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Part 7 – Aftersales: Parts vs Service

By October 20, 2014February 6th, 2017Think Tank

For the past couple of articles in this blog series, we have been discussing a topic that’s important to our customers: customer retention. In the last article, we stressed the importance of automakers and dealerships needing to work together in order to have a collaborative partnership and set a standard Aftersales process to boost customer retention.

In this week’s blog series, we explore how having separate Parts and Service departments may lead to a fragmented Aftersales department, and how inconsistent service and differing information from both departments may lead to confused and unsatisfied customers. Thus, we recommend that dealerships break down the walls between the two departments, and start working collaboratively to achieve their dealership goals.

“There is efficiency in having no distinction between parts and service. At the moment already we strongly recommend the dealerships not to have a separate partnership account but just one Aftersales account. Also, we recommend that they would not have a part manager. It’s the service manager that has some part guys and has some workshop guys.”

Starting from Now

Automakers understand that from customer retention and productivity perspectives, collaboration between Parts and Service departments is vital. However, teamwork and process efficiency between the two departments has traditionally been difficult to achieve, often to the detriment of productivity and customer retention. Differences in the way the departments are compensated results in parts and service teams working in isolation or sometimes even competing against each other. This can result in fragmented and inconsistent Aftersales processes.

When Parts and Service departments are separated rather than unified, the opportunity to provide an efficient, homogenous interaction for customers can be missed. A customer or service advisor may have to call two different departments to get a complete and accurate price quote, or they may speak with a member of one department who doesn’t have the latest information from another department. Aftersales personnel expend energy and time walking or calling between departments. These types of situations contribute to a poorer quality customer experience.

Aftersale Parts vs Service

Vision of the Future

In 2020, the drive to improve this situation will result in the alignment of Aftersales functions, with parts and service processes consolidated under a single, unified department and system. Greeting the customer, performing the vehicle health check, preparing a quote, pricing parts, and ordering will be the responsibility of a staff person, who will provide personalised service and develop a longterm relationship with the vehicle users. Parts trade customers will directly place orders using EPC systems provided to them, which will support human and device input.

“Parts and service process needs and has to be fully integrated in the future. One cannot survive without the other. You can’t have a service department without the parts and parts can’t function without the service. If they understand that, they have to become part of the same team.”

Under a unified Aftersales department and system, automakers will use progressive inventory logistics, including multiple part deliveries to the dealership and their trade customers per day, to reduce cycle times and eliminate fixed overhead, such as the cost of financing and storing parts. With increased automation coming from telematics and internet-cloud connectivity, the service and parts requirements will be more predictable and need less human involvement to diagnose, price, and authorise service work.

The alignment doesn’t stop at parts and service — in 2020 the Aftersales process will effectively encompass the dealership’s sales team and strategic application. A more engaging dealership experience before entering the workshop positively impacts the customer. Customers will have better exposure to the new car showroom, be more inclined to take interest in new models, and have the opportunity to discuss their ownership experience with the sales person who sold them the vehicle.

Bridge to the Future

Parts vs Service AftersalesThis unified approach will have been driven by both automakers and dealerships. Automakers will have created incentives to facilitate closer partnerships and build best-practice methodology into dealership agreements. They will have also partnered with logistics specialists to provide rapid parts delivery, and with technology providers who can deliver information systems that allow synergies to be realised between parts and service solutions. Specialist domain knowledge will be transplanted into ready-to-use customer engagement software. These will quickly understand customer needs, offer more relevant information, and sell additional parts and service to existing and new customers.

Success will also come from transforming the way parts and service leaders manage their resources and their perception of the customer. Dealerships will invest in training their staff to be sales people in addition to interpreters or account clerks. Everyone in parts and service will be capable of assisting customers at every touchpoint. From a technology perspective, ready-to-use information and advancements in portable devices such as tablets, and dealership infrastructure such as wireless systems, will provide the operational flexibility required for a consolidated Aftersales approach.