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Re-Thinking the DMS for New Car Dealers

I am ruminating: If new car dealerships are to re-invent their business model to adjust to the impending sea changes in the industry, it must start with completely re-thinking the DMS technology and specifically the third-party vendor eco-system. As value creation gets redefined by market dynamics, it is imperative that dealer data is no longer viewed as a trade-secret and readily shared across the dealer-vendor eco system with absolute minimum cost if no cost at all to all parties.

Easy and robust data accessibility features across platforms with maximum built in security algorithms should be the fundamental hallmark of this newly envisioned DMS. Also, it is imperative to mention here that lack of robust data accessibility is not just an issue for third party technology vendors but also for the dealer body, who often find themselves unable to access their own transactional data due to opaque nature of existing DMS technology creating road blocks or delaying speedy decision-making capabilities. Market innovation is also hampered. Now, I certainly don't want to lay the blame solely on the DMS companies, they do the best they can with what they must work with, which is modern day applications built upon at least a forty-year-old database system. Nevertheless, the time has come and we must usher in a new paradigm shift in how we view what a DMS is altogether and how it should behave with others.

In my view a DMS should be an open and yet very secure platform that synergistically allows for management of all digital and physical assets without leaving a heavy cost or maintenance footprint. Here are a set of principles on which I believe this newly re-imagined DMS should be built upon:

1.     DMS elasticity: DMS technology limitations or cost should never be a consideration for a dealer to expand departmental capabilities, employ the latest technology innovations, create newer revenue channels or enter into new markets. DMS should be completely invisible to these considerations.

2.     Data provenance: Every single data value should be tracked to its origin throughout the internal or external solution systems. The new DMS controlled wholly by the dealer becomes the shared key generator of all data assets including ones commonly shared with all third-party vendors. No more data attribution challenges. Every digital or physical asset is assigned a unique key shared across all internal or third-party platforms and ROI performance is calculated and shared in real-time by all parties simultaneously. The dealer of tomorrow will solely be in the business of "asset risk/management and customer management/retention business". Please see this presentation: Don Flow speaking at Automotive News, Retail Forum : Chicago October 17

3.     Distributed Computing Methodology: The dealer should be the sole decision maker regarding the DMS infrastructure topology. Dealer’s DMS could be hosted on-premise, off premise, on the cloud or in a truly distributed computing method utilizing existing hardware assets. Dealer gets complete control. No wastage of existing resources. Never pay for what is not being used.

4.     Analytics or Business Intelligence (BI) Ready: The underlying database should be equipped to handle both transactional and analytical interactions in real-time by employing data stream capabilities. The DMS becomes the dealer hub for inbound Big Data streams joining in real-time with its own localized transactional records thereby creating highly contextualized analyses for the end user. A confluential big picture versus small picture view enables right decisions at the right time.

5.     Open Source: The newly envision DMS must be completely open source from its DNA so any market innovator can enhance and offer new solutions benefiting the dealer and the entire supply chain marketplace. This will put the dealer in the pilot seat of what features and capabilities they want to invest in and which ones they want to forego.

6.     Distributed Ledger Based Third Party Integration Eco-System: Yes, you heard it right. I am proposing a DMS that employs private blockchain technology as a layer to create a third-party integration eco-system in which all internal and external solutions are working on the same shared key data elements. No more inserting or extracting data out of DMS systems. Blockchain allows each third-party vendor to contribute their own node to the blockchain network and host a distributed ledger of dealer data shared via a permissioned protocol thereby eliminating the need to update, insert or query DMS systems directly. Now data can be created and managed jointly without employing any system intrusive techniques. Blockchain data can only be viewed or managed by participating systems that possess the correct key. Data privacy and security are built in to blockchain technology. Hacking and altering blockchain data is next to impossible due to its multi-nodal distributive change authorization nature. Ethereum blockchain technology platform is an excellent option on which all third-party technology vendors would build their own value add applications. Ethereum platform based integration layer also enables dealers and third-party vendors to implement smart contract capabilities for future e-commerce purposes. Think about a possibility of any third-party retailer or a service provider transacting with dealer assets 24/7.

7.     Open Source DMS App Store: Principles, infrastructure and technology proposed above now for the first time will truly allow a vibrant and a decentralized DMS app store to flourish where dealers find themselves in complete control of which required features and widgets they want to implement without having to pay for the ones of no use. This will provide an unprecedented control over their own technology and digital marketing budgets and enable dealers to only train their personnel on features which are mission critical to their own operations or expansion initiatives. The DMS out of the box will come with most basic features and dealers can expand there onwards. An app store will also change the way third party technology vendors charge dealers. If an application is no longer desirable, it can be uninstalled within minutes without losing all the relevant data because that value add data is still accessible to the DMS via the distributed ledger system. The cost of integrating or switching vendors will be negligible provided third party vendors are participating in hosting their own blockchain nodes for distributed ledger services which will hold commonly shared and cryptographically secured dealer data. This will no-doubt require an industry wide cooperation and perhaps even a consortium. Let these innovations usher in a new era. "I have a dream!"

Please feel free to add to these set of principles.

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