Dealer Daily: Toyota's Communication Pipeline

For Barbra Cooper, CIO at Toyota Motor Sales USA Inc., the goal was simple: to build a new communications system to help dealers sell more cars and trucks.

Cooper's goal became a reality earlier this year when Torrance, Calif.-based Toyota Motor Sales formally introduced Dealer Daily, its Web-based dealer communications system.

The new system, which replaces a legacy IBM AS/400 mainframe system, was developed over the past four years by Toyota's IT division, which is led by Cooper, in partnership with Microsoft Consulting Services, Dell Computer Corp. and WorldCom Inc. It was introduced and implemented over the last six months of 2001. Its cost wasn't disclosed.

A Toyota spokeswoman said there has been no disruption in service since WorldCom declared bankruptcy, nor does the company expect to see any.

"The truth is that the bankruptcy filing will allow WorldCom to protect its assets and continue current services while it reorganizes its debt," said the spokeswoman. "While we have developed contingency plans, we are optimistic that Toyota Motor Sales will not experience any loss in phone calls or data transfers. We are monitoring the situation closely."

Before last year, "we had a dealer system that supported our Toyota and Lexus dealers that was developed over 20 years ago and had fundamentally not changed a lot over the years," Cooper says.

The old system handled basic factory communications between headquarters and dealerships for things like parts ordering and warranty claims. But everything else had to be done through regular mail, fax and telephone, Cooper says.

So Cooper decided she needed to enhance the company's ability to deliver and receive valuable information.

Enter Dealer Daily.

Designed to improve communications between the automaker and its 1,100 Toyota and Lexus dealers, the Internet portal has increased dealer productivity by nearly 70%, according to Toyota. Because of the new system, dealers spend less time at their computers and more time selling vehicles, Cooper says.

Toyota's Dealer Daily is a large, Windows-based virtual private network (VPN) that links the dealers' management systems to Toyota headquarters or to other business units around the clock. Dealer Daily lets dealers order parts, download sales and other company information, file warranty claims and manage financing and insurance for customers online, saving millions in printing and distribution costs, Cooper says.

And with the new system, dealers don't have to waste time keying the same information into their systems and then into Toyota's corporate communications system, Cooper said.

In order to integrate the retail side of the business with the corporate, Toyota turned to three automotive dealer system providers: Automatic Data Processing Inc., Reynolds & Reynolds Co. and Universal Computer Systems Inc.

Dealers that are connected to Dealer Daily over the managed network pay a monthly subscription fee based on the bandwidth they select. Users inside the dealership access the VPN via PCs on an Ethernet LAN. They access Dealer Daily, which is password-protected, through Internet Explorer.

Using Dealer Daily, Toyota can now deliver critical news and other information instantly to any user at any dealership across the country, Cooper says.

The company can also post critical messages that need immediate attention on Dealer Daily's home page and send targeted messages to users via the system's e-mail application.

"This is a leap, not a step, from where we were. Communication with the factory is now seamlessly integrated with the dealer management system," says Ron Napoli Jr., general manager for Toyota North in Mount Kisco, N.Y.

Napoli isn't the only dealer who thinks so.

"This is a great change, and it's a really great system," says Craig Whetter, executive vice president at David Wilson's Automotive Group in Orange, Calif., which owns and operates six Toyota and two Lexus dealerships that use Dealer Daily.

Whetter says the new system not only improves communication between the company and the dealers, but it also makes training for dealers easier.

"Previously, we had separate systems that weren't Web-driven. It took a lot of training. You couldn't just sit down and get information rapidly," Whetter says. "But everyone knows how to use the Internet, so it makes the training process very seamless."

In the long term, Cooper says, Dealer Daily is part of Toyota's strategy to take time out of the supply chain.

She says Toyota is developing a build-to-order system, to be delivered through Dealer Daily, that will allow the company to immediately tell a consumer when the customized vehicle he ordered will be delivered. Toyota said that it's too early to publish a timeline for completion.

Copyright © 2002 IDG Communications, Inc.

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