ASP DMS's
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ASP DMS's
by jdaniel » Fri Feb 08, 2002 9:15 am
We haven't migrated to an ASP, and aren't likely to- for several reasons:
Data migration and ownership concerns- it is a lot easier to convert data from one vendor to another if it lives on a box in-house.
Reliability- with the nonsense going on in the telecom world I have serious connectivity concerns.
Cost- this is new technology for most players in this industry and they always charge a premium for new technology.
Data migration and ownership concerns- it is a lot easier to convert data from one vendor to another if it lives on a box in-house.
Reliability- with the nonsense going on in the telecom world I have serious connectivity concerns.
Cost- this is new technology for most players in this industry and they always charge a premium for new technology.
- jdaniel
ASP DMS's
by Matt Parsons » Mon Feb 18, 2002 5:02 pm
I have to refute all of the points made by Jdaniel. There is really no issue with converting data from either a box located at a client's location versus at a central hosting environment. Data is data, and in fact, we are probably in a better situation to run conversions on boxes that are backed-up nightly and have dedicated IT personal maintaining them 24/7/365 than a box that is located a clients locations.
Secondly, I understand the concern you have with reliability...that is why you have to have confidence in the vendor you choose to host and deliver critical business applications. We at EDS sign up for very stringent service levels agreements that ensure our clients know exactly what they will receive. We monitor these metrics and report out to ensure our clients are fully aware of where we stand at all times. In addition, we often are the prime in deals meaning we stand in-front of the telco and guarantee their services - thus our clients only have 'one throat to choke' as they say.
Thirdly, this is not a new technology in this business (automotive retailing) or any other. This is old technology that is enhanced with new capabilities. EDS has been providing ASP solutions for clients for 40 years. We do not charge premiums for this offering unless customers wish to choose premium servicing levels (we have many servicing levels which allow the client to choose what is required for their business operations). From a DSP perspective, we see that the migration to an ASP will enable dealers to reduce their DSP related expenses by 30%-50% on average.
Secondly, I understand the concern you have with reliability...that is why you have to have confidence in the vendor you choose to host and deliver critical business applications. We at EDS sign up for very stringent service levels agreements that ensure our clients know exactly what they will receive. We monitor these metrics and report out to ensure our clients are fully aware of where we stand at all times. In addition, we often are the prime in deals meaning we stand in-front of the telco and guarantee their services - thus our clients only have 'one throat to choke' as they say.
Thirdly, this is not a new technology in this business (automotive retailing) or any other. This is old technology that is enhanced with new capabilities. EDS has been providing ASP solutions for clients for 40 years. We do not charge premiums for this offering unless customers wish to choose premium servicing levels (we have many servicing levels which allow the client to choose what is required for their business operations). From a DSP perspective, we see that the migration to an ASP will enable dealers to reduce their DSP related expenses by 30%-50% on average.
- Matt Parsons
ASP DMS's
by doc » Tue Feb 19, 2002 3:06 pm
Matt, I'll have to agree with you on some parts. Data migration is data migration. What you can do here, you can do there. Fairly cut and dry.
Reliability - Well ASP wins by its design alone. Most systems are going to be housed in, well lets just say a server farm. Meaning many servers to fall back on in the event yours fails. That SHOULD result in less downtime.
However, reduce DSP expenses 30-50%. Sounds good, but what costs are we looking at. Setup Fees, Contract Terms, Monthly Fees, License fees, user fees???
I've seen some of these prices and they do not seem to be that much cheaper.
And what about budget increases that the average dealer will have to make toward internal technology improvements to handle the new ASP technology. Wouldn't most dealers have to upgrade their current systems from green screens (dummy terminals) to pc's with Internet access? By adding more users to the Internet in your store then you start having to consider bandwidth issues. Wouldn't you agree? I mean you better add some broadband connections and fast or every department is going to be running real slow. And Dial-up Internet accounts just are not feasible on this platform. Last thing you want is to be financing a deal and waiting because your connection speed is too slow.
Don't take me the wrong way. I support to the new platform and believe it to be the best path for most dealers for DMS cost, data integrity & reliability. But I am also aware that many dealers are still running most of their systems on dummy terminals. So dealers also have to account for the costs to upgrade their own equipment, and then hire Staff/Service to maintain that equipment. Then weigh that to savings that ASP offers.
I just think that many of todays dealerships are just not ready for this move. For the ones that are equipped well then they'll be ahead of the game. For any dealers with IT staff, well they could end up being your best commodity during this decision. Not only in helping understand the requirements and plan for the implementation, but also in negotiations. They can help explain to the dealer what these companies are really proposing. They can help translate some of the tech jargon thats commonly used to confuse and mislead.
Wouldn't you agree!
Reliability - Well ASP wins by its design alone. Most systems are going to be housed in, well lets just say a server farm. Meaning many servers to fall back on in the event yours fails. That SHOULD result in less downtime.
However, reduce DSP expenses 30-50%. Sounds good, but what costs are we looking at. Setup Fees, Contract Terms, Monthly Fees, License fees, user fees???
I've seen some of these prices and they do not seem to be that much cheaper.
And what about budget increases that the average dealer will have to make toward internal technology improvements to handle the new ASP technology. Wouldn't most dealers have to upgrade their current systems from green screens (dummy terminals) to pc's with Internet access? By adding more users to the Internet in your store then you start having to consider bandwidth issues. Wouldn't you agree? I mean you better add some broadband connections and fast or every department is going to be running real slow. And Dial-up Internet accounts just are not feasible on this platform. Last thing you want is to be financing a deal and waiting because your connection speed is too slow.
Don't take me the wrong way. I support to the new platform and believe it to be the best path for most dealers for DMS cost, data integrity & reliability. But I am also aware that many dealers are still running most of their systems on dummy terminals. So dealers also have to account for the costs to upgrade their own equipment, and then hire Staff/Service to maintain that equipment. Then weigh that to savings that ASP offers.
I just think that many of todays dealerships are just not ready for this move. For the ones that are equipped well then they'll be ahead of the game. For any dealers with IT staff, well they could end up being your best commodity during this decision. Not only in helping understand the requirements and plan for the implementation, but also in negotiations. They can help explain to the dealer what these companies are really proposing. They can help translate some of the tech jargon thats commonly used to confuse and mislead.
Wouldn't you agree!
- doc
ASP DMS's
by jdaniel » Tue Feb 19, 2002 4:54 pm
In rebuttal-
If it is less expensive on your platform that's great (and as it should be), but the industry as a whole is still charging a premium for ASP solutions. Don't believe me? Ask Paul Gillrie.
As far as data conversion, my point is that if I have a battle with my provider and they pull my data off-line there is no way to access it without a lawsuit, much less convert it.
And no, this isn't a new idea in general or in DMS circles, but the big push is new in the DMS arena. As far as ASPs in the IT world at large, the past few years have seen enough go down the tubes to give me pause.
SLA from a telco? Means nothing when the bankrupty judge denies chapter 11 and forces liquidation. 45 days to drop a fresh T in the suburban Boston market right now.
That said, it is a great idea which has many advantages and has worked well for many companies in numerous industries- but a healthy dose of skepticism is probably wise. What do I know of the IT world at large? Enough to hold MCSE+I and CCNA certifications, among others.
------------------
Jack Daniel, MCSE+I, CCNA
If it is less expensive on your platform that's great (and as it should be), but the industry as a whole is still charging a premium for ASP solutions. Don't believe me? Ask Paul Gillrie.
As far as data conversion, my point is that if I have a battle with my provider and they pull my data off-line there is no way to access it without a lawsuit, much less convert it.
And no, this isn't a new idea in general or in DMS circles, but the big push is new in the DMS arena. As far as ASPs in the IT world at large, the past few years have seen enough go down the tubes to give me pause.
SLA from a telco? Means nothing when the bankrupty judge denies chapter 11 and forces liquidation. 45 days to drop a fresh T in the suburban Boston market right now.
That said, it is a great idea which has many advantages and has worked well for many companies in numerous industries- but a healthy dose of skepticism is probably wise. What do I know of the IT world at large? Enough to hold MCSE+I and CCNA certifications, among others.
------------------
Jack Daniel, MCSE+I, CCNA
- jdaniel
ASP DMS's
by Matt Parsons » Wed Feb 20, 2002 7:33 am
Jack, I fully understand your concerns.
I do have a question however, what type of firm holds a customers data hostage? If EDS did this in support of our clients we would be out of business! I can't imagine a scenario where this would or could happen in our company.
In relation to Telco's it all depends on who you pick and why. This is a perfect case of you get what you pay for. There has been a great deal of churn in the Telco industry, and that is why we have strategic alliances with tier 1 providers, and avoid the fly-by-night start ups like the plague. In addition, when EDS is prime we GUARANTEE the delivery of services to our customers. This means, if any elemenet of the solution was to fail, we are responsible to replace/repair and are still responsible to hit the Service Level Agreements in place for the customer. Thus if we have selected a telco solution and they go out of business or are not delivering to our standards, we repair or replace them - immediately. That is the power of a company like EDS - a pure play provider that is a leader in Information Technology and Information Services on a global basis - across every industry you can imagine, not just automotive.
Ultimately the IT world for most dealers is going to migrate to an ASP environment. In fact most OEM's (who are arguably the lastest provider of applications to dealers) have been operating this way for years. Many of the DSP providers have started to move or announced moving to this format. And keep in mind, that many stores across the country have operated under an internal ASP model - if they are a remote store to the host store (where the CPU sits) they have been in essence operating their own version of ASP with Telco's in the middle, etc. This move to offer a complete ASP model from providers like EDS and others significantly reduces most dealers risk when it comes to IT management and places it where it belongs, on IT providers.
I do have a question however, what type of firm holds a customers data hostage? If EDS did this in support of our clients we would be out of business! I can't imagine a scenario where this would or could happen in our company.
In relation to Telco's it all depends on who you pick and why. This is a perfect case of you get what you pay for. There has been a great deal of churn in the Telco industry, and that is why we have strategic alliances with tier 1 providers, and avoid the fly-by-night start ups like the plague. In addition, when EDS is prime we GUARANTEE the delivery of services to our customers. This means, if any elemenet of the solution was to fail, we are responsible to replace/repair and are still responsible to hit the Service Level Agreements in place for the customer. Thus if we have selected a telco solution and they go out of business or are not delivering to our standards, we repair or replace them - immediately. That is the power of a company like EDS - a pure play provider that is a leader in Information Technology and Information Services on a global basis - across every industry you can imagine, not just automotive.
Ultimately the IT world for most dealers is going to migrate to an ASP environment. In fact most OEM's (who are arguably the lastest provider of applications to dealers) have been operating this way for years. Many of the DSP providers have started to move or announced moving to this format. And keep in mind, that many stores across the country have operated under an internal ASP model - if they are a remote store to the host store (where the CPU sits) they have been in essence operating their own version of ASP with Telco's in the middle, etc. This move to offer a complete ASP model from providers like EDS and others significantly reduces most dealers risk when it comes to IT management and places it where it belongs, on IT providers.
- Matt Parsons
ASP DMS's
by Matt Parsons » Wed Feb 20, 2002 7:55 am
Doc - you have hit on an excellent point which is the internal infrastructure within the dealership itself. All of the analysis we have done does assume that the dealer will need to incur the fee of ensuring their facility has the proper infrastructure (TCP/IP connectivity, PC's, a robust and persistent network/internet connection). As you have clearly pointed out, many stores do not have the minimal backbone in place - TCP/IP LAN - and this is quickly becoming a requirement for operating in today's world. Assuming that the dealer needs to do a technology refresh at some point over a 5-year period, and including that in the ASP model, we show 30% to 50% reductions. And that analysis did not take into consideration any of the soft costs that a dealer has such as some percentage of someones salary to maintain systems in the store today or if they happen to have any special physical requirements to support their in-house environment, etc. What we did look at (and have hundreds of times) is all of the hard dollar costs - because at the end of the day, this is what really counts. The one item not included is the network connection as this varies by solution, but it reasonable to think that most stores require connectivity that ranges in the $550 to $750 per month (VPN, at least 128K, managed router, etc.). Even with this charge in place, which keep in mind may well replace current telco charges the dealer is incurring for connectivity to their OEM or DSP or individual internet accounts, etc. still would show a cost savings to most dealers of at least 25% to 35%.
As a last point of interest, as we are migrated one of largest clients to an ASP model, it is not required that they have TCP/IP and PC's. This does limit their ability to take advantage of newer functionality such as email, document imaging, and any PC based application like CRM, but it does not stop a person from accessing the core applicaitons from a dumb terminal such as Sales, Service, Parts, Accounting, Payroll....
We have taken this approach in that dealers need to make the decision as to what functionality they require at which desktop, and then we can assist in understanding what technology is required to support that business function. Evolution versus revolution is always appreciated by dealers, this way they can wring as much out of their current IT investment versus artificially end-of-lifing products and technologies.
Last but not least, keep in mind that ASp priced on a per seat basis allows dealers to control their spend in terms of ramping up and down. Seats are very easy to add - call up, specify what applications are needed, ID's get turned on, ready to go. In addition, if the dealer downsizes an area, the reverse is true. We see contracts in the ASP model as very different in terms of term (length of contract) and we have explored literally month-to-month. The dealer would need to pay for upfront things such as training, implementation, any installation of equipment needed in the store etc., but even the PC's can be leased to lessen the upfront outlay on a device.
I don't know about you, but I can't wait until the entire IT environment for dealers moves to this model and gives them greater choice and flexibility at lower costs.
Hope this helps.
As a last point of interest, as we are migrated one of largest clients to an ASP model, it is not required that they have TCP/IP and PC's. This does limit their ability to take advantage of newer functionality such as email, document imaging, and any PC based application like CRM, but it does not stop a person from accessing the core applicaitons from a dumb terminal such as Sales, Service, Parts, Accounting, Payroll....
We have taken this approach in that dealers need to make the decision as to what functionality they require at which desktop, and then we can assist in understanding what technology is required to support that business function. Evolution versus revolution is always appreciated by dealers, this way they can wring as much out of their current IT investment versus artificially end-of-lifing products and technologies.
Last but not least, keep in mind that ASp priced on a per seat basis allows dealers to control their spend in terms of ramping up and down. Seats are very easy to add - call up, specify what applications are needed, ID's get turned on, ready to go. In addition, if the dealer downsizes an area, the reverse is true. We see contracts in the ASP model as very different in terms of term (length of contract) and we have explored literally month-to-month. The dealer would need to pay for upfront things such as training, implementation, any installation of equipment needed in the store etc., but even the PC's can be leased to lessen the upfront outlay on a device.
I don't know about you, but I can't wait until the entire IT environment for dealers moves to this model and gives them greater choice and flexibility at lower costs.
Hope this helps.
- Matt Parsons
ASP DMS's
by doc » Wed Feb 20, 2002 3:53 pm
I couldn't agree more. As soon as the Automotive Industry moves to this platform, many new opportunities will arise to the dealers in the form of Marketing and data management/retrieval that they have not seen before.
My biggest fear will be that many dealers will not take the advice to fully prep themselves. Nickel & Dime the tech upgrades/connectivity essentially creating a negative outlook on the systems wishing they had never changed. If personnel within a dealership start thinking that way then they will most likely not take the time to learn the system well enough to get every bang for the buck spent. But eventually I believe this will be an excellent move for the dealers & the Industry as a whole.
My biggest fear will be that many dealers will not take the advice to fully prep themselves. Nickel & Dime the tech upgrades/connectivity essentially creating a negative outlook on the systems wishing they had never changed. If personnel within a dealership start thinking that way then they will most likely not take the time to learn the system well enough to get every bang for the buck spent. But eventually I believe this will be an excellent move for the dealers & the Industry as a whole.
- doc
ASP DMS's
by jdaniel » Wed Feb 20, 2002 4:55 pm
Matt- not being an EDS customer I'll take your word for the commitment and performance guarantees. Maybe I'll let an EDS sales weasel (excuse me, account executive) give us a pitch and hear what they have to offer. And I'm assuming you know the answer to your question, but I will not answer it in a public forum- I'll take that offline. Thanks for your follow-ups.
------------------
Jack Daniel, MCSE+I, CCNA
------------------
Jack Daniel, MCSE+I, CCNA
- jdaniel
ASP DMS's
by Ted@ADP » Wed Feb 20, 2002 8:27 pm
Doc, FYI, green screens can still be used with ASP via a terminal server. I imagine that the PC initiatives manufacturers and vendors are introducing will eventually make it worthwhile to upgrade green screens to PCs or Windows Based Terminals anyway.
Ted
Ted
[This message has been edited by Ted@ADP (edited 03-14-2002).]
- Ted@ADP
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