Introduction
What if the industry you were a part of was about to change? What if what you knew your whole life was about to be different? How would you adjust? How would you adapt? How would you continue to stay profitable and stay relevant knowing the entire world around your business is about to change?
You could ride out the current plan and hope for the best, or you could adopt new ideas and look for ways to reinvent yourself and your business in an ever-changing world.
What if your industry was already changing? What would you do? You could look for advice on how to adapt when technology and business models evolve — and learn from those that didn't adapt.
Welcome to the Automotive Industry.
The automotive industry has been largely unchanged for decades. The classic brick and mortar physical dealerships have had their ownership passed down from generation to generation doing business as their fathers did and as their father's fathers did before them. They have stayed profitable because of a tried and true, albeit archaic, set of processes that keep them running like a well-oiled machine. I'm not saying it's pretty. I'm saying it has worked.
But the world is changing. And the new dealership owner is beginning to realize that they need to change to stay relevant. The next generation of car buyer is concerned about their time and where it's spent. They do everything online and do it quickly. The business of "a handshake, a smile and a promise" is slowly fading away. I'm old—er. From a certain standpoint, that's sad. Today's world is about instant gratification and streamlining information and process. Everything has to be efficient because in today's modern age time truly is money. Time is currency and it's oh so valuable.
Having said that, from the bottom of my heart, I thank you all for taking the time to come and listen to this story.
Chapter I — A Toxic Relationship
The relationship between dealerships and some automotive solutions has been adversarial at best, and flat out toxic at times. All relationships have bumps in the road, but when that becomes an ongoing theme, it's time to reevaluate, and perhaps see other people. It happens every week when a dealership and a solution go their separate ways. There are hurt feelings, mistrust, and anger.
"You just don't listen to me…"
"But look at all the things I did for you…"
"Well, if you did this, I'd love you more…"
"It's not that easy to do that…"
"I think we should see other people…"
Withholding compliments, passive-aggressive behavior, playing with your partner's feelings to make them jealous. These are all unhealthy.
It should be a symbiotic relationship, not a power struggle. It should be a collaboration, not a negotiation. But the truth is, the two sides need each other. They are two halves of a whole — even if they don't see it.
How do they move forward? They start by going to therapy, focus on self-care, build empathy for each other's issues and concerns. Stop talking. Stop selling. Stop blaming and just listen. Then we can talk.
"I know this seems odd and very specific, but I need this in my life to make it better and here is why."
"I understand what you are feeling, let's see how we can make things better."
They need each other. We need each other — because a storm is coming.
Chapter II — The Oncoming Storm
We all heard of the change that is coming. We have to be ready. We have today to prepare because tomorrow is too late. We've all heard the buzz words of connectivity, autonomous systems, the impending shift to electrical power and ride-sharing. We've all heard rumors that franchises will go away and be replaced by direct sales. Maybe some of that's true, maybe it's not. Remember, I'm not a fortune teller. I'm a storyteller.
Autonomous Systems
The idea behind this phrase is to have the ability to supplement human drivers with additional tools that can make them safer on the road. This starts with automatic braking and lane assists and gradually moves towards fully automated vehicles.
This opens up the opportunity to pull data and metrics from sensors, geocodes, cameras and driving habits and common routes.
But for our point of view, it's not just autonomous driving vehicles. It is automating the process around a car purchase or lease. It's simplifying everything so there is less paperwork, less confusion, less anxiety, and a better experience. And remember that other thing, time? It saves you time. To do that, we need to be connected.
Connectivity
Like autonomous systems, you now have more data points, more code, more standards, more variances, more ways to keep people connected to their cars, the cars connected to the dealership, to the factory, and to each other.
In 1961, the first wireless based navigation system was introduced for military use. Thirty years later, vehicles started arriving with GPS systems. And now almost another 30 years after that, I wonder if my Audi is smarter than I am? The introduction of an increasing number of new technologies found in the vehicles requires dealership personnel to know more about the interconnected systems than they ever dreamed they would need to know.
How do they keep their knowledge current? How are we going to ask dealerships to move faster, learn more and adapt when some fought changes to move into the 20th century?
Electrical Power
Speaking of change. The electric vehicle isn't going to change the future. The OEMs already know they need to build, and support, sustainable, dependable hybrid, and fully electric vehicles: affordable eco-friendly models that are functional, sporty with performance capabilities. The OEMs figured it out and they are working to make it profitable, scalable, and safe.
When Tesla began selling vehicles en masse they showed that there was a new way to purchase vehicles. It was a new way to attract consumers. They didn't need a large lot with a lot of vehicles. They need a really nice showroom put in a mall. The industry will have to adapt to these sales models and make the car buying experience better because an electric car company did it. Not because they sell an electric car.
Moving away from internal combustion isn't going to disrupt the industry. However, the advent of the non-franchise model will force dealerships to adapt to direct sales and increased customer engagement.
Ride Sharing
We all know about the current list of ride-sharing companies. They are version 1 of this industry. The ability for anybody to use their personal vehicle as a method and means of income has been proved. The taxi industry isn't a fan. Maybe they should have evolved their business and learned to adapt.
What about vehicle fleet management? Pick up a car, from anywhere in the city, drive it around for a few days, leave it somewhere so another person can pick it up and use it. Imagine an Airbnb for fleet vehicles — not just per OEM, but for global multi-OEM dealerships.
Putting a Bow on It
Autonomous Systems, Connectivity, Ride Sharing, and Electrical Power.
All of those buzzwords and catchphrases — but what does it mean?
Dealerships will need to adapt as users drift away from the standardized purchase model. Dealerships have two things that they can carry into the future. One is vehicle service and maintenance. They have the best mechanics, the best shops, and with the right tools, can provide the best customer service. The second thing they have is a fleet. They have a location loaded with revenue options. The problem is changing the current model of purchase from a loan, lease, cash to a new model comprised of a dynamic usage option. Hourly, daily, weekly, monthly and yearly. We know it works. Rental car companies have been doing it for years.
Let's be honest: in today's world, data is almost everything — second only to time. Data tells you who, what, where and how. With sophisticated systems, it can even extrapolate when. That information can be used to help dealerships change how they do business. But how do we plug dealerships into that information in a way that is convenient and easy to digest?
Chapter III — Tilting at Windmills
Every year we see the number of online purchases rise and become more prevalent. The companies that can keep up with that change and keep up with those demands are the ones that succeed. The automotive dealerships are no different. They know that times are changing, and they must change as well. But the biggest question every year is how. How can I be more efficient? How can we embrace these changes when the monolithic entities that are supplying the information to my business haven't changed? The DMS. The CRM. The OEM. The marketing platform.
It's been a dilemma. We in the automotive software industry have created the problem. We have created this isolation. Every year at NADA someone comes and talks about the future and how they are a part of it or are building it. But does anything ever really change? Everything has been about me, me, me. Whenever the focus is on the "me," the "me" falls behind. No single group, no matter the size, is nimble enough to keep pace with this ever-changing world.
Today's sophisticated user is connected. Is real time. Is "now." So stop worrying about me and start looking at "we." I don't mean "we" as an individual entity or DMS. I mean we as in all of you. We are the industry experts. We are the domain knowledge and the implementation of best practices. We must decide to set an example.
That sole organization in isolation is no more effective than Don Quixote charging a windmill.
Not to steal a catchphrase, but it does take a village to progress, support and prepare for the future — and we as an industry have to start acting like a community and working together. We all have the same customers. We all have similar issues. We must combine knowledge and resources and intellect to help build a better future, to help maintain profitability. And to support our dealers, our customers, our clients, our friends in whatever the future holds.
Chapter IV — Building the Library
The obvious question is: "How can Fortellis (or anyone) be any different?" That's a good question.
In 2017, a radical idea was created to solve the aforementioned problems with one exception. They did not want to do it inside of yet another windmill.
The concept was simple: create a place where the industry experts can share their knowledge and combine it with other information to create adaptable, flexible solutions to support the automotive space.
The goal, very simply, was to stop building monolithic protective systems and begin sharing information and knowledge.
Fortellis is a platform. Yes, it is owned by CDK. Yes, it is built on technology. However, the plan was for Fortellis to exist outside of that world. Fortellis was geared to provide solutions, information, and an exchange of ideas between everyone — no matter how big or small or important they may be — even without the technology.
If that sounds somewhat familiar, it's because it's just like a Library. Libraries are an important cornerstone of the community. Libraries give people the opportunity to explore new ideas, find opportunities for growth, get lost in some amazing stories, and at the same time provide a place for gathering of like minds with the ability to support different ideas. Good libraries support the diversity of character as well as the needs and expectations of the community it serves. The library is geared to be a readily available source of comprehensive information needed by the community for everything it needs to survive. During periods of crisis and upheaval, the library provides information and resources to research from. Libraries are the lifeline to the world and all the information in it.
"Bad libraries build collections, good libraries build services, great libraries build communities." — R. David Lankes
Fortellis wanted to build a great library — even if they didn't know it at the time.
Chapter V — Brick by Brick
As when building anything, you must lay a foundation. You start by clearing the land, measuring your space and pouring the foundation on which you are going to build your structure. Fortellis was originally started on a new piece of land, and a new location. Questions were asked. Decisions were made. And a plan was formed. There were obviously patrons who have donated a small wing, but Fortellis opted not to build inside the castle walls of their benefactor's home.
The library stands ready for all to visit and is ready to use. Any author can publish — no matter how large or small their publishing house is. There are reference sections, forums to share information, opportunities to learn, and the library most importantly, is living. It is constantly growing and changing to better suit its community.
As new books are added, we need to ensure it is supported and cared for — no matter who the author. With each book, the number of stories in the library grows, the more answers it can provide and the stronger the community is.
As a note, I am not a librarian. I'm not that smart. I was merely the custodian for a time. When all is said and done, it was my job to make sure the library can support all the information that passes through its doors. It was my job to ensure that everyone with a library card can come inside, learn and share information.
Now, there are new custodians. I hope they will do the same.
Epilogue
The library isn't about me. It isn't about CDK. It's about all of you. You are the community who will use the library. It is my hope that you will share ideas, thoughts, information and make the automotive industry able to grow into the future.
It is through all of us that the stories are written. It is the information etched in books and chapters stored within the library that can help our customers, clients, and friends navigate the turmoil yet to come. The library is how people show they care about the community.
I'm here because I care. This is here, because I care.
As I close this story, you may be asking: how does this story end? I don't know. Remember, I'm not a fortune teller. I'm a storyteller — and this story isn't complete.
But I can tell you how it starts: by the telling of a story.
I've told ours and indirectly, mine. And now I challenge all of you to go write your chapter. I look forward to meeting you all and asking you one simple, but complex question:
"So, what's your story?"