REPORT
HOW TO CREATE A PEOPLE CULTURE
Daksh Gupta, Marshall Motor Group chief executive
NATIONAL ACCREDITATION
Steve Nash, chief executive, Institute of the Motor Industry
HOW TO THINK BIG Tokunbo Ajasa-Oluwa, head of GoThinkBig
THE VIEW FROM THE INDEPENDENTS Stuart James, Independent Garage Association director
PETER VARDY: THE ACADEMY ROUTE
Elaine Ashworth, Peter Vardy Academy director
VAUXHALL: THE IMPORTANCE OF PEOPLE FOR A BEST-SELLING BRAND Chris Roberts, retail network development director, Vauxhall
TRAINING RETURN ON INVESTMENT
Dr Paul Spear, return on investment manager, Institute of the Motor Industry
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WELCOME Welcome to the AM/IMI People Conference report. To ensure the automotive retail sector continues to play a significant role in the UK economy, it is essential it maintains a workforce that is competent and has up-to-date skills. Skills gaps and shortages have a negative impact on the economic growth of sectors and ultimately limit the UK’s ability to compete in a global market. The conference explored how to plug the skills gap and attract external industry applicants as well as high-achieving school leavers and graduates to the sector with a
defined career path accompanied by nationally recognised training accreditation. Are you doing everything possible to retain your staff and create a highly skilled workforce? For the latest thinking and information on the changing professionalism of automotive retail, click on the links to each speaker below. The AM editorial team @amchatter E: am@bauermedia.co.uk am-online.com/linkedin facebook.com/ automotivemanagementuk
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CONTENTS How to create a people culture Daksh Gupta, Marshall Motor Group chief executive Peter Vardy: The academy route Elaine Ashworth, Peter Vardy Academy director National accreditation Steve Nash, chief executive, Institute of the Motor Industry View from the independents Stuart James, Independent Garage Association director
Co-sponsors:
Vauxhall: The importance of people for a best-selling brand Chris Roberts, retail network development director, Vauxhall Training return on investment Dr Paul Spear, return on investment manager, Institute of the Motor Industry How to think big Tokunbo Ajasa-Oluwa, head of GoThinkBig Q&A
HOW TO CREATE A PEOPLE CULTURE
NEED TO KNOW n Marshall spends £691 per employee annually on training, development and rewards n Marshall scored 55% in its first Great Place to Work survey in 2008, but scored 77% last year
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ransforming a regional business into a national company can only succeed if its people are genuinely at its heart, according to Daksh Gupta, chief executive of Daksh Gupta, Marshall Motor Group. Marshall Motor Group To get there, Marshall has a ‘discretionary chief executive spend’ of £1.53 million or £691 per employee each year on staff training, development and rewards. That expenditure is translating into success, with Marshall’s operating profits up by 75% to £11.8m in 2013. Return on capital employed (ROCE) was at 18.3% in 2013. “Since 2008, our turnover has grown from £250m to over £1 billion. This hasn’t been achieved just though acquisition as our organic turnover per site has moved from £9.7m to £17m over that period,” said Gupta. “The only way to achieve such success is with the highest levels of engagement with employees.” Marshall went from having 41 dealerships, exiting 23 sites, to becoming a national player with 70 retailers from Cumbria and Scarborough in the north to Plymouth in the south. Employee numbers increased 275%, from 800 to 2,200, between 2008 and 2014. Gupta said: “72% of our portfolio is less than five years old as we have bought and sold more than 70 businesses since 2008. We have acquired businesses from 12 different companies, almost of all of which were loss-making, so the people challenge has been significant.” Employee turnover has remained at about 25%. Marshall introduced a Great Place to Work survey in 2008 and the first score was 55% with a 47% participation rate. By acting on the feedback, 2013’s survey scored 77%, with a 91% participation rate. “We had some very loyal employees, but never recognised them until they had worked for us for 30 years,” said Gupta. “One of the first
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HOW TO CREATE A PEOPLE CULTURE
things we did was send employees who had been with us for five years, champagne and for those who went on to work with us for 10, 15, 20 and 25 years, we arrange a weekend away with their partner. “We also introduced the Marshall CEO Awards and ensured it was open to all staff, particularly those who would have been excluded from traditional incentive schemes. Any employee can nominate a colleague and we have eight winners who also receive a weekend away. “We send around 40 colleagues twice a year to all sorts of locations like Moscow, Iceland and Croatia. While doing all of these things costs the company a very large six-figure sum, for me it’s an investment in our people and it has proved to be a vital component of the Marshalls culture.”
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PETER VARDY: THE ACADEMY ROUTE
NEED TO KNOW n Peter Vardy Academy gives all managers one day’s training a month on leadership skills n All new employees go through a three-day induction course
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n its drive to create the ‘best place to work’, Scottish dealer group Peter Vardy is confident the company will become ‘the John Lewis of automotive retail’. Elaine Ashworth, As winners of this year’s AM Award for Peter Vardy Best Training Programme, Peter Vardy’s Academy director academy director Elaine Ashworth told delegates the group’s focus on its staff has contributed to it surpassing its business plan objectives by 30% and a return on sales of almost 3%. More importantly, the group boasts 85% retention within its core sites and gained 10 percentage points in 2013 over the previous year’s training score in The Sunday Times 100 Best Companies to Work For, with 71%. Peter Vardy has 12 dealerships and 800 employees. At the heart of its strategy is the Peter Vardy Academy, which has been running for two years. All managers receive one day’s training a month on leadership skills and operational issues. The academy also provides structured training for all other employees, including customer service workshops. Peter Vardy incorporates a number of other initiatives including allocating a ‘buddy’ for new starters. All
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PETER VARDY: THE ACADEMY ROUTE
employees go through a three-day induction course. Day one focuses on Peter Vardy’s vision and values, day two is dedicated to customer experience, and the third day enables new recruits to ‘give something back’ to the community by working as a volunteer for the day. Ashworth said: “We have had people work in food banks and other local charities or with community agencies and it has proved to be one of the most successful policies we have introduced. “New employees are surprised that we encourage them to participate in the local community this way and they wholeheartedly embrace the opportunity, with many continuing to undertake voluntary roles long afterwards. It fully underpins the Peter Vardy ethos and we think it is one of the defining characteristics of the business.” Other initiatives include its ‘rookie academy’ which was established to encourage recruits from outside the industry and includes an intensive four-month programme. Running in conjunction with Edinburgh Napier University, it leads to an executive certificate in professional selling. “It may sound a bit clichéd, but at Peter Vardy we genuinely care about the people who work for us and the customers who buy from us,” said Ashworth. “It is very much a part of our DNA and is a direct result of our CEO Peter Vardy’s belief that this is the best way to run and do business. “We have created a real sense of belonging to the organisation and our culture of colleague engagement is very tangible. “I honestly believe it makes us as a company unique; everyone works together and has a genuinely team-player approach and that’s reflected in the success of our business.”
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NATIONAL ACCREDITATION
NEED TO KNOW n Four in five delegates want motor industry professionals to be licensed n Only 15% of industry managers are formally qualified
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our in five delegates at the AM/IMI People Conference voted in a poll for motor industry professionals to be licensed. Steve Nash said this is an issue about professional versus non-professional. “Those who get it understand you need to Steve Nash, chief invest in people. The true downgrading of our executive, IMI sector is by people who don’t want to invest in people and professionalism,” he said. Nash said the UK motor industry spends £100 million a year on training, of which £40m is on non-technical training including management development. He asked if this was a good use of resources and whether it was a sound investment. The IMI has worked hard to establish industry-wide accreditation, through Automotive Technician Accreditation, Automotive Management Accreditation, and a publicly searchable professional register of 40,000 qualified people. Such initiatives enable consumers to have more confidence in accredited motor industry workers, and also help dealers to employ skilled people rather than take a gamble. Nash said there are good natural operators in motor retail, but it raises the question of how much better they could be after training for a professional accreditation. Less than 1% of the skills and competence–based training is attended by dealer principals. That
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NATIONAL ACCREDITATION
has to be addressed, said Nash. In addition, only 15% of industry managers are formally qualified. He said the IMI has a role to play in attracting talent to dealerships. Its website includes a World of Work section, which explains and promotes the job roles within dealerships. An equally important role is to provide educators with a better message than the one they’ve always received. IMI has curriculum-orientated lesson plans and practical tools available for teachers, and Nash is involved in judging school projects. A big problem is in getting teachers and parents to aspire to their children working in the sector and the IMI is working on sector-wide recognition and defined career paths that demonstrate why a motor industry career is an alternative to higher education. Nash said in other sectors, 58% of starters are graduates on average. In the motor industry, it’s 17%. That reflects a traditional meritocracy in the industry, he said, where the likes of Trevor Finn started out as an apprentice and now run a huge group. But there’s a danger in a lack of change.
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VIEW FROM THE INDEPENDENTS
NEED TO KNOW n Training and legislation are among independents’ main concerns n IGA trained more than 3,000 mechanics in hybrid safety
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he increasing presence of a more professional independent sector will help raise the perception of automotive retail as a whole, according to the Independent Garage Association (IGA). Stuart James, Stuart James said: “The big ‘ticket’ items Independent Garage for the independent sector are undoubtedly Association director training, particularly technical development, access to manufacturer’s technical information and legislation, especially legal and health and safety regulations. “The sector is a sleeping giant, which is now awakening and adding its voice to the development of automotive retail. By so doing, we are adding gravitas to the movement to further professionalise the industry.” James said one of the misconceptions is that the independent sector is reluctant to invest in training. However, the IGA launched its hybrid safety awareness training scheme 18 months ago and it has trained more than 3,000 mechanics from 1,500 businesses. A large proportion of its members, who took part in an IGA survey, also employ an apprentice (38%), reflecting the sector’s commitment to developing young talent, and 56% said they would take on an apprentice if there was more support from the organisation particularly in negotiating the legislative process and helping to recruit the right person for the job. “Anecdotal evidence from our members suggests school leavers are receiving limited and even inaccurate information about apprenticeships in the independent sector and that is something we as an organisation need to tackle if we are going to help our members recruit high calibre school leavers for apprenticeship positions,” said James.
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Steele-Dixon Est 1961
The Automotive Industry’s Recruitment Experts Passionate about our candidates’ careers and our clients’ needs, we cover executive, management and specialist positions in the UK and International markets from the Middle East to the Caribbean.
Home Farm Barn, Radley, Abingdon, Oxon OX14 3NG Tel: 01235 536440 Fax: 01235 536448 recruit@steele-dixon.co.uk www.steele-dixon.co.uk
VAUXHALL: THE IMPORTANCE OF PEOPLE FOR A BEST-SELLING BRAND NEED TO KNOW n Only 18% of retail managers have a Level 3 qualification, compared with 45% in other sectors n Dealers must do more to communicate benefits of a career in the motor industry
W Chris Roberts, retail network development director, Vauxhall
hen Chris Roberts rejoined Vauxhall after six years running Thurlby Motors, he noticed gaps in the skill set of the managers. Only 18% had gained a Level 3 qualification, compared with 45% in other sectors. “To get the best out of our industry and our people, we’ve got to derive management skills and push those forward as a collaborative group,” Vauxhall’s retail network
development director said. Such changes include developing line management at dealer level and attracting talented young people fresh out of schools and colleges. Roberts said one challenge is dealers feel reticent about manufacturer training. Often it creates a spike in performance immediately afterwards that tails away because there aren’t the management competencies and performance measurements to ensure the team member continues to use their new skills. In recognition of this, Vauxhall has mapped its current training against the AMA (automotive management accreditation). Using assessors and approved trainers, its ‘gold standard’ training is focused on driving behavioural change. Often managers lose sight of what they should be doing, driving their teams and improving performance, because of their administration burden. It starts with AMA Trait psychometric analysis, to identify a manager’s competence and identify any training gaps. Training to fill that gap takes out cost and is more effective, said Roberts. The goal is to improve the customer experience, enable staff to sell value in the product rather than just negotiate on price, and create a happy workforce that’s been managed and motivated correctly so it will deal with customers more professionally.
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VAUXHALL: THE IMPORTANCE OF PEOPLE FOR A BEST-SELLING BRAND Salespeople, service advisers and business managers are going through it, and next year it will be rolled out to general managers. “To make this happen you need time. So analyse what your managers currently do that they shouldn’t do, what don’t they do that they should do, and what they do that they need to carry on doing. You’ll drive out some time savings.” Roberts said the motor industry must do more to encourage schools and parents to push children towards it. It needs to get the message out that the industry is about technology – sales teams explaining infotainment, aftersales using diagnostics and management control systems. To achieve this, Vauxhall has piloted an apprenticeship ‘toolbox’ that dealers can take to schools and colleges, or invite them into their dealerships, to explain what the industry is about. Relative to an industry with 700,000 employees, current apprentice numbers are poor, Roberts said. He suggested hosting meetings in schools and colleges, donating vehicles to those colleges, or getting the lecturers involved in dealerships.
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TRAINING RETURN ON INVESTMENT
NEED TO KNOW n IMI’s research identifies return on training investment n Apprentices cover costs of training in 18-24 months
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echnology is an essential part of an automotive retailer’s operations and while they believe it can give them a competitive advantage, the majority are finding it difficult to keep pace with change. Dr Paul Spear, return It is possible to achieve a high return on on investment investment (ROI) from targeted training, but manager, Institute of non-targeted training that merely ticks boxes the Motor Industry will not give good results, said Dr Paul Spear. “Skills development is a proven route towards improving efficiency and productivity,” he said. “It’s about thinking way into the future and developing individuals.” The IMI’s research shows training can really make a difference and it has created an ROI calculator hosted on its website at www. theimi.org.uk/roi. About 68-70% of businesses believe training had no impact on profitability, said Spear. However, the problem is if you don’t measure it you can’t see it. “Average retail margins in motor retail are very thin, around 3%, and to invest in training
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TRAINING RETURN ON INVESTMENT
there needs to be a high degree of certainty that you’ll get some kind of return.” The ROI research looked into leadership development and apprenticeships. For the former, the IMI looked at two managers from Scottish franchised dealer John Clark Motor Group, who undertook an AMA (automotive management accreditation) assessment. From projectbased management training, designed to fill an identified knowledge gap, they achieved an ROI of 184% and 212%. In another case, a Mercedes-Benz Commercial Vehicles service team manager transformed the business through a management accreditation and achieved 100% ROI on training. Spear surveyed 13 graduates of Loughborough University’s BSc degree in automotive management. All benefitted significantly, and most got their next position as a result. From studying results of 30 apprentices in several companies over two years, the study demonstrated that an apprentice can deliver an ROI of 150-300% net of employer costs. After 18-24 months, apprentices will have covered their costs.
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HOW TO THINK BIG
NEED TO KNOW n Lack of contacts ‘is keeping young people out of the motor trade’ n GoThinkBig aims to see more than 50% of businesses in every region offering work experience
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housands of young people in the UK have a passion for motoring, but struggle to find a way into the sector, according to Tokunbo Ajasa-Oluwa, head of Tokunbo Ajasa-Oluwa, GoThinkBig. head of GoThinkBig Motoring has been identified as one of nine passion points by people aged between 18 and 30, alongside others such as fashion, music and technology by an initiative launched by AM’s parent company Bauer, in October 2012 called GoThinkBig. This free-to-use online hub (www.gothinkbig.co.uk) was created with O2 in response to record numbers of UK youth unemployment as a means to bridge the gap between the millions of young people Bauer reaches through its brands (that include Empire, Grazia, FHM, Kiss FM and Heat) and employers. Tokunbo Ajasa-Oluwa, head of GoThinkBig (GTB), said: “Among the biggest hurdles for young people looking for experience or employment is the lack of insight or opportunity. “They may have a considerable passion for motoring, but don’t have a clue how to work on the sales or service side of a car brand. Their contact networks are limited; no one in their family has experience, so the dream never becomes reality.” GTB found that contact-building was hampered by the fact that in only two UK regions more than 50% of businesses publicly offer work experience opportunities. Working to address this, Ajasa-Oluwa said that every time a dealer had an opportunity available, GTB would work to match up a young person that could be deemed as “untapped talent”. His ambition was to see more than 50% of businesses in every region offering work experience within the next 15 months. Ajasa-Oluwa said 40% of GTB’s users had identified motoring as a passion. But only 8% had looked into getting experience in the sector.
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HOW TO THINK BIG
He said GTB could bring dealer groups and manufacturers looking for new, young talent together with the right young people “enriching their offer when they are sitting opposite you in your dealership”. Since GTB’s launch it has provided more than 10,000 employment opportunities (work experience, internships and full-time roles) to its audience of an average 16,000 monthly, registered unique users. GTB is working with 35 organisations, including the BBC, IBM, Santander and Sony Music. “The ambition amongst young people is there to get into motoring. Our role is to position ourselves to pull together the bespoke opportunities that are relevant to your business and uncover talent – for free.” Businesses using the service will be provided tailor-made content to promote them and being part of Bauer, its brands can be used to amplify the opportunities available via GTB. “Being able to bring motoring into the portfolio of companies we work with will see Go Think Big come to fruition.” n For more information email: tokunbo@ gothinkbig.co.uk
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Q&A
How do we encourage leaders in retail businesses to engage in people development?
GORDON ROSCOE
Managing director, The Blue Water Partnership Insist that they must play a part in any initiative for line managers. At the very least a structured briefing that makes their responsibilities clear and at best a programme tailored for the senior leaders that has a focus on strategic as well as team leadership. It is inevitable that when you run an initiative for line managers only, they will soon be asking why their own managers are not displaying the behaviours promoted by the course. For this reason, it can potentially cause discontent in an organisation to work solely with line managers and not with their senior managers. A point worth making to the senior managers at the outset.
STEVE NASH Chief executive, IMI
We need to provide irrefutable evidence to convince them and the IMI’s return on investment (ROI) studies, presented by Paul Spear, are an important part of that solution. Certainly this helps to address the concerns or objections of those who typically see training and people development as a cost rather than an investment. The issue of dealer principals being reluctant to attend training, despite generally being willing to send their staff on courses, is one that the IMI is addressing directly with the manufacturers and the large retail groups. Helping DPs to understand their strengths and to identify and address their weaker areas against a defined framework of management & leadership competencies is at the core of the IMI’s automotive management accreditation (AMA). Building training programmes around assessed outcome modules, where individuals both learn and actively demonstrate their ability to apply that learning, is a very engaging way of developing managers and leaders. Co-sponsors:
Q&A Once all of the (16) core competencies have been successfully learnt and assessed individuals achieve a nationally recognised accreditation, which can be maintained through undertaking CPD. This, in turn, helps to define future training needs and to maintain continued learning engagement with this critically important group. Most people want to enjoy work but also to pay the mortgage etc. How do you ensure even those team members on the lowest wages still feel they benefit equally from the business success? Gordon Roscoe Managers drive engagement or disengagement through the way they manage their people. Pay level is not the major indicator of people’s feelings of benefit and job satisfaction. How do some supermarkets manage to create engaged shelf stackers? After all they don’t get paid a lot. When managed effectively people will share in the celebration of success and gain fulfilment from playing a part in a job well done. Creating this environment is a management skill. Steve Nash People can and should be engaged at every level and successful businesses ably demonstrate that (Marshall’s and Vardy being two good examples). It basically comes down to culture which, in turn, is a function of leadership. A former colleague and very good leader frequently said (and is still often quoted as saying) “.....there are no ‘only a’s’ in this business” i.e. only a cleaner, only a receptionist, etc.... It’s easy to say that people are your greatest asset but leadership is the key to unlocking their true value. It therefore follows that any investment made in developing leaders, at all levels in a business, will multiply the effect of any investment made in developing those they lead.... What is your advice to those managers who say they have no time to coach? Gordon Roscoe Coaching will lead to reduced pressure and more time, after all you frequently have to coach in order to be able to delegate. Managers who
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Q&A have no time to coach are either using this as an excuse to avoid doing it or are genuinely overcome with their workload. The latter reason is without doubt a personal organisation issue proven by the fact that there will be other managers in the same job role who do have time to coach. One clear outcome of poor personal organisation is that managers end up prioritising incorrectly and doing the wrong things (hands on activities while team members have time on their hands). They flounder and their career stalls whilst another manager prioritising effectively is doing the right things (coaching, planning, motivating) and making good progress. Steve Nash You absolutely cannot afford not to find the time to coach people. That’s how you help them develop to take over the responsibilities that are keeping you busy in the first place. In other words, don’t condemn yourself to being a busy fool.......! What does Peter Vardy do on the three induction days?
ELAINE ASHWORTH Peter Vardy Academy director
On day one we spend time explaining and demonstrating our company values, vision and workstyles and carrying out team activities to underpin these. Day two is dedicated to the ‘guest experience’ – we focus on our approach and culture towards guests, the skills needed to deliver a world-class experience and how we are measured through manufacturer programmes. On day three we dedicate to giving back – undertaking actual projects in the community helping others – recent examples include garden tidying for a recently bereaved elderly lady and assisting in food banks. Are long working hours/weekends and sales target pressure a turn-off for young people from motor retail? Steve Nash The sooner that dealers accept that they are in a seven-day-a-week Co-sponsors:
Q&A business and resource accordingly, the sooner they will find working time solutions that actually work for their staff – rather than drive them to look for more sociable work conditions elsewhere. This is also key to attracting new staff. Saturday and Sunday are probably now the best selling days of the week, yet many dealers still don’t staff fully and only offer limited aftersales service. Extra staff may cost more, but that should be offset by increased income and better facility utilisation. Shift working is one answer, as is four (extended) days on/three days off, but there are many permutations that can work effectively. Also, part-time workers can be a good solution and the UK’s flexible approach on zero hours contracts helps this enormously. VMs also have to come to the party and offer seven-day support in key functions. ➢ Does anyone on the panel think the current rise in new car sales might be masking some underlying challenges in the motor retail sector when it comes to sales – is it currently too easy to sell a car so the focus isn’t on the customer experience? Steve Nash When the market is tough, we invariably find true selling skills are sadly lacking in many sales staff and have to train them to do the job properly but, when times are good – as they have been for the past 27 months – many of them simply forget the sales skills and disciplines they have learnt and just become (often quite poor) order takers. This is a cycle that has been repeated over and over
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Q&A
again as the market fluctuates and it has to be time for a change – notwithstanding the fact that there are unquestionably some excellent, very professional sales people out there (but not enough of them...!). The remuneration model is undoubtedly a factor, which Daksh [Gupta, Marshall Motor Group CEO] commented on eloquently at the meeting and I wonder if he can get enough key players to join him in establishing a new (higher basic/lower commission) model? Unfortunately some people will always move on. Of what value are exit interviews and how can a business maximise that value? Steve Nash It’s just as important to conduct exit interviews with staff who are leaving as it is to undertake proper induction of new staff: both are vital, but are by no means routinely undertaken by all businesses. Understanding why people leave is an essential way of finding out whether cultural issues exist within your business, or whether there are problems at some levels of management which are exacerbating staff turnover and need to be addressed. Given the tendency to promote people in our sector on the basis of their job skills and knowledge and not necessarily on any identified leadership competencies, it is vital that management shortfalls are recognised and that individuals are helped to broaden their management competency as part of their development. Exit interviews are an important diagnostic tool in this respect. Co-sponsors:
Events
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Date
Event
Venue
August 15 2014
AM Executive Breakfast Club
Simpson’s in the Strand, London
September 4 2014
AM Digital Dealer Conference
Heritage Motor Centre, Gaydon
October 21 2014
AM Used Car Conference
Telford International Centre
November 7 2014
AM Executive Breakfast Club
Simpson’s in the Strand, London
February 6 2015
AM Executive Breakfast Club
Simpson’s in the Strand, London
February 19 2015
AM Awards
The ICC, Birmingham
August 15 2015
AM Executive Breakfast Club
Simpson’s in the Strand, London