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Let’s explore a simple 3-step approach that will help improve any dealership department.
1. What am I doing now?
Do you clearly understand the road to revenue or process flow from origination to transacting business?
For example, are customers handled the same way every time by every salesperson? How detailed is that instruction? Is every phone call answered the same way? Are the sales techniques the same for everyone interacting with customers? (Note, I’m not talking about what should be done, instead what is actually being done)
Is there a clear understanding of the value proposition that your dealership should be presenting to customers? Why should I buy a car from your dealership? (Note, exclude price, location, family ownership, being number one, having a large inventory, and winning the president’s award)
In the service drive, are writers just taking the 8 a.m. oil change drop offs and sending the paperwork through to dispatch or is your scheduling set up to provide an opportunity for writers to conduct vehicle walk around inspections and up sell services?
Do you have a clear picture of the process for every customer touch point? Look at every department and answer question number one.
2. Why do I do it this way?
The answer to this question will knock most decision makers off of their chairs.
There is so much power in taking the time to answer this question procedure by procedure, you will find that many times the answer is something like: “It’s just the way we’ve always done it.”
Remember, we all have a process even if sometimes the process is the absence of one. Marketers spend millions trying to stay up to date on knowing why people do what they do and more importantly how to control those decisions.
Did you pick that customer-relationship management system because they threw it in free with your dealership-management system? Did you buy that product because you’ve known the sales rep for years or because you though it was the best?
Did you hire that manager because he was the best or because you just needed a warm body to fill the spot. Sport scouts talk of the clouded judgment that comes with filling a spot vs. choosing the best player.
How many decisions that you currently live with on a day-to-day basis at your dealership were made under some form of duress? Pressure to spend the co-op money or lose it, pressure to hire sales people because there wasn’t enough coverage?
3. Is there a better way?
Many great ideas come from the pure act of talking through a situation and making an effort to consider an option other than the one you thought was best.
The idea of exploring better ways to do something opens the door to increasing efficiency, improving profits, and trimming the fat the right way instead of line item cost cutting. Line item cost cutting without a true perspective on return on investment can be dangerous during times like these because the decisions aren’t being made with full consideration of the facts.
In the movie Wall Street a reporter asked Gordon Gekko why he wanted to wreck a good company, and he answered “because it is wreck-able.” Sometimes expense reduction and cost cutting measures are treated the same way. In many cases exploring better ways to do something is the perfect time to make a purchase of a product or service that will better address the needs of the process.
I won’t say it will be easy to self examine, but it is necessary. You owe it to yourself to do everything to maximize profits.