Key Performance Indicators for Monitoring Dealer Engagement
Transcript of Key Performance Indicators for Monitoring Dealer Engagement
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Key Performance Indicators for
Monitoring Dealer Engagement
Peter Drakeley – Director of Professional Services, EWA
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Syncron is the global leader in aftermarket service
optimization
• Dealer Management and
Aftermarket Specialist
– Inventory Management
– Price Management
– Analytics
• Customers are multinational
companies
– Active users in over100 countries
– R&D intensive, investing >20% of
revenue
– Over 425 man years invested in
Dealer IM development
Meet the Presenter:
• 8 years of experience in
Dealer IM implementation
• Leads global teams on
multi-disciplinary projects
• University of Birmingham –
MSci Theoretical and
Mathematical Physics
Peter DrakeleyDirector of Professional Services
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Best Practice Dealer IM (Inventory Management) Program
• Needs to be seen as a strategic initiative by senior executives at the OEM and part of
the standard OEM – Dealer business model.
• High dealer adoption is a pre-requisite for a successful project.
• Using a dedicated Dealer IM software platform is a key success factor.
• Dealer terms and conditions must
incentivise adoption and differentiate
from non-program dealers.
• OEM parts sales model needs to
incentivise retail sales rather than
wholesale sales.
• Efficient and fast roll-out important to
minimize project cost.
• Investment in change management at
the dealer and at the OEM is a key success
factor.
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Successful Dealer Inventory Management Programmes are
built upon a solid, process-driven foundation
Pre-Implementation Implementation Post Implementation
In pre-implementation, we focus on establishing a pipeline of dealers ready to join the Dealer IM programme.
During the implementation phase, Syncron and the OEM work together to implement Dealer IM into the network.
Post implementation support is required to ensure continued, correct engagement in the Dealer IM programme and to maximise value achieved from both the dealer and OEM perspective.
Dealer On-boarding:
• Raising RIM profile within the dealer network
• Establishing dealer interest
• Dealer readiness assessment
Dealer Implementation:
• Full RIM model for distributors
• RIM Light for smaller distributors and dealers
Dealer Engagement & Audit:
• Ongoing motivation
• Additional training
• Analyst support (OEM/Syncron)
• OEM support
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There can be many causes of low levels of engagement and
poor adoption amongst the dealer network
1) Investment in Inventory Management capabilities are negatively
correlated with distance from OEM/PDC and the number of tiers away
in the Supply Chain.
2) Inadequate support during the on-boarding phase leading to an
undertrained and unprepared dealer.
3) Poor availability of parts from the OEM undermining the Dealer
Inventory Management programme.
4) Not having the right Dealer Inventory Management-associated
incentives.
5) Change of personnel at the dealer and an inadequate framework of
support.
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Tracking and reporting data delivery and quality are
fundamental to maintaining dealer engagement
• In a large Dealer IM implementation the DMS integration is a critical
success factor. This needs to be stable, and actions need to be taken
rapidly if it is failing.
• Syncron comes with excellent reporting capabilities for monitoring the
integration as well as ensuring that integration issues are detected and
alerted immediately.
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Standardising business KPIs is step one in understanding the
relative level of engagement of your dealers
• Large variation of KPIs
– Sales Value
– Service Level
– Service index
– Inventory Value
– Stock Turns
• Reports
– Risk of Run Out
– Excess Stock
– Alerts
– Inventory Follow Up
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Syncron offers full support for system auditing –
Dealer Compliance Tracking
• Compliance measures the proportion of parts which have dealer applied overrides to the replenishment parameters.
• Low levels of compliance can indicate advanced system usage at the dealer level.
• Low levels of compliance can indicate that a modification maybe required to the standard system parameters applied for that dealer.
• Actively monitoring dealer system compliance encourages dealer / OEM engagement and continuous dealer IM process improvement.
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Syncron offers full support for system auditing –
Order Acceptance Rate Tracking
Choose type of KPI
Placed order linesRecommended order lines
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Syncron offers full support for system auditing –
Complete Order Audit
• A detailed order audit by order line enables visibility of all modifications the dealer is making to any order line.
• An order audit can be used in a real time analysis of engagement and also historically to review potential reasons for over stock / stock run out.
• The order audit should record:
• Whether an order line was confirmed or not.
• The types of order placed.• The original order line.• Any modifications made
and by what user.• Any notes on the order line.
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Model One: OEM takes full control of dealer inventory
• Dealers own inventory
– Initial stock clean is usually
executed favourably to the
dealer
• OEM manages all aspects of
ordering
– Automated process
– Follow-up on the performance
of the dealers
• Obsolete stock buy back guarantee
• Stocking lists for new parts
provided by OEM
• Dealer may or may not have
access to an ordering portal
OEM Distribution Center
Dealer 1 Dealer 2 Dealer 3
Figure 1: OEM drives dealer forecasts and recommends new order levels
Forecasts & Order Recommendations
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Model Two: Dealers retain full control of inventory
• Dealer owns and has full control of
inventory and ordering
• OEMs suggest replenishment
recommendations to dealers
• Obsolete stock buy back guarantee only
if certain conditions are met:
– Dealer places X% of orders
suggested by the system
– Access to high quality dealer data is
available
• Strict penalties need to exist for low
levels of stock order efficiency
• OEM requires audit and follow up on the
dealer performance
OEM Distribution Center
Dealer 1 Dealer 2 Dealer 3
Figure 2: Dealer drives forecasts and recommends new order levels
Forecasts & Order Recommendations
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The less control the OEM has of dealer replenishment the
greater the level of engagement monitoring required
OEM Controlof replenishment
process
Necessary Monitoring Complexity
• Data delivery• Data quality• Business KPIs• Application logons• Compliance• Order acceptance
• Data delivery• Data quality• Business KPIs
100%
O%
Low High
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Conclusions
1)Provide relevant support to the dealers post implementation.
2)Different levels of engagement tracking is necessary dependent on the level of OEM control of the inventory.
3)An automated alerts framework is required to effectively track engagement complemented by a pro-active dealer support team.
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Key Performance Indicators for
Monitoring Dealer Engagement
Peter Drakeley – Director of Professional Services, Manager EWA