In the interview part II: Marco Loth and Markus Leister from TMD Friction
In his role as Vice President, Marco Loth is responsible for category management, global data management, pricing, sourcing and engineering. He is also responsible for sales in the Asian region. Markus Leister heads the “Global Data” unit. A key aspect of this unit is the maintenance and processing of catalog data. Together with Jürgen Mehlis, EVP Data Manager Product at TecAlliance, we talked about the growing importance of data quality in a rapidly developing market and constantly increasing customer requirements.
The automotive aftermarket is a very competitive market where not only the speed but also the timeliness and accuracy of data is important. As a market expert, we understand the challenges this presents to the aftermarket community and are delivering an evolution in data delivery with Instant Data Processing (IDP). With IDP, we are significantly changing the world of data distribution. The time-consuming process of data transmission is transformed into a real-time process thanks to IDP. The new interface allows data suppliers to update and transmit their catalog data in real time. In just a few seconds, all data that has been transferred via IDP is integrated and published in the TecDoc Catalogue, Web Service and Web Shop. We thus enable the market worldwide to always work with the latest and most accurate data.
Jürgen Mehlis: When you think about the topic of “data quality” and how work is done in this area. What significant changes do you notice over the last 10 years?
Marco Loth: On the one hand, we of course have a completely different flood of data than we did 10 years ago. On the other hand, we have the situation with the vehicle manufacturers, who don’t really make it easy to access and process the data either. It is also becoming more complex to access certain data. We are very well positioned there with TecAlliance on our side. We have good data coverage, but the vehicle manufacturer’s aim is of course to keep the aftermarket preferably out of the loop.
In addition, we also want and must fulfill many more country-specific requirements. Now, in the first part of the interview, I only mentioned China and Brazil, but there is also Russia or Australia, each of which works with completely different systems and requirements. Then we have the additional challenge that when a customer discovers an incorrect item, he obviously wants to see it corrected online within an hour. That’s why we also changed from quarterly updates to monthly updates to the current four updates per month. These are demands that must be placed on our teams. We need to update our databases in a timely manner so that we can then provide the data to TecAlliance quickly. Ultimately, it helps us to offer this service to our customers. Especially in the case of TMD Friction with our four premium brands Textar, Nisshinbo, Cobreq and Bendix, the customer also expects us to provide a premium service. Therefore, for these premium brands, for example, the data status and the update must also be at an absolute premium level, and this means in a timely manner. This makes the work in the teams, which are scattered globally but access a standardized database, very complex. Because we must feed from different sides and make sure that everyone has the latest status of the database.
Jürgen Mehlis: So that means IDP, our Instant Data Processing, pays off exactly what you just described?
Marco Loth: Yes, absolutely.
Markus Leister: We are one of the companies or data suppliers that really deliver data almost every time. In the last two years, we have skipped exactly one data delivery each time. This was always the one after Christmas, which is on January 2. The data that we would deliver between December 25 and January 2 would not change due to the Christmas vacations. This is also exactly the point that shows that we are doing everything we can with the means currently available to have the appropriate data quality in the market. And it is an advantage that our updated, new data are live and online in the TecDoc Web Catalogue after a maximum of 6 days.
Marco Loth: This is quite crucial in our growth markets like China. We update the WeChat data in parallel with the TecDoc data submissions.
Markus Leister: Here we have now worked out a solution together with the TecAlliance partners in Shanghai, with which we have updated the data within one working day. That is a very big advantage from my point of view, because the data is simply available very quickly.
Marco Loth: That is a huge step forward that we have made there. But that is also the market requirement in China. The Chinese don’t want to wait two days.
Jürgen Mehlis: Customers report an error and expect it to be corrected in the system at the same moment. We observe this in exactly the same way. IDP will also be able to do this in the future and will be able to support precisely these processes. We are right on target here and have caught the pulse of the times. This also plays into the topic of data quality. It is not only a matter of improving the content, but also of immediately communicating to the market what has been improved or even newer products. That is data quality!
Marco Loth: Exactly. It’s about the service we provide to customers.
Jürgen Mehlis: Now we have talked a lot about the increasing complexity with regard to data quality and how market developments influence this complexity. What direct effect do you see this having on your business?
Marco Loth: First of all, we try to cover the complexity by investing in the structure, i.e. in databases, in employees, employees on site. The effect is quite simply that we have also been able to gain customers as a result. Because the customers know that the data fits and if an error occurs, TMD Friction is ready to take care of it and correct it quickly. There will never be a 100% error-free database. Every company will find an error in their database. In the past, it just took a month or two to correct it. Such a long correction time was of course very inconvenient for the customer. Now, with the new update frequency, customers see that we respond directly to their comments. We fix the error they reported within a couple of days. In China, for example, the customer is quick on his feet. He goes into WeChat, looks in the catalog, clicks on a part and sees directly whether it has been adjusted or not. We have also received a lot of feedback from customers in China on how we can adapt the interface so that it is easier for them to find the information they really want to see quickly and easily, right through to the workshop. This means that the visual appearance was adapted with our colleagues from TecAlliance in China. So that the data that the customer wants to see at the dealer level or in some cases at the workshop level can actually be seen at a glance in the catalog, i.e. on the cell phone. Accordingly, we have then also adapted the format. And we have already received positive feedback on this from many customers. You can feel that, too, because otherwise we wouldn’t have the growth rate we have today. You can only achieve that if you have the databases and the catalog data in the background. Particularly in China, with 20 million new vehicles a year plus cars that may not run as well in Europe. This is then developed for the market by the TecAlliance team and our local team. That’s why I think local teams are very important, also from the TecAlliance side. Especially in growth markets like Asia, but also Brazil, Mexico or Russia.
Jürgen Mehlis: It is particularly important to TMD Friction to make the work of its customers as simple as possible. This means easy processes and good data quality, which can then be used to ensure that the customer can identify his parts unambiguously and, above all, quickly. What other advantages do you see in good data quality?
Marco Loth: As TMD Friction, in addition to the high data quality and the product range offered, we have also made it our business to cover new vehicles relatively early. As soon as a vehicle is available, TMD Friction directly tries to bring the pads and brake discs to the market. From that point of view, the research in the background, which is partly done by our team in Romania, is also of enormous importance. We want to make sure that when we have a new part in the range, it is also directly available to the customer. It’s great if we have a new part for a BMW 5 Series in our range, for example, but that’s no use if the customer can’t find it anywhere. That’s why it’s important for us in the ‘new to range’ division to make this data directly available to the customer. At TMD Friction, we have what is called a ‘first-to-market policy’. This year, we have already launched a number of first-to-market parts on the market, i.e. parts that no one else is offering at this point in time. We are also evaluating this based on TecDoc analyses.
Jürgen Mehlis: What is the other side of the coin? From your point of view, what are the dangers and risks that result from poor data quality?
Marco Loth: I think everyone has already made their own experiences. Poor data quality means loss of trust. The customer relies on the data we show in the catalog. He orders the part accordingly and passes it down the chain to the workshop. And then the mechanic stands in front of the respective car and the part doesn’t fit. Which is a cost for everybody in the whole chain. For us, the cost side is maybe still manageable, then we just take two parts back and send two new ones and then the mechanic can try again. But if I, as a mechanic, have thought that one part is allocated 1:1 and then he stands in the workshop and can’t install it and has to put the customer off for another day… that’s a cost that nobody wants. Neither in the workshop nor at the dealer. Of course, we want to avoid that. That’s why it’s important for us that the customer can identify the part straight away, in order to keep frustration and costs as low as possible throughout the entire chain.
Jürgen Mehlis: In addition, a spare part that has been linked incorrectly or not at all cannot be sold. This leads to a clear sales loss, which is measurable.
Marco Loth: Exactly. If a ‘new to range’ part has not been linked and assigned and the customer therefore cannot find it, then I can have as many ‘first to market’ parts in stock, but I will not sell a single one of them. Therefore, it is important to provide the customer with the
the complete portfolio to the market. As soon as the part is in the warehouse, i.e. can be ordered, the right data quality must also be behind it.
Markus Leister: If our quality is not right, then at the end of the day it is not only the dealer who is no longer satisfied with us, but also the dealer’s customers who are no longer satisfied with the dealer. This entire chain must not be allowed to build up in the first place.
Marco Loth: I think it goes even further. Data quality can also influence the entire image of the company. Certainly not if it happened once that a link was incorrect, but if such errors accumulate, then this results in a loss of image for the entire brand. The fact that our coating is always of the highest quality in terms of performance then no longer plays a role, because the customer has simply lost confidence.
Jürgen Mehlis: Absolutely! Speaking of customers… what do you think your customers expect from TMD Friction’s data quality?
Marco Loth: With the brands Cobreq, Textar, Nisshinbo, Pagid and also Bendix, we play in the premium segment. We are not the cheapest suppliers and therefore have to offer the customer a certain level of service. One is the update frequency, the other is quality data. This does not mean that we have better data quality for these brands than for other brands that are not in the premium segment. However, the customer naturally has higher expectations in this regard and wants to be able to clearly identify his part. A certain level of convenience is also expected, i.e. that the customer can call up the part in the app, in the WeChat catalog, etc.
Jürgen Mehlis: Now we have also talked a lot about the development of data quality. So how was it 10 years ago and how is it today. How do you see the topic in the future, i.e. in the next five years? How will data quality change?
Marco Loth: It will become even more complex, even more international. TMD Friction will increasingly go to the respective regions. Maybe not to every country in Africa now, but to the main markets that we have identified as growth markets – China, Brazil, Russia, India, Australia, Southeast Asia – we will expand our business there more and more. For the individual regions, we then have to adapt or tailor the data accordingly to meet the respective needs and requirements. In Brazil, the vehicle population is somewhat different, and in China, customer requirements are more specific. It will definitely become more international in the next five years. I also think the hurdles that are being put in place in some cases by the OEMs will make the situation more complex and difficult in terms of data management. But we know that we have a strong partner in TecAlliance.
Jürgen Mehlis: At TecAlliance, we have the guiding principle “Where our customers are, there we are too!”, which is why we have numerous locations in the countries. That is very important. We see it the same way as TMD Friction. We have to research the vehicles and information in the respective country, because that’s where the expertise is, that’s where the access to the respective systems is. The local people speak the local language. In China, for example, there is no English-language system, it is in Chinese. So we need the specialists on the ground who can also see which vehicle is really on the road and how it is received by the market. How is it referred to? Are they talking about platform, model? We successfully pick up on all of that on the ground with our local teams. We have now talked about the effort you put in at TMD Friction to ensure good data quality and also to adapt it to the respective market developments. In what specific areas do we as TecAlliance support you?
Markus Leister: Since we maintain our data in the TecAlliance tool DMM, we naturally have the advantage that we can exclude possible errors within a certain framework through the usual data validation. Furthermore, there is the current DQM initiative, which was launched by TecAlliance. It also sets new KPIs that can be used to achieve a higher data quality standard. For me, the whole thing also goes hand in hand with the advantage that we can now deliver our data four times a month. This means we can always provide our customers with the most up-to-date data quickly.
Read also part 1 and 3 of the interview: