Web Services: New Technology or New Hassle?

By: Adam Kimber

Web Services: New Technology or New Hassle?

I moderated a panel on web services at the VSCAC conference on Sept. 15. The panel consisted of Brent Allen, President, Stone Eagle Insurance; Kumar Kathinokkula, COO, F&I Administrative Solutions; Mark Virag, Managing Director, Open Dealer Exchange; and Brian Reed, CEO, Intersection Technologies, Inc. The following are some thoughts I took away from this session.

First, technology moves fast! Think about your life 15 years ago: did you have a cell phone or e-mail address? And if you did, was it your primary form of communication like it is today?

Personally, I did not have either at that time. How did we ever communicate? How did business ever get done? If I’m away from my Blackberry for 10 minutes, anxiety starts to set in. The advent of modern technology (i.e., cell phones, e-mail addresses, etc.) has allowed us to communicate more efficiently.

In the beginning, it was a challenge to figure it out. It took some time to get used to, but in the end it has helped businesses run more efficiently.

As an administrator, do you remember the days when you relied on the fax machine as your primary mode of communication with the dealership? Then Dealertrack and Route One came out with their DMS software and we saw the fax machine go the way of the dinosaur. The technology they brought to the industry did the same thing cell phones and e-mail did – they allowed the communication process to be fast, efficient and accurate.

Sure, it took some time to learn the new DMS software (perhaps you even resisted the change), but ultimately it is amazing how much better DMS systems make the whole process.

Web services are the future for the F&I Industry. It is the means through which a dealer and provider can exchange information quickly and accurately. How important is it for the F&I manager when giving his presentation to have the rates in real time? Wouldn’t it be ideal if at the point of sale there were no paperwork filing, e-mailing, faxing, etc? Instead, the click of a mouse would enable EVERYBODY involved in the transaction to have the appropriate data.

Wouldn’t it be great to stop duplicating the data everywhere and have one central place where it is stored? Web services are the answer and the undeniable future of the industry.

The problem, however, is that people have been saying this for almost a decade. How many times have you read an article on e-contracting or been involved in a conversation where it is said the F&I office will soon become an e-F&I office? For years now you’ve been hearing this stuff, but it has yet to be implemented by the dealers. The truth of the matter is that while web services provide great opportunities for expansion and efficiency, there are still a number of hurdles dealers need to clear. Here are several of the main challenges:

  • Fragmentation. The dealer has to do business with many people. It works a certain way with one company and a different way with another.
  • Legacy Systems (i.e., AS 400). Some degree of modern technology is required to make web services work.
  • Staffing. Older legacy programmers haven’t been trained to work with web services.
  • Work. A lot of upfront “man power” is required to connect with everyone.
  • Incentive. Dealers who are making $1 million per month are very content with their current system. A lot of energy needs to go into this, and the dealer is not convinced the benefit is worthwhile.

These challenges are halting the progress of web services; however, consider the following benefits:

  • Rates. Are obtained in real time
  • Communication. It takes away all the barriers.
  • Expansion. It increases the number of people with whom you are able to do business.
  • Cost. The cost to administer a contract becomes much less while enabling you to provide better service to your customers.
  • Work. You build it once and then use it all the time. The effort is up front.
  • Data. It’s all together. There is no need to duplicate forms into multiple systems. All parties have it at the point of sale.

Now, we can discuss the pros and cons all day long, but what will it take for dealers to implement web services? Bottom line: the dealer must see the benefit and it must be EASY for the dealer to use.

A crucial mistake is to upset the dealer’s processes. Every dealership has a certain way it wants to sell. Respect what systems and processes are in place at the dealership but connect all web services to those systems. Plug your web services into every menu or desking system in town.

Web services can be configured to the exact preferences of the dealer. There is no need to upset the ebb and flow at the dealership. Convincing dealers that there does not have to be a complete uprooting of the way they do business is key to getting them to adopt web services at their dealership.

Yes, there are challenges for dealers to utilize web services; however, will the benefit of web services far outweigh the challenges? The answer is yes. Like it or not, web services are the way of the future. Just as fax machines became all but obsolete when DMS providers emerged, so will the paper system of the F&I office.

In the end, this new technology will do the same thing that all new technology does: streamline processes and make communication quicker and more efficient, with improved accuracy.

This article was written by:

- has written 3 posts on P&A Magazine.

Adam Kimber is the Publisher for AE and P&A Magazines. He has extensive publishing, sales and marketing, and trade show management experience.

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The views expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views of P&A Magazine or any employee thereof.

8 Responses to “Web Services: New Technology or New Hassle?”

  1. Jim Smith says:

    Great article Adam, and I always enjoy the VSCAC conference

  2. Jennifer says:

    Your article reminded me how fast things have changed and will continue to change.

  3. Tim H says:

    Excellent article and you did a great job with the panel.

  4. Gary Twigg says:

    Things are changing, but not fast enough. Look at e-contracting. Everyone thought it would be accepted within a few years, but we all know how that worked out.

  5. Joe says:

    I was there for the panel and it was excellent. Also great job with the summary.

  6. James Barron says:

    I found your article interesting, and I agree web services are the future – but I am not sure it we are talking about my future or my kids!

  7. Helene_Damen says:

    Has any new information on this topic been published?

  8. Dan Penn says:

    Adam….Great article, and I hope this topic will be covered again at the VSCAC Conference

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