Digital transformation has been a strategic priority for every CEO. In almost every survey, Going Digital is either the number 1 priority or amongst the top 5 priorities for over 80% of the CEOs polled. Every industry is looking for new ways to connect and engage with their customers. While the stated reasons for undergoing a digital transformation vary by industry, the shared objective is an improved top-line or bottom-line growth.
Automotive is one such industry that is undergoing a huge change due to changing consumer behavior especially with the strong consumer interest in autonomous vehicles and mobility as a service (MAAS). In the age of fast-paced technological transformations, consumers are influenced by the digital experiences offered by the brands they choose. The modern consumer is tech-savvy, digitally connected, and does not like to wait in queues.
Unfortunately, automotive repair centers are still operating in the old fashion which leaves much to be desired for the modern-day consumer used to the digital way of life. The consumers demand the same convenience and efficiency in all aspects of their life- be it grocery shopping, purchasing a new car, or getting it repaired. The automotive repair segment needs to evolve in order to offer a seamless, connected experience to the customers and improve their own operating metrics.
Creating a Differentiation
In an industry that is traditionally over-serviced and commoditized, the consumer experience helps create a strong differentiation. The various issues that relate to a typical auto workshop include:
- Poor utilization
- Poor operating metrics due to huge operational costs leading to constrained cash flows
- Incomplete visibility of the complete information across the entire value chain
- Poorly managed feedback mechanism, and
- Inadequate workforce training.
Poor Utilization: An average workshop lacks adequate mechanization and the repair bays are not optimally utilized. The reasons could be varying volumes of repairs, inadequate worker training, and efficiency, thus impacting productivity. Most of the finances are locked in fixed assets such as land, building, waiting lounges, etc. thus adversely impacting the cash flows.
Inadequate training: Attrition and workforce factors also impact the consumer experience at the workshops. A job undertaken by an inexperienced worker can lead to incomplete fixes, leading to repeat visits, thus negatively impacting the consumer experience. The productivity difference between an inexperienced and an experienced worker needs to be addressed through new-age training methodologies. While most of the organized players do have manuals and Standard Operating procedures (SOPs), these are insufficient to bridge the gap effectively.
Cost and Time variance: While the centers do try and give an estimate of the cost and time required for the repair, the variance between this and the actual bills can be huge. This is generally due to the incomplete information available at the time of preparing the estimate. From the consumer’s perspective, who is looking for a fair cost and time commitment, this adversely impacts his experience at the workshop.
Feedback Management: Most of the centers do not have any formal feedback management process. No formal records of feedback, action, and closure are recorded, neither are formal escalation matrices put in place. The management loses this valuable information to bring changes in the processes or take corrective actions, further impacting the consumer experience.
The current service delivery models need to undergo a radical transformation across the entire value chain. The industry needs to use cloud backed systems, analytics, and mobile apps effectively to create a delight factor for the consumers and reduce their fixed costs, thus positively impacting their revenues, profits, and cash flows.
An ideal scenario would be that the consumer raises a service request through an app. An analytics-driven artificial intelligence system looks for vehicle history, past issues, and build up different cases. Complemented by human intelligence, a draft plan, which includes a cos and time estimate, is prepared and shared with the consumer. In case of a minor repair, which does not require a visit, an Over the Air (OTA) update can be pushed to the vehicle.
For other repairs, the system checks for the parts under warranty and process the claim. In case some of the parts are not available, an order is generated. Post that, the customer is notified and the customer schedules an appointment. As a matter of fact, most of the repairs can be scheduled at the customer’s premises instead of the workshop. Once the customer accepts the appointment, a repair van is dispatched along with technicians, the parts, and other materials required for repair.
In case the customer cancels or reschedules the appointment, a GPS based zoning solution alerts other users in the area about the availability of the technicians in their area. In case someone wishes to get a repair done, the system generates an appointment and the van is routed to the customer’s location. This will help maximize productivity while ensuring optimal utilization of the resources.
Technicians are equipped with mobile apps for Augmented Reality capabilities that guide the repair process. In case they face any issues while doing the repair, they reach out to the experts at the workshop through video-conferencing. Once the repair is complete, the technician marks the job as complete and an invoice is generated by the system linked to a cloud-based finance and accounting system. The customer inspects the vehicle and pays through the app using multiple payment options.
An alert comes on the consumer's phone for a quick rating and feedback. Any adverse feedback is immediately sent to the management as per a pre-defined matrix. Instant feedback gives management access to real-time information and to take corrective actions if required.
The service centers also need to use augmented reality and digital tools for training their workforce. Self-paced learning programs delivered through their apps can help significantly bridge the productivity gap between new workers and experienced ones.
For the service centers, the movement to the asset-light model can significantly boost the operating profits and the cash flows. They no longer need expansive service centers, thus unlocking the capital held in fixed assets. It also leads to lower operational costs, lower inventory, better resource utilization, and employee productivity letting them run lean operations.
For consumers, it means additional convenience, no queues, better visibility into time and cost estimates, and more payment options. For the service centers, this translates into better customer experience and ultimately customer loyalty and repeat business.
Innovantes is a leading technology firm known for its expertise in mobile applications with advanced AR and VR capabilities, web apps, custom CRM development, and AI solutions for the automotive industry. Our solutions have enabled our clients, including global automotive Fortune 500 companies, to increase revenues, and improve operating metrics by undergoing complete digital transformation. Reach us to discuss how we can accelerate your digital transformation.