The Ultimate Service Manager-Part Two

In part two of The Ultimate Service Manager we will dive into the evaluation and form a plan of action. The key to an evaluation is not to get into what we call Analysis Paralysis!

Believe it or not, it happens more than you think it does. We pull report after report and it seems to always finds it's way to the trash, due to lack of an action plan.

 First and foremost, the most important part of this evaluation involves your employees.

One of my favorite authors is Jim Collins and in his book, "Good to Great", he states that you must have the right people on the bus, and they need to be in the right seat.

This is the key to consistent growth month after month because as we all know, success is a moving target and without the right employees in the right seats, change will never happen consistently.

So here's a few questions to ask yourself and assist you with building your Performance Management Process:

1. Do you review each employee's performance daily, weekly, monthly? Yes/No
2. Who's performance is concerning me? ___________.
3. Does the Behavior Profile match the position? Yes/No
4. Is the Behavior needed for this position trainable? Yes/No
5. Does this employee have a Job Description? Yes/No
6. What performance metric is concerning you? __________.
7. Does the pay plan reward what you want repeated? Yes/No
8. Is the performance metric realistic? Yes/No
9. Has this employee performed it in the past? Yes/No
10. Is the performance objective/goal crystal clear? Yes/No
11. Does the employee need additional training? Yes/No
12. Does the employee need a coach? Yes/No 
13. Does the employee want to do it? Yes/No
14. Have you written out a corrective/disciplinary action plan and reviewed it with the employee? Yes/No

Remember one of the most important choices you make is who is allowed on the bus. It can make you or break you! I can't even count how many managers made bad choices on a gut feeling with no paper trail only to find out they are out of a job.

I also want to point out that no documentation can substitute for Great Management. What I mean by this is it's a tool to assist you in communicating what the Vision and Goals are however you still need verbal praising/coaching everyday by MBWA or (Management By Walking Around.) 

If you manage from your office it will show in your numbers. Let's take a look at a real world dealer client of ours and see how we came up with the action plan.

First, we performed a personality profile on each employee and then reviewed each of them to see if they had the right behavior profile to fit the job description.

We had two advisors that did not fit the profile for that position. Then we asked for the job descriptions for all employees and their wasn't any. 

One of the service advisor's in question was the receptionist and wanted to write service. They handed her a pen and she wrote service. Let me re-clarify that just a bit... she "took" orders which led to under $100.00 in labor sales per Customer Pay Repair Order.

Let's take a look at the other advisor that did not fit the profile. He has been there for over 20 years and had been through all the factory training as well as with a few consultants that had visited the dealer. He was a master at everything and his certificates proved it.

So we took a look at the financial evaluation results and he was at or under $150.00 in labor sales per Customer Pay Repair Order for the last year. When I sat down to ask him why his sales are so low for a seasoned advisor he had a list of excuses a mile long.  

Next I asked if any corrective/disciplinary action or "write ups" were recorded on any employee in the last year and again the answer was no. This is 90% of the numerous dealers I have been in over the last 18 years. The majority of them thought it was corny and wouldn't make a difference. 

I have a saying: "I would rather be corny and profitable then cool and broke". The last thing I was looking for was a Goal Action Plan and again the answer was no.  

How can you expect your employee's to know what you want if you don't have a vision/plan/goal, train, coach, and consult? So we started with the infamous Job Description for all employees. We then sat each employee down and reviewed it with them and asked if any part of the job description was not relevant to the job position?

Next, we had them sign it and we created a performance file for them. Then we went over the Vision and Goal Action Plan for the store and asked again if they thought it was relevant and then had them sign it. This also went into the performance file.

The pay plan was next for the service advisors. One of the  main problems we see is Dealers or Managers fearing how the employee will react. Their is nothing wrong with this, however don't let the employee dictate how you build a pay plan. The number one thing to focus on is to reward what you want repeated.

We have seen a lot of pay plans that reward Poor Performance. The guide for service advisor compensation is 5% of the advisor's total labor and parts sales, (customer, warranty & internal). A balanced plan requires a combination of total sales, sales per per customer pay repair order with a minimum total sales per month to achieve a sales bonus.

We don't believe in salary's at all. This job is a sales position and I have never seen a "top" salesman being paid a salary to sell cars. Installing a new pay plan can give a Manager an uneasy feeling however you have to make the tough decisions if it is best for the business.

This is not a social club and it's main function is to absorb 100% or more of the total dealership expenses.

Here's a question to ask yourself, How does your Fixed Operations measure up in the Service Absorption arena? The Goal is 100% and the pay plans can make you or break you as we have seen over and over again.

The best way we found to install a new pay plan is to show them how we came up with the numbers to support it and what the Vision and Goals are for each of them.

We then give them 30 days to adjust to the new pay plan meaning they can choose their old plan or the new one based on the greater of the two at the end of the month.

Next month we will continue with part three of the Ultimate Service Manager!

Until the next blog...remember one thing:

Success is a Moving Target! 

Guy Salkeld is the President and Head Performance Coach of Automotive Consultants Group Inc. The only Low Risk High Return Training, Coaching, and Consulting company in the world! To learn more go to www.smartservicetraining.com  Have a question? E-Mail Guy directly at guyacg@aol.com or Call me direct at: 305-331-3373    Follow @smartserviceguy

S.M.A.R.T. Coach Online

What Is Smart Coach Online?

ACG's Smart Coach Online Program will provide you a very cost effective way to Train, Coach, and Consult your Fixed Operations towards 100% service absorption.

Here's how it works.

 ACG is using EBIS software that will enable you to discover numbers that you otherwise would be unable to view. It allows our ACG Performance Coach to Train, Coach, and Consult your Fixed Op's Director, Service Manager, and Service Advisors to obtain "Unrealistic Results" month after month without travel expenses.

 EBIS also performs a Warranty Labor Rate review to see if your in need of an increase based on your Customer Pay repair orders Effective Rate on sequential repair orders. 
Then you can summit the Repair Orders that the software has chosen to your factory representative for the Best Labor Rate Increase. 

So far EBIS has increased hundreds of Dealers Warranty Rates and Thousands of Gross Profit Dollars to the bottom line without having to pull hundreds of Hard Copies. It's all done with a click of a button!   

The EBIS software also allows for "Real Time" rankings and bench marking "On-Line" for Dealerships of the same make and size. It's like a 20 group on steroids every week with a lot more than 20 Dealers participating. This includes Op-Code comparison, Effective Rates, Hrs. Per R.O., Sales Per R.O., Gross Profit %, Labor Sales, and the list goes on.

Here's Some Examples:  

Virtual Performance Group Report

What ever you can think of we can measure, build a report and perform a comparison to see were you rank with the group or within your store. We also have a "What If" analysis and calculation that will show you the "Gross Profit Opportunity" that can be made from a simple change.

We will link Dealers of the same brand to our Virtual Performance Group meetings that will be held "Weekly" and review where each Dealership Ranks in all different areas through a  "Live online Webinar".

The reason these meetings will be held weekly by ACG is so we don't "Wonder what Happened We make things Happen" before the end of the month!

This is not a "Talk About" your numbers meeting it will be an intensive Action Plan building and Review session with Execution! ACG's Performance Coach will provide unlimited Training Webinar's for Parts and Service Departments for all of your employees.

These webinar's will include but not limited to:

• Pay Plans 
• Job Descriptions
• Service Advisor Training
• Behavior Profiles
• Service Management Training
• Parts Management Training

This is just a few of the "Live On-Line Webinar's" we offer so you can achieve your Daily Objectives as well as your monthly and long term Goals.

For a FREE Live Webinar with the Details and Cost of this program: 

Register Here

Guy Salkeld is the President and Head Performance Coach of Automotive Consultants Group Inc. The only Low Risk High Return Training, Coaching, and Consulting company in the world! To learn more go to www.smartservicetraining.com  Have a question? E-Mail Guy directly at guyacg@aol.com or Call me direct at: 305-331-3373    Follow @smartserviceguy

The Ultimate Service Manager-Part One

I have been asked over and over again what does it take to become a Top Performing Service Manager? In Part One of this series I've titled "The Ultimate Service Manager", we are going to explore this topic in depth.

This E-Book will also guide you what to look for, make a plan to accomplish it, and how to execute it. We will also provide proven, common sense solutions that will lead to "Unrealistic Results" month after month.

Over the past fifteen years, I have trained,coached and consulted many dealer principles and service managers and it seems that the one common thread I find with each of them is lack of execution after an evaluation and a plan has been created.

I have a three step process that if followed as designed will bring you continuous success over and over again.

Here it is:

• Evaluate
• Plan
• Execute

When your done REPEAT! It's a never ending circle if you want to be successful.

Let's dive into what I look at first in an evaluation of my fixed operations.

The first thing is the most important. I take a hard look at your current employees and knowing what you know now about your employees would you hire them today?

If your answer is no, ask yourself why? What happened during the hiring process? Maybe one of the employees has been there for 30 years and doesn't perform up to standards and you didn't even hire them.

If your asking yourself what the answer is, you need a Hire to Fire process in place. If you're thinking to yourself after reading that last sentence..."I know what to do"...then you need to ask yourself..."How well am I doing at what I know?"

The answer I get 95 % of the time is "not very good! Why is that? We know what to do,  however we don't apply what we know to our business. Doesn't make any sense right?

The number one thing I have found after visiting over 300 plus dealerships is the majority of employees are not being held "Accountable" or "Praised" for their behavior or their actions.

Now I have found a few of the dealers employees were being disciplined while others were exempt for whatever reason or excuse. Remember I said "Some" of them. I would rather see no one being held accountable then some of them.

The same is true for praising the employee(s) when they do a great job! This is one of the most basic fundamental things that exists today in any business if you want to achieve your Goals.

Here's what our Hire to Fire questioner looks like and I can already hear some of you saying that you already know or do this. Then you need to find a mirror and take a good look at yourself and ask how well you are you doing it?

A. Hire to Fire questioner:

1. Would I hire any of these current employees right now knowing what I know about them after working with them?
2. Do I have a Hiring Process in place so I don't make mistakes from a "Gut Feeling"?
3. Do I have an Employee Job Description for each position?
4. Do you have a Pay Plan that rewards what needs to be Repeated?
5. Do I have an Employee Handbook Process in place?
6. Do I have an Employee Orientation/Training Process in place? 
7. Do I have a Goal Action Process in place so my employees don't have their own individual agendas?
8. Do I have a Corrective Action Process in place so I don't play favorites and correct unfavorable behavior in a timely manner for everyone? 
9. Do I have an Employee Exit Strategy Process in place so I can learn from it?
10. Do I create a Job Description first before I hire anyone so I don't just throw people at a problem?

So now after reviewing the list,  how many of these items do you use with every employee? 

Let's review how to use each of these items. The first item on this list is fairly self explanatory, however I would suggest you involve the other managers to discuss all the employees in fixed operations at one time. 

The more input you receive the better the decision on what to do with each employee. Remember to take in account if this employee went through a "Hire to Fire" process when hired? 

The second item is all about having a few interviews to review; personality or behavior profile results, background checks, job description review, overall goals and pay plan. All of which are necessary before hiring so there are no questions left unanswered about the position prior to employment. 

As you can clearly see, not having all these items in place leaves you vulnerable to high turnover percentages which, in turn leads to low employee moral and employee satisfaction rates.

These items are irrefutable! If you are not following these "Basic Fundamentals" the end result is loss in customer retention and net profits. Low turnover percentages is a matter of "Good Management".

Remember, happy employees will create a happy customers every time. Let's take a look at the next item on the list which is your Operational Structure or as we call it "Cradle to Grave" process. This is how we process our customer from initial contact to follow-up.

The number one item on my list is the Service Drive Process. Now, out of this process is the "key" to a successful operation which is...an Appointment System that everyone follows. Here's a question I ask all the time...

Do you allow customers to "Just Bring It In" or do they need an appointment before they come in for anything including oil changes?

If the answer is "Yes"?...Anything else you're asking your Service Advisors to do is going to fail do to lack of Time Management. It also has a trickle down effect with your Technicians and Parts Department as everybody loses!

We all know how many things we ask our advisors to do each day and it can't be done without an Appointment System that is customer friendly.

Do you wait for the customers to approach the advisors or do they greet them at their vehicles?

Is there more then two customers in line for any of your advisors in the morning? If so, then you' customers are not receiving what you promised them which leads to poor C.S.I. and low gross profits.

Do we Inspect Every Customer's Vehicle no matter what mileage it has? These are just some of the items that need to be in place for continuous success!   

B. Operational Structure Evaluation

1. Do you have a Service Drive Process which is customer friendly?
2. Do you have a Production Process in place?
3. Do you have a Morning Meeting with your Techs and Advisors to review current performance and today's objectives?
4. Do you have a Follow-Up Process that can be reviewed each month?

The service drive process should take care of your customer from the time they call to the time they receive there vehicle to leave. How does your's measure up?

I don't mean what you know, but how well is it working? I have so many managers tell me they already do that and I have seen with my own eyes and ears that it's not working. 

Let's move onto the next item in our evaluation. This is an area which tells the story. I only need to look at a few items to tell a dealer what is happening in his Fixed Operations.

I have so many managers who get themselves into "analysis paralysis" by over analyzing what is happening in their departments and some that don't know what their looking at or never look at it. 

Here's a short list of what I look at when reviewing a financial statement or custom reports.  

C. Financial Evaluation

1. Labor Sales Per Customer Pay Repair Orders. (Total and per Advisor)
2. Total Customer Pay Labor Sales Vs. Last Year Same Period. (Monthly and Year to Date)
3. Customer Pay Repair Order Count Vs. Last Year Same Period. (Monthly and Year to Date)
4. Number of Technicians and Production % for the last 4 months.
5. Missed Opportunities per advisor over 30,000 miles.
6. Departmental Net Profit Vs. Last Year Same Period. (Monthly and Year to Date)
7. Fixed Operations Absorption Rate.

As you can see, I don't start looking at expenses until I know what our customer retention and sales are doing  because 90% of the time, once you get the Gross Profit up to guide the expenses usually fall into place.

There is a lot of things you can drill down into once you see where opportunity exists. This short list tells me everything I need to know to get started.

The last thing in my evaluation process is how well we are able to take care of our customers. What is their perception of our Fixed Operations when they visit? One of the first things I do is visit the bathroom. Believe it or not, this is one of the top reasons why a customer will not return to you service department. 

It should have a report on the wall when the bathroom was last cleaned. How's the waiting room looking? Do you have magazines dated back months or even years? Is the furniture clean from dirt, dust and stains?

These are just a few things I have found in my dealership travels.

Here's a few key things to look at:

D. Facility Evaluation

1. Does your signage effectively inform customers of important instructions?
2. Is a daily Cleaning Process in place to keep everything consistent and professional in appearance?
3. Is your Service Drive well maintained and vehicles moved in a timely manner?
4. Is your building clean and well maintained?
5. Do you meet with other management monthly to discuss any issues concerning the facility?

This is a very short list of what should be looked at twice a year with all management because each of these items overlap into the other departments. We want a Great Customer perception of our facility and how well they have been treated.

Guy Salkeld is the President and Head Performance Coach of Automotive Consultants Group Inc. The only Low Risk High Return Training, Coaching, and Consulting company in the world! To learn more go to www.smartservicetraining.com  Have a question? E-Mail Guy directly at guyacg@aol.com or Call me direct at: 305-331-3373    Follow @smartserviceguy