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Steve Hall

Steve Hall

Author's details

Name: Steve Hall
Date registered: April 8, 2013
URL: http://www.ncminstitute.com

Biography

Steve Hall is a full-time instructor for the NCM Institute and is responsible for the development of its Fixed Operations training curriculum, with an emphasis in express service management, collision management and parts and accessory management. For more than 25 years, Steve’s experiences have encompassed almost every aspect of the retail automotive service, parts and body shop business. He was an equity partner in two dealerships and has held management positions in all areas of auto dealership Fixed Operations, including Service and Parts Director and Vice President of Fixed Operations over 19 stores.

Latest posts

  1. Successful Failing: Why Embracing Failure Leads to Greater Achievement — May 25, 2016
  2. Curing the Fixed Ops Hangover — May 3, 2016
  3. A Triple-Dog-Dare: Stop stalling and solve that dealership problem — March 1, 2016
  4. Collision has Recovered: It’s Time to Get Serious — September 24, 2015
  5. Three Hours Lost: Your Top 10 Service Time Wasters — August 25, 2015

Most commented posts

  1. Three Chances to Sell in Service — 3 comments
  2. Three Hours Lost: Your Top 10 Service Time Wasters — 2 comments
  3. Collision has Recovered: It’s Time to Get Serious — 2 comments
  4. Customer Retention in the Service Department (Part One) — 2 comments
  5. Trying Something New? — 2 comments

Author's posts listings

Steve Hall

Successful Failing: Why Embracing Failure Leads to Greater Achievement

businessman with laptop

Our culture is built on success. Ironically, we can only achieve the highest levels of success by failing along the way.

Failure is the basis of knowledge.  Imagine you’re back in elementary school. Your teacher has just placed two apples on each end of her desk and asked, “If I added these two apples to the other two apples … ”—she physically moves them together— “… how many apples would you have?” She waits, then says, “Okay, class, now count them. One. Two. Three. Four.”

This is how most of us learned in school: repetition and visual learning. Kids will chant along, correcting their answer when they realize it’s wrong. Failure in these very early stages is important; it teaches persistence and focuses on the importance of learning over knowing. And, in time, we all eventually did learn that two plus two equals four!

The Success-Only Cycle vs. the Failure-Achievement Cycle

Sadly, over time, we abandon the elementary school approach and focus more on knowing than learning. Failure changes from a useful tool to punishment. By the time we enter the workplace, most of us have fully accepted that failure represents the result of an action, and we view it as nearly insurmountable.

Honestly, how useful is that philosophy? This Success-Only philosophy allows for only one option: You succeed, or you fail. This approach rewards knowing and only works if you already know how to do something. If you don’t know how to do the task already, well, you’re in trouble:

Image 1

The Failure-Achievement Cycle, however, focuses on failing fast—and then learning from your mistakes. No one is expected to perform flawlessly. Instead, failure is viewed as a feedback mechanism that allows you to improve your plan and try again to yield better results. Failure isn’t considered the opposite of success; instead, this approach views failure as a critical component of it:

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Successful Failing

Failing when trying something new or working towards solving a problem is admirable. This type of failure should be rewarded, provided that two key components were included in the effort:

  1. First, did you plan the activity, initiative or process to the best of your ability for the information that you had been provided at the time? Failure due to “just winging it” is not productive failure. Plan for success, work your plan and adjust as needed.
  2. Secondly, did you learn from your failure? Successful failure requires you to analyze what happened and to create a game plan for other possible solutions moving forward.

Failure can’t be a show stopper

Mistakes aren’t the end of the line. They merely delay achievement. When you fail successfully, you must make sure that the delay is as short as possible.

As a progressive manager, who is always trying to grow your department, you should actively demonstrate to your employees that failure is welcomed. Give this a try. Hold a “learning from our failures meeting.” During the session, share some of the errors you’ve made in your career and how it helped you solve a problem. Encourage your staff to do the same, requiring them to explain what they learned from the experience and how it helped them become better in their positions going forward.

Not only will your less experienced employees gain valuable knowledge from the more experienced ones, but it will reinforce to your staff that successful failure is an important part of your process.  Done in the right way, it creates a great learning experience. Keep everyone focused on how the person improved from the experience and how to avoid the same mistake themselves. (It can also be a fun team experience, especially when you discover how entertaining others’ past mistakes can be! Be sure to share some funny examples of your own!)

Failure is painful and, of course, we’d all rather avoid it. But when we apply successful failing, we learn how to bounce back quickly from failure and achieve even more in the long run.

What’s your failure philosophy? Do you embrace a Success-Only approach or have you already discovered the benefits of a Failure-Success cycle? Tell us below. 

 

Permanent link to this article: http://blog.ncm20.com/2016/05/successful-failing-why-embracing-failure-leads-to-greater-achievement/

Steve Hall

Curing the Fixed Ops Hangover

Monday morning again

What a party it was! We showed up, had a great time, talked excessively, drank a bit too much, stayed out far too late and were glad that we did it.

Glad, that is, until the next morning when we woke up and had to face reality. Now, our head hurts, our body aches and we don’t want to go to work! The only reason that we actually get out of bed and go to the office is that we are afraid of the consequences if we don’t. We resign ourselves to the mantra, “Just make it through the day.”

Hangovers aren’t just post-party events—they happen in Fixed Ops, too.

The idea of “Just making it through the day,” can occur in any aspect of our lives. You’ll often see this attitude pop up in Fixed Ops departments after month end.

Just think about it. At the beginning of the month, does your service department get off to a sluggish start? I’ve typically found that work in process is low. The team is feeling the “hangover” effect of closing repair orders while looking for those last dollars to finish the month. Many dealerships have a light appointment schedule around this time, too, as they pushed customers into those final days.

Reacting to this environment, employees just want to take a day or two to catch their breath. As a manager, you can just feel the entire department is coasting. It’s as if they too, have also adopted the mantra, “Just make it through the day.”

What causes the Fixed Ops Hangover?

If you were to review the typical advisor’s monthly sales on a weekly basis, you would find that the sales aren’t spread out evenly. Rather, the advisor sales distribution curve usually looks like this in a four-week month: 15% the first week, 25% the second week, 25% the third week and 35% the last week of the month.

It’s a cycle that feeds on itself. And whether this uneven workload is caused by the month-end hangover effect or a combination of it along with the advisors not closing tickets until the end of the month, it is a major problem.

Stopping the Fixed Ops Hangover

So, how can a manager stop this monthly hangover? I recommend motivating your service advisors with a “fast start” spiff. This could be a monetary bonus or another reward to any advisor who hits a pre-set objective for the first seven calendar days of the month. The idea is to keep your department rocking from the very first day of the month, rather than losing the first couple of days while everyone relaxes after the close.

The spiff can be set at different levels for various types of advisors; you can set different goals for the main shop and express, rookies and veterans, as long as they must work to achieve it.

No matter what goals you set, make sure they are challenging enough that the “just make it through the day” attitude cannot pay off. This spiff can not only be used for advisors but can be incorporated with your technicians’ compensation, also. Be creative, and get out of the starting blocks strong—right from the very first day of the month!

Do your service advisors and staff suffer from the “Fixed Ops Hangover?” Learn how to break the boring cycle and other useful service tips at our Service Management Roadshow

Permanent link to this article: http://blog.ncm20.com/2016/05/curing-the-fixed-ops-hangover/

Steve Hall

A Triple-Dog-Dare: Stop stalling and solve that dealership problem

dare

Nothing could get me moving outside my comfort zone faster as a kid than my friends daring me! Granted, many times those dares weren’t the wisest actions to take, but peer pressure will make you do some amazing things. (And, no, I won’t share any stories.)

The power of a dare: action

There is no better case for how far a dare can take you than the 1983 movie classic A Christmas Story.  In one scene, a young boy named Flick has the gauntlet thrown down for him: the triple-dog-dare.

This kind of dare, we’re told, challenges your manhood along with your entire social status. And it can really make people do things that they normally wouldn’t. In the scene, Flick falls for the bait and ends up in the brutal cold with his tongue stuck to a frozen metal flag pole while everyone else runs away. Not exactly the result that he wanted.

I triple-dog-dare you to address a dealership issue

What I am going for in this blog is not to get you to take unwise actions but, rather, to take positive steps. I dare you to take action. Forget that, I’m going to go all in and triple-dog-dare you to take action!

I challenge you to address one of these issues for your triple-dog-dare. Or, if you’re tough enough, do all three!

1) Have the tough conversation with “that” employee. Most departments have one employee who just doesn’t get it. Maybe production is too low. Maybe the attitude is all wrong. It might be that attendance or punctuality is deficient.

Whatever the reason, you and I both know they are a cancer in the department. Yet, you have put off the tough talk with them. Sure, conflict is tough, and you may not want to lose the person. You also know in your heart that the conversation must happen.

Whatever the reason that you haven’t addressed the person, I triple-dog-dare you to face reality and do it today!

2) Meet with your boss and admit something that you don’t understand. People never want to admit that they don’t know something. Yet, if our leadership isn’t aware of a deficiency, they can’t help us improve.

If you’re not sure of how to improve profitability, margins or growth—or even the best way to lead your team—be direct and honest with your supervisor. Show them your vulnerability and your true desire to learn.

Not only will they appreciate the honesty, but it will improve the respect for you as a manager. Requesting training shows that you want to learn, not just be a smoke blowing know-it-all who really doesn’t know-it-all. I triple-dog-dare you to have an honest relationship with your boss.

3) Take charge of your career. Take time from your schedule to attend a training class or workshop. Buy a book on business or leadership. (Yes, an actual hardcover—without pictures!) And then, I challenge you to actually read it.

If you don’t take charge of improving your knowledge base, who will? Learn how to become a better leader of your people. Read the book within the next 30 days, highlighting items that jump out to you.

Not sure what would be the best book for you? Just e-mail me and I’ll give you a few suggestions.

Do whatever it takes to improve yourself. I triple-dog-dare you to get started on the path of self-improvement within the next seven days.

So, there they are: my “childish” dares. While I certainly don’t want to hear about your tongue stuck to a frozen pole, I do want to know if you accept my triple-dog-dares! Send me an email and let me know how it goes or comment below with your experience.

Permanent link to this article: http://blog.ncm20.com/2016/03/a-triple-dog-dare-stop-stalling-and-solve-that-dealership-problem/

Steve Hall

Collision has Recovered: It’s Time to Get Serious

I’m not going to lie: Collision has a bad rep.

Collision Centers Infographic

Just look at the statistics. Collision centers have declined 57% since the Eighties, and a whopping 27% of that drop has happened since just 2007. Stricter environmental regulations have increased expenses, and direct repair programs have changed how clients are acquired. So, when business got tough during the 2009-2010 recession, many dealers saved costs by closing the doors on their collision center, and shifted focus to vehicles sales and the service department.

Collision centers are back, for some.

Happily, our industry has rebounded in recent years. So, I’m surprised that dealers are still unwilling to look at their collision center as a profit center. Meanwhile, our publicly-held competition is investing heavily in collision repair, and venture capitalists are actively involved with some of the largest multi-location collision companies, gobbling up locations and market share.

The surviving independents are making a killing. I think the independents’ success is part necessity. After all, if an independent collision shop can’t evolve fast enough, it will go out of business.

Dealerships, though, seem much more reluctant. This is partly because ownership often views the collision center as a loss-leader – to them, it’s a customer retention tool rather than a true profit center. Plus, I’ve seen many dealership collision centers continue to operate even when they are unprofitable.  They just struggle along while ownership focuses on vehicle sales; owners just hope the collision center doesn’t lose too much money! That’s not a philosophy that evokes much confidence.

Preparing for Collision Competition

So how do you – the individual dealer or small dealer group – compete against the mega-groups and the well-established independents? Like so many other dealership issues, I think the solution lies in three things: training, knowledge and support.

Technical excellence ≠ management skill

A common theme I encounter while working with collision managers is that many were promoted with very little management experience. Most start in the industry as a helper, moving their way in the ranks to become a body tech or painter and then an estimator. Once the prior manager quits or is released, they find themselves the manager.

Now that they’re expected to “make the department perform,” they have no clue how make that happen. Most are remarkable technicians or estimators – that’s why they were promoted – but few are prepared for their new responsibilities, such as managing a team, forecasting and expense control.  These great workers are left hanging: They don’t know how the numbers work, how to get people to produce or how to grow a business.

Sink or swim leads to drowning

All this adds up to a very frustrating experience. Lacking experience and knowledge, a motivated manager will work harder – very hard – but not necessarily smarter. They race faster and faster, trying to perform, and then – the next thing you know – that star employee is totally burned out.

And what does burn-out lead to? Quitting. I’m floored at the number of times dealers end up losing a quality long-term employee, often without gaining a thing along the way!

The craziest part is that much of this can be avoided! The sink or swim mentality accomplishes nothing. Stop putting people into positions with no training or support. Instead, equip your manager with the training and knowledge they need to lead a team and grow the business. Teach them how to obtain profitability and unlock the potential of their department.

Invest in people for a return on investment

With more vehicles on the road than ever before – and fewer shops to repair them – dealers’ now have an incredible opportunity.  It’s time to get serious about your collision center and make the collision department become what it should be … a profit center and valued part of your dealership.

Ready to take the next step for your collision center? Join NCM® Institute’s experts in learning the Principles of Collision Center Management. It’s the most effective way to turn your best tech or estimator into your best manager. Classes filling now. 

Permanent link to this article: http://blog.ncm20.com/2015/09/collision-has-recovered-its-time-to-get-serious/

Steve Hall

Three Hours Lost: Your Top 10 Service Time Wasters

Clock

When we ask service managers how important technician efficiency is to profitability, they most often say that “it goes hand-in-hand” or “if they aren’t efficient, you won’t make money.” While I agree with this, let’s look at it another way: time.

Here are the top 10 time wasters I’ve seen in service departments.

  1. Talking (non-productive talk)
  2. Waiting for the first job of the day
  3. Getting authorizations from customers
  4. Waiting on advisors
  5. Waiting in line in Parts
  6. Looking for or waiting on special tools
  7. Walking to Parts and back
  8. Phone calls, texts, e-mails and using tablets or laptops
  9. Smoking
  10. Arriving late or leaving early

How many hours lost?

I ask managers to make this list during each of my training sessions at the NCM Institute, and then I have them to assign time lost by activity. Sure, there are minor variations each class. But what doesn’t change is that we routinely come up with 2½ to 3 hours spent each day, not working on vehicles!

I know it is unreasonable to think that every minute can be spent on productive work, but how many of these lost minutes can we pick up?

Getting time—and money—back.

Let’s look at an example: We will figure an average shop of 12 technicians and gain just 15 minutes a day in actual production. We will use an $85.00 an hour effective labor rate and a gross profit percentage of 75%.

The numbers would look like this:

12 technicians x 15 minutes a day = 180 minutes of production gained a day (3 hours a day gained)

3 hours gained x $85.00 ELR = $255.00 in labor sales gained per day

$255.00 x 75% gross profit (labor) = $191.25 labor gross gained per day

$191.25 x 300 business days per year = $57,375 additional labor gross profit per year!

Add in corresponding parts gross generated from the labor sales, and you could earn more than $95,000 in additional fixed gross profit per year (and that is figured at 100% efficient). If they are 125%, the numbers are even larger! All of this from just gaining 15 productive minutes per day from each of your technicians.

Take the time to evaluate all of your technicians’ daily time wasters. Find ways to reduce the wasted time. Ask them for ideas and creative solutions. (And, once they know you are paying attention, some of the time wasters may just disappear.)

Go ahead, do the math your own numbers and find your potential: you’ll be amazed!

service_parts_senior

Permanent link to this article: http://blog.ncm20.com/2015/08/what-are-15-minutes-a-day-worth-in-your-service-department/

Steve Hall

Service Managers: How Well Do You Communicate With Sales?

ServiceAdvisor

Processes…even the best processes don’t work if employees don’t understand them. It’s Monday morning in the service department. The day is off and running and a flurry of customer activity abounds.  Things are busy, but running smoothly. Just the way you (the service manager) designed it.

Now it’s about 8:45 and the sales department is just leaving their Monday morning sales meeting. A fairly new salesperson comes into service, walks up to you (the service manager) and says, “I sold a car Saturday, stock number Z1576A. We spot delivered it, but we need to have a spoiler installed that’s not in stock. Can you take care of it for me?”

You look at him, as if he’s a nobody and snipe back, “Where’s the ‘We-Owe?’ Did you already order it, or not? When is the customer scheduled to come back? Do you even know the color code for the spoiler or do you want me to just guess?” The new salesman looks puzzled and slightly embarrassed.

He thought his job was to sell cars, which he did. He thought the service department was supposed to help him when he needed it. Maybe he misunderstood the relationship. He thinks, “They just seem so nice to customers and so grumpy to the sales department. Why?”

What the new salesperson was not privy to was the sordid history, and possibly the proper and much-improved process. The service department knows they can’t order or install the spoiler without proper documentation and basic information from the sales department. That happened before recently, and they got the speech, “Don’t EVER do anything on a vehicle without receiving a sales manager-signed We-Owe.” They also know the salesperson doesn’t get a CSI survey to submit on the service department, so I (the service manager) can “teach him a lesson” on how to interact with service without the repercussions of a negative CSI survey.

Unfortunately, this type of scenario happens way too often. With turnover in the sales department, often times the sales managers are stretched just to train the salespeople on product knowledge and the vehicle sales process…and they never get to train the other necessary dealership processes.

This is where the service managers need to take charge.

We need to realize that if we want the sales department to be a “bell cow” to our customers on how great we are, we need to start treating them great. One way that I have found that improves this relationship quickly, along with strengthening processes, is to attend sales meetings on a regular basis.

When you (the service manager) attend a sales meeting, several positive things happen. Here are a few:

  • You get to know the people, and they get to know you. You are on the same team and this relationship helps everyone. You get to learn who people are. Now they have a name, not just the new salesperson who “knows nothing and wants everything.”
  • You get to answer their questions. Open communication between sales and service…now that’s REALLY a good thing!
  • You can train on a process or two – departmental or inter-departmental – every time you attend. Short, precise instructions to make the processes flow better. Yes, as you have turnover, you will have to re-train the process, but if you don’t, who will? Also, refresher topics can even help long-term people.
  • You will get a better understanding of what they have to deal with and you may become slightly more open to training someone…not just “barking” at them.
  • You may even learn a few sales training tips to help make your advisors more effective.

Whether you attend the whole meeting or just do your part and exit, it will be time well spent with one of your most important clients. The goodwill from this effort pays large dividends. Become a leader, a mentor, and have success the old fashion way: one person at a time.

At the NCM Institute, we believe every department should better understand the dealership as a whole. With that in mind, some of our clients purchase an annual training subscription and cross-train managers in different departments. Sales managers learn about service; service managers learn about used vehicles; parts managers learn about service; and so on. This greatly helps them understand the daily struggles each department has and helps them learn the importance of working together as one unit. Check into a more affordable way to help make your team stronger and ask about our annual NCMi training subscription and bundling options.

bundle-money

Permanent link to this article: http://blog.ncm20.com/2015/08/service-managers-how-well-do-you-communicate-with-sales/

Steve Hall

We’re All On The Same Team: Parts & Service – Helping Each Other Succeed

Parts and Service

Have you ever wondered why Service and Parts Managers don’t get along? In reality, don’t they need each other to succeed? As we examine this, let’s start with some generalizations from dealing with thousands of Service and Parts Managers along with General Managers throughout my career. The overwhelming consensus is that Service and Parts just don’t get along. That’s not to say that there aren’t dealerships where they do get along very well, but those are definitely in the minority.

If you think about it, it’s easy to see why these managers can be at odds. Here are just a few reasons:

  • Service Managers are typically extroverts, whereas Parts Managers are typically more introverted.
  • Service Managers typically have a “whatever it takes” attitude towards resolving issues. At that moment, they just want the customer handled. In the same situation, the Parts Manager will typically revert back to the processes to work through the issue, looking for the reasons why it happened.
  • Parts Managers like to have a place for everything and everything in its place. Service Managers generally don’t.
  • Parts Managers work from an inventory of parts. If a part doesn’t sell today, it will still be on the shelf to sell tomorrow. Service Managers work from an inventory of time. If they don’t utilize an hour today, it’s gone forever.

I’m not saying that one is right and the other is wrong; it’s just that they’re wired differently. That’s what makes each of them good at what they do; they have different mindsets for different types of positions. Unfortunately, these different mindsets can often times cause friction and impede them from effectively working together.

Rather than belabor the differences, let’s work on why and how they must align to achieve their departmental goals.

Did you know that, in a typical dealership, 85% of the Parts Department gross profit is generated from their internal customers, meaning the Service Department (and the Collision Department, if they have one)?

Or, have you ever thought that the Parts Department doesn’t really sell anything? They fill orders and requests. On occasion, they may “sell” an additional item when filling a request, like when a front counter customer is purchasing a timing belt and, at that time, the counterperson suggests drive belts or a timing belt tensioner and the customer purchases them. But most of the time, they are filling requests. Again, this is not an indictment; it’s reality.

Why is it so important? Because it all comes down to knowing what truly affects your department’s numbers. Realizing that 85% of your Parts gross profit is generated from your Service and / or Collision Departments (and that they are truly the salespeople for the Parts Department) is vital in building a growth strategy for your Parts Department.

Let me explain a key correlation for your Parts and Service Departments.

When dealers are asked how much total gross profit they generate for every dollar of labor they sell, we generally hear an answer like this: “We have a gross profit on labor of 75%, so that would mean we earn 75 cents of gross profit for every $1.00 in labor that we sell.”

While that answer will appear accurate on the surface, it actually is incorrect. Remember, I said the Service Department is the salesforce for the Parts Department, and when I asked how much total gross profit is generated from every $1.00 in labor sales, this changes the previous answer. Because there is a relationship of Parts to labor sales, for every $1.00 in labor sold, a typical dealership will generate approximately $1.25 in total gross profit. You have to remember that when you sell labor, Parts will naturally be sold with it.

Realizing that the Service Department generates the vast majority of the Parts Department gross profit, what would be the most effective way to grow both your Parts and Service Departments?

You need to sell more billable flat-rate hours! Both departments must be focused on this primary goal.

Are you starting to see how these managers must start working together for the good of their departments? So far, I’ve focused on why the Parts Department needs to get along with Service. You may be asking, “Why does service care?” It still comes back to the driving factor for both departments — producing more billable flat-rate hours. The Service Department can’t produce as many billable flat-rate hours if they aren’t working well with the Parts Department. Parts can slow down or even stop production, thus costing the Service Department the ability to produce gross profit for themselves.

What we need to find is common solutions that allow the Service Department to bill more flat-rate hours and the Parts Department to achieve more Parts sales through those hours billed. So, how do both managers find ways to increase the amount of flat-rate hours billed? Let’s start with what the Parts Department can do to help. Here are some thought starters:

1) Stock more breadth of Parts and less depth of Parts. With daily stock orders, departments need less depth of parts, or how many of each individual part number you have on hand. Then, you can repurpose this capital into having more part numbers in stock, thus increasing your breadth, or total number of parts that you have on hand. By having better breadth of Parts, the Parts Department will be able to have a higher filled-from-stock ratio. This will help keep Technicians in their bays producing billable flat-rate hours and help both departments grow.

2) Another way to increase billable flat-rate hours is to find ways to keep the Technicians in their bays working, rather than waiting at the Parts counter for Parts. The best way to achieve this is by delivering the needed Parts to the technician right to his bay. This saves walk, talk and wait time for the Technician, as they would normally make their way to and from the back Parts counter.

3) Stock fast-moving Parts in the express Service bays. At the very least, oil filters have to be in the bay, but in reality you should make provisions for additional fast-moving items like air filters, cabin filters and wipers. Service Managers, take note: once these parts are stocked in your bays to increase Technician productivity, the parts are now under your control and any shortages are the responsibility of the Service Department.

4) Aggressively chase parts rather than automatically subjecting the Service Department to the perils of the special order Parts process. If you can pick up the part locally from another dealer and complete the job today, do so.

5) Keep your Parts Department aware of the daily and month-to-date hours produced in the Service Department. Seldom will you have a great month in the Parts Department without your Service Department having a great month. Therefore, the Parts Department needs to know exactly how the Service Department is tracking.

By posting these numbers, this will keep the relationship of hours billed to parts sold fresh in your employee’s mind. Hopefully, this will make them more proactive in finding ways to keep the Technicians in their bays working rather than waiting in line, or talking about their latest fishing adventure.

You can even incorporate shop hours produced into the pay plans of back counter people to keep them focused on increasing flat-rate hours billed. This helps make them more open to solutions.

Those are some ways that the Parts Department can help the Service Department produce more flat-rate hours. But since this is a team effort, what can the Service Department do to assist in this effort?

The Service Manager and Department must realize that the Parts Department is a business partner with them, not a servant to them. The success of both Service and Parts will be greatly reduced if they don’t work together.

Think about this: how is the Service Department staffed? Do you have enough Technicians and Advisors? Are both of these positions selling and producing enough? If you’re short Technicians or Advisors, your labor sales will suffer, thus your Parts sales will suffer. This is a critical element for both departments. Remember: your Service Department is your sales staff for your Parts Department.

Next, track and scoreboard your “Parts sales to labor hours billed” ratio. This will help you determine any shortcomings that you have by individual employees.

The final suggestion that I would like to give is simple. Employees find ways to work their pay plans. If you want to increase Parts sales, include your “Parts sales staff”, meaning your Service Advisors. Incentivizing Advisors (along with Service Managers) will help increase your Parts gross profit and help break down some of the interdepartmental barriers, as they will feel more a part of the same team. Continue to promote teamwork to ensure that both departments are successful, as that’s how the dealership wins. Just like a football team, the offense must be successful and the defense must be successful for the team to win the game. One without the other just won’t get it done.

Permanent link to this article: http://blog.ncm20.com/2015/06/were-all-on-the-same-team-parts-service-helping-each-other-succeed/

Steve Hall

60 Seconds to Gain a Service Customer

Clock

Do you have 60 seconds to gain a service customer? Let me restate that: Do you have a structured 60 seconds to gain this customer? Why the emphasis on “structured”?  Let me explain.

Let me start with this.

If you are a dealership that doesn’t already perform an introduction of the new and used vehicle owners to the service department, then you aren’t quite ready to read this article. In that case, set the process in place, and get it started. Enough said?

Now, for the intended audience:

What does your customer introduction to the service department really look like? Think about this. You have just worked hard to gain a vehicle sale, and now your sales consultant completes the dealership “road to a sale” process by escorting the new customer to the service department for an introduction and to set the appointment for the first service visit. The salesperson stands with the customer in the service drive as the advisors are busily moving around. One of them is on the phone, one is with a client, and another is working on something, but we’re just not sure what. Five minutes pass by… OK maybe it’s only 45 seconds, but it feels like five minutes. Once the wait is over, the sales consultant and customer approach one of the advisors. The advisor glances around, looks at the salesperson and customer with a “what do you want” look, and he doesn’t even smile. Everyone can can tell that he’s distracted.

The salesperson tries to make the situation better and introduces the customer to the advisor with an enthusiastic phrase, but the advisor’s response is lukewarm. The advisor congratulates the customer on his purchase and says, “If you ever need anything, please let me know,” and then he hands over a business card.

At this point both the sales consultant and the service advisor feel that they have followed the process and have “done their job”.  But what really happened? Did the customer feel welcomed? Did the customer feel like you really wanted them to do business with you? Did your people provide anycompelling reason why this new customer should do business with you?

Your service department just had 60 seconds to win a customer – and you fumbled. Worse yet, you didn’t even realize the opportunity that you missed.

I am a firm believer that every new customer should be introduced to the service department, parts department, and the collision center. I am also a firm believer that these introductions should make a very positive impression on each customer. This is our time to shine! After all, this may be the only time that members of these departments ever get to see this customer, so we need to make a great impression.

To help you along the way, here is an introduction script that I developed for our NCM InstitutePrinciples of Service Management class.

Introduction Script:

Service Department Employee: Congratulations on your purchase. I would like to be one of the first to welcome you to our family. What type of vehicle did you buy? (as the customer talks, smile, nod in approval slightly, and listen… do not interrupt them.)

Customer: (Answers)

Service Department Employee: Terrific! May I ask what kind of vehicle you have been driving up until now?

Customer(Answers)

Service Department Employee: Well, we’re glad that you are joining our family now, and I’m sure that you will enjoy your (type of vehicle purchased). I would like to share a little information with you, so that you can feel comfortable anytime that you come in for service… 

  • (Point to the service doors.) You can see over here, these are the service entry doors. Any time that you need service, you will just pull up to them, and we will open them up and let you in. 
  • (Point to the service advisors.) Also, you can see the advisors over here. They will greet you and take great care of you any time that you arrive.
  • I would also like to reassure you that we are here for you. There is no reason to worry about anything pertaining to your vehicle, because we can handle it. Whether it is warranty work (which hopefully you will never need), routine maintenance, tires or anything… we can handle it for you. We offer highly competitive prices on everything, including oil changes. We will get you in and out quickly to make it most convenient for you.
  • But, most of all we want you to know that, since you have purchased your vehicle, you are now part of our family and we will take great care of you. 

Are there any questions that I can currently answer for you?

Customer: Not right now, I’m just excited to get the vehicle.

Service Department Employee: I’m sure you are. Here is my business card. Just know that if you ever need anything please let us know, and enjoy your car.

You can see that your employees will need to practice the script, but I’ve underlined the most important points so they are easier to learn. You will also need to modify it slightly for customers that are currently servicing their vehicles with you, but you get the concept. As a final tip, I suggest that the sales consultant carry a color-coded, bright yellow clip board when he escorts the customer to the Service Department. The yellow clip board signifies to the service department employees that the salesperson is accompanied by a new dealership customer and not a “heat case.”

Consistently perform and flawlessly execute the structured 60 seconds approach to win over the customer, and it will become one of the most profitable investments of time ever spent with your clients.

Permanent link to this article: http://blog.ncm20.com/2015/05/60-seconds-to-gain-a-service-customer-2/

Steve Hall

Two Quick Tips for Service Managers

Auto Mechanic

It seems these days everyone is pressed for time and running a million different directions. Because of this, your team can feel disconnected and often times alone in their jobs. They don’t get quality time with their supervisor and never get to really hear what is going on in the department or business. They have questions like, “are we doing well or not,” and “am I doing my job to your satisfaction, “or ”am I about to be the next ex-employee?” Most of the time employees don’t actually ask these questions; instead the questions just keep floating around in their mind.

It’s a shame when valued employees feel this way. After all, it doesn’t take a lot of information or interaction to make these questions disappear. With this in mind, today I would like to give you two quick tips you can implement, with no added expense. These two items can possibly help your employees feel more informed and secure in their jobs.

The first tip is the monthly wrap-up and kick-off meeting. According to Marcus Buckingham and Curt Coffman in the book First Break All the Rules, one of the key components to employee retention is making the employee feel they are part of the information stream within the business. One way to help your team with this is to hold a monthly kick-off meeting.

On the first day of the month, bring your departmental team together for a quick three to five minute kick-off meeting. Think pre-game speech for the professional sports team. This meeting can be held right in the service department around the lifts and vehicles during normal business hours. Have the attendee’s stand, so the meeting stays short. For the wrap-up part of the meeting, let them know how the prior month finished up. Cover items like departmental gross profit, or shop hours versus objective, and be sure to cover CSI. Don’t forget to congratulate a few employees that had stellar performance

For the kick-off portion, set the goals for the month that is starting. Be sure to acknowledge upcoming employee anniversaries and milestones. Include anything that is upbeat and challenge the employees to reach the goals that are set.  Giving just a couple minutes of your time, combined with the key information that is shared, will make the whole team feel like an integral part of the organization. This meeting costs nothing, but has a lot of value. By doing this you can bring the team together, and win together.

The second tip I would like to share today is coaching from the sidelines, not the locker room. I think that is worth restating. Do you coach from the sidelines or the locker room? Let me explain what I mean. You would never see a NFL coach hanging out in the locker room while the game is being played. They are found watching the action as it happens and coaching everyone on the team to perform better.

Now, put this into your everyday work life in the service department. Game time for the service department is every morning from about 7:30 to about 9:00. Where are you during this time? Are you hanging out in your office running reports, answering e-mails and reviewing numbers? That would be considered “in the locker room”. Should you be on the “sideline” watching the game and coaching the team while the action is happening? Yes.

Is there really anything more important to a leader than helping their team perform better?  Wouldn’t this also help the employees better understand how they are performing in their jobs? Keep this in mind each and every morning and spend the time directing the team, when the game is actually happening, then perform the behind the scenes work during the non-peak times of the day.

Remember that your team moves at the speed in which you lead them, and to lead you must be in front of them. Don’t focus on the wrong items. Put your efforts into your people and unleash the power of the team.

service_mgmt

Permanent link to this article: http://blog.ncm20.com/2015/05/two-quick-tips-for-service-managers/

Steve Hall

Why Dealers Should Be In Express Service

Express Service

Dealers know you must provide fast, convenient, and competitively-priced service in order to retain your customer base.  They also know that oil changes and light maintenance are the most requested service items by customers.  Knowing this, why do dealers continually fight express service?

I’ve heard all the excuses: it hurts my hours per repair order; it hurts my gross profit percentage; it hurts my effective labor rate; I can’t make any money in express service; the list goes on and on.  Shouldn’t we think about it differently?

Isn’t it logical that if a customer comes to you for express services, you will have an advantage to getting the remainder of their maintenance and repair work?  Customers generally do business with people they trust.  If you start to grow that relationship from day one, when the only things that are needed are express-types of items, won’t you have the trust of the customer when the “real” repairs come into play?

We need to realize express service is the gateway to real profits, and if done properly you can make plenty of money along the way.   After all, how do you think all the mass merchandisers and independents stay in business?

Let’s look at it this way, have you ever taken a low profit (or no profit) deal on a new vehicle?  I’m sure that every dealer has, many times.  Why do you do this?  Often times it is because you are getting a trade-in you feel you can make money on.  Other times it is so you can move a unit off the lot to reduce your inventory costs, or maybe to help you reach unit bonus levels for factory incentive money.  Possibly, it was just so you would have an opportunity for the F&I department.  Whatever the reason you decided to take the short deal, you have a plan.  The loss of front-end gross on that unit gave you opportunities to make more money in the long run.  You had to make the deal to gain all of the other benefits.

Can you relate this thought process to express service?  We must retain the customer in order to get all of the long-term benefits.

But express service has an added benefit.

If properly structured, you will make money in express while retaining your customer.  That is a win-win, both short- and long-term!

Take a few minutes and examine how much money is spent on a single vehicle over the lifetime of that vehicle.  Include average warranty work, recalls, oil changes, maintenance, tires, brakes, breakdowns and everything else that happens eventually to every vehicle.  Once you add all of these dollars together and look at the complete picture, you really see what the customer is worth over the lifetime of the vehicle.  Now you must develop your plan to make sure that customer never goes anywhere else, and express service has to be part of that plan.

Let’s look at express service for what it can and should be, a profit center with long-term financial benefits.  Remember, customer retention is a good thing.  Get fast, get efficient, get competitive and get profitable!


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Permanent link to this article: http://blog.ncm20.com/2015/02/why-dealers-should-be-in-express-service/

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