As a service director or general manager, I would encourage you to spend time on the service drive to observe and listen to the conversations your service advisors are having on the service drive with your customers. I would be willing to bet that after a few minutes your level of frustration will reach a boiling point. Today, this moment, is the exactly the right time to get back to the basics of performing a proper write up that will help you build a strong foundation with the customer. This foundation will be the building block of creating exceptional customer service scores, customer retention and along the way you will sell more service.

Generally speaking the conversation will go something like this:

Advisor - “Hi how are you today, how can I help you”?

Customer – “’I’m here to have my oil changed”

Advisor – “ok great, are the keys in the vehicle?”

Customer – “yes they are in the ignition”

Advisor – “sounds good, if you would like to have a seat in the lounge we will get going on it right now”

When I use the word “generally” what I really mean is this a very general greeting and our trained service professionals should be anything but general. General is the same greeting I get when I walk into Walmart and unless you plan on being the lowest price in town your customers will soon discover your competitor.

As I mentioned it’s time to demand excellence and this previously mentioned greeting will simply not hold in today’s competitive environment. Our customer’s expectation level is at an all-time high and I simply don’t see an end in sight. The easy fix is to script out the verbiage you want them to say to every customer that comes in to your store. This will only create a perfectly trained robotic staff that begrudgingly follows the script and we have trained them to not think for themselves. The real fix is to teach your people how to be personable and conversationalist. This is the key to creating lifelong loyal customers.

Now, I know an advisor's time is tight, but if we can control the time they spend with each customer, every minute that ticks by with the customer engaged with your advisor is a brick building the foundation of future business. Of course, there is some very critical information your advisor needs to get from every customer such as updated contact information including email and cell numbers. Along with their main concern and perform a quick walk around and recommend additional services. Unfortunately these items have created a giant wedge between the advisor and the customer – and the customer feels it, trust me. My point is we can still get all this information in a non-scripted way and all the time communicating with the customer in the way they would like to.

Here are a few items to consider in your next advisor training session that will help them be more relatable to the customer and help carry on a conversation with them.

• Listen and show genuine interest
• Ask purposeful questions about them and their vehicle
• Respect – Space, privacy and their point of view
• Focus on the positives – do not dwell on the negatives
• Give compliments
• Be up to date on current affairs
• Speak clearly
• Use humor – light hearted

Last but not least…….

• Enjoy it!!

“If your company’s mission is to climb a tree, don’t hire a horse” is a well-known quote and it really holds true here. If you have a customer facing employee that generally does not like to interact with customers or other people, you have them in the wrong spot to succeed.

Good Luck, enjoy 2016 in the auto industry, it’s going to be a great one!!!

Already a promising year starting off in the automotive industry and there is no plan of let down in sight and according to most of the industry experts 2016 will be a banner year. This is great news, right? Well of course it is, however let's avoid some of the common mistakes made during the last cycle when business was good only to come upon a time that followed with a not so great outlook. The last time the industry had a downturn we were all faced with a decision to make several reductions to protect the financial return. I remember sitting down and implementing a strategy of how to get more done with less manpower. At the time the simple goal was to get back in line with the industry standard taking in consideration the reduced sales of parts and labor. This was an extremely tough task and certainly not fun to do, but it was very necessary.

The point I want to make is over the next few years the service and parts business is going to be there for the taking and we all need to aggressively go after it, with one caveat; increase sales and performance intuitively instead of hiring someone to help with the added workload or volume coming in.

Recently, I reviewed a dealers financial statement where their salaries, benefits and training was more than ten percent higher than the industry guide; basically their human capital was costing them financial capital returns. After a short visit with some of the employees, it became very evident most of the hourly employees that were hired on over the last year were brought on with a narrow vision of duties and responsibilities. In simple terms, the “easy” fix was to plug a person in place instead of defining a specific process and training to become more efficient at it.

To take it a step further this created a small silo effect within the workforce. They explained to me that one person does this task and then they pass it off to the next person that does the next task, and if “person A” does not do their job it at causes problems with “person B” completing their duties. As I analyzed the process, I realized that every person has become “specialized” in their duties, instead of being aware of the final goal and what they could do to make the process flow smoother.

Making this transition is a tough battle, but necessary. Here are some tips to help this flow smoothly and help you not fall in the excessive manpower trap.

• Look for more efficient ways to get the job done – identify the bottlenecks, is it the process or the people?
• Improve communication – open book here, be transparent, explain what and why things are happening
• Explain and then re-explain the reason and the goal – Employees will have a lot of questions, meet them head on and allow plenty of time for questions.
• Determine if the task is a “necessary” or a “nice” benefit to the customer – Examine which ones are mission-critical and really matter, which ones are questionable or discretionary, and which ones were assigned years ago and are no longer necessary.

We have all experienced the let down of a well qualified, proven performer slipping through your fingers at the last minute to make a decision to stay with their current employer rather than joining forces with you. Sometimes they even decide to go with another company that has their hat in the ring as well. The point is, when you are trying hire the right person there are usually other players in the game and this high stakes game is very competitive. According to a Forbes article in 2014 states

“Staying employed at the same company for over two years on average is going to make you earn less over your lifetime by about fifty percent more.”

As a manager this type of notion is scary as hell knowing the shortage of skilled human capital. So what can we do? How do you not end up with all the “leftovers” to build your team?

First suggestion put a premium on your workplace environment that encourages those to stay but more importantly attract new talent when needed.

Here are 6 tips that will help you create a workplace that attracts the top talent.

• Open communication – Open discussion about company goals and the steps needed to complete the goals. Tip – this includes the good and the bad news.
• Career path – everyone wants to see his or her opportunity for advancement. Show them the path and the steps necessary to climb the ladder.
• Be open with information – The industry buzzword is “transparent” but this really does create employee happiness. Tip – open dialog between employees and management.
• Recognition – everyone likes to be rewarded for their hard work, unfortunately the easy path is to throw some money at it. Although it is a start; sometimes a well thought out public recognition goes a lot further.
• Honor your commitments – As a manager the most important thing you can do is commit to something and then do it. Not falling through on your commitments makes you come across as not dependable or trustworthy.
• Promoting the wrong person – Sometimes the person advancing is not the best performer; it’s the manager’s closest friend. EVERYONE in the workplace sees right through this and it makes their effort seem all for not.

2016 is slated to be a banner year for the automotive industry. Develop a strong team, execute the game plan and prepare to dominate. Good luck.

In sports there is an over used saying “next man up” that is referring to the next person in line to fulfill the position vacated by an injury or poor performance. The really good teams have two or three people capable to fulfill the position “waiting” for their chance and for their name to be called. In most cases, when asked most athletes have a story of when they received “their chance” and what they did to make the most of their opportunity. I could go through and name several professional and collegiate programs that perennially have a lot of success and when the coach is asked about the success they often refer to the fact that they have a very experienced team and when someone gets injured there is a person waiting for their opportunity to step up. I could also name several athletes in team sports that have gone on to have a very good career when they received “their chance” and they went on to make the most of it and became a superstar.

The point of this, we need to be looking at our organization and constantly develop people that are ready to be “the next man up” when a spot becomes available.

Think of when your service advisor has a family emergency or is sick, who fills in for them and how ready is that person to fill their shoes? My guess is there is a significant drop off in talent and that person is simply filling a hole for you to help reduce the stress on the department and the other employees.

This is not an easy answer and it is even harder to execute, taking in consideration that fine line of being over staffed and over expensed to simply have the pleasure of having a person ready to step in and help on the service drive.

So how do good organizations do this? They put a premium on training, cross training and a build a culture within the walls of the dealership that fosters this mentality.

The first step is to look at every position; this includes the manager position all the way to the car wash or porter position. Evaluate who would fill the position tomorrow if you lost someone for an extended period of time and then evaluate what training do they need to be ready to take on the added responsibility. I know we all have a shuttle driver, support person, office clerk that could “fill in” but the point is great companies have people ready to do more than simply fill in; they have cross trained and developed the next person in line to be ready for their chance to step up and take on the new role. As managers we need to be thinking, who is the person to take on my duties when we are away from the office? Who is our replacement?

Identify and develop your people, the more knowledge they have the better off your team will perform. Take the time to cross train and grow your people from within, they will perform better and faster than trying to hire someone from the outside. As you are evaluating your team and you have someone in a position that is not able to step up in the next role, you need to really look at what type of exposure that is to your organization and determine a game plan. The ultimate goal is to have a cross trained person that has been trained in all facets of the organization that is simply looking for their opportunity to “step up.”

Looking forward to the New Year and in most of my conversations with executive level management about their fixed operations business, they have indicated that 2016 represents an opportunity to make a few little changes to have a really successful year. Some of these changes they point out are doing a better job handling the increased traffic or improving on the customer experience slightly to achieve high levels of customer satisfaction. All of these tactics are well deserved and certainly needed but I would suggest adding one more element to those tactics to maximize their effectiveness.

I have yet to have a discussion with any level of executive leadership that indicated the changes that they will be making to make the team stronger and yield better results. Here is a suggestion, invest your time into your people and help them build strong teams.

I recently read an article on HBR.com that discussed the importance of using the word “together” when developing your action plans for change or implementing a new policy. They continue stating that studies show a dramatic increase in the performance and engagement of an employee that is in a workplace with relatedness.

“The feeling of working together has indeed been shown to predict greater

motivation, particularly intrinsic motivation, that magical elixir of interest,

enjoyment, and engagement that brings with it the very best performance.”

As I read this article and related it to the automotive dealership I was constantly reminded that in most cases, under the same roof, three or four teams work very independently. The teams I am referring to are the Sales, Service and Parts teams. Although history would not indicate this is going to change anytime soon I would encourage any dealer to get everyone working together as a cohesive team.

“So what we need is a way to give employees the feeling of working as a team, even when they technically aren’t. And thanks to new research by Priyanka Carr and Greg Walton of Stanford University, we now know one powerful way to do this: simply saying the word “together.”

Two thousand and sixteen will be a great year for the automotive industry but we need to be aware of the cyclical nature of our business and what is looming out there in the years to come. I am reminded of a saying that applies here “you fix your roof on a sunny day.” So Today, lets focus on our people, build a well-informed cohesive team that is a ready for what the industry will throw at us.

As you are preparing for 2016 and finalizing your forecast, keep in mind the biggest opportunity for improvement: Building a passionate work culture that is able to deliver high-level results.

In the biology world the term “culture” refers to the cultivation of microorganisms. Relating this to the automotive industry, I automatically refer back to the latest NADA workforce study where it states that in an average dealership, barely 50% of the employees make it to the three-year milestone. Stores that exceed this level see an increase in sales and customer satisfaction scores due to the actions of a senior staff. As leaders in this industry it is time to invest your efforts in growing and building your team, creating a positive workplace culture and maximizing your human capital.

Culture is made up of the values, beliefs, underlying assumptions, attitudes, and behaviors shared by a group of people. Culture is the behavior that results when a group arrives at a set of - generally unspoken and unwritten - rules for working together.

 - Here are some tips in building a positive workplace culture

• Have a clear vision statement
• Establish trust for all employees and the employer
• Insist on mutual respect between employees and management
• Have a positive attitude and look for a positive attitude when hiring
• Open door policy
• Open communication and keep employees informed of exciting new changes

Human capital is the stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.

 - Here are a few tips to grow your human capital

• Embrace creativity
• Encourage growth in knowledge, have a clear training plan
• Think laterally and solve problems through an indirect and creative approach
• Discuss issues in a solution-oriented way
• Improve employer and employee relationships

To begin leveraging human capital and a positive workplace culture start with the basic measurement of the effectiveness of everything from training programs to employee engagement. Use these analytics to make decisions on grooming talent and finding ways to keep it. Companies that place a premium on human capital, measuring it, and treating it as a pure asset will increase the margin between those that succeed and everyone else.

Understanding the difference between a “transactional customer” and a “relational customer” is the first step to helping your team succeed in customer satisfaction and future sales.

Applying an ideal training program that gives your employee the competence and the confidence to help customers properly and start building a “relational” type customer is the next step.

“Sales people are not needed to quote prices. They are the bridge between the selling price and the perception of value provided to earn the sale – Jeffery Gitomer

A transactional customer is simply there to fill their current need. They are customers that you will see in your service department once a year or maybe once every two years having a repair completed on their vehicle. Compare that to the relational customer when you review their service history they have pages upon pages of service history and their service history includes all type of services from oil changes to mechanical repair.

Here are a few more quick examples comparing the two different customers we see on a daily basis.

Transactional Shopper

• Only focused on todays need, has little thought of future purchases
• “Good deal” Price is the number one influencer in purchase decision and are very happy to negotiate
• Have already become the expert of the needed repair due to the research they have already performed

Relational Shopper

• Considers todays purchase as a series of future purchases
• Motivating factor or purchase decision is confidence in making the right decision, not price – They are simply looking for the “right place to buy”
• Looking for an expert they can trust

Now it should be very easy to see and determine what type of customer you would like to see more of in your service drive. Now lets take the next step and talk about the most effective way to help your staff achieve this goal.

Training – the key to helping your team become better is first recognition, and then developing a training plan to help overcome some of these type of roadblocks in service.

A consistent training program will help your team identify these customers and have the confidence to help convert all your customers into a relational type long-term loyal customer. Here are some training tips to accomplish this.

• Repetition – Train, train again and then train again. The more you talk about it the more effective it becomes
• Variety – Discuss the same topics if necessary but look at it from all angles and apply a different approach.
• Small Doses – instead of having an hour-long session consider 4  - fifteen minute training sessions to keep it short and simple and not a burden.
• Apply knowledge quickly – encourage employees to apply todays training content immediately, even on the next customer.
• Interesting – make it interesting and encourage collaboration.
• Feedback – encourage feedback from your employees for future training.

Now that you are looking at your customer base differently, discuss it with your team and help them identify the benefits of having relational type customer in the service drive. Knowing that a relational type customer is looking for an expert to help them make the right decision, apply a training program that gives them the confidence to be the expert.

Human capital is the stock of knowledge, habits, social and personality attributes, including creativity, embodied in the ability to perform labor so as to produce economic value.

Providing ongoing training not only helps your employees perform their duties with more efficiency, but it also adds to their satisfaction and fulfillment within their job. To this date, when performing exit interviews I have never heard an employees reason for leaving was excessive training and investing too much into their career development. Unfortunately we do a poor job giving our employees the foundation of training it takes to succeed?

I do believe that a small percentage do a good job in this area, but the large majority within our industry fall below the minimum acceptable level.

Here are a few benefits to having an ongoing training program

• Reduce cost of turnover – A recent survey indicates that 40 percent of employees who receive poor job training leave their positions within the first year.
• Enhanced company image – Your customers are able to “feel” the culture of a business. A culture of a turnover-laden business does not increase customer satisfaction; actually it will directly affect you negatively. An enhanced company image will help you retain additional customers and employees.
• Increased employee motivation and efficiencies in processes – Quite often after a training session, I will have an employee come to me with a proposed solution to an ongoing problem or process that will improve customer satisfaction. There have been many times when the proposed solution was not implemented, but at least I know where the frame of mind was for my employee and they were looking for ways to improve our business.
• Increased professionalism – You never get a second chance to make a first impression and again this holds true here as well. Especially within our business we could use a little shot in the arm to up our professional standards.
• Increased sales and profits – This is one that does not happen immediately after a training session, so don’t loose sight of the end goal. Although not immediate, it is proven that someone that is properly trained will yield greater success within his or her career.

The greatest preparation for the future comes from planning and investing in your people. The best and most effective way to do this is develop a well-rounded training program.  

Looking at the recent projected numbers by NADA, it appears that fixed operations is in a position to increase on their 2014 total of service and parts sales of $91.73 billion. In this latest report NADA was projecting a modest increase of four to five percent in the customer mechanical number. However, there was a 20 percent projected increase coming from the warranty side, obviously we can thank the increased volume due to recalls. Recently, I was presenting in meeting with a group of high functioning CJD dealers and looking at their composite year to date we found that warranty repair was getting close to 35 percent of their total labor sales. This number is huge when you take in consideration it has typically been in that 20-25 percent range.

So why do I think this is a bad thing? We all want the added income, right? Warranty/Recall work is providing a substantial increase to all of our income – but is it here to stay? I believe that the litigious battle of recalls is here to stay, but are your customers? The added recall work is bringing new customers to your door that otherwise may have never come. They are giving you the opportunity to grow your customer base, but are they going to be long-term loyal customers? Can you forecast and count on this added volume next year in your customer pay numbers? My suggestion….. NO

Is the first experience your customer receives from you a positive one? Considering parts availability issues and the length of time to complete the recall, you will be able to retain a very small percentage of the “new” faces that are coming in to have their air bag inflators replaced on their 10-year-old vehicle. Most of these customers you will never see again.

Here is my biggest worry for 2016 and forward.

• Very few recall customers will stay and continue to service or spend with you
• The recall business is making it harder for your loyal customers that do want to spend with you get in the door.

This added volume is helping pay the bills and has increased most of your commissioned based pay employees paycheck over the last several months but it is also allowing them to make this income through the path of least resistance. Recall work is eroding our customer pay business. Advisors car turn into a high volume recall factory and at the end of the month all theses bits add up to a glob. A customer that spends with us typically will stay providing it was a positive experience. A recall customer that also has a positive experience still does not have the loyalty bridge built as one that spends with us. Therefore a very small percentage of them will return even after a great experience.

To sum it all up – The recall business is here to stay. How are you going to make space for your long-term loyal customers and how are you going to keep your advisors focused on building the customer relationship one oil change and multipoint inspection at a time?

Periodically, I get the opportunity to roll up my sleeves and dig into a dealer’s pain point. More often than not these pain points lately are, “How do I get all the customers in to my shop and completed in a timely manner?” or, “Do you know any techs?” and “What is the best way keep my customers coming back?” Here is the extremely tough answer to Mr. Dealer’s questions. The short answer goes something like this, “I have an answer, but I don’t think you will like the timeline it will take to accomplish this once and for all.” After a frustrated perplexed look from the dealer I usually say, “The complete fix sits within your people, your training program and your ability to grow and mentor your staff.” Obviously this is not an overnight fix. Most of the time I feel they are looking for the silver bullet to

Customer retention starts with having a solid process and business model, yes this is a given. The execution of customer retention sits fully on the shoulders of having a well-trained senior staff that builds relationships with every one of your customers. It goes without saying customers like to do business with people and competent ones at that. They may like the facility or the customer waiting lounge or even your movie screen, but when it comes to loosing a customer it is always due to the action or lack of action of a person within your guidance.

How do we create a positive workplace environment that has long-term employees excelling at their position? Here are a few areas to start.

All of these should be completed with regularity within your department.

• Positive reinforcement of a job well done – This one regularly goes without notice. This doesn’t mean pay a spiff or more money, challenge the owner or GM to walk though and hand out a high five very publicly.
• Develop your staff – A well-trained staff not only handles tough customer situations better but they also feel valued by the organization to invest in their success.
• Balance – We work in an intense environment. Help employees understand their needs to be a balance in their work life and personal life. Granted we want them here for the hours of their scheduled time just as important is to enjoy the time they are not there.
• Communication – Engage in open and thought provoking dialog with your employees. Too many times businesses think of communication as talking about policy change or a new process and this is important but not the entire equation. Talk to your employees about their solution to customer satisfaction. Remember to listen and you might just learn something.