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DMS Conversion Ahead? Your Dealership CPA Has a 10-Step Road Map

It may be time to switch to a DMS platform that can more seamlessly handle your team’s sales, finance, and service operations.
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Is a dealer management system (DMS) conversion in your future? If you’ve been running your business’s day-to-day with a DMS that’s no longer keeping pace with your growing dealership, it may be time to switch to a platform that can more seamlessly handle your team’s sales, finance, and service operations. But before diving into a new DMS, you need a clear road map.

Within this article, you’ll find your 10-step DMS conversion checklist to help pave the way for a smoother transition.

  1. Don’t Rush. Consider allowing about a year from the research phase to the official DMS transition day. Because dealers will want to avoid making a significant shift during their busier selling seasons, plan accordingly as to when to start the initial DMS conversion process.
  2. Choose Wisely. Like matching the right car with the right buyer, choosing the right DMS—with the capacity and functionality your team needs—is a nuanced process. Before shopping, take stock of the features on your team’s wish list. Evaluate any third-party applications you may already be using for CRM or managing inventory. After identifying the tools your team will need moving forward, check that your current third-party tools are compatible and can be integrated with the new DMS. Equally important, if the features your new DMS will offer duplicate current third-party services, revisit your contracts and make plans to cancel any unnecessary third-party applications at the right time.
  3. Draft Your Best Quarterback. Behind every smooth DMS transition is a project management pro. Select the right point person to work alongside the DMS vendor you ultimately choose to help manage the overall conversion plan and coordinate the milestones along the way. Choose the employee best able to work collaboratively across teams, convey objectives, and meet deadlines. Take other less urgent work off of their plate if needed. You will want a star quarterback to carry this project across the goal line.
  4. Dig Into the Details. Don’t assume that all of your data and custom reports will seamlessly convert to the new system. Take control of the transition by outlining what information will be converted by each department, including any necessary archived files and images. As part of this step, consider any quarterly or annual filings like payroll. Similarly, engage all levels of employees—not just management—in developing a list of custom reports you will need moving forward to fully understand what the comparable report in your new DMS will look like.
  5. Clean House. Allow time to review your current database and declutter any outdated or unnecessary files prior to conversion. Think of your DMS transition as moving to a new house. It would be a waste to pay movers to transport junk you didn’t use at the old home over to the new one. Similarly, it’s a waste of time and resources to take unnecessary information to a new DMS. Consider this the perfect time to purge!
  6. Back It Up. Save copies of all schedules, financials, and other essential data from the month before conversion. It is also best practice to save copies of all schedules the night before conversion. Experienced dealership accountants recommend these steps to spare your team confusion when some data is inevitably conveyed in a different manner in the new DMS. It’s also not uncommon to lose some details your accounting team will need as the first month of your financial data transfers into the new system. Having solid backup files before the formal transition will help ward off unnecessary post-conversion head-scratching.
  7. Prioritize Employee Training. Help set up your team for success by including  ample time for training in your new DMS contract. Limiting the budget for training will only increase the likelihood of a DMS conversion failure.
  8. Have Support on Standby. While it’s important to train everyone thoroughly on the new DMS before the conversion, the rubber will truly meet the road after the conversion is complete and your team is live with the new system. Have help on call—or better yet, on site—to address the questions that will undoubtedly arise. This kind of support will be particularly helpful the first time payroll is processed and the first month-end is closed.
  9. Manage Expectations. Even with proper training and support, your new DMS will come with an adjustment period. Performing tasks like setting up an appointment to service a car or processing payroll will become more intuitive with time. In the meantime, prepare employees, vendors, and customers for tasks to take slightly longer as your team is getting comfortable with the new system.
  10. Maintain Short-Term Redundancy. To guarantee access to data files that may be needed for reference, particularly for quarterly or annual filings, dealerships should aim to keep the old DMS active for a minimum of 30 days following the transition but, if possible, up to one year.

As with any major operational change, occasional hiccups will arise, but this 10-step checklist should help prevent a minor headache from turning into a full-blown migration migraine. Dealership consultants at FORVIS typically see clients overcome the initial learning curve within 90 days following the transition. During this time, encourage employees to provide feedback to your DMS point person so you can quickly triage any issues, and plan regular check-ins with your project manager until everyone settles into the new way of working.

How FORVIS Can Help

If you’re seeing a DMS conversion on your auto dealership’s horizon, the knowledgeable professionals in our Dealerships Practice can help answer your questions as you create a custom conversion plan using your checklist from FORVIS. For more information or assistance, please reach out to a professional at FORVIS.

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