Introduction to Service Manager Scorecards

In this insightful episode of the Driving Sales Defining Leadership Podcast, we delve into the essential process of creating effective parts and service manager scorecards. Hosts Bart Wilson and J.D. Mixon are joined by special guest Craig Wilson, who brings his extensive experience and expert insights to the discussion. Learn why service manager scorecards are crucial for managing your service departments, discover the key performance indicators (KPIs) you should track, and get practical tips to enhance your department’s efficiency and accountability.

Understanding Parts Manager Scorecards

Craig also shares valuable strategies for developing parts manager scorecards that can significantly impact your dealership’s performance. Discover the essential metrics for parts managers, understand the importance of proactive parts management, and learn how aligning service and parts goals can drive overall success. This episode is packed with actionable advice that will help you create scorecards that improve performance and drive results.

Key Takeaways: 

• Importance of scorecards for parts and service managers
• Key performance indicators (KPIs) to track for enhanced performance
• Practical tips for aligning service and parts department goals
• Strategies for proactive parts management
• Understanding the impact of effective labor rate and other metrics 

Chapter List: 

• 0:00 Introduction and episode overview
• 1:02 Welcome and introductions
• 2:15 Importance of scorecards in service and parts departments
• 4:10 Key performance indicators for parts managers
• 6:45 Aligning service and parts goals
• 8:20 Practical tips for creating effective scorecards
• 11:35 Strategies for proactive parts management
• 13:50 Understanding effective labor rate and other crucial metrics
• 16:00 The role of customer satisfaction index (CSI) in scorecards
• 18:25 Tips for tracking technician productivity and efficiency
• 21:10 Conclusion and final thoughts

 In this episode, “Remote Work in Dealerships: Insights from Mike Donovan,” hosts Bart Wilson and J.D. Mixon are joined by Mike Donovan, CEO and co-founder of Search Engines MD. Mike shares his extensive experience managing a remote workforce and how it can benefit dealership operations.

Throughout the discussion, Mike highlights the importance of work-life balance, effective communication, and fostering a supportive team environment. He explains how remote work isn't just for tech companies but can also apply to dealerships with multiple locations. Learn how to implement successful remote work strategies, maintain team cohesion, and ensure productivity across your dealership's workforce.

Join us to gain valuable insights, practical tips, and expert advice on adapting to the evolving workplace landscape. Whether you're looking to enhance employee engagement, improve operational efficiency, or explore new management strategies, this episode is your go-to resource for dealership excellence.

Welcome to another insightful episode of DrivingSales Defining Leadership, where Bart Wilson and J.D. Mixon explore how car dealer employee certifications can elevate your dealership’s performance. In this episode, they discuss the critical role of certifications in fostering employee engagement, retention, and overall dealership success. Employee certifications are not just a formality but a strategic tool that can transform your dealership operations, making them more efficient and aligned with your business goals

Chapters with Timestamps:

00:00 Introduction to Certifications

10:15 The Need for Customized Training

20:30 Building a Certification Program

30:45 Assessing Competency and Performance

40:00 Continuous Improvement and Scaling

50:15 Q&A and Listener Insights

We sat down with Paul Budvitis, CEO and Founder of Insurian, and picked his brain on employee development. He talks about how he would approach people and gives some tips on recruiting and training.

Why is training so important today?

You know, I'd like to start by saying I've had the greatest mentor, my dad, from the time I've been in the car business since I was five years old, and I think that the car business, from my view, selfishly, is the greatest industry that there is.

People fall in love with cars, and in my opinion, the opportunities in the future are going to be amazing for people, especially those, getting started right now.

The changes that are happening are unbelievable, but I think that one of the things that we need to look back on is maybe turn back the hands of time a little bit, and really empower people more and truly train them on all aspects of a business.

I got to see when my dad started out in the late 60s, they did everything, and they were delivering cars at the kitchen table and things like that.

I think that now we need to empower people, and by that, I just don't mean front to back, whatever your sales process is, that's your sales process, or wherever you want to go, that's it. We really need people to come in, and we need to turbocharge their knowledge about all aspects of the business, not just let them sit in their own area.

We need to take ownership of people, and I think that when we do that, and as an industry if we can deliver that story about how the future is amazing, and that you're going to come in here, and you're going to become the best business person you can be, you're going to learn an industry and skills as you've never seen before.

When a salesperson steps foot in a dealership, or a service advisor, or a technician, or anybody for that matter, they're going into a dealership that has multiple businesses under one roof, multiple personalities under one roof, and there is undoubtedly massive opportunity.

The Growth Mindset Culture 

The training, from my view, and you're speaking my language, I was very, very blessed at a young age, and I'm going to give some accolades to a mentor of mine, Les Shapiro, who was the head of training for all of Aon Corporation under Pat Ryan, wrote a book called The Training Effectiveness Handbook.

We have an opportunity, when we're talking about changing people's lives, is take a look at not just the skills they can get inside a dealership, but the life skills, because there are amazing people in our dealerships who are running their lives in amazing ways. And when you're talking training, if a person can take a look at where they are right now in their life, in a particular skill level, and that dealership is willing to transfer knowledge on a daily, weekly basis, and really engulf these people with amazing knowledge, that's one skill.

These people are going to see the difference between where they're at and where they can be., and if we all got on the same page with training and a message and knowledge transfer, and how we can make people's lives better, that's a very powerful message, because we get to do it every day with very, very high touch.

How should a dealership approach training?

How often do we have a people meeting? How often do we have a people success meeting?

And how often are we making sure that we have the right training that's happening in place in our dealerships?

When you start breaking this down, and you say, the most important meeting that we can have is our people meeting, and you break it down from there and say, we're going to talk about our recruitment outreach, we're going to talk about the competency skill levels, of our current people, we're going to take a reflection as a management team and say, okay, great. What are the skills that we need to elevate? What do we need to train on, and training only takes place when there are role plays. When people are guiding that, and that leads to a very, very important thing.

One that's been very successful for me is, you have to train the people in your organization to be trainers. If you teach them a learning mindset, where you require them to have a mindset where they need to learn the skills of your store, how to treat customers, what we say to customers, how we interact with customers, as if they're going to train the next person, I think you can inspire learning a lot differently.

But you have to live that on a weekly basis. And you have to point out when it's happening, and when it happened. When people in your organization can identify that, you're going to be in for some really interesting changes.

But it's not easy. It takes 60-90 days, 120 days, maybe even six months to get that kind of feedback and communication going. But the moment it starts happening, you start raising the bar on the communication and the people in your organization.

Why is roleplay so important?

We have to teach people that growth comes from being comfortable with being uncomfortable, and when your people can give honest feedback at scale inside your organization and say, you know, you hit everything perfectly, but you know, these couple of things could have been improved, whether it was your tone or you're talking too fast.

It's not always what we say. It's maybe that we're not looking at people. If you have an organization that can deliver the type of feedback, okay, recognize high-level behavior and continue to raise the bar, you're 100% correct. You're going to move the needle and your people are going to perform better when new things come down the road, new technology and vehicles, which is going to be rapidly growing. We all know that.

How can dealers recruit talent today?

People are the most important asset, but why? I would tell you that if you're a dealer principal or a general manager, what's the most important sale that one of your leaders could make in any given day, any given week or any given month, that would be what if you brought in the next 20 plus car a month salesperson and he had an impact from the beginning.

Things that I've done in my life, I've been blessed to travel around the country and implement programs, turn dealerships around, and raise gross profits. I had a dealer who brought me in and wanted me to implement dealership-wide strategies, but he was losing $60,000, $70,000 a month in his used car department. And I said you don't need me to do us all. Let me, let me pay attention to your used car department. 

We evaluated the team as a whole, the personalities, skill levels, and everything. We went out and through some market research, we found who the best person in the brand was at selling used cars, and we went out and got them in a pretty short amount of time, shorter than what most of the time it takes, because it can take eight, nine, 10, a year, year and a half to recruit a real impact player.

That person ended up bringing two people. We took that dealership from 60 units a month to 160 units a month in less than 90 days.

So when you're looking at this, it's about mindset. It's about that people meeting and knowing that you are one person away in your department from raising the bar on where you're at. When you take a look at somebody who's a 20-car-a-month salesperson and the true impact that they have, that's the most invaluable thing and the most valuable activity.

So how many hours should a manager be in building relationships in the community, and getting to know most of the people in the car business around them? What value is that to have that conversation? And how long should that meeting be on a weekly basis?

How should a dealership be forecasting talent needs?

I think that this starts at a very, very high level in knowing what the capabilities of your leaders in your organization are to be able to plan. When you take a look at a dealership, there are a few key areas that they all need to raise the bar competency-wise, right?

Volume, margins, expense reduction, people, employee satisfaction, customer satisfaction, and setting a requirement throughout the year, once at least, maybe twice, for them to put and deliver what plans they're going to implement in their departments and how they're going to achieve those plans, 

That's a very big one because now you're going to be able to evaluate, as the leader of the organization, how good are the plans that are coming. How good are the ideas and are they going to be able to execute? Because in their plans, if they don't have the execution criteria and what it's going to cost, then you're failing before you start. 

But at the same time, when you're taking a look at these plans, if there's not a very, very strong emphasis on finding people, then you probably need to start with that, because people are always going to be the answer to growth and being able to acquire new dealerships.

And they're going to give you the ones that are able to execute on your plans.

How to identify management coaching opportunities.

So you know, when you're the leader, and you're seeing somebody who's extremely talented, maybe they're struggling on some of this planning process, that's a big opportunity, you know, to step in and help them become a better business person.

What's the organization missing? As it relates to this planning, how are we going to do it? But as it relates to the people equation, if your people can't turn on their juices when they're putting in place business plans, and get you sold on ideas, then they probably are not going to be able to sell your people on coming into your organization. So it's an important step, and it's really all related.

But you know, we started off with, hey, why don't more dealers do it? And I would tell you, we need to have the people meeting every week, you know, and who's talking to who, and what plans we need to have in place, and who are the movers and shakers in the market, and how are we going to grow people? How are we going to find people? How are we going to get more people referred to us?

And how are we going to make sure we connect with those people when they do come across our table? Are we wowing them?

You know, because I know that there are all types of things out there and tools about recruiting, and what needs to go into your job description, and you need to have a clear mission and vision statement, and, you know, in your compensation ranges, and how do you optimize the recruiting website for mobile?

But what we're talking about here is, as the leader of the organization, when a potential candidate is talking to one of your people, how are they going to feel? It's so different than buying a product, you know, how is this going to change my life?

We have got to be in a position as leaders inside dealerships, to be able to portray to people that this is going to change their lives.

How can a dealership raise the bar of its culture?

As trainers, we know, and we've seen that, regardless of whether it's a customer service skill, one portion of a road to a sale, just delivery, right, or a follow-up call, okay, that we can really have an impact in a lot of things just by the training of how we do that, and people will see that.

I think that optimism is really important. I also think that we have to be accountable to the organization and the people that we're training that when we see people who are not raising the bar when we're raising the bar, they're not putting in the time when we're putting in the time, they're not delivering the results and improving, you know, to the degree, in fact, they may be detracting, you know, there's a point at which we owe it to the people around that we're going to be committed to a, you know, goal-oriented, okay, successful organization, okay, well, those require people that want to come on board. We also have to know, when, hey, we've trained you, you can go be successful, we're a great organization, you're going to do well, but it's time to move on because we do have to raise the bar internally.

Creating a winning employee referral program.

This is one that is really, really important, okay, and should be part of the people meeting and should be something that's constantly evaluated, there are so many elements.

And again, they're HR people, they probably have other vendors that are familiar with the requirements of garnering and implementing employee referral programs, how they compensate employees and what they do, do they have a mentoring program in place, and things like that.

I would say this, okay, that all those things are relatively easy, and those are tactics, having a mobile app, that you're able to send somebody when you meet them, very simple things to do, having a splash page and a recruiting page, that your managers can send somebody that they're really interested in, very easy things to do, how you get your entire organization on the same page to tell them and outline them what we're looking for in our organization, and how people are going to feel when they are done with the interview process, and when they get onboarded.

So the execution needs to be planned at the time you're setting up the easy things. The response time for how quickly you get back to an employee referral may be even more important than the response time on selling one car. Because that referral could be 10, 15, 20 cars a month, like, right like that extra.

So having the execution items, having your managers on the same page, you know, having the right personality profiles, and those things in place for people to take, so that you know how they're going to fit in with the team, they know how they're going to fit in with other expert people that perform well in the job and your organization, okay.

Those are things that need to be put in advance so they can be done quickly.

They can be done quickly.

Dealerships need a strong process for recruitment.

Again, having these people conversations, not just with managers, but department-wide. , you. Here's what we're looking for, here's why we're going to be the best in service.

You know, LinkedIn is the greatest thing in the world, social media is the greatest thing in the world because we get to look at every day, the amazing dealers and leaders in our industry that make a commitment to this. And there's more than is reflected online, but we now get to see these things in place.

And you know, some of these places are, they're capturing some of the top people. I did work for years back, for a Honda store, and they had probably the best recruiting strategy I've ever seen. They went out and over a course of a period of time, captured the top nine Honda salespeople within a three-state area, and they had flexible programs and assistance and everything.

The lowest person on the totem pole sold 30 cars a month.

This is an industry opportunity.

Imagine if, from an industry standpoint, if we're having positive conversations about where our industry is going, and we're implementing and executing positive conversations for people that we're introducing to our industry, you know, this is an industry opportunity for us to captivate, you know, a generation of people to really hone their skills and change their lives.

When you look at, top performing dealer personnel, they're some of the highest paid people in the communities that they live. You know, everything from service to sales, to leadership roles.

And, you can't really put a price on it.



In this episode of DrivingSales Defining Leadership, hosts Bart Wilson and J.D. Mixon sit down with special guest Michael Hayes, Director of the NADA Academy. With over four decades in the auto industry, Michael shares his invaluable insights on leadership and the evolution of dealership management. Together, they explore how modern software changes impact dealership operations and discuss strategies for fostering a culture of innovation and excellence. Tune in to gain a deeper understanding of what today's workforce looks for in a career and how leaders can adapt to meet these evolving expectations.

Join Dan Trinidad, Founder and CEO of Benchmark Data, as he dives deep into the crucial question every business faces: "What's my ROI?" Discover practical tips on how to optimize your marketing strategies, enhance process efficiency, and leverage software systems for better business outcomes. Whether you're a business owner, general manager, or executive, this video will empower you with the knowledge to understand and improve your return on investment across various marketing channels.

Key Highlights:

• Understanding ROI in marketing and how to measure it effectively.
• Strategies for enhancing operational efficiency to boost ROI.
• Insights on integrating software solutions for optimal performance.

You can’t fix a process problem with marketing.

The question I got most when we were just doing consulting was, what's my ROI? I would most likely to be talking either to the owner or the general manager or a C-level executive, and they want to know what their return on investment is.

There are different marketing channels and different marketing campaigns, and what we always told them is until you are running as efficiently as possible, both in your processes and with your software systems, we're never going to know what your true ROI is.

If you neglect your process and you look at your ROI, and your marketing and its inventory management, lead handling, or internal sales chain that's causing the biggest leak within that flow, that's going to cost you more than what your marketing dollars are. So, 100 percent of the dollars spent on the process is going to improve the dollars spent on marketing.

Why do we spend money on marketing instead of process?

I think it's twofold.

One, it's easy to push the bug down the road, right? If you're if you consistently don't hit a goal and you pull the marketing lever and it doesn't work, you're constantly focusing on something that's external, and it's not your fault. So, the accountability is not there. In this industry, a good management team has to be accountable and has to accept what, you know, what the data is pointing them and where to look.

I think the second reason is maybe they don't know how to improve a process. There are not a lot of systems in place within this industry that could be and should be that some of the top dealers execute. and I don't think they really have the information or know-how on what to do when something's not performing internally if that makes sense.

What do you see the role of management in this?

I think the managers, it really depends on how they came to become a manager. You know, unfortunately, in this industry, they'll promote someone who's a really good salesperson and maybe has a very good internal process and how they look at us, you know, their own personal achievements, and they'll be promoted to a manager the majority of the time.

That doesn't translate on how to educate or how to, you know, groom someone else who's coming up.

I think managers, their perception is they’ve got to do the job, just get the job done, qualify and bring them in. It's more of a hard nose, get your job done instead of nurturing. And, in today's day and age, the consumer is different. You’ve got to service the client. You’ve got to ask questions of the client.

It's hard to groom salespeople who have been doing this for years. It's easier to work with some of the newer guys. So, I think it's just a challenge.

And then it's called inspecting what you're expecting. Once they get to that granular level of inspecting, I think they're going to see a better outcome or change.

Simple adjustments can make all the difference.

It's the little things that make all the difference. What we often see within a dealership is the easiest thing to have an impact on your sales that month is your internal sales chain and the management of your sales team.

For example, I have a client this month and we're talking about how come we're not hitting our 150 goal. It’s a metric they've been trying to achieve in April for years. Now, we've grown from one hundred and eight to one hundred and fifteen. Now, this year we're tracking one hundred thirty-five.

And the conversation went, “I don't think we have enough of the market or I don't think we have enough leads to achieve that goal.” But when I showed him, we had two new salespeople and the bottom sales performer usually performs about 30 percent less than your top sales performer. In this case, the two bottom salespeople were performing 25 and 30 percent less than the store average. Yet they had the most ups and most walk-in distribution. If they would have been closing just at the store average, they would have had 14 more sales month to date. And that was last week. That would put them at exactly one hundred and fifty sales.

So, it's just managing the walk-in distribution. If you're managing the up distribution and just looking at who's taking on those opportunities, a simple tweak like that can make all the difference in them.

What are some of the first metrics you look at in a dealership?

The first thing we do is we do a funnel review. We measure the amount of users, the VDPs, which is an indication of marketing. Then we measure their VDP to leads, an indication of inventory management. Then we measure leads to visits, an indication of lead handling, and then you're in-store visits to closing to sales, closing percentage.

The reason why we do that is every dealership has a different weak point within their flow, and it's really, really crucial that the dealership knows where they're lacking in that funnel and they prioritize that part of the funnel to start correcting.

It's always process, whether it's a marketing process or an inventory process.

One of the things that I've noticed that most successful dealers do is inventory management. I think that has the biggest impact on sales. It's usually recon time, I think, is number one. Some dealers are really happy at five to six days of reconditioning time, whereas others are above ten. But, you know, I hate to break the news, but some of the top dealers are two days, two to three days in reconditioning time. Their time to the line is instant. They buy that vehicle for day one, and there's really no depreciation by day two or three, whereas with another dealer, they buy a vehicle, they put it out on the lot 15 days later. They're already in the values are very much different.

I think that it's really important to find what part of that funnel is impacting your ROI the most. Focus on it, and I guarantee it's a process issue that can be improved.

What are some of the most impactful sales metrics a dealership can look at?

Here's another interesting example. We have a young salesperson in a dealership versus an experienced salesperson in a dealership. We like to measure ups to demo and percentage ups to write a percentage. Those, I think, are the two most impactful metrics that a dealership could look at with an individual salesperson.

For a store up to the demo, a good average is anything above 75 to 78 percent. But the most important metric is that they get them to the write-up phase, and what we see is when a young salesperson doesn't get them to the write-up phase, it's usually because they're not qualifying them properly, they're not gaining their trust. Maybe during the demo ride, they're not asking the right questions. It might be a flying TO and they're not answering the questions. Does he have a trade-in which is payment? How much has he got down? Does he have a co-signer? When they come back to the dealership and they're sitting down with the prospect and, you know, they're going to go to the manager, a lot of that information hasn't been gathered and there's really no bond or trust, so the consumer is reluctant to give that information.

We recognize that's the number one metric that really increases sales as your ups to write a percentage. If it's an older sales rep or a more experienced sales rep with a low ups to write a percentage, what we notice is they like to overqualify. They don't need the manager's help. They know they have all the answers. This person doesn't have good enough credit by a car. They're not going to qualify, so they kind of rush them out.

What we see is consistent in both of them is they go through that process quickly, that that customer leaves and they're standing at the door onto the next customer. The follow-up process and feedback percentages are low, so they usually get the most opportunity and the lowest ups to write up and the lowest feedback percentage.

I'm telling you that impacts the dealership, you know, huge, greatly a month over month. just by fixing or analyzing those two metrics with your sales team, you can have a much different month.

And that's something that you can implement today. That's not something you have to wait for, you know, next month or something different if the manager is looking at those metrics and they understand what's impacting their sales, that can be turned and changed overnight.

Data should not be a weapon.

For years, we gathered the data manually, and we were we were a boutique consultancy. We would spend a lot of time within a dealership and provide this information and try to help them, you know, groom along the sales route. Now we have a software that's automated that does creates these reports for them on a daily basis and sends them a benchmark alert and lets them know this individual is underperforming in this specific metric with a for example, here's you can do a B or C.

What we're what we're updating now is an accountability factor where the manager who's in charge of the department will get an alert and they would have to put in a note and close out the alert to just to show that someone took action on what's happening. It's no longer taking a lot of time.

It's presented to the dealership, you know, for them and let some know what's wrong and potentially how to fix it and gives them the opportunity to close out what we call an open ticket or an open alert so they can address the issue. Now, understand that not all changes are going to have a huge impact. It takes time.

I also want to say that data should not be weaponized. When a dealer first starts analyzing data and managing their store by leveraging data to the best of its ability, you have to give it time. You have to give it three to six months for everyone to make an adjustment and try to improve.

As soon as you weaponize it, it has a negative impact and no one wants to be graded at that level. Then they start to skew numbers.

Who should be accountable for this?

 You have to have the trust of the employee. First of all, it comes from the top down. You need an owner of the solution, regardless of what solution a dealer invests in, whether it's a marketing campaign or a website or our software for process management. You need an owner within the dealership to own the solution who's going to manage the process, meaning he's going to manage the alerts and manage the timelines.

That person has to be a voice of reason and of trust. The employees have to trust the data and trust the person that's delivering the information.

I usually think it's not it doesn't fall on the employee when they can improve. It's usually management because management is in charge of hiring, right? Making sure to hire slow, fire fast, making sure you got the right people on board. And then it's up to the management to provide that nurturing and education for them to get better.

I think the employee should kind of have almost free reign in the first 90 days to look at their data, find out what their weak points are, and try to improve upon it, but it's imperative that the dealership has something in place to help them grow and grow.

You know, we find oftentimes where, you know, dealerships overinvesting in certain parts of the funnel, right?

Let's say they're overinvesting in the bottom part of the funnel and they can save five, ten thousand dollars a month and they wouldn't have any impact on their sales.

A lot of times when you find that, they want to know what's the next marketing campaign that we can reinvested in because we still want to sell more cars. My answer to them is to find the leak within your sales chain. And if it's in sales and development, invest in that.

You know, if the managers are not equipped to educate and bring that salesperson along, bring someone who can, and I think when they adapt that mindset, they're going to get a better outcome. They're going to get much better results for their investment.

What is the ideal client for you?

I would say it's a dealer, one who has to be data-driven. They don't have to completely understand how to be data-driven or know what to do, or how to be data-driven, but they have to be of the mindset that we want to make decisions based on empirical data to improve. Number one.

Number two, they have to have someone within the dealership who's going to manage that process as an account and is accountable for managing that process, someone who's willing and able.

When we do a demo for a dealer, we have a discovery call. We like to ask who within your dealership, "Can you see in this position, and is this person available either in a week, biweekly, or monthly for monthly meetings?"

We can go online and we can onboard and continue to educate that person once they have that in place and they can visualize someone that they that they trust. That's an ideal client for us.

And as long as that person is transparent, willing, and able to look at the data, you know, make adjustments accordingly and educate, then then it's going to be a really good relationship, and results are inevitable. It all really depends on how long it's going to take us to achieve that goal.

And so that's pretty much it. It all really depends on how long it's going to take us to achieve that goal.

How do you stop salespeople from “gaming” the data?

On our end, you know, that's one of the main things we experienced, and especially when we onboard a new client, they want to know how accurate the data is or we'll get a lot of pushback that it’s not right.

Within our system, we have an auditor and we can see when things are kind of fudged or not followed accurately, whether it's leads, whether it's visits, b-backs, BDC appointments, or appointment shows.

In our dashboard, we have CRM data and then we have benchmark data and we hold them side by side. Oftentimes those numbers will be different anywhere from 10, 15 percent. In the beginning, it could be up to 40 percent.

In utilizing that auditor, we're able to show, well, this person didn't use a stop, put in a stock number, this person said this that the appointment arrived. It was an appointment, but they put the appointment in after the visit arrived. It's probably a visit, not an appointment.

So we're able to break it down, and we use that as a teaching tool and a management tool for the manager to go in and make sure everyone's trying to follow the process accordingly. It takes us a good three to four weeks to implement this process and have everyone on board.

So it's important that the dealership follows it. They're of the mindset that they want to get as clean as possible and get the data as accurate as possible, but we actually have some tools on our end that we can kind of see what's going on, even if they're not utilizing the system the right way.

The importance of data in the sales process.

Most dealerships, when they think data, they think in terms of marketing. They're not measuring their internal processes, first and foremost.

Once you start doing that, you have to understand that you're already ahead of the curve. Now you're starting to see where you can improve internally, and once you accept that and understand that every dealer has similar issues, every dealer has holes in different areas of the processes.

All you have to do is say, how do I focus and how do I set them up for success?

And again, I think that's management and, you know, C level, you know, a problem or challenge to try to solve. How can I put my team in a better position to succeed if the metrics aren't where I want them to be?

How many of your process metrics are universal vs dealer-specific?

We know that the OEM will have some specific data and we can use that as a guideline, but we pull historical data into the dashboard and we'll do a 90-day average of their performance.

And then according to what their goal is for the month, we'll let them know throughout that sales chain what percentage, what type of improvement, improvement by percentage in each part, each part of that funnel that they need to improve upon to meet that goal. So instead of saying every dealership needs to be here or every dealership has to follow this OEM guideline, we have to first figure out where you're at, what's your starting point and how can we improve upon what you're doing. Then we can start saying here's an OEM percentage or here's an industry standard.

You know, we see metrics up and down. For lead handling, I have a BDC team that performs leads to show at 34 percent. I don't care what part of the season it is. Consistently leads to show, not leads to appointment, leads to shows at 34 percent. That's an that's an excellent number. And, you know, you have other dealerships that are at 12 percent.

So you have high and you have low. I think a good number is right about 28 percent, that's a good low benchmark, I would say, for any dealer.

There are some industry averages that I've seen throughout the years. There are some OEM recommendations. But then I think the most important metric is where does a dealer sit at now and how can we improve upon his personal performance, you know, in the next 60 to 90 days?

Can you define hard and soft conversions?

During our consulting time and the majority of the time we would sit in meetings, and we’d spend hours with the marketing team and with the dealership ownership and management. We'd be going over metrics such as cost per click, click-through rate, impression, impression share, and influences. These are five soft conversion metrics, and we would talk about them through exhaustion.

I would sit there and tell the dealer we're having another month where we're underperforming by 20 percent. The marketing team or agency is telling you how great they're doing in all these soft metrics.

As a dealer, if you're not investing in soft metrics. They are important, but that's for the marketing team to focus on and understand their internal performance has nothing to do with the dealership.

The dealership is investing in hard conversions. That's leads, visits, and sales. That's what they should care about. That's it.

Why is that? If all the soft conversions are performing, all of them, and they're all coming to your website and they're not converting into leads, then that's a conversation that they want to say, hey, let's take a look at your inventory. If they're coming to your site and they're looking at your VDP and they're staying, you know, above two and a half minutes, three minutes on a VDP page, that's a quality visit. If they're not becoming a lead, which is a hard conversion, why is that? What's wrong with our inventory? You know, when was the last time we updated pricing? Do we have the right pictures? What was our time to line?

Now you could ask those questions internally, but the dealerships spin themselves in a circle month after month, focusing on these soft conversions. They don't understand. They're not a marketing agency, nor should they want to be.

Another thing I would tell you is I would never invest in impression share unless my conversion rates and unless my leads, my VDP to leads is above 15 percent on any specific campaign. I'm not going to invest in impression share because you're all you're going to do is spend more money on visitors who aren't going to convert, and that's a great way to spend your money quickly.

Another example is influences. You know, we have a saying, if you can't measure it, you can't manage it. Not all multichannels are actually influencing a sale, so that's just another area a dealer really has to be careful with.

What they want to do is trust their marketing agency to make sure your soft conversions are there but focused on your soft conversions are there, but focused on your hard conversions, because that's what's really ultimately going to make a difference with the new dealership.

Discover how managerial scorecards can redefine leadership and drive efficiency in automotive dealerships. "Measuring Management: Should Managers Have Scorecards?" is a thought-provoking podcast episode hosted by Bart Wilson and J.D. Mixon, who bring over three decades of combined experience in automotive retail. Join them as they explore the transformative potential of implementing scorecards for managerial roles.

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Dive into the heart of adult education within the automotive industry in this insightful episode of "Driving Sales, Defining Leadership." This time, hosts Bart Wilson and J.D. Mixon are joined by John Diaz, a seasoned Learning and Development Specialist from Principle Auto Group. With a rich background in educational programs and a passion for adult learning, John sheds light on how adult education principles are revolutionizing training and development in the automotive sector.

Highlights of the Episode:

• Exploring the principles of adult learning in the context of the automotive industry
• John Diaz's journey from educational expert to automotive learning innovator
• Key strategies for implementing effective adult learning programs in dealerships
• Overcoming the unique challenges of adult education in a fast-paced industry
• Leveraging technology and innovative methods to enhance adult learning experiences

Discover a world where leadership meets innovation in the automotive industry. "DrivingSales Defining Leadership" podcast episode dives deep into the art of leading a team to excellence. With insights from industry experts, J.D. Mixon, Bart Wilson, and special guest, Mel Wilson, Fixed Ops Director of Goode Ford in Burley, ID, learn how to revitalize your leadership approach and steer your dealership toward success.

Empowering Teams for Transition:

In this episode, we explore the essence of transformative leadership and its impact on team dynamics. Learn how to cultivate a culture of empowerment, where every team member feels valued and motivated to contribute their best.

Strategies for Success:

Dive into practical strategies that can help you navigate the challenges of the automotive industry. From employee development to leveraging human capital, discover how to optimize your team's performance and drive sales.

Cultivating a Winning Culture:

Uncover the secrets to building a resilient and adaptable team culture. Learn how consistency in training and accountability can forge a path to success, making your dealership a beacon of excellence in the automotive sector.

Join us as we explore these themes and more, providing you with the tools you need to lead with confidence and achieve remarkable results.

We recently sat down with Travis Peterson, VP of Product at One View to discuss how cloud computing and cloud storage has evolved. We chat about how dealers are leveraging cloud storage and the best practices you can implement when moving your documents to the cloud.

How has cloud computing transformed document storage?

You know, as far as the dealership is concerned, their world has changed drastically. They looked at documents they had coming off that dot matrix printer for the sound effects. I even remember years of saying I just wanted to print during the day so I feel that nostalgia. But dealerships, as they've evolved, realize that there's more use of electronic signatures, and electronic storage of the documents because it's not just the retail space, it's also the security of those documents, who can touch them and access them.

A lot of the dealerships over the past few decades have been dealing with that struggle. Maybe they're getting off of paper and they're trying to get into scanning or they've scanned paperwork and they're trying to figure out how they evolve into a digital age of all of their documents being stored in a different storage system that's easily retrievable across the dealership.

So the evolution of dealerships and how they transition their paper for their digital asset is very important.

Document storage and security.

The concern is how people have access and what are the security controls. I remember my days a long time ago being in banking and the fact that you had to have two signatures to take cash from the vault.

And the reality is how much money, maybe digital or people's data that goes through a dealership is kind of the reason why dealerships have been pressured into that financial institution regulations. What dealerships have to do.

How can cloud storage help with document organization and accessibility?

You think about your laptop, you sync it up to Dropbox, you sync it up to some cloud solution. The reality is, if I'm just throwing the files into the file cabinet, it does no good when I want to go and retrieve them. So you have to have them organized in a way where it's VIN-specific, customer-specific, and relationally. you want to be able to pull all those data points together when you're trying to find something related to a legal situation or a deal and you need to make sure that everything we needed substantiated and we have it. Or everything that is there, someone requests us to delete it. We need to be able to know that we are confident in our ability to go out and delete all of the data that needs to be deleted for that client.

Why has automotive retail been slow to adopt cloud storage?

I think that COVID was a big driver, a big push. But I think that a lot of people have just lived with paper as being the tangible asset to be able to work through a car deal or the tangible asset to provide proof. Franchises for a long time harped on the fact that you had to have the physical piece of paper in your hands, and if you didn't have that physical piece of paper. how is it going to be real? Manufacturing that paper and pulling it back out and saying, yeah, a piece of paper is legitimate enough for me to consider it to be the original.

A lot of dealerships are scared and have been scared, honestly over the past few decades. Just knowing, "Am going to be good for the franchise asks? Am I going to be good if the IRS calls? Am I going to be good, protected is a better way of saying good, but am I going to be protected in this situation when I have to produce that document or whoever is requesting it? And will they question that process or will they question the validity of the paperwork?"

I think the challenge in my mind is I think about it is how many times have we taken our kids to the doctor and have no paperwork anymore to fill out. They adopted that quite a while ago. In banking, what kind of digital solutions do we have in place now where we don't really go into the brick-and-mortar anymore for a bank? And things became digital and we stayed with that, whereas we're in the dealership and now we've got paperwork that we have to fill out. We've got deal jackets that are still paper and we're trying to figure out how we're going to store them in the file cabinets.

How do customers feel about data security and protection?

I always joke that there are just different generational situations. You may have a parent who is all about technology and wants to embrace it as much as they can. And then you're going to have another parent that says, I don't want to. I mean, I'm a parent that has lots of different apps just to keep track of stuff. And there are some days where it'd be nice if I just got one sheet of paper that told me everything that's going to happen this week. 

But that's just people's perceptions of technology. If the idea of me keeping organized and having all of the data at my fingertips is something that I'm okay with, and I think that that comes down to that security factor. If the dealership is okay with that security and knows all of the documents that are going to be stored are going to be secure, then I think that changes the factor for people acknowledging and accepting a digital cloud solution for storing their documents.

And the other side of that coin is going to be someone who says, I don't trust that I don't want my data out there stored in some system that I don't have access to. They want to control that. So some people are going to be safer or feel safer keeping it at the dealership in a file cabinet. They just don't know what they don't know about the security controls that exist in the dealership

How to you protect the dealership documents? 

It's a partnership between the dealership and us because the dealership has employees, so then we have to extend to the dealerships the fact that we need legitimate user access. We need people to have real emails. We don't want to have just random logins to the system. We want everything to be secure. So we're going to use MFA technology to make sure that people are logging in and accessing it in a secure manner.

We're going to make sure that our system is using proper encryption technology and APIs that are going to connect the user to the images that they're trying to look at or that they're accessing. But something that you mentioned is all about the redundancy of the data, and the reality is, is going back to that paper now, this paper that I have here in my hand, the one copy, that's the only copy. We use a system that can store a daily backup, a weekly backup, and a monthly backup. There's just multiple iterations of that backup being capped, and that gives you more confidence. From my perspective, I'll jokingly say, that if I were to go back to my cell phone and say, How many times are the images or the photos of my kids back up on there? That's an important thing to me, and I want to make sure that this paperwork: service deals, parts, app checks, whatever it is that is put into a digital file cabinet that is backed up multiple times with secure redundancy that only the people that need to access it are able to access it.

How cloud storage can help with dealership compliance

Another point of that, I mean, you brought up credit compliance. In my opinion, choosing a vendor that can store that without printing it isn't an even bigger piece of the puzzle. Why would I want to put it on that piece of paper that goes on to the edge of the desk that someone can walk by and just pick up? I remember when I was in the dealership, the red flag compliance training that we went through, making sure that there was no paperwork on my desk and that everything was cleaned up. That's a big key and that's great. But why not just circumvent that process completely and just have that data never go into a paper format?

Are most dealers scanning and uploading documents or electrically managing them?

It all depends on the DMS. Frankly, We're kind of talking about the deals or finance. So yeah, if a dealership is doing the contracting, they're really focused on that.

But then a call that I had this morning was about how I figure out all these systems that I'm using to produce a deal. And I jokingly say, What's in the deal? We'll see with our clients that the average deal is 60 pages if all are printed out. The question is how many systems did you use electronics systems to produce 60 pages of paperwork? Some of them are a digital e-signature. So that is a hot topic. That's it's really something people really want to inquire about or figure out. How do I get that into my dealership? Maybe you have an E menu, or maybe your whole contract is E, but then you forget that there's other paperwork that comes from 60 pages. So maybe you consolidate 20 or 30 of those pages and get them just electronically stored. That's phenomenal. That's great. You just reduce half of the work that someone has to do scanning and the paperwork. Hopefully, you don't print those out. Hopefully, you keep them there in electronic form.

What is the value of cloud storage for fixed operations?

Fixed Ops, I think, is not looking at as much for parts, but definitely in service. Parts maybe if you have a large wholesale business you'll say, Hey, it's going to be a lot easier to retrieve the documents, look them up, look for stamps that way. But service is going to be very focused on their warranty and then the warranty processing documentation or they're going to be a situation where they're producing a lot of repair orders, a lot of paperwork that's coming out of the printers, and they want to find a way to archive and get that captured and stored.

I was working with the dealership last week. They are taking down their old building. They built a brand new one and the statement that the CFO made to me is it would have been great if we'd done this five years ago. I wouldn't be trying to figure out what to do with all this paper. So that paper, when you move from one place to the other, becomes a large storage area in your new building. If you didn't have that storage requirement, you could use it for a moneymaking situation. 

So in service, they're looking at real estate that paper consumers that they could be using instead for a revenue-generating product. Instead. So that's what we see with the service side of business as well as they're focused on the warranty. How do I know that I have everything captured for warranty paperwork should I ever get a question from my franchise? 

How cloud storage can help with a DMS switch.

It's a good question. I'm just going to speak in generalities of documents. If you were to think back to the days of file cabinets that would sit inside of a dealership, they would switch their DMS, they would change their CRM, all that information would change, but their file cabinet would stay the same. They would still store their customer's data in a secure place where everyone who needed access could go in and access it. I remember in the dealership I was at, the file cabinets were located in the office. You had to know the code to get into the office to be able to access those documents, or they were in a storage room wherever keyed control. I mean, you had to have the key and you have to get in.

But you have to realize that a lot of dealerships, as they transition through that process and store those documents, from my perspective here, we need a system that is going to make it where they can access the documents anywhere in the dealership they need to.

What processes does a dealer need to have in place?

As far as your file cabinet, imagine that I just open up a drawer and shove the documents in there. By not making sure that they're alphabetized. If I'm not making sure that they're organized by VIN or retrievable by VIN, it's going to be a challenge. But if I have added value, I know what documents should be going into that drawer of the file cabinet. And I know they went in and they're still in there. I've got a thousand repair orders for this month and I'm going to file them away into the file cabinet.

From our perspective, we know that the dealerships need an exception or they need something that's dynamic that is going to tie to the document type that they're working with today. And it's going to tie into all the documents that they need to have access to. a dealership that has that kind of checks and balances to make sure everything that went in there is a perfect way for them to know I switched my DMS. I need to go back and look at something historical. It's right over there in that drawer, in that folder. 

Well, if it's a digital cabinet like we're providing, that's a place where they can switch their DMS, and still be able to find the documents that they need. One of the challenges we've seen over time is when a dealership converts from one system to the other. They have one file cabinet regardless of the DMS, the efficiencies, find the documents, and answer the questions a lot easier. 

I just had a dealership yesterday that was looking at their accounting data and they were trying to figure out why a fixed asset changed and they needed the details for their CPA. How that's going to happen? For every dealership that switches their DMS, they need to look for the data. They need to answer a question for someone, And that could be or CPA that could be an auditor. If I can easily get to it, that's going to be important. Well, back that train up just a little bit.

I know our process of how we train people and I think that's a big thing too. What we do here is train the individuals who put the data into the system and make sure that it's a high-quality document going in. I may talk about a dealership that is still today counting every page they're scanning into the system. Is it required? No, it's not. They choose to do that because it gives them assurance. This reporter has eight pages. I scanned eight pages and I'm good to go knowing that everything is there. And that gives them confidence from the very beginning of the capture to make sure that everything is easily accessible, regardless of the DMS, regardless of how many years have gone by and I need to go back and look for the document. It's there. 

What reporting do you provide?

There's definitely reporting right at the front. There's a simplified exception report or an advanced exception report where someone can just see a chronological record of the tickets, where you can use our exception report that is going to give you that advanced perspective. It's a graphical interface. It's going to tell you what documents you closed in your DMS in a certain period of time. Click on service. Say I closed 1000 repair orders this month. I scanned 900 of them. Where's the other 100? I get them scanned in. I look at the report again. I can see regularly that all of the documents are being scanned into the system.

To me that exception report is key. Your accuracy in the process that you put in place. I've had people on my system switch, then they don't have that visibility anymore and they feel like they're floundering. They don't know why. I was told I scanned everything with an exception report that's right up front, right in people's faces lets people know what is being scanned and what is missing is very important to the production they're accessing. Whether it's fixed, whether it's variable, accessing those documents that they need at the dealership.

Who is scanning the documents in the dealership?

 The same person who would be filing the documents today is typically the person I would recommend be the person scanning the documents. But it's going to be the last person who touches the document ideally. When I'm finished. If it's someone who is finished with the title work on a deal, it would probably be the best person suited to scan the deal. If it's a service person who brings everything to a cashier, maybe I'm going to scan there. 

I had a store up in the northeast. They had service advisors, as soon as they finished with that repair order, they were able to scan it right in from a terminal that is centralized to them, get everything scanned at one spot. So every dealership's going to do it just a little bit differently and you don't have to hire someone to do that job. It's just all about setting it on a scanner and quickly scanning it. 

When it comes to who is going to look at that report, I'm going to recommend that it's management right up front. I'm going to recommend that it's a controller or CFO who has visibility and is aware of that on a monthly basis. I can recommend that it's a service manager, a finance manager that's looking at the exception report for their deal genre, wherever they're at. If it's fixed. I'm looking at service, if it's sales, I'm looking at the deals, because when I need to go back and look at that document, I want to know the system was there to protect me and I'm in control, or I'm directing the person that is routing those documents through the channel.

I don't need to hire anyone else to do it. It's a short, quick report that people are going to look at, whether it's 5 minutes a week or 10 minutes a month. They're going to look at that report. It's a quick accountability to the process to make sure that everything that you put in place is now working and you're going to be confident when you need to go retrieve the document.