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Tag Archive: Automotive Industry

Kevin Cunningham

Imitation is the highest form of flattery for 20 Groups, too.

Business Team

Peer collaboration can come in many forms; it can come from conferences, blogs such as this one, news publications, discussion boards, and social media platforms.  Those are all good ways to share ideas, but there comes a time when surface-level chat doesn’t cut it.  When it’s time to get serious about taking your business to the next level; when you know you need to step out of the day-to-day business in order to work on the business, there’s no better platform in our industry than a 20 Group. Granted, I’m biased, but if you’re in a 20 Group or have been in a 20 Group in the past, you know nothing compares to the idea sharing and consistent and ongoing operational improvement and accountability that comes with peer collaboration among similar sized, like-franchise dealer peers in a true 20 Group environment.

But what is it that makes a 20 Group unique and separates it from other ways of collaborating?

As the automotive industry pioneer in 20 Groups, we’ve found that in order for the members to get the most benefit from their 20 Group experience, the following must be present:

  • Confidentiality
  • Non-competing dealerships
  • 20 or so members—that’s the peer collaboration sweet spot
  • Detailed analytical tools to help you compare your operation to your peers and Benchmark-level performers
  • Vigorous business discussions among all group members
  •  Members control agendas, meeting locations and who can join

That last point is an important distinction. We’ve found that when the members of the group have ownership over whether a dealer is or isn’t a market conflict, who to include in the group, where and when they meet, and what they discuss when they meet, the group will be more cohesive, stable and self-sustaining.  On a related note, your moderator should not arbitrarily bring in guest speakers, or dominate your meeting by consulting or selling; at least with NCM, we are going to let you control your meeting.

Those of us at NCM Associates have thoroughly enjoyed watching our innovatively-simple idea blossom into what is an invaluable asset to many car dealers and dealership managers, and to business owner-operators in many other industries as well.  We also consider it flattering that so many have emulated our concept.

We have seen other organizations and individuals offer traditional 20 Groups over the years, but don’t be fooled—a discussion platform, a conference or a training seminar is not a 20 Group. These formats have a place in the conversation, but they will never match the power of face-to-face collaboration where many lifelong friendships and accountability partners are born and endure.

So, remember:

  • If your competition is or can be there, it isn’t a 20 Group
  • If anyone can join, it isn’t a 20 Group
  • If there are hundreds of people involved, it isn’t a 20 Group
  • And if you don’t control the conversation, it isn’t an NCM 20 Group!

What do you think?  Are you confused by all the talk about what is and isn’t a true 20 Group?  Are you in a traditional 20 Group or have you found another form of peer collaboration that works for you?


Permanent link to this article: http://blog.ncm20.com/2015/02/imitation-is-the-highest-form-of-flattery-for-20-groups-too/

Joe Basil

Musclecar Dream Engine Comes True in Modern Technology

LT1This column is typically reserved for “next practice” tips for better retail automotive management, but today we’re paying homage to the source of our passion for this industry — the allure of the automobile and all it signifies. It stole our hearts and captured our imagination with dreams of speed, power and freedom on the open road. For me, the passion was sparked by the Chevrolet musclecars of the 1960s and 70s.

For all you other musclecar motorheads who used to have hair with a color other than gray, the 2014 C7 Corvette Stingray LT1 engine is a motorhead’s dream come true. It’s got all of the technology you dreamed of in the day but had no idea how to bring it to mechanical life. Just go back to the 60s and early 70s, when you were 18 and building that small block drag car. Yeah, when you pulled up to the Sunoco gas pump and cranked the octane lever to 110+; when the gas filler was behind the tail light on a fin or behind the license plate; when you burned a full tank of premium on a Friday or Saturday night street racing with your hottie.

That’s when you spent hours and hours talking to the guys at the track, trying to get the latest tricks from the speed shop and spending lots of bucks building that small block to put out every bit of horsepower you can squeeze out of it. You remember, putting in that highlift cam, swapping out the stock intake for an Edelbrock high-rise topped off with an 1100+(or larger) CFM Holley. Pulling off the heads and putting on the double bump angle plug 2.02’s. And since you switched the rear end gears and you threw out the stock distributor you had to replace it with an HEI mechanical advance and had the advance curve tweaked. Oh and don’t forget those “Hooker Headers” and a couple of Cherry Bombs just for effect.

And then when it came to race day, on the track or on the street, you checked the temperature to see if you were going to swap out those jets on the Holly, reset the base advance, and maybe adjust up those rocker arms to change the cam timing. All of those little tweaks you did under the hood with tools are now being done by computers in milliseconds without ever touching a wrench.

Back in the day, I was a musclecar motorhead and even with gray in my temples, I guess I still am.   That’s why I’m so excited about a very special event coming up later this month in Tonawanda, New York.  Where the heck is Tonawanda, New York?Tonawanda is a suburb of Buffalo and it happens to be the home of the GM powertrain plant where the 2014 C7 LT1 Corvette Stingray engine is built.

The C7 LT1 has it all. Let’s start with 450 hp out of 6.2 L. By the way, that’s 378 cu in. No need to make any adjustments anymore since we now have computer-controlled direct injection, variable valve timing with 2.13 intake valves, and computer-controlled ignition timing. By the way, remember using “plastiguage” to check your bearing clearances? Now the clearances are measured in microns. A micron? Yeah, a micron; that’s one millionth of a meter.

So how would like to see these engines being built? On August 23rd and 24th the General Motors plant in Tonawanda is having an open house. So what? It’s an engine plant, you might say; well, there’s history that goes with this plant and the Chevrolet musclecar engines it produced. When they look under the hood of 60s and 70s musclecars, collectors always look for a little rectangular sticker on the valve cover that reads “Produced by Chevrolet Tonawanda.” Not only is the Chevrolet Tonawanda engine plant noted for producing 60s and 70s musclecar engines and big block marine performance engines, it holds the world record for the most number of engines produced in one day — 8,832 (in 1988).

The plant is celebrating its 75thanniversary and is having an open house and classic car show on August 23rd and 24th. You get a full tour of the plant and the actual crews that build the engines will be explaining and showing you how they do it. I was in this plant quite often in the 1970s when we had a Chevy store close by and serviced the plant cars. I went on the tour a couple of years ago and what a drastic contrast!

It’s a great opportunity to fly into one of Buffalo’s  private aviation strips, bring your off shore boat and do some “street” racing on the Niagara River or Lake Erie, or just cruise your favorite musclecar ride to the car show. Last but not least,don’t forget to visit Frank and Teresa’s Anchor Bar (where chicken wings started) for some wings and “beef on weck.”

For details just go to GM Powertrain Tonawanda Engine 75th Anniversary on Facebook (https://www.facebook.com/75thanniversary) or give me a call and let’s wax nostalgic about the days of our shared musclecar mania!

Formerly of the Basil Automotive Group, Joe Basil is a 20 Group Moderator for NCM Associates.  NCM has many GM nameplate 20 Groups including Buick, GMC and Chevrolet dealer groups. For information, call 877.803.3631 or to reach Joe directly, email jbasil@ncm20.com.

Master-Your-Destiny

Permanent link to this article: http://blog.ncm20.com/2013/08/musclecar-dream-engine-comes-true-in-modern-technology/

David Kain

It’s Time for 3rd Party New Vehicle Lead Providers to be Transparent

fishbowlThe 3rd party new lead providers I know are operated by genuinely good people who want to provide a valuable service to the auto shoppers, dealers and manufacturers they serve. For more than 15 years in some cases, companies like Autobytel have worked diligently to bring car buyers and car dealers together using the magic of the Internet. Like Autobytel, AutoUSA and Dealix are also very well-intended companies that realize in order to grow their business they must also grow the businesses of the dealerships that write the checks for their leads. Beyond the well-known 3rd party new vehicle lead providers are other new vehicle lead providers that don’t have the marquee profile of these industry stalwarts, but send leads in the thousands each month to dealerships all over the country in the name of vehicle manufacturers. These companies are Shift Digital and Urban Science and their new vehicle leads show up in your CRM or lead management tool as Manufacturer 3rd Party Leads.  All are necessary and generally beneficial to the healthy growth of new vehicle sales across the country.

However…if they want to thrive in the future (not just survive), they need to be totally transparent with the originating source of the leads they sell to dealers. The business model used by most 3rd party new vehicle lead providers is that of a lead aggregator. They sell leads to dealers and manufacturers from their own sites (AutoByTel & AutoUSA) and sites they own (Dealix owns InvoiceDealers), as well as leads they buy and then “aggregate” to dealers from root lead sources.   There are literally hundreds of these root lead sources that are not well known to dealers, but you can easily find them if you search for your brands’ current make and models in your community.

These root lead sources typically show up on the side bar with the other pay per click advertisements just to the right of the organic search.  A recent search I conducted on Google using the terms “2013 Ford Fusion Lexington KY” returned several pay per click options, including one that said Ford Fusion with a sub-message that promoted “Don’t Pay $21,700 for a Ford Fusion – Submit Form for a Free Quote!”…A click on the link took us to a site where the headline reads, “Did You Know Every New Ford Fusion Has a Secret Price?” Once I filled out the form to obtain my Secret Price and hit submit, I was then provided the option to get additional pricing on a Mazda, Honda and Chevrolet.  Wow, four quotes for the effort of filling out the form just one time! Sadly, four dealerships will now receive this 3rd party new vehicle lead from a presumed buyer interested in their brand, but the salesperson will likely not know the original root source because it will be masked as a well-known source; in my opinion, too often as a manufacturer 3rd party lead.  Oh…these four dealers that received my test lead…they will each pay for the lead even though none of them will know whether their brand was the primary selection of the auto shopper.

Here’s where we come in. We teach dealers each day how to effectively respond to their leads and how to motivate car buyers to come in to their dealerships. One technique is to read the lead and identify the source.  When the source is identified as a Manufacturer Partner Lead or a Manufacturer 3rd Party Lead or even one of the Big 3 lead providers (Autobytel, AutoUSA and Dealix) the salesperson or Business Development Center agent can’t be sure of the original source and therefore, they will not know what the customer experienced during the lead submission process.

We encourage dealers to take electronic field trips online with their Internet sales team to click where the customer clicks so they can have a clear understanding of their experience before they hit submit. When a dealer knows what the customer experienced, the dealer can respond in kind knowing what the customer was told during the shopping process. This helps buyer and seller appreciate one another more, especially when a salesperson or agent states during the call or email that they are the preferred dealership representing the root lead source. This works great when the sources are clear-cut such as Kelley Blue Book or Edmunds.com, but they are confusing when the source is called Manufacturer Partner or 3rd Party leads.

There is no good reason why this root lead source isn’t clearly identified to the dealership that buys the leads. The reasons for not providing the names of these obscure sources are likely to keep the dealers from being concerned with the quality of individual sources, but that’s not fair to the ones who are writing the checks. All dealers appreciate that leads are scrubbed for working phone numbers and email addresses before they are sent to them. The leads I am concerned about are the leads that get through the filters without telling the dealerships they are likely the 3rd brand choice, or that a price has already been provided below invoice. This would be great for the salesperson or agent responding to know so they can provide a more valuable reply to the auto shopper.

If Trilogy SmartLeads and TrueCar can provide the sources of their leads, so can all the 3rd party new vehicle lead providers. It’s time to help car buyers and selling dealers by reducing unnecessary tension.  Let the buyers know that a dealer will likely be calling them to provide a price, and tell selling dealers that a buyer has selected their vehicle, it was their second or 3rd choice, and they already know the invoice and were told they should pay less. It’s only fair and it’s also the best way for your business and you’re paying dealers to thrive. Just my two cents.

This article was reprinted with permission from KainAutomotive.com. David Kain is a well-known speaker and trainer on Internet sales and management best practices for automotive dealers and he also moderates NCM’s Internet 20 Groups. To find out more about NCM 20 Groups for Internet Directors and Managers, call 877.803.3627

 

Permanent link to this article: http://blog.ncm20.com/2013/05/its-time-for-3rd-party-new-vehicle-lead-providers-to-be-transparent/

Rebecca Chernek

Auto Dealership F&I Sets the Stage for a Successful 2013

Use a better F&I sales approach in 2013

If you haven’t already done so, it’s that time to review your 2012 performance in detail. In what areas did you fall short of your goals and why? Where could you have generated greater gains and how? Don’t allow January to slip by without these facts in writing and a discussion of how you can best move forward in 2013.

A common F&I pay plan in the automotive industry is known as the grid. It compensates managers based on their per vehicle retail performance and products sold during the menu presentation process. The amount of products sold combined with per vehicle retail earned determines the percentage of payout from the department or individual pot reserved.

A grid pay plan is one of many, but the final outcome should result in over $1,000 per vehicle retail. This outcome is derived from approximately 60% of products sold and 40% from reserve, which will keep charge-backs under 12%, with a better than average CSI score.

Whatever your pay plan is, don’t put off reviewing the opportunities that 2013 and a potentially improved economy might present.

Ask yourself these questions:

  • How well do you understand the facts and benefits of each product for individual customers with different needs and abilities to pay, and can you discuss them with clarity and confidence?
  • Which particular products do you have the most trouble presenting and why?
  •  How effective are you in overcoming customer objections on any or all products offered and do you use visuals?
  •  Would you rather just flip to a higher term or discount your product offering a lower payment in lieu of selling the value of your product?
  • When you prepare your menu, do you maintain a stringent policy preventing you from discounting the price of your products for fear of customer rejection?
  • Do you present your menu 100% of the time with all terms properly disclosed?
  • Do you get involved earlier on in the transaction and out on the floor visible and proactive with the sales personnel?
  • Do you have a positive relationship with your banks and do you understand the various alternative guidelines available to obtain financing?
  • Do you have a turn -key process that assures 100% turn over to finance? How many cash transaction are you converting to finance or lease per month?
  • Do you meet each customer at the sales person desk, review the transaction and establish rapport, every time before the customer enters your office? Why not?

The Customer Interview

One of the biggest mistakes F&I managers make is forgoing the interview. It can literally add thousands to your bottom line. According to the J.D. Power and Associates 2012 U.S. Sales Satisfaction Index (SSI) StudySM  released in November, statistics showed that customers prefer salespeople “who invest the time up front to listen to them and ensure they select the right vehicle.” Their apprehensions decreased when dealership personnel established a business relationship and understood their needs.

Today’s savvy customers have access to Edmunds.com, a favorite shopping guide that lists all the do’s and don’ts on buying a new or used vehicle. The website even has a special section on financing options and what products to buy or forego. These customers develop an aversion to a dealership’s F&I manager and consider their meeting with you a threat.

The 2012 SSI showed that “nearly 80 percent of new-vehicle buyers use the Internet during their shopping process” and about a third of them consult online ratings/review sites when selecting a dealer. Vehicle buyers are using social media sites to gather perceptions of your general sales reputation. Don’t ignore or minimize the influence of dissatisfied customers.

It wouldn’t be out of the ordinary to envision that some customers may even whisper to one another on their way to the F&I office, “Honey, don’t forget what we read and what happened to us the last time we bought a car. Just say NO!”  Or when the customer pleads with the sales person, “Do we have to go in there?”

However, if your customers have already met you, shaken your hand, shared a few pleasantries and built a rapport, however tenuous, the edge is taken off their office meeting with you. The time you spend reviewing the transaction at the salesperson’s desk—to assure there aren’t any red-flag issues that might stall the final contract-signing—pays off in big dividends later.

During the interview, determine the customer’s driving habits, whether the vehicle is an addition to a current one, or whether a trade is being made and why. Learn if the customer is single, married, or head of a family with live-at-home children. These facts make a significant difference in how you overcome product objections and succeed in making the sale. Abstain from an intense interrogation for a more conversational approach. A conversation is interactive. Watch and listen carefully. Body language speaks as loudly as words.

Once you greet this customer again in your office, maintain a cordial attitude. In addition to selling products for the selected vehicle, you are also selling trust and your integrity. Satisfied customers become loyal customers. Since you have already met the customer you don’t have to go into unnecessary dialogue that dilutes the presentation.  The transaction is verified and complete you can immediately present the menu without fear of reprisal. Once the customer enters your office delivery time should take no more than 20 to 30 minutes. Avoid long drawn out deliveries—as the saying goes, the more you babble the less you earn.

If your goal in 2013 is to achieve over $1,000 per car or more each month, spend as much time on evaluating your personal attitude and overall customer satisfaction as you do on the ROI percentage. Never forget that personally meeting each customer at the sales person desk sets the tone for your ultimate success.

After the 2010 SSI was finalized, Jon Osborn, director of automotive research at J.D. Power and Associates, said, “The process of working out the deal is the primary indicator of whether new vehicle buyers have a satisfactory purchase experience.… It is particularly important for retailers to make this process as efficient and collaborative as possible, given its importance to overall satisfaction.”

It still is in 2013.

Rebecca Chernek of Chernek Consulting is an NCM Up To Speed guest expert in the area of retail automotive F&I best practices. Chernek Consulting offers affordable customized in-dealership consultation, web conferencing and workshops. You may contact Rebecca at 404-276-4026.

Click for details on our Jan. 29 webinar!

Permanent link to this article: http://blog.ncm20.com/2013/01/auto-dealership-fi-sets-the-stage-for-a-successful-2013/

Dale Pollak

5 Benchmarks to Guide Your Used Vehicle Investment Success in 2013

Today’s article is contributed by Dale Pollak, the founder of vAuto, and our newest Up To Speed contributing Guest Expert! Dale Pollak’s career in the automotive industry spans more than two decades. As a dealer, technology entrepreneur and best-selling author, Pollak has helped many successful automotive dealers make dramatic improvements in their used vehicle operations. I’m pleased to announce that this is the first in a series of articles Dale will be contributing over the coming months. In the meantime, this entry and Pollak’s entire blog can be found at dalepollak.com.  –Garry House

Dale Pollak“Dale, what can I do to take my used vehicle operations to the next level in 2013?”

This question comes my way more frequently, and much earlier in the year, than it did in the past. To me, this is a good thing: more dealers are thinking hard and planning ahead to do a better job in their used vehicle operations.

For the majority of dealers who pose this question, my answer is nearly uniform: Do a better, more consistent, job of meeting the metrics that guide an optimal return on investment (ROI) and maximum profitability for your used vehicle operations.

I share this guidance because it’s no easy task to consistently maintain efficiency and harmony among all the people and processes that touch every used vehicle.

Inevitably, even the best dealers will stumble. And, when they do, the corrective steps almost always go back to the fundamentals—the benchmarks
that provide the baseline conditions for success.

Here are the five used vehicle management benchmark metrics I share with dealers to help maximize their ROI and profitability in 2013 and beyond:

  1. Market Days’ Supply: This metric measures market supply/demand data on specific cars, and offers a thumbnail read of their desirability among potential buyers. The goal: a 70-day market days’ supply for your entire used vehicle inventory.The benchmark should guide, but not strictly define, a dealer’s acquisition strategy. Broadly, vehicles with a market days’ supply of 65 days or less are often retail “no brainers”—that is, the balance of supply and demand data suggests these cars will sell quickly.

    However, used vehicles with a 120-day market days’ supply can also make good sense as retail units, depending on a dealer’s ability to acquire it “right” and align its pricing to reflect a fair amount of competing cars.

    The key here is striking an inventory-wide balance between highly desirable and less desirable cars. In general, the 70-day mark indicates a well-balanced inventory.

  2. Cost to Market: For much of 2012, dealers have complained that high wholesale values for used vehicles make buying cars “right” more problematic. They found the cost of reconditioning and packing cars hurt their ROI and profitability.These insights were gleaned from tracking the cost-to-market metric for their used vehicle inventories and individual cars. The metric measures the ratio or “spread” between the dealer’s cost to acquire and make a vehicle retail-ready and its prevailing retail price point.

    The benchmark: Dealers should aim for an 84% cost-to-market metric for their inventories. This creates a 16% “spread” to achieve a dealer’s front-end gross profit goals. This benchmark should guide vehicle acquisitions to ensure appraisers and buyers can readily understand the relationship between the acquisition price, reconditioning/other costs and a unit’s likely gross profit potential.

    The old saying, “you make your money when you acquire a car” remains true today.

  3. Price to Market: This metric compares the asking price of a vehicle to the prevailing prices of similar vehicles available in a market. It’s ever more critical for dealers to offer competitive pricing to capture consumer attention. The most successful velocity dealers manage this metric in relation to a vehicle’s market days’ supply metric and its time in inventory.Example: A vehicle with a 120-day market days’ supply might be priced 5% less than competing units (a 95 percent price to market) during its first seven days as a retail unit.

    The 5% discount reflects the unit’s lesser degree of desirability, because the market days’ supply metric suggests a high degree of retail competition. If the car doesn’t sell in a week, a dealer would adjust the pricing to 93% price to market for the next seven days. The cycle typically continues until the unit sells.

  4. Inventory Age: Every dealer knows it’s important to sell fresh cars fast to maximize gross profits and inventory turn. That said, I still see a lot of dealers with more than half of their used vehicle inventories older than 30 days. This scenario suggests a problem managing cars that don’t sell right away.The causes of aging inventory are many: the wrong car, the wrong prices, too much time lost to make it retail-ready. Regardless of the issue, however, dealers who maintain at least 50 percent of their inventory under 30 days of age are best positioned to maximize their inventory turn, investment ROI and profitability.
  5. Average Discounts on Deals: This benchmark ensures that dealers “hold gross” when they close deals with customers. The goal: average discounts should run $250 or less at a dealership. Dealers should track this number by individual managers and salespeople. In addition, dealers who adopt sales processes that validate their retail asking prices with customers and the market are best able to minimize discounts.

A final point: It takes a great degree of discipline and oversight to ensure your people and processes are pointed to meet these benchmarks on a daily basis. But, as I tell dealers who seek better results in the months ahead, the payoff from improved ROI and profitability is well worth the price of admission.

If your used vehicle operation isn’t performing up to Dale’s recommended benchmarks, give the NCM Institute a call. Our industry-veteran instructors teach the proven processes benchmark-performing dealers are using all across the country. Classes are coming up soon in San Diego, Orlando and Kansas City.  Click or call 866.756.2620 for details!

Used Vehicle Management Training 

Permanent link to this article: http://blog.ncm20.com/2012/11/5-benchmarks-to-guide-your-used-vehicle-investment-success-in-2013/

Garry House

Are You Closing 20% (or More) of Your Internet Leads?

H--REK-Pictures-Email campaigns-AIM Internet Sales-Fotolia_39667104_XL ecommerce word cloud-thumb_A sound Internet/BDC operation is a key component of every successful automotive dealership. The question is, what makes a sound Internet/BDC operation? When the NCM Institute decided to sponsor a dealership Internet/BDC training program earlier this year, we decided upon one of the recognized e-Commerce experts in the retail automotive industry, Automotive Internet Management (AIM), because we found their definition to be consistent with the needs expressed by our clients.

The operative words in my last sentence were “one of.” There are many recognized e-Commerce experts, some being generalists and some being specialists. However, in discussions with clients involved in our 20 Groups, who are using our Retail Operations Consulting programs, and who regularly attend NCM Institute classes, most said that what they need is to better understand Internet lead management (as oppose to lead development). These clients told us that their priority was to improve their Internet closing ratios, rather than increasing Internet lead volume. AIM’s “claim to fame” is to achieve world-class lead management effectiveness, and that’s why NCM selected Automotive Internet Management as its “specialist” training partner in presenting Bridging the Internet Sales Gap, one of NCMi’s newest training programs.

Last week, NCM sponsored the first such workshop, and as the host, I was privileged to attend. Bill Phillips and Greg Elam of Automotive Internet Management began the workshop by saying, “We know the reason you guys are here is to learn how to deliver vehicles to 20% of your Internet leads.” They then went on to show the class exactly how to do that.  It was all about expectations, process, activities, measurement, inspection, and yes, in a nutshell…Accountability Management. All of this training is focused on what needs to happen after the electronic lead hits the dealership. Bill and Greg did a great job of “downloading their brains” to the audience, without making it a sales pitch for AIM’s services.

The response by those attending this program could not have been more positive. As a result, NCMi has scheduled another Bridging the Internet Sales Gap workshop for November 7th and 8th in Atlanta, Georgia. Because of the nature of AIM’s program, seats are limited, so if you would like to enroll in this training program, please call Brandiss, Kara, or Cassie at 866.756.2620.

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Permanent link to this article: http://blog.ncm20.com/2012/08/are-you-closing-20-or-more-of-your-internet-leads/

Garry House

Can Your Managers Lead Your Automotive Dealership Forward?

In the most recent NCMi Leading Your Dealership to Success course that I taught in April, I made three “punch-in-the-nose” statements in my introductory comments that were related specifically to the retail automotive industry:

  1. Most (a lot more than 50%) auto dealership employees give less than 100% commitment and effort to their jobs!

  2. Employees at most dealerships are over-managed and under-led!

  3. Employees don’t leave dealerships…they leave dealership managers!

And all the dealer principals, group executives, and general managers in the classroom agreed with me. The discussion quickly transitioned to what they needed to do in order to improve the leadership qualities of the front-line dealership manager. At NCMi one of our underlying training concepts mandates that when developing any improvement strategy, you first need to know where you are today. That’s why I suggested that my class attendees begin by employing a 360° Leadership Assessment at their dealerships.

This is a foundational survey used to gather perceptions of a manager’s leadership capabilities from the manager himself and from a reference group of boss, peers, and subordinates. Just as we check our outward appearance in a mirror before entering a business meeting or important social engagement, we should look in our “social mirror” by asking for feedback from others on how we’re showing up in the world. What they’re not saying is often as important (or more so) than what they are saying.

There are numerous companies that offer these assessment instruments. To find one you like, just do a web search on 360 degree leadership assessment. Being a passionate advocate of the right kind of 360° assessment, let me try to clear up some fog surrounding these tools, from a dealer operator’s perspective.

The right kind of 360° degree leadership assessment is a developmental tool that will help managers identify leadership areas in which they could benefit from some focus and work. Since none of us are born perfect leaders, it is always helpful to know how we are doing—not from our own, often rose-tinted self-assessment, but in the eyes of the people around us who see us leading every day. In order to ensure that honesty drives the result, 360° leadership assessments should be anonymous from the participant standpoint. From a recipient’s point of view, they should be seen as developmental and never tied to bonuses, salary increases or used in a punitive manner.

Today, most 360° leadership assessments are conducted online. They typically provide both numeric (5-point or 7-point scales) and qualitative feedback (written comments). The following table lists some of the leadership capabilities we are trying to assess:

Business Acumen

Decision Making

Planning & Organization

Integrity & Trust

Innovation & Creativity

Results Orientation

Customer Focus

Managing Change

Communication

Teamwork & Collaboration

Leading Others

Performance Management

One of the most important elements of the 360° assessment process is taking action. There is no point in doing 360’s if there isn’t a clear path to taking action to improve one or two behaviors that could use some work. The best 360º assessment instruments provide documentation that will walk managers through a process of identifying behaviors they feel they should work on (and suggest how they should work on them). This needs to be followed by personal accountability.

Developing managers who can effectively lead your dealership organization forward is essential to your continuing success. Frontline supervisors are often put into leadership roles without proper development; they simply do not know how to lead. Leadership development is a strategic priority required in order to compete in today’s uncertain and changing environment. Successful dealers know that effective leaders are the backbone of their organization.

cta-button-leading-your-team-to-success

Permanent link to this article: http://blog.ncm20.com/2012/06/can-your-managers-lead-your-automotive-dealership-forward/

Garry House

Clear Expectations Set the Standard for Dealership Excellence

Elements of Accountability ManagementSeveral weeks ago we published an article that discussed the 6 Elements of Effective Accountability Management. The second of these elements, “Clearly Defining and Communicating Your Expectations,” is a critically needed, but rarely well-practiced, discipline within the retail automotive industry. You’ve heard it before: people will rise to the level of performance and/or behavior that is set for them. Mind reading is not a job requirement, in spite of what some dealership managers think. Throughout my consulting experience, I’ve become convinced that most managers don’t set job expectations very well. They are often excellent at noticing when things aren’t done right, but when it comes to telling their employees upfront what they want, they try to communicate by mental telepathy.

Performance and behavioral expectations are fundamental to building and sustaining a successful dealership operation. Expectations can be described as objectives presented in small, edible bites for employees. They set the standard for excellence. Managers must communicate what they expect from their employees today, tomorrow, next month, and next year. Many (if not most) managers in the retail car business fail to clearly communicate exactly what they expect from their employees. They fail to tell their employees what is important to them. They fail to tell their employees what the most important tasks are they should accomplish each day. They fail to communicate.

Where possible, expectations should be focused on activities, not results. Here are a couple of examples:

For a Vehicle Sales Consultant -  inbound telephone appointment percentage, outbound phone and email follow-ups per day, number of CRM updates per day, demo percentage, number of potential vehicle replacements discovered on the service drive, etc.

For a Service Advisor – number of outbound status calls per customer per day, percent interactive walk-arounds, percent menu penetration, percent sales penetration on ASRs received from technicians, percent email penetration, etc.

Start with a vision of what you want the end result to be for the employee. Clearly define the activities required to produce the desired end result; these are your expectations. Today’s expectations should produce tomorrow’s results!

From the very beginning, establish your expectations in writing. A detailed job description or a set of job objectives is a MUST. The job objectives format employed by the NCM® Retail Operations team also serves as an employee evaluation tool. Also make sure that you ask employees to sign any document related to expectations. After the document is signed, give the employee a copy for his records. A signed acknowledgement of expectations stands to reinforce employee performance and behavior.

Never check for understanding of expectations by asking, “Do you understand?” Your employees don’t want to look stupid, so they will answer in the affirmative. Instead, ask questions about the expectations: “Which one is most important? Why?”; ”What will be your first steps?”; “If you perform this activity as it’s laid out, what will the result look like?”.

Set your expectations high…not so high that they are impractical or unreachable, but just high enough so your team has to stretch a bit to get there. Every professional believes that stretching is good for you!

The NCM 20 Group moderators, Retail Operations consultants, and NCM Institute faculty members are all former dealers or senior dealership managers with extensive experience in setting expectations. If you feel you might need outside assistance in setting expectations or documenting job objectives, please call Brandiss Warren at (866) 756-2620, and she will ensure that you are directed to the most appropriate NCM professional or check out our professional bios by clicking on the button, below.

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Permanent link to this article: http://blog.ncm20.com/2012/01/clear-expectations-set-the-standard-for-dealership-excellence/

Garry House

The Importance of Accountability Management

Elements of Accountability ManagementEverything we discuss in any NCMi® retail automotive training program falls under the canopy of The 6 Primary Elements of Effective Accountability Management.

Because accountability management is a critically-needed, but rarely well-practiced, discipline within the retail automotive industry, the NCM Institute Center for Automotive Retail Excellence has adopted it as the umbrella under which all training programs will be developed and presented.  Everything attendees learn in any NCMi education program will fit somewhere under one or more of the six elements of effective accountability management.  You have probably heard or seen some of these individual elements before; however, all six elements must be combined to most effectively practice accountability management.  Those elements, in no particular order of importance or priority, are:

  1. Plan your work, and work your plan!
  2. Clearly define and communicate your expectations.
  3. Measure what you need to manage!
  4. Inspect what you expect!
  5. Reward positive results, and respond appropriately to negative results!  (Positive behavior that is rewarded will be repeated; and negative behavior that is not effectively addressed will, likewise, be repeated.)
  6. Develop and implement a systemic structure! (“Dissimilar” people operating within the same systemic structure will produce similar results.)

Described another way, the practice of accountability management mandates:

You cannot manage results, just activities.  Manage the activities, and the results will follow.  You MUST measure what you intend to manage, inspect what you expect, and let everyone know the score.

Therefore, our most successful client-dealers measure ALL their key performance indicators (KPIs)…they regularly inspect these KPIs…they very visibly post these KPIs for all to see…and then they let the egos take over.  These dealers know that if they are disciplined to do even just elements 3 and 4, the performance of their store(s) will improve, although perhaps not as smoothly as when they practice accountability management elements 1, 2, 5, and 6, as well!

The 6 Primary Elements of Effective Accountability Management is a discipline taught in all Level I courses at the NCM Institute Center for Automotive Retail Excellence. To learn more about NCMi, click here.

Permanent link to this article: http://blog.ncm20.com/2011/12/the-importance-of-accountability-management/