Peterborough, Ontario -- January 22, 2017 -- Executive Vision focuses on discussions with key players in the auto claims economy. Darryl Simmons, Publisher of Collision Repair magazine, sat down with Debbie Day and Jack Rozint of Mitchell to discuss Mitchell’s new parts procurement solution, Mitchell Parts powered by uParts, and the trends impacting the industry today and in the future.
Collision Repair magazine: Mitchell's philosophy is to embrace technological change in order to best serve their customers. So with the acquisition of uParts, how will this be delivered?
Debbie Day: Mitchell is 70 years old this year, and we're built on the auto physical damage from all that time ago. What's still the case is that Mitchell is about empowering better outcomes. By that, we mean a varied set of stakeholders -could be the carriers, could be the repairers, it could be the parts providers. With uParts, it's really significant because it can be used by any shop, on any part, for free, and it will help the repairer workflow, instead of creating friction.
Jack Rozint: There have been so many attempts to automate parts procurement, going back to the ‘90s, when some of the first electronics parts procurement programs started showing up, and virtually all of them have fallen short of expectations because of their inability to work on every transaction, every day. So, there's one solution that works great on OEM parts, one that works great on aftermarket parts, there's one solution that's mandated by a certain insurer but the shops don't like it, the suppliers don't like it. There are all of these different procurement networks out there, and none of them is really taking hold.
We built a strategic alliance with uParts because they have a platform that's based in the cloud. It’s completely device independent and can work with anybody using any software. It works with every single part type reliably, and it does so on a level playing field. It doesn't give one supplier of one type of parts an advantage. It allows the repairer to make a decision, aided by the intelligence of the system, on that particular repair.
That "particular repair" is a certain type of vehicle for a certain insurer, who may be on a DRP program or not. The system is intelligent enough to base the parts suggestion it will make to the user, to say "this bundle of parts is going to work best for you, because we've got all of your preferences loaded in." The repairer can then look at that, push a button and all the parts orders go off with a single click. It works with every supplier of every type of part, and it brings significant efficiency to both the suppliers and the shops. It's the first system we've ever seen that does all of that. We think it's really going to change the game.
DD: We looked a long time at this, and we're making a very deep integration. It's actually going to be embedded in four different Mitchell solutions: the estimate itself, it's going to be in RepairCenter, it's going to be embedded in our analytics and our connectivity, and our next generation estimating, which is all going to be in the cloud. We took some time to evaluate it to make sure we got the integration right. We'll be rolling out first in southern California, then elsewhere.
CRM: So we will be getting this in Canada?
DD: Yes! It's funny you should say that.
JR: When we came out of our recent conference, where we had our customer advisory council, and some of our top Canadian customers literally walked out of the room and grabbed me and said "We want this in Canada."
CRM: This sounds like once again it ties into your philosophy of working with technology. How will you adapt to other trends in the industry? It's not just change, it seems like there's a revolution at stake.
DD: I'm going to pick out a few of the trends that we think are really significant. One is that mobility is a must. Every consumer is walking around with a camera right now, taking photos, and getting that integrated with first notice of loss and making a better dispatch, whether it be to a staff appraiser or total loss or repair. That gives us a lot more intelligence.
The second one is consumer self-service, or the role of the consumer who wants to initiate a claim and be kept apprised of status. That's big.
The third is the idea that machines help humans, the idea of artificial intelligence. You might have seen the announcement we made with a company called Tractable. The idea here is, just via photos, machines can assess damage. We're going to start with this technology in the review function. A human writes the estimate, but before you commit it, you have the machine take a look. It will make recommendations, like saying "maybe instead of repairing that, you could replace it," or vice versa. And the machine will start learning. The idea of incorporating machine learning into a human intensive system is very exciting. We've been working hard on that.
CRM: So the machine intelligence will get better with each estimate, and self-correct?
DD: Exactly. It's funny, but Tractable was only looking at a few industries: oil and gas, biotech and insurance claims. They believe there's so much opportunity, and when I think about the industry, frequency is up, severity is up and we've got to do more with less. The pressure to perform is high. It can help the insurers, the shops and the consumers, all the way through the shop.
JR: The first trend that comes to my mind is the increasing complexity of vehicles. That's a problem that's not going away. Every year it's more and more of an issue. From the adaptive cruise control, to the 360-degree cameras, to just more and more technology. A mirror replacement these days is actually a computer repair job along with replacing the part. That complexity is a challenge for repairers. As information providers, we've got a very good product called TechAdvisor that has a lot of repair information. We're looking at how we can get that information more integrated into the workflow, so that as you're developing the estimate and repair plan that all the information is at your fingertips so you can make better decisions, whether they're just developing the estimate or actually fixing the car.
It's fairly apparent today that it may no longer be a world where every shop can fix every car. That leads to questions about what kind of intelligent dispatching tools might be needed in the future, so that when you have a Ford F150 that's been in a rollover, you have to get that vehicle to a facility that has aluminum repair capabilities.
That leads directly to my next major trend, and that's the increasing influence of the OEMs. For years they were selling parts into the collision process, but pretty much staying out of the operations part of the industry and not really interacting much with the consumer aspect of collision repair.
You see that changing now. You see the OEMs getting more active. If a consumer has a bad experience with a collision repair, it taints the brand.
Therefore it affects the opportunity to sell a customer another vehicle of that brand. They still have a desire to sell parts, of course, but overriding that is the protection of their brand equity by making sure repairs are completed effectively. We work with a number of OEMs in how they integrate their information, procedures and methodology to help the repairer get that vehicle returned to the safety and function it had when it left the factory.
CRM: Along with that, would there be the advanced triage that you've been working on with Toyota? For example, if the sensors report that the car has been hit in the right quarter, so therefore send all the parts for a right quarter?
JR: Where the car itself, through telematics, is informing another party of the parts needed for the repair, that's still a bit down the road. But we do have a very close relationship with Toyota and their certified collision repair program, and the specific Toyota estimating template lets you get very quickly to an estimate. Instead of the old way of building an estimate, where you start with a blank sheet and build it line by line, you now select the damaged area of the vehicle on the Toyota template, and you actually get a complete estimate with just a couple of clicks. You can deselect the parts that aren't damaged. It's a whole new methodology of estimating that's proven very effective.
The other thing that's really effective about that, is it puts the Toyota repair procedures right into the process. You're not going out of the estimating system and going to another computer screen and looking up Toyota's Technical Information System to find the procedure you need or to find out if a part is reusable or not. In that template, it's telling you "that windshield nozzle can't be reused" and you can make a good decision on the first estimate, rather than having to submit a supplement.
CRM: It seems like there's a lot of stuff coming up for Mitchell's 70th birthday. Where do you see yourselves in the next 70 years? What can we expect from Mitchell in 2086? Where will we be even in 2020?
DD: I love technology and I heard something last week that fascinated me. Our grandchildren are going to look at us with our smartphones, and say "Look how cute you were." I think one thing that will always be with us, no matter how technology advances, is that you're going to want to take care of that consumer. You're going to want a proper repair and make sure that it's safe. There's going to be tons of technology that emerges and the OEMs are going to continue to make cars smarter. The cars are going to start to tell us what's wrong with them, the same way we tell the doctor, "Hey, my left front quarter panel hurts."