Systems for success?
Selecting a software system – either an upgrade or a brand new
implementation – is a major challenge for a motor lessor, lender or
broker, Brian Rogerson finds
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Automotive financiers, be they fleet or retail lenders or
brokers, seek a common aim from their software systems. This is to
achieve as speedy a return on investment as possible together with
a visible fast-track on new business levels.
The competitive nature of today’s motor finance industry means
that more players are looking to technology to make a difference in
profitability.
Software providers, while acknowledging lenders’ goals, often
seek a more measured, longer-term, approach to achieving them. As a
consequence, software companies and their customer do not always
see eye to eye.
A fairly major headache
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By GlobalDataMartin Drake of DRIVE Software Solutions says: “Lenders’
priorities are to gain a competitive edge and meet customer needs.
The priority needs for a system, therefore, should be flexible
e-business capabilities, products and services. The second priority
is efficiency, provided by automation – including credit, billing
rules and back-to-back finance management.”
James Powell of Fimasys
believes that the main priority for lenders is for a solution that
offers the flexibility to manage the entire motor finance portfolio
in one common platform.
“Traditionally,” he explains, “motor lenders have been forced to
use a variety of systems across their different business units,
often based on a diverse range of technical platforms. A typical
motor lender may have a legacy mainframe- or client server-based
contact management system to support the retail finance and leasing
portfolios, perhaps with various web-based point-of-sale modules
bolted on the front and deployed at the dealerships.”
He adds: “In addition, there could be a separate stocking system
for the dealer-funding aspect and specialist contract management
systems for the fleet businesses. Add to this the various
sub-systems which naturally emerge from such a complex IT landscape
and you have a fairly major headache in both business and technical
terms.”
The costs of maintaining such disparate systems, ensuring they
are compatible and can talk to each other, together with the
challenges of presenting a consistent external image to customers,
dealers and manufacturer partners, are not to be
underestimated.
Powell observes: “Possessing a system that is capable of
managing the front to back end processes for all these business
activities can have a significant impact on the bottom line as well
as enabling the lender to communicate its corporate image
consistently to the market.”
Taking the plunge
Andy Shuter of Frontline Solutions says: “If you even attempt to
sell a system now without built-in lender interfaces, the customer
will just laugh at you. The demand this year is for systems that
can generate leads.”
John
Harman of Oyster
Bay Systems underlines the fact that lenders seeking new
systems should be addressing compliance with the Consumer Credit
Act (CCA) 2006 changes that are due to come in this October. He
says: “October 2008 will mark the implementation of changes to
extend and improve the information that must be provided to hirers
and debtors. This will have a fundamental impact on the systems and
processes of all consumer credit grantors.
“The CCA 2006 can, and should, be used to underpin new and
better customer relationships – and the industry should seize these
opportunities.”
Harman also believes that retail and fleet lenders, as well as
brokers, need the capability to transact the right deals at the
right time. He adds: “Relentless legislative and regulatory change
and an increasingly competitive environment mean that the aim of
the game is immediate decision making and rapid responses. Yet some
businesses are held back by their inability to respond quickly to
customer demands and they may, therefore, find that they are
missing out on vital business channels.”
Cost is not the sole option
“Many businesses,” says Andrew
Denton of CHP
Consulting, “want to improve their customer service levels and
responsiveness, and that traditionally leads to a rise in operating
expenditure. However, shrewder operators have realised that
exploring technology in the right way can help them differentiate
their products and services without incurring the additional
costs.”
“System value,” says Neville Briggs of Pinewood,
“is a far more important consideration than absolute system cost –
and this is particularly relevant to the way in which we provide
our dealer management service to dealers.”
Motor Finance Issue: 41 – March 08
Published for the web: March 26 08 15:55
Last Updated: March 27 08 12:40
