4 ways construction equipment dealers can be smart about digitalisation

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As if they didn’t have enough to keep them awake at night, many off-highway dealers and distributors are under pressure from customers and manufacturers to improve performance and digitalize their business processes.

While most agree this would be a ‘nice to have’ the reality is that this is easier said than done.

The iterative way in which many dealers’ IT systems have evolved over time means that rather than to be an enabler, the tech can become an obstacle to future growth.

This is due to a lack of features, their inflexibility, cost of maintenance, cumbersome nature – the list goes on.

Throwing all these systems out often isn’t an option – and so many dealers are looking to adapt new technologies to solve their own internal IT issues, be more efficient – and ultimately better serve customers and equipment in the field.

Fortunately, this situation is sufficiently commonplace that solutions to help dealers/distributors digitize their businesses are so plentiful that the challenge isn’t finding one – but choosing the right one.

Technology is jargon and acronym filled, complex and the landscape is moving fast, while dealer inhouse capacity and competence is scarce.

Of course, every business has their own unique starting point and challenges, but while accepting this, below are a four general pointers that our experience tells us are worth taking notice of by dealer business management.

1) Decide what needs improving

Before starting your digitalization ’journey’, take a breath and look at your business today and assess with a clear head where realistically you want to be tomorrow; where are today’s pain points and tomorrow’s improvement areas.

Ask yourself: ‘How can I better support my customers?’ and ‘What new services should I create and offer?’ Try not to be dazzled by the tech or outrageous promises of all-encompassing ‘platforms’ – focus with laser-beam intensity just on business added value.

Develop a clear, rational step-by-step digitalization plan that focuses on implementing technology that accelerates business value at a pace and sequence that makes sense for you.

2) Pick the right tool for the job

With so many to choose from – and all sounding like the best thing since sliced bread was invented – selecting the right tool can be a daunting task.

It may sound simplistic but simply listing your specific business requirements is surprisingly helpful – which you then can use to benchmark your potential solutions.

It can evaluate not only the potential new solution but also the potential implementation partner.

Dealers are experts in the construction industry and its products, not necessarily in new IT technology.

Therefore, it’s important that dealers find partners they trust and have confidence that they will remain steadfastly by your side before, during and after the implementation.

Choose a suboptimal digital solution and business will soon hit a wall, often resulting in costly and imperfect adaptations to the software to incorporate missing demands.

Choosing an optimal system but implementing it badly is just as bad.

It can jeopardize the expected benefits and lead to increased costs, missed business opportunities and loss of trust, internally and externally. But don’t be disheartened!

3) Tech is really not that scary

Not normally renowned for being early adopters of new technology, the construction industry is now in a phase of digital transformation.

For dealers and distributors, this means new expectations and needs coming from two directions – on the one hand customers demanding new product solutions and on the other, OEM partners requiring the implementation of modern business processes.

In this vice-like pinch point, dealers have to create new services and accept new tech-based processes in order to stay in the game, let alone be competitive.

And this trend will only accelerate – meaning that the sooner dealers get their IT platforms up to date the better they will be able to embrace new tech.

AI and machine learning in particular hold the potential to revolutionize multiple areas of dealers’ businesses, such as automating sales and service processes to truly proactive and preventive maintenance services.

4) Implement smart

When planning projects, small incremental steps is often lower risk/stress than going for a ‘big bang’ wholesale upgrade approach.

Getting traction and business value introduced early, even if in an limited scale, will help you draw conclusion for next phases, as well as fostering confidence, energy and enthusiasm within the organization.

Whatever the scale of the project, any implementation phase requires solid project management and a core team with the competences and ‘can do’ mindset to identify and solve problems quickly, and without causing rebellion within the business.

A clear plan and process around how the project is managed, led and change communicated is vital, and will determine how effective the organization adopts the new dealer business system.

In upgrades such as this it’s easy for the technology itself to become the most important thing. It isn’t. The benefits to the business is what is critical -  technology is merely the enabler.

Hans Iredhal is executive partner of the commercial vehicle advisory practice abcg.