Category Archives: Attitude

7 Strategies for Your Fixed Operations “Space Race”

I was thinking this morning about how rockets and Fixed Operations Customer Management are related. With all the news about the different companies striving to become the next NASA, it reminded me that we are all in a “Space Race” even though I know that the two subjects seem completely unrelated and are not even in the same Encyclopedia volume.

And I submit for your consideration that driving a rocket into space and good Customer Service Management is exactly the same. Let me explain why.

Your Fixed Operations Service Business is your rocket ship. In this ship is everything you need to survive when venturing into the hostile environment that is the Customer Service space. In your ship (Service Department) you will find all of your life support systems, everything you need like electrical power, data bases, computer systems and communications.

You communicate with your Customers using phones, text, email and even person to person interaction to get them the information you need so they can give back to you course direction. Things like “Yes, go ahead and repair my brakes and rotate my tires” are course corrections for your Advisor and Techs.

Communications and course corrections are just as critical in your business as they are in the space business. You can’t go anywhere unless you know which direction you are going.

Pretty cool, huh. You were driving a rocket ship the whole time and you just thought you were at work.

There is one other element to consider that is the same in space flight as well as your Customer Service Department. It’s the people flying your rocket ship and what they do every day. So, I’d like to tell a little story about the space travel business (and Fixed Operations) and how monkeys become astronauts.

As the space race was starting, it became apparent that eventually someone was going to have to strap in, flip the switch and ride a burst of hot flaming gasses from earth into space and achieve orbit.nasarocket

In the beginning, there was a lot of concern regarding the effects of flying what is essentially a roman candle, into space. Not wanting to risk human life unnecessarily, the idea was floated to teach a monkey to ride in the rocket, thereby getting the data necessary to facilitate safe human flight. (Can you imagine the conversation around that conference table? “We’ve just spent a gazillion dollars on these rockets and we need someone to test fly them.” From the back of the room a tiny voice shouts out “We can get a monkey to do it!”)

So the call went out, find a monkey to go to space. Now we have continents full of monkeys, however, it’s doubtful any of them had seen a rocket much less flown one or even had any idea they were going to learn how to fly. They are monkeys after all.monkeysinspace

As the search started, it became apparent that we would need to set a few standards in place. We had to find acceptable monkeys. We had to train them. They had to be able to complete some simple tasks, pull a few levers, push a few buttons and survive the trip back to earth.

We found acceptable monkeys, trained them and then sent them. It was a Success…except for one thing. We couldn’t get the monkeys to tell us how the ride was, what they experienced and most importantly, what did they learn.

Why go to space if you can’t learn?

After all of the experiments were over, and we had all of the data, we went out and found the best pilots and asked them if they wanted to become astronauts. We had a very stringent selection process that filtered out those that would not make it in the harsh environment of space. We instituted a long intensive training program to make sure that the astronauts could fly rocket ships and respond appropriately in case of an emergency. We then edified the position to attract even more talented pilots who wished to become astronauts. (Who didn’t want to be an astronaut growing up?) We didn’t recruit or train any more monkeys. We found that we had all that we needed.

Nice story. What does that have to do with Fixed Operations Customer Service Management?

Well, I have a few questions to answer your question, Customer Service Professional.

Did the monkey actually “fly” the rocket or just ride around in it and complete a few tasks?

In your business, are your people flying your rocket, or just riding around pulling a few levers and pushing a few buttons?

Are you searching the continent for monkeys or astronauts? Are you training monkeys or astronauts in your store?

Take a look at the list of seven strategies for your space adventure next year. 311-hey-you

1. Key people in key positions need to be fully trained in the operation of your rocket ship.

2. Astronauts make better pilots than monkeys. Hire the right people.

3. Pulling levers and pushing buttons does not make a monkey a pilot. If they are a monkey, give them monkey duties. If they are a pilot, let them fly the ship.

4. You can train a monkey to only do so much. Then you need an astronaut.

5. Astronauts need to have a destination to fly to. (Set Goals)

6. If you keep flying the ship, no one else learns to be a pilot. They become monkeys.

7. Everyone likes a monkey until there is a crisis. Then they don’t want them.

For the new year is your course set? Do you have astronauts or monkeys?

By Leonard Buchholz

(The original article was posted here: http://EzineArticles.com/416202 and written by me)

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Why small increases are important to your Dealership profits

Just what does a 10% increase (in any KPI you choose) really mean to your dealership?

Why small changes make big things happen.

Why small changes make big things happen.

 

Have you heard the old saying “Yard by yard it’s hard, but inch by inch is a cinch”?

If I were to go to any of your dealerships and walk into the GM’s office and say “Would you be interested in a 50% increase in Gross Profits?” what do you think he or she would say to me?

They would jump out of their chairs and yell out “Of course…how do I get it!”

And therein lies the problem with increasing performance or increasing profits 50% at a time. It is really hard to achieve that big of a jump all at once. It’s not that people are not capable or willing, it’s just that getting all of the components of a dealership focused and firing on all cylinders at the same time is a difficult proposition at best, and trying to get a 50% increase in any measurable KPI just becomes impossible.

Truthfully, whenever you have heard someone (DP, GM, New Manager, etc…especially the New Manager) say something like “I’m expecting big things this year and our goal is to increase (fill in the blank) by 50%”, would you say the “Dirty Diaper Alarm” trips in your head and you disregard everything that was said and develop a less than favorable opinion of said “Authority Figure” (or whomever was speaking)? Yep, me too.

But if I go into any dealership and ask any service advisor “Hey there Mr. /Ms. Advisor, do you think you could sell an extra $10-20 dollars on every repair order?” what do you think the answer is nearly 100% of the time?

“Of course I can.”

That is the power of a 10% increase.

So let’s look at John Q. Advisor and some of his numbers. At the average of 1.5 HPRO at $85.00 an hour, every repair order John writes is averaging about $229.00 a ticket. A 10% increase is only $22.90 and if John writes 220 repair orders a month, that equates to a $5 Grand a Month increase in Service Sales.

What does John get? At the end of a year, he gets an additional $60 grand in Commission-able Sales and if he is on an average pay plan, he just made another $5000.00 or so dollars for the year or $400.00 bucks a month.

Now go ask your Advisors, “Hey there Mr. /Ms. Advisor, want to make $400.00 more a month?” and what do you think their answer will be? (If they say something smarty pants or “No” or “Who do I have to kill?” just tell them you are going to write a letter to their spouse or significant other stating they turned down a $400.00 dollar a month raise)

Most organizations focus on trying to increase too much when they should focus on just making small but effective changes that yield results over time.

One more thing. Don’t forget the power of compounding.

Back to back increases of 10% in John Q’s example is big. How big? In the second year of a 10% increase, John’s average sales per repair order become $277.00 per copy or $48.00 more than year one, which equates to a $126,720.00 yearly increase in service sales…not too bad a result for a 10% increase.

Get focused on making small incremental changes that add up to big improvements! Help your team see the value and vision of a 10% increase in their service sales process and watch those profits (not to mention team morale) soar!

By Leonard Buchholz

Is this a “Training Issue”…?

Nearly every week we spend training in a Dealership, we try to identify and help correct deficiencies in production, CSI and dealership employee performance. The rub is that every dealership has different issues and problems.

Sometimes it’s the training, sometimes it’s the employee and sometimes it’s the management.Is this a "Training Issue?"

And 100% of the time when there is little progress in performance or profit improvement, the dealership employees and management say “It’s a TRAINING ISSUE!” Of course, it must be a training issue because there is no way on this green earth that is could be the dealerships employees or management team.

So, let’s tackle the myth of the “Training Issue.”

Inconsistent application of processes is not a Training Issue. Once a process has been introduced, trained on and implemented, it can’t be un-introduced, un-trained and un-implemented. It can be ignored. It can be discarded. It can be disregarded.

Processes are systematic steps completed in a specific order to achieve a desired result. Once personnel have been trained on them, practiced them, implemented them and used them, training is complete.

When they are not being followed, it’s because a human being decided that they were not going to follow that process. This means, it’s not a “Training Issue. “

Lack of follow through on promises made to the Customer is not a Training Issue. As an Advisor, when I made a promise to the Customer to call them by 2:00pm with an update on their vehicle, if that did not happen, it most definitely was not because I had not been “trained.”

There may be any number of reasons (excuses) that I missed my call back time. What’s not important is the reason, what is important is the implication, not only to the Customer, but to the Service Team.

If I as a Service Advisor, do not follow through on my promise to the Customer to call them back, take care of an inquiry, make sure a part got ordered…etc., why would that Customer trust me or the Service Department to take care of their needs in the future?

That is the real consequence of lack of follow through. Customers stop coming back. And that hurts the entire dealership.  And it is most certainly not a Training Issue.

Absence of performance results is not a Training Issue.  Performance increases remain the end result of repeated application of processes. Stop applying the process, start deceasing performance. It does not matter if you are talking about a sports team; orchestra, business team or dealership team, the performance achieved is directly related to the consistent application of a process.

So, what is a “Training Issue?”

It’s when someone does not know how to do something. They require Training to understand the process, what steps need to be taken in what order, how to circumvent obstacles and how to implement what’s been taught.

As a young Advisor, I needed to be shown how to write a repair order. I needed Training to understand the steps necessary to make a piece of paper print on a printer so I could present it to the Customer for their signature. Someone had to Train me to do that.

If I did not follow the steps, a piece of paper did not print and I could not get a signature. It was not a matter of not being Trained and entirely a matter of not following the steps.

In the CarBiz, we all have processes in place to help us take care of the Customer whilst making a return on the investment of time we put into following that process. Anytime we deviate from that plan, we risk losing all that we put in plus we risk losing the Customer.The Truth

Make sure that what you believe is a Training Issue is really a Training Issue by asking the simple question “Do they know how to do what we are asking?”

Because most “Training Issues” are really “Leadership Issues.”

By Leonard Buchholz

Where does Profit Improvement start? At the Service Managers Desk, of course!

In every Dealership there is a desk. And behind that desk sits someone who has the responsibility to increase Profits.

In Fixed Ops, this person is called the Service Manager.

Typically  (when I go into a store that is not profitable), I find the person sitting behind that desk working on everything not related to increasing Profits while believing that they are working on everything related to increasing Profits.

I call it the “Theory of Un-relativity” and it goes like this.

P=ATD+PIxNC. Profits equal the Amount of Time Dedicated plus Process Implementation times the Number of Completions.

Simply, the Manager must dedicate as much time as needed every day to making sure processes are being followed and that they are being done with every Customer.

In stores that are not profitable, the Manager spends more time on things that have nothing to do with Profits and everything to do with nothing…including Managing the department…or as I stated before the “Theory of Un-relativity.” The things they are doing have no Relativity to making more Profits for the Dealership.

UP=ATW+UTxNC. UnProfitable equals the Amount of Time Wasted plus Unnecessary Tasks times the Number of Completions.

Let give you an example. I am standing in the Service Drive with a Service Manager when he is approached by the Sales Manager and informed that the tethered marketing balloon outside which normally is in position first thing in the morning is not up yet and “Could you take care of that as soon as possible.”  Unnecessary Task.

Another. SM is working in his office when he is informed that the lights on the front lot “are not lit up and can you do something about it?” Unnecessary Task.

One time, as the owner of my store had just handed me another daily task not related to Profit growth, I decided to write down all of the daily tasks that had been thrown my way over the past year just so I could get a handle on it. The list was 40 plus items and guess what…not one of them had anything to do with making more money.

Were some of them important? Yes. Necessary…no doubt about it. But at the end of the day when the Dealer Principal has “The Fin” in his or her hands and wants to know why “Fixed Ops is off by 15% and what are you going to do about it?” and you have the “But Boss, I’m so busy doing all of these other things!” excuse sputtering out of your mouth…now doesn’t that paint a pretty picture Mr./Ms. Service Manager?

By the way, when I handed the Dealer my list and asked him to specify which of those tasks were Top Priority and which were not, he actually apologized. He had no idea how many things he had “delegated” to me until I pointed it out to him.

Here are a few things you can do to get back on track making more Profits.Profit

1st, make a list of the things you are doing every day. Now separate that list into “Tasks That Make Money” and “Everything That Does Not Make Money.” Give Top Priority to Monitoring, Coaching, Training, Managing and Nothing, Zero, None, Nada Priority to Everything Else. Within a few days someone will come to you and say something like “The lot lights are out again” and then you can show them your list that makes the Dealership money and they will find someone else to ask about the lights.

2nd, share this list with your Dealer Principal or General Manager. Why? Because they forgot they told you to do half of those things and don’t remember the reason why they told you to do the other half.

3rd, learn to say No. Point out that working with your Advisor on Phone Sales Skills is way more important than stocking toilet paper in the bathroom or talking to the coffee vendor about the price of the new machine.  Stick to what makes money and makes sense.

Lastly, you and I work in the real world. If the DP drops the keys off and asks to get his demo washed and gassed, don’t show them your list. Get the demo cleaned up and gassed. Remember the 20 foot rule. Walk outside the building 20 feet and look up 20 feet and see whose name is up there.

by Leonard Buchholz

The Right Way and The Wrong Way

During the analysis and evaluation we conduct prior to starting a training program the question of ethics and standard business practices we train on usually requires some explanation. In other words, Dealer Principals and General Managers want to hear from us that we conduct our training programs ethically and professionally.

If I were to stand in a room full of Dealer Principals and ask “Who in here believes that the best way to take care of a customer is to sell extra or un-needed services?” I would venture to say that not one hand would be raised.

This misconception is a holdover from an original misrepresentation/misconception of our industry from the early beginnings. It is far past the time that we begin the process of changing the perception that people who work in the car business are only interested in taking as much money as they can using unethical business practices that prey on the public at large.

In 99% of the situations I have personally investigated where something went awry and the customer felt that they were “wronged”, I have found that almost every one of these situations was an error (and not a conscious decision) and 100% of the time it was resolved in the customers favor with little cost to the dealership.

In every dealership and within our industry we have a small percentage of people that just don’t get it, no matter what the culture, training and daily business practices that you reinforce at your dealership and it is those people we must remove permanently from our industry.

Customers are nothing more than the person standing in the mirror every morning, they are you. From Dr.Tony Alessandra “Treat other people as they want to be treated.”

All this means is dig into what the customer wants, separate those wants into needs and then identify the must haves from the needs. Communicate those must haves to the customer in a way they can understand you and do that ethically and with passion.

By Leonard Buchholz

businessethics

 

Are your Advisors “Helpful” or “Professional”?

Helpful…or Professional…which of these sound better?

If you are like a lot of Dealers and General Managers hiring “helpful” people always seems to be the right call. The belief is that you can develop someone into becoming a Professional. While I don’t disagree with this practice, what I find all across the country is the opposite of helpful or Professional.

Because we train all across the country, we have exposure to every make and model of vehicle in every kind of Dealership, whether it is a locally owned single point, multi-line point or large Dealer Group.

And when we train invariably, we get to the point in the training that we ask the Advisor “How do you see yourself as an Advisor” or we might ask “What is your role in working with the Customer?”

And 9 times out of 10 the answer comes wrapped up with a bow in a package labeled “I want to be helpful” or “I want to help the Customer and give the best possible Customer service.” This answer is of course not only the expected answer but the accepted answer. And it has absolutely nothing to do with helping the Customer.

In fact, I submit to you that being “helpful” is exactly what we don’t need in a Dealership.

The reason I say that is because in every single case where I have an Advisor who is trying to be “helpful” to his or her Customers, they have become the exact opposite. They have become “un-helpful” and in most cases a liability.

Let me explain.

Helpful Advisors share 3 common characteristics.

  1. They make decisions for their Customers without asking the Customer what they (the Customer) would like to do.
  2. They make judgments about their Customers based on past experiences and fail to honor the word “Advisor” which is part of their job title.
  3. They are poor Salespeople with poor communication skills and non-existent processes.

Helpful Advisors make decisions for their Customers like not telling them everything that is wrong with their vehicles, instead just telling them what they think the Customer wants to hear.

They do not offer additional services during the write-up process and never present a menu. They have become in effect the same as the person whom we call an “order taker” at your local dry cleaners or fast food restaurant.

Professional Advisors make no decisions for their Customers at all. They Advise them on everything the vehicle needs, recommend additional services they know will be beneficial for the Customer and present a menu at the time of write up. They take the time to explain everything to the Customer so the Customer can decide what they would like to have done on their vehicle.

Helpful Advisors make judgments about their Customers based on the past.

If Mrs. Jones came in 2 years ago and Doubtful Dan tried to make an Additional Service Recommendation and was shot down by Mrs. Jones with the “I can’t afford it today”, Doubtful Dan now assumes that Mrs. Jones can never afford any additional repairs and stops telling her that there are additional services needed in order to maintain a safe and reliable vehicle.

The next time Mrs. Jones comes in for an oil change, Doubtful Dan is surprised to learn she has new brakes and tires.

Doubtful Dan then asks Mrs. Jones “Where did you have the repairs completed?” and Mrs. Jones replies “Right down the street at Bob’s Big Boy Service Center. After the last visit here my grandson stopped by to visit me and said ‘Grandma, you should have your tires checked’ and of course I asked Timmy (my grandson) ‘Why?’ and he said ‘One of your tires has some wear on the edge Grandma.’”

She continues “Well, I just happened to have some free time later that day and popped in at Bob’s and they said ‘Sure we can take a look at it’ and next thing I know they told me that the tires were needing replacement and I said ‘Are you sure, because I just had it in a ABC Motors and they didn’t say anything’ and they showed me the worn tires and wouldn’t you know it, when they took off the tires, the brakes were worn down too.”

In the car business this is known as “Someone just ate your lunch.”

Professional Advisors do not make judgments. They Advise. They take all the recommendations from the repair order, prioritize them from most important to least important and then tell the Customer everything they need to know about maintaining their vehicle. They let the Customer decide.

Lastly, Helpful Advisors are invariably poor Salespeople who do not keep up on their skills and they do not use any Sales Processes because they want to “be natural and not robotic.”

Let me ask you this and you tell me if it sounds crazy.

When was the last time the General Manager stood up in the Sales meeting and said “From this day forward, Salespeople do not need to log their ups. You do not need to touch the desk and you do not need to complete a walkaround and test drive with the Customer. You can do what you feel is natural.”

Crazy….or what?

And every day in the Service Drive we have Helpful Advisors who do the exact same thing. They don’t follow a process, they don’t communicate the benefits of maintaining the vehicle to their Customer and they don’t develop their skill sets.

Professional Advisors use tools like processes, like menus, like Listening Skills, etc. to help them make the Customers service experience the best it can be. They want the Customer to make informed decisions based on the recommendations and vehicle maintenance needs.

So, look around your Service Department. Ask yourself “Are my Service Advisors helpful or Professional?” and decide for yourself which of these is the better choice for your Dealership.

Written by Leonard Buchholz

Did you THRIVE or SURVIVE in 2012?

By Leonard Buchholz

Every year about this time we begin to contemplate. What was our final score for 2012? How did we end up? Did we just SURVIVE or did we THRIVE?

For most of you, that reality was written months ago and on the 10th of January you’ll be reading the results you already suspect.

You may even be feeling some anticipation (much like a kid on Christmas morning).

For those of you who spent more time on the “naughty side of retail life” you are hoping for a miracle to turn poor effort and lack of accountability into a Kodak perfect picture moment when you open your present (EOY Financial)…only get ready for the stinky picture…the one with the sad tear-streaked face when you finally tear open your package of coal.

And for the rest of you…”Smile!” click…click…click post it to FB ‘cause you got a HappyFace!

So, the real question is, did you THRIVE in O12 or did you just SURVIVE O12?

Here are 3 Thrive/Survive Reality Checks for you to contemplate right now.

Did you have a significant increase in Service Customer Pay Gross Profit? Let’s define significant. Was your increase at least 20% or more? Before I get a slew of “Hey, we got ___(fill in the blank) and it was significant to us” emails, you have realize that any organization that experiences an increase in Gross Profit, whether they are selling soup or nuts, that is greater than the year before would consider it “significant”, “fantastic”, “beyond expectations”…you get the point.

It just so happens that 20% is considered significant and noteworthy (and all that other stuff) because most of the business world runs on extremely small margins and mucho dinero is made every day in this  country by people smarter than me betting on the tiniest increase and decrease in those margins.

Imagine what a day at the stock market would look like if the Fortune 500 companies all reported a 20% increase in Gross Profits. Wow.

So, yes, 8, 10, even 18% is a nice number when it comes to a Gross Profit increase. But 20% and above is pretty damn significant.

Those dealerships that are thriving…INCREASE! Those that are surviving…SAME! So, I have to ask the question, did you start 2012 with the Goal of staying the SAME or did you want an INCREASE in Service Customer Pay Gross Profit?

Next Thrive/Survive Reality Check is your Service Customer Pay RO Count. In 2012, did you INCREASE your Customer Pay RO Count or did it just stay the SAME?

2012 will be a pretty good Sales year when all the numbers are tallied. Last I read, total sold units in 2012 will be somewhere north of 14 million and represents an overall increase of nearly 14%. 2011 was not all that bad (relatively speaking and compared to previous years) when it hit over 11 and a half million units sold. So, that would indicate that based on these numbers, there are additional Service Customers in the marketplace looking for a Service Facility.

Which begs the question, where did all of the Customers from 2011 and the first 6 months of 2012 go for Service? Was it your Dealership? If not, why not? What is keeping the Customer you worked so hard to sell from coming into your Service Drive for Service?

In every Dealer that we complete a Profit Potential Analysis and review the previous 2 years of RO Counts, I can honestly say that in my experience, there is always room for growth. In fact, I do not believe I have heard any Dealer Principal say “No thanks to increasing the Customer Pay RO Count in our store, we have enough.”

So if you have not had at least a 10% INCREASE in Customer Pay RO Count in 2012, that would be an excellent place to begin your Goal Setting Process for 2013.

Lastly, have you had an INCREASE in CSI or stayed the SAME? Honestly, the CSI Score is without a doubt, the craziest number ever to have been invented to measure a Dealerships performance. Sometimes it can feel like you are trying to hit a mouse in a hurricane with a beach ball.

And many Dealerships consider it a Success just to maintain “Zone Average.” I get it. But the Dealerships that are THRIVING have invested themselves into a new thought process when it comes to CSI…changing the “gottadoit” to the “wantadoit” and the P-step Program “Process,Participation,Prevention” and making a difference in their CSI Score.

SURVIVING means every week/month when the new scores come out, the Service Manager and General Manager have a moment referred to as “Show-me-the-money-or-get-out-the-honey.” Either you hit the numbers or you start spreadin’ the honey. It can be fun in a kinda “You bet your job” sorta way, I guess.

Take a minute on the morning of Jan 10th to consider and ponder and contemplate 2012. Look for other areas you consider vital and important to your business, your Dealership. And take a look at the three areas we just talked about, Service Gross Profit, Customer Pay RO Count and CSI.

As the zero one three business year kicks off in your store and you are starting to write your Goals are you thinking of SURVIVING or THRIVING?

My best guess is you have started to consider THRIVING the year away. Thrivein2013