersales?

I researched available solutions on the market and got in touch with dealers and experts (SMEs) to collect as many details as possible to find the answer. Result: It is done “somehow.”

We clearly detected the considerable potential for improvement. What could be the reason for such an underestimated situation in Aftersales? Finding the answer made it apparent that “The devil lies in the details.”

Firstly, the diversity and complexity of service processes limit the application of uniform procedures like sales opportunity management. Secondly, dealers blindly and narrowly focus on sales, and thirdly, the missing DMS operational support limits the potential to implement Aftersales Opportunity Management in real life.

The support of DMS plays a vital role in Aftersales Opportunity Management, especially if we start discussing topics like Aftersales Lost Sales. The service process is a predictable “thing” divided into aftersales stages (scheduling, reception, work in progress, quality control, pick-up, follow-up, etc.), so could we somehow “learn” from Sales Opportunity Pipeline or not?

Let’s detail and summarize how one must consider the essential elements to apply them in reality.

Five vital elements of Aftersales Lost Sales in DMS

1. Automated creation and tracking of aftersales opportunities (for instance, by service booking, walk-ins, quotations, or by transferring aftersales leads from external applications).
2. Quickly identify an event and stage in service workflow when dealers lost the aftersales opportunity (Service appointment or orders cancelation, reducing the initial scope, refusing price offering…)
3. Understand what caused the loss (no-shows, missing parts, service or workshop capacity, the high price of the initial offer, competitive offer, or absent communication…).
4. Take measures and evaluations using valid KPIs. (Lost quantification, % lost revenue, assessing reasons, identifying trends and roles of seasonal aspects…) and finally
5. Improve the existing state to prevent it from happening again.

Once dealers manage all elements profoundly AND get functional support from the DMS, things start to change.

Indeed, in a broader context of the aftersales lead management functionality, dealers must count on additional details and factors. Primarily on how effectively they can manage and transfer aftersales leads received from diverse external channels (OEMs, WEB, Campaigns, etc.) into the sales. We can discuss this excellent topic next time if you are interested.

I hope you were able to gain insight from the article and look forward to your feedback and am genuinely interested in your opinion of it.

Dr. Juraj Hanus, hanus@taxapa.com

Data Analytics & Automotive Applications Expert for Dealerships

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