Service Drive Magazine July 2015 by CBTNews

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SERVICE DRIVE July 2015

MAGAZINE

CBT AUTOMOTIVE NETWORK PUBLICATION

Volume 1, Issue 3

COUPON MICROSITES

DESERVE MORE OF YOUR PLANNING

PETER MARTIN ...see PAGE 16

DIGITAL VIDEO

TRACK CALENDAR

CONNECTS

UTILIZATION AND STAFF EFFICIENCY CPIs CLOSELY

MICHAEL ROPPO ...see PAGE 8

Video resonates with service customers, so try filming actual repairs, customer testimonials, even the service manager introducting himself. ...see PAGE 22

INNOVATE WITH PAY,

BENEFITS POLICIES FOR TECHS

ROB GEHRING ...see PAGE 12

KNOCK DOWN THE WALLS BETWEEN PARTS, SERVICE GROUPS

CHUCK WENZLER

TAKING

...see PAGE 30

PRSRT STD US POSTAGE PAID Permit No. 1459 Pewaukee, WI

FIGHT TO

INDEPENDENT COMPETITORS

CBT Automotive Network 5 Concourse Parkway Suite 2410 Atlanta, GA 30328

SIZZLING SUMMERS Donâ&#x20AC;&#x2122;t let either the heat or the typical July-August crush of business catch your service drive unprepared. ...see PAGE 24

Lamenting repair business lost to independent shops and oil change centers is old news. We talk to service pros who have taken the fight directly to independent competition through pricing, marketing and merchandising. ...see PAGE 6

ATTENTION Dealers, GMs, GSMs, Sales Managers, F&I Managers, Marketing Directors, Service Managers, Internet Managers, BDC Managers and Pre-Owned Managers

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SERVICE DRIVE MAGAZINE

Letter from the editor

SERVICE DRIVE TODAY Email

Newsroom@ServiceDriveToday.com Phone

678.221.2955

 THE LIST OF REFRIGERANTS WITH WHICH AUTOMOTIVE SERVICE TECHS MAY HAVE TO WORK AS THEY REPAIR AN AC SYSTEM, and that might help carve an even bigger hole in the earth’s ozone layer, is truly mind numbing.

PRESIDENT AND PUBLISHER Jim Fitzpatrick

How many people out there know what R-134a is? R-1234yf? R-744? Nobody? Don’t worry, I don’t have a clue either. Fortunately, service techs need to have more than a passing familiarity.

VICE PRESIDENT / COO Bridget Everett

The EPA makes anyone who repairs or services a vehicle AC system undergo what is known as Section 609 training and re-training. That training is designed to ensure that techs are ready to handle the HVAC hardware, refrigerants and refrigerant containers.

MANAGING EDITOR Jon McKenna

It’s subject matter worth a dealership service drive’s revisiting right about now, first because it’s pretty darned hot around the country and second because the EPA recently mandated that training organizations update their materials to reflect the latest refrigerants and new initiatives from the U.S. and European Union governments.

ASSOCIATE EDITOR Russell Brown

It seems that after 20 years of widespread use of R-134a as a successor to a refrigerant that contributed to greenhouse gases, scientists have discovered it actually was eating away at the ozone layer itself. Replacement (and hopefully less problematic) refrigerants include R-1234yf, R744 and R-152a. At any rate, service techs who work on AC will need to get trained on the latest developments in this technology at an EPA-approved center. The National Institute for Automotive Service Excellence (ASE) is among the approved providers of training and certification. Best not to let this training mandate slide for too long.

WEB DESIGN Keith Tuggle

Managing Editor

DIRECTOR OF MARKETING & EVENTS Alex Branam

In This Issue 22 Put digital video of repairs and testimonials to work By Phil Sura, UnityWorks Media

24 Plan ahead for the crush of service work in July and August

By Rich Holland, AutoPoint

12 Take bold steps on compensation to keep service techs longer

By Jeff Cowan, Jeff Cowan’s PRO TALK Inc.

Pay is not the No. 1 issue why a tech says no to your job offer

By Rob Gehring, Fixed Performance Inc.

16 Coupon microsites are a smart marketing strategy within reach By Peter Martin, Cactus Sky Digital

18 Ask The Pros

By Kevin Bradberry, TK Worldwide Inc.

Remote, dictatorial style from service manager can kill retention By Kirk Manzo, The Manzo Group

4 Service Drive JULY 2015

30 Take steps to jump barriers between service, parts depts.

By Christopher Lawrence

By Michael Roppo, Automotive Domain Results

10 New owner clinics build service customer loyalty by education

MARKETING ASSOCIATE Roxanne Luhr

20 Communication gap, career ladder issues in service departments

By Jon McKenna

8 Calendar utilization, efficiency metrics are particularly critical

DESIGNERS Betsy Alvarez, Ruth Gomez PRODUCTION MANAGER Jason Lowsy

JON MCKENNA

6 How some service drives directly take on independent shops

CREATIVE DIRECTOR Simone Tieber

By Chuck Wenzler, M5 Management Services Inc.

32 20 successful habits, traits for service and parts staffs By Grant Cardone, Entrepreneur, Writer and Commentator

34 Staff resistance proves strong in overhaul of one service drive By Paul Potratz, Potratz agency

Do you really let your managers shine? Test your willingness By Tom Kukla, Credere Leadership

SUBSCRIPTION MANAGER Tom Domagalski

MEDIA SALES REPRESENTATIVE Jane Howard jhoward@cbtnews.com d 678.221.2964 c 404.452.9551

Subscriptions To subscribe electronically, log on to ServiceDriveToday.com and click the subscribe link on the side bar. Alternately, forward your company name, your name, address, phone number and email address to info@ServiceDriveToday.com or CBT Automotive Network, 5 Concourse Parkway Suite 2410, Atlanta, GA 30328. Please send address changes to the above email or mailing address. Permission to reprint or quote excerpts granted only upon written request. Advertising rates are provided upon request. Entire contents ©2015 Service Drive. All Rights Reserved.

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DON’T JUST SIT BACK AND ACCEPT LOSS OF SERVICE BUSINESS TO INDEPENDENTS

Take on independents aggressively to keep these bays filled.

Approaches others have tried on targeting older vehicles, converting facilities, changing inventory may work for you. BY JON MCKENNA

ervice managers and advisors spend an awful lot of time complaining about the volume of business lost to independent service outlets. Consultants and trainers spend an awful lot of time warning about the trend’s implications. But, few seem to take much time actually doing something about the problem and confronting independents headon. This edition, we spoke with dealers and fixed-ops veterans who had tried to directly take business back from independent repair shops through marketing and pricing strategies and adding new facilities.

6 Service Drive JULY 2015

TARGETING OWNERS OF OLDER CARS Hurley Chrysler-Jeep-Dodge-Ram in DeLand, Fla., has undertaken several campaigns in recent years to pull in the kind of service customers and jobs that tend to gravitate to independent repair shops, dealer Brendan Hurley said. The dealership has had no problem keeping buyers of newer vehicles still under warranty coming back for service. However, a couple of years ago it started targeting what Hurley calls the “fall off the face of the Earth syndrome” vehicles – meaning, those that are at

least 4 to 5 years old and often bought used. “We have to make a special effort to keep those [owners] returning” and not driving to an independent shop based on price, he said. “But there’s only a certain amount of marketing time and effort you can devote and still be successful.” His managers used a feature called Traffic COP on their AutoSoft CRM to identify older vehicles that particularly weren’t being returned for service work (for example, used Town and Country minivans), or parts that seemed to break frequently after 4 or 5 years on a certain vehicle (say, a real seal on a Jeep

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“You do a lot of hand-wringing about why people are going to the independent shops.” 4.0-liter high-output engine that tended to leak). They put together a special service package for the vehicles and promoted a reduced price to repair or replace the targeted components. Hurley used direct mail to reach those owners, and has again turned to direct mail twice recently to seek service business from prospects who didn’t buy a car. A 10,000-piece campaign promoting a free oil change got 613 takers, he said. The second campaign is just starting and offers a free recall check on Chryslers as well as a free diagnostic exam. He estimated various outreach has added 25 percent or more to his dealership’s service work, and many of those repairs on aging vehicles otherwise would have wound up in an independent shop.

PROMOTING A QUICK LANE Jim Ramsey is now president and CEO of the 14-store Lamb’s Tire and Automotive chain based in Georgetown, Texas. However, he previously spent 20 years managing fixed ops for dealerships. “When you’re in that world, you do a lot of hand-wringing about why people are going to the independent shops,” he acknowledged. One of the conclusions he drew – which has been reinforced at the tire store chain – is that it makes dealership customers feel uncomfortable when their vehicle disappears into one of many remote service bays, hidden from their line of sight. “Whereas, at one of our stores, the guy who wrote you up is standing 10 feet away from you at the service counter, and you can see your car go from the parking lot to the bay.” So, at a Ford dealership, Ramsey led the construction (actually, a conversion) of a quick lane, at a cost of $150,000 to $200,000, as a direct response to competition from independents. The dealership built a loop connecting two of its existing service lanes, added a couple of drive-on lifts and began funneling all oil and fluids changes and scheduled maintenance into that quick lane. “Also, when we sold a vehicle, the salespeople introduced the customer to the quick lane advisor specifically and said, ‘This is where you’ll come for oil changes and scheduled maintenance,’” he recalled. “The perception for that new customer was, ‘This is where I can get in and out quickly.’” At that time, the Ford dealership also began examining long-term customer retention metrics and specifically broke out revenue generated by the quick lane service advisor from that of his co-workers.

BENDING ON PRIVATE-LABEL PARTS As parts manager of Nuss Truck Group Inc. in Roseville, Minn., Ole Olson finds himself competing tooth-andnail with independent repair shops on some occasions, and cooperating with them on others. As most dealership service and parts managers preach, Olson used to always urge customers to buy

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Hurley: Take special efforts to pursue owners of cars hitting the age when repairs are needed.

OEM truck parts. “Independents might not all be quoting OEM parts to those customers.” Still, trucks with a few years on them “were being taken over to Joe’s Repair at half the price.” Olson and Nuss decided they couldn’t stick to their position and stay in business. While shying away from stocking or dealing in “white box” after-market parts, he opted to begin offering Road Choice parts. While a private label, Road Choice is a division of Mack Trucks Inc., so Olson could viably tell customers they carry the OEM name for Mack and other Volvo Group Global trucks. That approach with customers “has worked, but it’s still a tough sell. For years, parts shops have preached that only OEM-quality parts are sufficient, and now we’re suddenly out there changing the tune to say, ‘Yes, OEM is good, but we also have this other line out there that will work.’” Meanwhile, Olson has also conceded that

independents inevitably will steal some service work from Nuss, so he has tried to maintain a cordial relationship with a handful of independent shops. He has invited their managers, as well as customers’ repair techs, to attend technical training sessions held by vendors on-site at Nuss facilities, and shared technical bulletins from manufacturers with them. He isn’t trying to be an altruist. “Do I want to be a training depot for an independent shop that won’t buy tools from me? Absolutely not. But, if I get a repair shop that is a regular parts customer and maybe will refer larger service jobs that are out of their realm, then I will further that relationship. “It can be a mutually beneficial relationship. We can’t look at them automatically as trying to steal our customer, although that is bound to happen at some point.” That said, some of Nuss’ service personnel are “less than supportive” about the outreach, he admitted.

JULY 2015 Service Drive 7

Calendar Utilization,, Efficiency Are Among

MOST IMPORTANT ARROWS IN CPI QUIVER Improvements in these technician time-usage indicators lead directly to dealership net income. Last story in a series BY MICHAEL ROPPO

s dealerships keep pressing to recover profitability as the economy gradually recovers, itâ&#x20AC;&#x2122;s always a great time to look for hidden opportunities and tweak critical performance indicators (CPIs), while also dedicatedly removing roadblocks to success. The service department is one of the areas in the dealership that always certainly merits a closer look. Striving for the best possible ratios with the CPIs I have written about in this series of stories should bring your service department higher levels of shop selling time, increased shop performance, and overall increased profitability and performance for the dealership. Further, having the service staff compete for incentives tied to improving efficiency and proficiency CPIs in a properly utilized calendar month can ensure long-term business success. With the calendar utilization CPI measuring the number of days you have in open shop and billable time, efficiency measurements tell you how well the specific technician or department performed vs. the time billed to customers. Proficiency measurements tell you how well the individual and/or shop used the available techniciansâ&#x20AC;&#x2122; time-hours. Why is this important? It leads to an increased amount of net, and a considerable amount of it!

CALENDAR UTILIZATION FORMULA Calendar utilization is calculated by comparing the number of days worked in a given time period with the

8 Service Drive JULY 2015

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“Unfortunately, many dealers still tend to examine dealership performance benchmarks only from a high altitude … Rather than look down on performance from 40,000 feet, perhaps dealers should pose more specific and more focused questions.” number of days that techs or production people were scheduled to be at work. Note: For some shops, this calculation can assume that the service department is open for 24 hours, with a working technician at every bay. Pretty interesting, isn’t it?

MEASURING EFFICIENCY Efficiency measures how well the technician performed as compared to the time the customer was charged for a specific job. So, the source of the initial estimate is critical in this situation. Using an accurate labor guide to determine the amount of time required to perform a specific vehicle repair generally ensures a good starting point. The amount of time required for repairs that have been performed a number of times in the past can be based on that history. The key is to have a starting point that is consistent.

TECHNICIAN EFFICIENCY FORMULA In this calculation, you divided sold (billed) hours by actual hours per service technician for a time period. Example: If a tech clocked 30 actual hours for the week, and that work represented 25 billed hours charged to customers, the efficiency rating for that tech would work out as 35 billed hours ÷ 40 actual hours = 87.5 percent efficiency. The tech’s goal should be to achieve a routine average of 100 percent efficiency. Note: An entry level tech, such as one who has graduated from an automotive technician training program, should be able to correctly perform routine services at 50 percent efficiency (assuming proper training) within 90 days, and continue to improve until he meets the minimal accepted performance for management (usually 40 hours of produced billable time).

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Ask Right Questions To Get Right Answers Better questions for a dealer/GM (and, for that matter, the service manager) to explore are:

How many days will the service department be open for business this month?

Do the techs know how efficient they need to be and how many hours they need to turn and bill?

What is causing technicians to spend time away from their bays?

Are parts fill rates at optimal levels?

Is the distribution of work to technicians appropriate for their skill levels?

Is the dealership keeping track of techs’ hours on time tickets?

Do the techs clock in on every work order and every individual job on the work order?

Is the facility designed to promote efficiency with workflow and information?

Are technicians properly trained?

Do techs have the correct tools, and are all of those tools in good working order?

Are staffing levels in service appropriate to meet customer demand?

Are the technicians paid fairly and rewarded for a job well done?

At the end of each work day, are all time tickets turned in and their hours and efficiency totaled and communicated to the techs?

Are those generated hours and efficiency levels posted for each technician on the service department’s performance board by 10 a.m. the next day?

MEASURING PROFICIENCY Proficiency is a measurement of how well the business utilized the labor hours that were available during a given time period. It indicates how well the shop is running. One hundred percent proficiency indicates that technicians spent all available hours doing repair work. Evaluating proficiency enables the shop to identify areas that can be improved and pinpoint processes and procedures that can be modified, leading to greater profitability for the overall business and its employees.

TECHNICIAN PROFICIENCY FORMULA With this calculation, you divide billed hours by available hours. Example: If a shop charged 100 billed hours during a week and had 150 available hours to schedule, its proficiency would work out as 100 billed hours ÷ 150 available hours = 66 percent. Unfortunately, many dealers still tend to examine dealership performance benchmarks only from a high altitude. At these dealerships, questions often heard at month-end are: “Where will hours per RO per advisor end up this month? What about labor gross profit percentage? And how about fixed gross?” Rather than look down on performance from 40,000

feet, perhaps dealers should pose more specific and more focused questions, such as: “How did our fixed operations performance compare with our calendar utilization/facility potential?” “Why did we fall short of expectations when it comes to tech efficiency?” “How productive, proficient and efficient are our technicians, and what opportunities do we need to offer in order to make improvements?”

ACT BASED ON UTILIZATION QUESTIONS As I mentioned in the May story (see Service Drive Magazine, May 2015, p. 14), many CPIs can influence performance and profitability in our industry. In order to make the most of these CPI measurements, dealers and service advisors must pose smart questions and take well-planned actions in the reporting of maximized time and calendar utilization. Time is the main ingredient that a service group sells! Processes must be put into place and actions must be taken to use and influence the information I’ve reviewed here, to make evaluations and identify areas that need improvement.

MICHAEL ROPPO Director of Fixed Operations and Training /QPS at Automotive Domain Results Michael has more than 30 years experience in training and consulting for Automotive Domain Results and its parent company, The Mironov Group. He helps dealers attain maximum profitability, customer satisfaction and retention by improving the quality of their management teams and the personnel who come in contact with their customers. Visit his website at AutomotiveDomainResults.com.

JULY 2015 Service Drive 9

New Owner Clinics Have Future W Service Work As Their Goal

hen does your dealership find that it tends to lose service customers? Is it after their first service appointment? After their warranty runs out? Or, in reality, have you already lost your shot at customerâ&#x20AC;&#x2122;s service business the moment he or she drives away from the lot in a new vehicle? If your service team never even gets a chance to meet owners of newly purchased vehicles, it is really tough to develop a lasting customer relationship with them. To present yourself as a trustworthy, credible source of superior automotive repairs, your service department needs a foundational connection. New owner clinics offer an effective way to start forging those bonds.

REASONS TO HOST A CLINIC

Leverage this chance to position your service team as experts to people who just bought a car. BY RICH HOLLAND 10 Service Drive JULY 2015

Effectively conceived and executed, new owner clinics offer more than just a chance for recent buyers to master their vehicleâ&#x20AC;&#x2122;s key features. Since these events typically are hosted by service managers or advisors, they provide a prime opportunity to introduce your department to potential

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Bring new owners into your dealership to discuss the finer points of their cars.

clinic that keeps them returning to your service drive for years to come.

1) Market effectively

Do the motorists who drive off the sales lot even know your dealership offers a new owner clinic? One modest page on your website is not enough. The sales team should mention the clinic as one of the key benefits of purchasing a vehicle at your dealership. The clinic should be marketed as a premier opportunity for motorists to learn more about their vehicles from the people who know them best – for free. Salespeople should emphasize the most compelling features to be covered, such as Bluetooth set-up or smartphone synchronization. You can also develop a clinic to teach basic auto skills your customers might lack (for example, how to change a tire or check vital fluid levels). This kind of agenda could prove especially useful for key demographics, such as young new drivers. To get the word out about your new owner clinics, try targeted e-mail campaigns, handing out flyers and announcements on your landing page. Also, one of the best marketing tools you can use for this program is social media. Create an event, then make a post on your Facebook and Twitter pages and encourage your followers to share it.

If your dealership decides to invest in a bigger incentive, you might want to base it around your service department. For example, you could give away $250 of free maintenance or five free oil changes. Anything you can do to get those motorists into your shop will go a long way toward customer retention.

TAKE LOTS OF QUESTIONS 4) Encourage discussion

When you organize your clinic, the leader should plan to either set aside some time for motorists’ questions or encourage ongoing discussion throughout the event. Consider positioning model vehicles along the service drive for the customers to explore and trigger their questions. They might notice features in their vehicle for the first time.

5) Give a tour

Give the attendees a tour of your service department. Introduce them to service techs who might well be maintaining their vehicles, and explain to them your service drive’s basic processes. Tell them how to make an appointment. Give them insider tips, like the best time of day to bring in their car or when the car wash is least busy.

“If your service team never even gets a chance to meet owners of newly purchased vehicles, it is really tough to develop a lasting customer relationship with them.” CANDOR, ALONG WITH INCENTIVES 2) Tell motorists what to expect

service customers and position your dealership as the best source of future maintenance and repairs. If your service team effectively orchestrates clinics and persuades owners they are industry experts with the customer’s best interests at heart, you’ll definitely build loyalty and trust. New owner clinics give a great chance for the service team to get to know the dealership’s car buyers and gain their service business. Don’t underestimate the event’s potential.

MARKET CLINICS AGGRESSIVELY

A new owner clinic is only an opportunity, not a guarantee. The motorists who attend your event aren’t focused on the value of getting to know your service department. They just bought a brand new, or new-to-them, vehicle; they aren’t thinking yet about future maintenance or repair bills. And, they definitely aren’t jazzed about sitting through a service sales seminar. If you want your clinic attendees to later come back to you for service appointments, you need to find a way to make them feel like a partner, not a prospect. Try these steps to get owners to attend and create a 1 ½- to 2-hour

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Announce to potential attendees what you’ll cover in the new owner clinic. Even if you’ve already targeted people interested in the flashy high-tech features, there are plenty of other owners who feel confused by topics such as warranty coverage or predictable maintenance needs. Dealerships who use them typically aim a clinic at a specific auto make, and cover all of that make’s models. However, if you can build enough demand over time, your service department also could host clinics centered on alternative topics – for example, fuel-efficient driving techniques or making the most of safety features. If you can get the same people to attend multiple clinics, you have an even better chance of building lasting relationships with them.

3) Provide an incentive

Still, some people need an extra reason to take time out of their busy schedules to attend a dealership event. So, many dealerships offer small incentives, like free food. Some others advertise drawings for bigger prizes, like flat-screen TVs or iPads.

Anything that engages your customers on a personal level, or makes them feel like you’re letting them peek behind the scenes, will help establish a strong connection.

CLINIC IS NOT THE LAST WORD 6) Follow up

At the end of your clinic, offer the motorists informational takeaway materials. These can include overviews of safety features, quick start style guides for their vehicles, or a maintenance schedule at specific mileages. Don’t forget to include your contact information as well. After your new owner clinic, be sure your service team is following up with attendees. Thank them for attending, remind them about key information you touched on during the clinic, and encourage them to call your service team with any questions or concerns. Remind them that your service team is on their side for the entire life of their vehicle. With the right approach, your dealership can leverage a new owner clinic as a valuable opportunity to form new and lasting service relationships. Don’t miss your chance to form a lasting connection with future service customers.

RICH HOLLAND Managing Director of AutoPoint As a frequent speaker on the future of automotive dealership service, Rich believes in an “adapt-or-die” theory of innovation. With more than 30 years of diverse experience, he is a recognized expert in information technologies and creating customer loyalty through digital excellence. Visit the website at Autopoint.com.

JULY 2015 Service Drive 11

Creativity With Compensation Can Help Cure Service Tech Retention Headaches Discretion in how dealerships award vacation, tool accounts, bonuses has become essential in a tight labor marketplace. BY ROB GEHRING ll across the U.S., I hear a common refrain from dealerships: “I need technicians, where can I find them?” Generally, these dealerships don’t want to hear the answer; they just want their needs provided. “Please tell me I can wiggle my nose and have two technicians by Monday.” This is a typical dealer’s attitude. However, it will never happen this way. The backlog of needed technicians in the workforce across the U.S. right now is 30,000! Let’s spend a moment examining the demands on these individuals. The first requirement from a typical dealership is training standards that meet the manufacturer’s requirements. The more factory training certifications a technician has, the better his odds of getting hired. That technician also can count on individually investing about $40,000 in hand tools. And, let’s not forget the likely dealership investment of about $50,000 to bring a rookie tech up to factory master certification. Let’s face it, there’s a lot of money flowing around our dealerships’ technicians, so dealerships would be smart to get more creative in recruiting and retaining. In the past, our industry expected techs to forfeit vacation time accrued at their prior job. Those days are long gone, and if you expect to keep techs for very long, you’ll need to be creative in compensating them. A qualified technician will generate roughly $150,000 annually, on average, in labor gross profit. He also should contribute about $50,000 gross profit from parts sales.

12 Service Drive JULY 2015

CREATIVITY WITH VACATION POLICY There is no excuse anymore; we must treat our technician staffs better. Let’s look at some creative ways you should consider to compensate the service tech staff you need to run a profitable service department: •

If the technician is experienced and was getting three weeks of annual vacation per year at his last job, then pay him the difference in cash until he has met the same vacation standard at your dealership. Let him take unpaid days off if the off time is more important to him than the cash. Doing this will let you continue following the rules of your existing vacation program without showing favoritism to one employee.

•

Provide each tech the ability to access 40 hours of flat rate pay annually, which he can use at his discretion on repair orders assigned by the dealership to make up for jobs on which the tech did not make money. Don’t make your technician staff go begging to a service manager for help getting paid on a job. Renew this fund annually and give your techs a cash bonus in December to cover any hours they haven’t utilized.

Story continues on pg. 14

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•

Provide a discretionary tool account funded by the hours that techs turn. If a tech turns 40 hours this week, for example, then fund a tool account with $40 to spend at his favorite provider. An added bonus to this approach is that the tool vendor will be talking to every tech in the area, bragging about what a wonderful dealership yours is to its service staff.

SIGN-ON BONUSES ARE STANDARD Sign-on bonuses are becoming more and more common as the technician shortage has ramped up. Bonuses now commonly exceed $5,000, and the highest I’ve seen is $15,000. Your dealership should provide an aggressive sign-on bonus and also make it available to current staff who bring in new techs. Provide each technician with his own laptop equipped with communication software and hardware (e.g., Shop Watch and ROAMS) that makes it easy to perform his duties and track performance. Software must be state-of-theart, and hardware should be current with that software. An annual bonus that rewards techs for their length of service is another way to make it harder for your staff to leave. With every year of service, the amount paid should increase as a way to financially thank technicians for their service. Technician “spiffs” are another essential way to encourage techs to recommend needed repair and maintenance items that are approved and added to the repair order. The best spiff programs are paid on a daily or weekly basis and funded promptly. It gives the tech an immediate reward for the actions taken during the week.

Your dealership may need to become a lot more creative with pay and benefits if you want this service tech to stay with you for several years.

DON’T STOP WITH PAY INNOVATIONS Apart from creative compensation, every forwardthinking dealership should be sure:

A technician’s Bill of Rights has been instituted. This document should spell out the dealership’s commitment to help the techs earn as much as possible under a flat-rate pay program.

Special tools should be stored neatly and in proper order, so that a tech does not waste time getting ready to start a repair.

3. 4.

Parts should be delivered to service bays, to prevent delays at the parts counter.

Every technician should work under an individual training plan, so he understands the dealership’s commitment to invest in him.

Service should be staffed with advisors who don’t write more than 20 ROs a day. Porters should be available to prepare cars for service, reducing lost technician time looking for vehicles. And, scheduling should be managed with the goal of selling a minimum of 70 percent of available hours for the next day. Many people reading this article might consider the costs excessive if they implemented this total package of benefits. I would argue, the real cost in the dealership world is not providing incredible customer care and expecting customers to wait weeks to get their vehicle into the service departments. It’s in putting off used car inspections for three weeks while customers wait for the service department to have a technician available. My hope is that you reading this article understand we as an industry need to change the way we treat our technicians. If we don’t, the shortage of techs will never improve.

14 Service Drive JULY 2015

ROB GEHRING President and Founder of Fixed Performance Inc. Rob’s company specializes in training engagements for dealership fixed-ops clients throughout the U.S. and Canada. It aims for dramatic and profitable improvements in a dealership’s fixed operations in both processes and people. He also writes a free weekly newsletter and holds a free weekly conference call on fixed operations topics.

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ON EVERY IN-STOCK OVER THE COUNTER PARTS PURCHASE Plus tax. Must present coupon when order is written. Cannot be combined with any other offers or specials. One per customer, per transaction. Coupon has no cash value. Valid only in our service department.

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INSPECTION Must present coupon when order is written. See Service Advisor for details Coupon valid until June 30, 2015

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Call Today 888-555-5555 Please click on an individual coupon to print it

Buy four select tires, get a $60 mail-in rebate on these name brands: Michelin, Goodyear, Dunlop, Continental, Hankook, Pirelli, Bridgestone and Yokohama.

See Service Advisor for details • NO APPONTMENT NECESSARY • Coupon valid until June 30, 2015

See Service Advisor for details Coupon valid until June 30, 2015

Coupon Microsites: A Smart And Easy Marketing Strategy For Service Offers Try posting your deals to the same external site, to simplify searches and track hits accurately. BY PETER MARTIN

f your dealership doesn’t already have one, it needs to consider a dedicated coupon microsite to get the best online search exposure, better engagement with customers and trackable ROI. Eightly-three percent of consumers say they search online for vehicle service and repair information, before taking their car in for service, according to C+R Research. Does your dealership offer any coupons from

16 Service Drive JULY 2015

its website to make those customers favor your store over the other choices they’ll find online? Maybe your dealership does post coupons for a $19.99 oil change and for a free tire rotation. But, have they expired already? How do they look when they’re pulled up on a smart phone; can the customer view the entire offer? And, how do your deals stack up with those from the independent repair shop a mile down the road?

Now, what exactly is a “coupon microsite”? It’s an external landing page used to host your dealership’s coupon offers, and for no other purpose. It is maintained separately from your dealership’s website, and is easy to navigate if the creator did his job correctly There should be no need for click-arounds or time-consuming searches for the customer to find exactly what he or she needs on the microsite.

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We all know that coupons are an integral part of dealership service department marketing and have been for decades. They represent a simple marketing technique to get new customers in your door and give your service drive a chance to earn their repeat businesses.

COUPONS DESERVE MORE PLANNING However, whether in a circular or on a microsite, coupons are often the least-thought-through marketing channel because they are one of the easiest to implement. Sure, you know your dealership and its service drive must offer coupons to compete – but, have you put substantial thought into the specifics of that offer or just looked at your competition’s coupon page and marked down every discount by a few percentage points? Here are a few pointers I recommend as a dealership reviews its coupons or microsite:

Don’t limit your reach.

One of the biggest mistakes I see is dealerships offering coupons only for their manufacturer. As a Toyota store, you may be more interested in earning business from Toyota owners, but a hard line and make-specific coupons cuts out most of the market. A consumer may not buy a vehicle from your dealership but still be perfectly willing to use your service department for maintenance work. Make that customer happy with the service work, and he or she is more likely to come back to the dealership when it is time to buy the next new vehicle. Offering coupons covering all makes and models ensures you maximize your appeal to potential service customers.

Keep the offer relevant.

I also often see dealers fail to regularly update their coupons. A reduced price on snow tires does not make much sense in April. Neither does a complementary air conditioning check in December. Take a look at all the coupons on your page now. Would all of those offers appeal to you as a consumer, right now? Would any of them? Keep the coupons fresh and relevant, and consider an expiration date that is no more than a few months after the offer debuts. Doing this forces you to update offers but also creates a sense of urgency with customers who routinely check your site. Seasonal offers are a great way to build customers’ trust and keep up with their vehicles’ needs. On a coupon microsite, it is easy to swap out specials and keep them seasonally relevant. For example, in the fall start pumping your winter special offers on snow tires, tune-ups and fluid exchanges. This will help keep your dealership top-of-mind with those customers. Make sure your expiration dates are relevant to the offer. Seasonal specials are a great way to reactivate customers who might not have been in the dealership for several months. That means needed service work has piled up, so the average returning repair order runs about $500.

Strategize for smart phone searches.

A coupon microsite is proven to rank higher on search engines. A coupon or specials page may get buried among other pages within your website, but a coupon microsite turns up in searches about service coupons thanks to its unique domain and tags. Our clients’ coupon microsites consistently show up on Page One of Google, improving their exposure and the dealership’s reputation. When you construct your coupon microsite, make sure that the coupons render properly on a mobile device. After all, most of your consumers are going to want to show the coupon on their smart phone or tablet. Mobile-responsive design attracts a wider share of the market.

Coupons should be in every marketing campaign.

And, promote your coupon microsite in all of your existing digital marketing channels. Coupons can easily be shared and linked to through e-mail marketing campaigns, Facebook advertising and website promotions. Since the microsite acts as a stand-alone landing page, it is easy to track engagement and ROI.

Monitor your page’s analytics when various coupons are up, and see which offers garnering the most responses. This will help your dealership tailor service work offers to best fit your audience. And, track which coupons ultimately are redeemed at your dealership.

LOOK AT OTHERS’ MICROSITES For reference, below I give the links to three dealerships’ coupon microsites, so you can familiarize yourself with their basic and simple features. They are for Jerry’s Toyota in Baltimore; Rockland Chrysler-Jeep-DodgeRAM in Nanuet, N.Y.; and Springfield Ford Lincoln in Springfield, Pa. � www.coupons4autos.com/Jerrys-Toyota/ � www.coupons4autos.com/Rockland-CDJR/ � www.coupons4autos.com/Springfield-Lincoln/ In sum, a coupon microsite should be a quick and easy task for your current web development team or a fairly inexpensive outsourced job. If you want to boost service revenue, earn repeat business and track your service drive’s results, I recommend investing in a coupon microsite today.

“Take a look at all the coupons on your page now. Would all of those offers appeal to you as a consumer, right now? Would any of them?”

Don’t cut the list price too much.

Always remember: A coupon’s real purpose is always to up-sell the customer, not just to have him or her come in for the discounted service. So, offering coupons with steep discounts can create the impression that your list price is not a good deal. Instead, try to imagine how a reasonable consumer would respond and make sure your discounts are not so substantial that they make your regular prices seem high.

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PETER “WEBDOC” MARTIN President of Cactus Sky Digital Peter is a technology correspondent and digital marketing expert for the automotive industry, and particularly works with e-mail marketing, mobile-enabled e-mails, conquest e-mail marketing and selling to women. He is a frequent speaker at industry events such as NADA Digital Dealer, AutoCon and RVDA.

JULY 2015 Service Drive 17

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Pros:

Do you have questions? We have experts who can answer them. We have partnered with some of the top fixed operations consultants in the business who are ready, willing and able to share their knowledge and advice with you. All you have to do is email your questions to Newsroom@ ServiceDriveToday.com, and we’ll take care of the rest.

IS IT A BETTER MANAGEMENT PRACTICE TO MANAGE PARTS BASED ON GROSS INVENTORY TURNS OR TRUE TURNS? – CARL N., SOLON, OHIO Chuck Wenzler, Consultant/Coach at M5 Management Services Inc.: Inventory

turnover can be measured in two different ways. Both provide a measurement as to the performance of the inventory, but in very different ways. Both are very similar in intent but reflect very different aspects of the true performance of the inventory. Understanding the differences in what they represent and how they are calculated is important in clarifying which is the best method to use and why. Gross turns is the ratio of cost of goods sold, in dollars, to the average inventory value. It is represented as such: CGS in $/Average inventory value = Gross turnover Bear in mind that the calculation includes emergency purchases and special order parts. Because the calculation includes these items, it does not accurately reflect the effectiveness of the manager in managing the inventory or the efficiency of the inventory. Gross inventory turnover can therefore be very misleading. On the other hand, true turns more accurately portrays the integrity and performance of the inventory

and how well it meets the needs of the internal (service, collision, etc.) and external (retail) customers. There are a few different ways to calculate true turns, with the following being the simplest way: Sales from stock (net sales in $ minus non-stock sales in $)/Inventory value = True turns Both gross turns and true turns provide a measurement of the parts inventory performance. Gross turns, which can be more easily understood and is more widely used, does not reflect a true picture of the inventory performance, as it does not focus solely on stocked items. Larger, more expensive non-stocked parts can inflate the number of gross turns. True turns shows a more accurate measurement of the inventory’s performance, as it takes into account solely the parts that are sold directly from the inventory. This allows the dealer to accurately gauge the performance of the manager, the inventory and the investment on that inventory. Both methods provide a measurement of the inventory performance, but true turns is by far a more accurate representation and the better management practice.

I OWN A DEALERSHIP, AND WE ARE LOOKING AT ADDING AN INCENTIVES LAYER TO HOW WE COMPENSATE CERTAIN JOBS, INCLUDING OUR SERVICE ADVISORS. IN GENERAL, HOW ARE YOU SEEING MOST SERVICE ADVISORS PAID ACROSS THE COUNTRY – ARE REWARDS FOR SALES PRODUCTIVITY THE MAJORITY OR THE EXCEPTION? – ARTHUR T., LOS ANGELES Glenn Pasch, CEO/Partner of PCG Digital Marketing: As with any sales-relat-

ed job, service advisor compensation or bonuses come into play. There are two schools of thought. First, bonus the individual advisors on what revenue they generate. If they hit or exceed a certain metric – say, front-end alignments or CSI score – they receive a bonus. The other school of thought is not to bonus the advisor. Set a goal for the group in terms of revenue or CSI, so everyone works together. This has worked in some stores, because then everyone is available to help all customers, not just those that they may get a bonus for. A few words of caution: You must make sure whatever metric you reward aligns with your business value proposition, not just the bottom line. If you reward up-sells or a dollar amount per ticket, you can run into disgruntled customers, because the advisors may push services. Win in the short term, loss in the long term. If you are focused more on CSI or customer reviews, then you are looking to have your advisors focus on providing solutions that customers need, not hit a bonus for themselves. I think a better metric to focus on would be customer retention. What if you rewarded the service department or advisor team on the number of repeat customers who come each month? This would incentivize the team to make sure they are reaching out to their database to make sure all service happened at your dealership. If you think of the number of service customers that your dealership has accumulated over the years, keeping in contact with them not only keeps them coming back for service but also more apt to buy from you the next time they are in the market.

I THINK WE COULD IMPROVE OUR REPUTATION MARKETING FOR SERVICE IF WE STARTED GOING WITH THE OWNER’S MANUAL RECOMMENDATIONS ON OIL CHANGES AND TRANSMISSION FLUSHES, RATHER THAN DEALER-RECOMMENDED. WHAT ARE YOUR THOUGHTS? – TOM G., GOSHEN, IND. Jeff Cowan, President of Jeff Cowan’s PRO TALK Inc.: I don’t feel you are going

to build your reputation by simply offering one or the other. You will build your reputation based on offering what the customer needs, not what the manufacturer or a vender is trying to sell you. I would schedule a meeting with my technicians and service advisors. I would give them a list of these

18 Service Drive JULY 2015

various services and the intervals at which they are recommended. I would ask them to take two weeks and decide which services are needed at what intervals, based on the vehicles they see that are driven in the conditions and on the streets in the area you service. They are likely to return to you a list that has a combination of both. You may even see where they are recommending some of the services be accelerated or decelerated. But, what you will see for sure is a list that is

supported and easily sold by your staff. They then can look the customer in the eye with a clear conscience and confidence and say, ‘Based on working with vehicles just like yours every day that drive on the same streets in the same conditions that you do, we recommend ____.’ That approach builds a reputation with your customers that they can trust you, because you simply work from fact.

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Attention Dealers, GMs, GSMs, Sales Managers, F&I Managers, Marketing Directors, Service Managers, Internet Managers, BDC Managers and Pre-Owned Managers The CBT Automotive Sales, Service and Marketing Conference & Expo addresses the needs of every area of your dealership. The automotive industry’s top thought leaders and nationally recognized keynote speakers will come together to present powerful general sessions, more than 70 breakout sessions and thought-provoking panel discussions in what promises to be the most comprehensive and information-packed event in retail automotive.

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Bridging Communication Gap

Between Advisor And Tech Can Bolster Your Service Operation So can adding more rungs to the fixed-ops career ladder at your dealership. BY CHRISTOPHER LAWRENCE

nication breakdown between the two, the technician is going to be stressed out, the advisor is going to be stressed out, and nobody is going to make any money.” “[Advisors are] paid on their communication and their sales skills, so they’re always trying to upsell different items to the customer and they’re not really technically savvy on what’s actually really wrong with the vehicle,” Hurst explains. “If there is a communication breakdown between the two, the technician is going to be stressed out, the advisor is going to be stressed out, and nobody is going to make any money.” While more dealerships are emphasizing sales skills among its service advisors, he sees problems arise when results of the initial conversation haven’t been relayed to the tech before the vehicle inspection begins, resulting in a different list of necessary work begin given to a confused customer. If a customer feels he or she can’t get a cohesive and consistent repair diagnosis, Hurst said, that would affect trust in the dealership. And, there’s still another potential danger in the disconnect adding to frustrations among the service technicians and giving them a reason to seek employment elsewhere.

f your dealership’s service advisors and service technicians cannot seem to speak the same language, the headaches won’t be contained to the fixed ops area. Customers invariably will pay a price in comprehension and time when they get mixed messages from the adviser and the guy repairing their cars, and that poses real dangers to your retention rate. Matt Hurst, director of products for fixed operations at Dealertrack Technologies Inc., believes the disconnect between advisors and techs presents one of the biggest needs for improvement in most dealership service departments. It can be infuriating for a customer if he or she hears a different diagnosis from the service tech than the advisor had given earlier. “[Advisors are] paid on their communication and their sales skills, so they’re always trying to up-sell different items to the customer and they’re [often] not really technically savvy on what’s actually really wrong with the vehicle,” Hurst argued. “If there is a commu-

20 Service Drive JULY 2015

Service advisors often fail to tell techs which services and products they have suggested that customers buy. ServiceDriveToday.com

“If there is a communication breakdown between the two, the technician is going to be stressed out, the advisor is going to be stressed out, and nobody is going to make any money.” So, what actions can dealerships take to improve communications between advisors and techs, if not make them seamless? Hurst is a big proponent of using one of the multi-point inspection software packages as soon as the customer’s vehicle comes into the service drive, with real time communication between advisor and tech by mobile phone app, tablet or computer. A quick phone call from the advisor to the assigned tech immediately after the first customer interview can go a long way toward providing a consistent message, he added, and various teambuilding exercises for advisors and techs could be productive. “Everybody should be able to communicate effectively. Those lines of communication need to stay open.” Customers with appointments should not be managed as though they were walk-ins, Hurst added. He thinks service advisors and techs need to do a better job researching the customer record and the latest initial RO ahead of the appointment, eliminating the chance that, say, an oil change will be suggested when the customer has pre-paid for changes. “They need to do due diligence before the customer shows up.” Another way service departments can improve is to add more steps on their specific career ladders. In a recent blog he wrote, Hurst addressed how he feels the lack of a varied career path affects service employee job satisfaction. “Guys get stagnant if they stay in the same role for five or six years and never have the opportunity to continue moving up,” he stated. “Once [employees] hit that point, it’s when [they] start to look for other dealerships, and if it’s someone you want to keep then let’s get a little creative.” By “get a little creative,” Hurst means both training plans and job responsibilities that are specifically tailored for employees in the service department. One dealership he mentioned has created a process manager position, whose responsibility is to train prospects with potential of becoming a general manager. This person works with the managers of all of the existing departments (sales, service, parts, etc.) to help develop the processes required to meet various tasks in both the front and back ends of the dealership. Hurst gave the example of a service department making a change from using PCs at a fixed location

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to becoming more mobile through the use of tablets. The process manager would develop and implement the procedures to make this happen. Over time, the employee gains valuable experience beyond that acquired in his or her previous department. “He understands how everything flows from the technicians all the way up through the advisors, and then out the door to the customer.” Randy Mabe, parts and service director at Lilliston Ford in Kingsland, Ga., said that at his dealership, ambitious service employees with managerial goals have opportunities to progress through a number of specialties, ranging from porter and lube technician to senior and master tech. The full list of job titles in the service area at Lilliston is regular technician, senior technician, master technician, lube technician, service writer, porter, parts personnel, assistant service manager, and parts and service director. As a tech progresses along the career ladder, plenty of support is offered throughout his time at Lilliston, Mabe said. “We pay for them to go to school and get their certifications,” he said. “You can definitely work yourself up the chain.” Hurst’s and Mabe’s ideas are just a few of the possibilities available to help dealers improve their fixed operations. Better communication and a less stressful environment could lead to a more productive workplace. “Treat them fair and treat them like family,” Mabe said. “If you treat them good, that’s when they’ll stay.”

You’d be surprised how many new positions a service department can add and create an appealing career ladder. JULY 2015 Service Drive 21

CREATIVE USE OF DIGITAL VIDEO

HELPS ATTRACT NEW SERVICE CUSTOMERS AND KEEP THEIR LOYALTY Video of actual repairs, customer testimonials, introduction of service manager appeal to people with an online bent. BY PHIL SURA s your dealership as focused on gaining visibility for its service department in your markets as it is for the sales side? Here are a few quick questions for any GM or service manager to address that will give insights: • Are the percentages of digital ad spend equal with variable and fixed? For example, say 50 percent of your dealership’s variable spend is directed to digital marketing (rather than traditional media such as direct mail). If the sales team’s ad budget is $40,000, with 40 percent directed to digital; and the fixed ad budget is only $5,000, then the digital spend on fixed should be .40 X $5,000 = $2,000. • Do you have a paid search focus with your service team? • Do you have a video strategy for your service team? • If you are involved with pre-roll (a 15- or 30-second ad that targets specific types of prospects), have you allocated part of the budget to service? If you answered “Yes” to all of these the questions, congratulations; you rank among the minority of dealers across all brands. However, some manufacturers definitely are paying attention to the issue. I had the opportunity to participate in a four-city tour with Toyota last year. Google and DealerOn also had speakers. My session was focused on video applications including pre-roll. Toyota was interested in educating their dealers on the reality that the same concepts that drive sales gross will drive service gross. I also participated in a two-day fixed operations conference sponsored by Chrysler. I worked a booth that gave me direct access to service managers. It was clear that the service managers I connected with were not aware of the digital opportunities available in the market. It isn’t that these managers were incapable of learning; they simply had not been given the opportunity to grow. Some GMs have told me that they don’t want to grow their service business. They believe they are at capacity. While they understand service is the most profitable department in the dealership, they openly voice concerns about growing it due to difficulty in finding and training techs, running multiple shifts and parking constraints. I cannot imagine a GM having this attitude with the sales side. I cannot imagine a dealer announcing to the sales team that they have hit the wall with the number of sales, and the goal for the remainder of the year is simply repeating what happened last month. The ser-

22 Service Drive JULY 2015

vice prospects who are being ignored by some dealerships will find alternative solutions, and this will also represent lost future car sales.

VIDEO KEY FOR WEBSITE

Let’s assume you are interested in growing your fixed operation. Here are some basic steps to start the process of building a digital focus for service and parts: • Determine your brand message for fixed operations. This message shouldn’t be something so innocuous as “We strive to be the best” or “We make it easy for the customer.” A customer assumes you should already do this. He or she is looking for monthly brand campaigns focused on different initiatives such as oil changes for life, points and loyalty programs, and free inspections. • Develop your website to showcase the service and parts departments. Some dealers have developed stand-alone websites for the fixed operations. If your dealership is not ready to take this step, at least make it easier for customers to find the pages dedicated to service. Make it easy to navigate that part of the website to find the information the prospect most needs (phone number, map, dealership address), and make certain you post monthly specials. • Add a video element. Showcase customer testimonials, give a video introduction to the service manager, provide a video explaining why customers should visit your specific department (also known as an “about us” video). People of all ages are consuming video at all-time-record levels. Also, Google says 29 percent of video service-related searches are tied to customer testimonials. But, if you create these, make certain you use their person’s first name only, and get a signed release.

YOUTUBE MARKETING IS CRITICAL

DEVELOP A VIDEO STRATEGY. In additional to the points listed above, post video content to your YouTube channel. Google has released some great information tied to the key opportunities on which you can focus. Forty-nine percent of the people searching for service-related content opening do-it-yourself videos. So, create a series of videos with a techni-

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cian demonstrating how to change the oil, the cabin air pollen filter, a tire, the spark plugs, etc. The majority of such videos are sourced on YouTube. Some managers might question why anyone would educate prospects on this information and potentially lose the service gross. The answer is that the customers will find the content somewhere, and at least your dealership can get credit for providing the answers. Many of these videos are getting hundreds, in some cases thousands, of views over a short period of time (six months). This is inexpensive advertising for your service team. USE VIDEO PRE-ROLL. Pre-roll lets you go after specific types of prospects in a geo-targeted area. This means you have the ability to take the brand message developed by your team and advertise those points by ZIP code or by a radius around your dealership. Think of pre-roll as a network commercial online, with the ability to redirect those prospects to your website. These messages should be focused on specific campaigns and not just general dealership branding.

ONLINE SEARCH APPROACHES ARE REVEALING

Develop a paid search strategy to drive additional traffic to your website. Most dealers have a strategy tied to paid search with their new models. Focus on the same opportunity with your service department. To test your effectiveness, conduct a series of searches on Google tied to service and parts. Don’t just focus on your brand with these searches. The majority of your service prospects are looking for help without adding a specific car brand in the search. If a prospect owns a Honda and needs new tires, he or she is not likely to add “Honda” to the search phrase. Here is a starting point for this type of analysis. Let’s assume that you are a Ford dealer based in Portland. Conduct these actual searches, and pay attention to the dealers who end up listed on the first page of your results. Sample search phrases: Tires Portland, tires, tires Ford, transmission, transmission repair, transmission

repair Ford, transmission repairs Portland, AC repair, AC Portland repair, AC Ford repair, brakes, brake repair, brake repair Ford, brake repair Portland, brake repair Oregon, brake service. This is an easy test to determine if your dealership service department is visible in common searches in your market. It will also let you quickly discover what the competition is doing from an SEO and SEM perspective. Mobile is key. Half the searches are conducted on a mobile device. Make certain your website to various devices (smartphones, iPads). Conduct searches on your website with your phone to gauge whether customers will have a happy experience. Use video in communications between your advisor and customer. Audi has been helping some of its European stores use video to demonstrate car problems and suggested repairs for the customer, with tremendous results. You could have techs use smartphones to record actual repairs, and then have service advisors show that video over smartphone while describing the need for new brake pads or rotors.

Customers respond very favorably to YouTube videos of commonplace repairs.

PHIL SURA VP of Sales at UnityWorks Media Phil has worked in that role for 11 years at UnityWorks, which create video for ads, SEO messages and websites for the automotive industry. He also speaks at dealer conferences and writes for automotive trade magazines around the country. Before coming to UnityWorks, he spent four years as a dealership GM and 13 years with a dealership consulting group.

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JULY 2015 Service Drive 23

Service Teams Should Covet July And August,

Not Sweat Out Those Months Plan ahead for the annual crush of business, and turn this into the period that makes your year. BY JEFF COWAN

uly and August are the two hottest months of the year. They are also two months that can make or break your sales goals in the service department. It is during these two months that many shops find themselves overextended because of the sudden influx of customers. Business is hot! The average service advisor will write up 30 percent more customers each day during the summer than he will during the winter. The dealership has an invaluable opportunity to increase sales, customer retention and, ultimately, survey scores. It all depends on how well the service drive handles the influx. If preparatory measures are not taken, most service departments can efficiently deal with the July-August deluge for at most a day or two. By day three, the sales advisor’s job

devolves from advising and selling to survival. This is when word tracks are thrown out the window, walk-arounds stop, recommendations for service beyond what the customer requested cease, and technician inspections all but vanish.

THE LATE SUMMER RUSH GAME

JEFF COWAN President of Jeff Cowan’s PRO TALK Inc. Jeff, in his 28th year of training, is recognized as the creator of the modern-day walk around and selling processes for service departments. Currently partnered with NADA, EasyCare, NCM, MPi and other vendors and manufacturers, Jeff is the nation’s authority when it comes to training service advisors and service support staff. Visit his website at automotiveservicetraining.com and sign up for free, weekly training.

24 Service Drive JULY 2015

It becomes a game of “How fast can we move the vehicle through the shop?” rather than “How best can we serve our customer?” With that approach and mentality, the service department can count on sales penetration stopping, retention taking a major hit and survey scores plummeting. This unpleasant situation rolls around in late summer after late summer, in big dealership groups and single stores, in cities all over the U.S. But, it does not have to be this way. Here are steps your service department can take to avoid the madness and transform what are normally bad-performance months into the best of its year.

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“Your service team is going to have numbers to answer for at the end of July and August. Are they going to be numbers you planned and prepared for and can be proud of, or will they be results that surprise you and have to be explained to the dealer?”

STEP 1:

STAY TRUE TO YOUR PROCESSES

Think about Starbucks. When you visit one of that chain’s stores, it does not matter whether one or 100 customers are in line; the process remains the same. Do not allow your service staff to fall into the trap of rushing the check-in process, rushing the vehicle through the shop, and rushing to deliver the vehicle back to the customer. Just as it takes a set time to make a latte at the Starbucks counter, it takes a certain amount of time to properly work with a customer. Customers are very aware when they are being rushed.

STEP 2:

DO NOT ALLOW SERVICE ADVISORS OR BDCS TO OVERBOOK

Although high sales quantity and ROs “look” good on paper, if your processes and staff are not set up to handle the influx of late summer business, you are setting up everyone in your service department for failure. Your customers do not care how many people visit your service drive. They care about the quality of the service they receive. If your process is set up so that each advisor can handle 15 customers per day, then for every customer he writes up beyond that number, two will get only half the service they expect and deserve. As a service advisor in this scenario, when I help that 16th customer, I am realistically stretching myself too thin. As a result, I am going to rush him or her and devote half the time needed. I am stealing time and attention from my customers, and potentially giving core repeat customers half of the customer service and half of the quality they deserve. You can readily understand how an advisor who is set up to work with 15 customers and suddenly finds himself with 20 will have to give at least 10 of those customers subpar service. Goodbye customer retention at that point. Goodbye sales penetration. And, goodbye favorable survey scores.

STEP 3:

PLAN AHEAD FOR EACH DAY

This is where the service manager can truly make a positive impact. Either the night before or the morning of a sales day at this busy time of year, pre-print all of your customers’ ROs. Meet with each of your service advisors and review each RO, so that you both have a clear idea of additional work the customer may need based on mileage, history or time elapsed since their service visit. By doing this, both your service advisors and you can mentally prepare for the day ahead. You will have a clear anticipation of the types of sales that are possi-

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ble. You also can review the areas where your service advisor may be weak and formulate plans on how to execute a given situation, so that the advisor can earn the maximum results. When doing this planning, do not underestimate the power of role-playing. These meetings should take no more than 10 minutes per advisor.

and August. Are they going to be numbers you planned and prepared for and can be proud of, or will they be results that surprise you and have to be explained to the dealer? Hot months should equal cool profits!

STEP 4:

HAVE THE SERVICE ADVISORS MAKE PREDICTIONS

After completing Step 3, have the advisor write down his predictions regarding customer-paid RO hours, effective labor rate and total dollars sold for the next day, based on the pre-written RO review (we have a form to do this available at Pro Talk; contact us through our website and we will send it to you). Have the service advisor sign the paper and submit it to the service manager. Engaging in this step makes the service advisor accountable on a whole new level. This new accountability can help maximize his chances for success.

STEP 5:

REVIEW EACH RO

At the end of each day, review each RO that was written, with the advisor who wrote it. Discuss the successes and failures, as well as what you think caused each success and failures. Doing this will let your service team identify success factors that can be replicated. It also will shed light on the failures, so that corrections can be made. This step is one of great importance. It is one thing to tell someone that he did a good or bad job. It takes on far more meaning to tell him exactly why.

FOLLOW THESE STEPS EVERY DAY

Recently I presented a workshop, and a service manager questioned the methods I just outlined. He wanted to know how realistic it is to execute all of this every day. Before I had the opportunity to answer, another service manager in the room answered for me. He said, “Two years ago when I came to my first meeting with Jeff, I was skeptical, too. I found Jeff to be right on the mark when he told me to prepare and prevent, or repair and repent!” Make the late summer months your power months. Your service team is going to have numbers to answer for at the end of July

JULY 2015 Service Drive 25

Repair techs like this one typically place a lot of importance on feeling respected by management and working in a clean environment.

THE DISCONNECT BETWEEN DEALERS AND SERVICE DRIVES ABOUT THE BARRIERS TO HIRING TECHS F Focus on what really draws a tech to a dealership job – and it’s not necessarily pay. BY KEVIN BRADBERRY

ixed-ops staffing shortages have turned into something of a nationwide crisis. So, how did this happen? How can you protect your dealerships from being harmed by the problem? More importantly, what can you do to help fix the problem? USA Today spotted this trend back in 2012. Here’s a snippet from the article:

“‘We’re finding we’re going to run short of technicians in the very near future,’ says Rich Orbain, manager for General Motors’ Service Technical College. The nation’s demand for auto mechanics is expected to increase about 17% from 2010 to 2020, adding 124,800 jobs, according to the Bureau of Labor Statistics.” Aside from all the doomsaying in this article about how hard it is to find kids who are interested in turning wrenches, and the ensuing retirement title wave of master techs who are trading in their tool boxes for golf clubs, my takeaway from the article was this: We knew this storm was coming and yet, here we are three

26 Service Drive JULY 2015

years later and the problem has only worsened. What, then, can your dealership and service drive do to avoid becoming casualties of the future tech shortage? Or, if you’re already struggling with mechanic or body shop technician shortages, how can you reverse the exodus?

WHAT DEALERS THINK

I recently ran an e-mail poll with dealership managers and asked them, “What is the main reason you think it’s difficult to properly staff your dealership service department?” I gave them five reasons from which to choose. Here are the results:

Reason Response Prospects can find a better pay plan or benefits elsewhere

53 percent

No opportunities for advancement in pay, rank or certification

29 percent

There is a major disconnect between management and lower-level employees

12 percent

Service techs don’t get enough support from management, and no one seems willing to listen

6 percent

Poor and unsafe working conditions

0 percent

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So, most dealers you talk with believe the No. 1 reason why their service departments have a tough time staying fully staffed is uncompetitive pay and benefits, and the No. 2 reason is shortcomings in the career ladder in the service drive.

IN REALITY, PAY IS OVERRATED However, I found the results very interesting when I cross-referenced against the states where technician pay is the highest (according to the federal Bureau of Labor and Statistics). There was no direct correlation in service labor shortage with average pay. I believe salary advantages can serve as an initial call to action for a dealership service department, but they are not the main factor in fixed-ops people migrating from one job to another. It’s true that competition with other industries for skilled service employees does place SOME strain on a dealership’s ability to recruit good technicians. But, I think that factor is relatively insignificant. For example, back in 2012 my company had the privilege to compete in a dealership recruiting services pilot for Ford Motor Co. During the “muscle-flexing” phase, we were asked to recruit techs for one of our pilot dealerships in Odessa, a remote Texas town. In this part of the country the oil and natural gas industry has a strong presence as well as a great need for good techs. Our recruiting results in this market had the effect of derailing the dealer’s philosophy regarding manpower shortage issues. Our sourcing efforts resulted in more than 150 techs applying to work at this dealership during the pilot. The good money they were making in the oil fields couldn’t trump their desire for a better working environment.

FOR COMPENSATION. Note that pay is near the bottom on the priority list. When techs come in for an interview, they respond more favorably and immediately to respect, environment and schedule factors – and respect is most important of all. Lots of dealers assume that pay levels are the big barrier, but they should emphasize pay less and consider investing instead in continuing education possibilities, if they really want to make a good impression.

FOR UNDERSTANDING THEIR NEEDS. They need to have a stronger voice with dealership management. Consider appointing one senior or master tech, who has a good working relationship with the service manager, as shop liaison representing the techs’ interests. That liaison needs to have weekly meetings with the service manager.

APPLICANTS WILL QUERY YOUR TECHS To summarize, service techs are telling dealerships

how they can R.E.S.C.U. themselves from this manpower crisis, once they find good people. Make sure your existing employees feel validated every day. This is the scenario you want to achieve: Recruiter: “Hi, _____, I have a great job opportunity for you at ABC Motors. Would you consider a job offer at a new car dealership?” Fixed-ops candidate: “No, thanks, I really feel valued at this dealership, and it would take a lot for me to even consider entertaining a job offer from a different company. Have a nice day.” CLICK! Here’s a meaningful factoid: Most techs will drive around to your service bays and speak with other techs before coming in for their interview. What are your techs saying about your dealership? There’s plenty of fixed-ops talent available to every dealership in the country. Techs just need the right reasons to come work for you, and for that matter to stick around once they’re on the payroll.

“We knew this storm was coming and yet, here we are three years later and the problem has only worsened. What, then, can your dealership and service drive do to avoid becoming casualties of the future tech shortage?”

FACTORS THAT MATTER TO TECHS Of course, once a dealership makes a successful pitch to technicians from its own industry or another, the kicker is that it then must keep them. Our more successful dealership clients, as well as fixed-ops employees who are practically immovable from their current jobs, have told me they would need the following (and in this priority order) before considering a new job opportunity:

The service advisor on the left probably thinks the service tech is motivated primarily by pay rates — and he’d be wrong.

FOR RESPECT. Respect your technicians! The No. 1 reason why technicians leave dealerships, I have found, is because they don’t feel respected. There are any number of gestures, small and large, in which a service manager can show respect. Bring them ice water on hot days, EVERY hot day. If techs say they need fans, get them fans!

FOR ENVIRONMENT. You must give your techs a good working environment. Keep the service drive clean and well organized. Give techs a space in which they feel proud to work. Also, they need to be familiar with their environment. Bill Fee, service director at Allen Samuels Auto Group in Fort Worth, Texas, believes in assigning newcomers to a senior tech for at least one month, so before they fly solo on a service job, they know: • Policies, procedures and parking places • Where the keys go when repairs are completed • How to interact with service advisors and the parts department • Where the cars get parked when waiting on parts, etc.

FOR SCHEDULE. At most dealerships I’ve seen, service techs really need a more flexible work schedule to have better balance with their home lives. A four 10-hour days work week might go a long way toward achieving that balance, but service directors tend to obsess instead on turn rates and the number of ROs per day. Consider discussing a prospective new tech’s schedule needs in the initial interview.

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KEVIN BRADBERRY President and CEO of TK Worldwide Inc. TK Worldwide is a seasoned and well-established automotive recruiting and training firm with a top reputation among its clients and an A+ rating with the BBB since 2000. Kevin has been a featured speaker at dealer conferences and sought as an industry expert for interviews by some of the most widely recognized automotive publications.

JULY 2015 Service Drive 27

Don’t Shrink From The Root Causes Of

Staff Retention Problems In The Service Drive Problems in management style can drive away good people. The good news: These problems are curable. BY KIRK MANZO

ne of the great challenges at many dealerships today is finding and retaining the best talent. While facilities and technology enhance the customer’s experience, it is the people they deal with who will ultimately impress or disappoint. As a key element of a successful dealership, service departments often struggle to maintain a full staff of both service advisors and technicians. What can be done to reverse this trend? As with any change, motivation may need to precede productive action. The first question you, as a service manager, must consider is: How much does it cost your dealership each time you need to hire and train a replacement? Costs typically from one-third of the job’s annual salary to as high as two times that pay figure. Regardless of where your dealership falls in this range, the bottom line is that replacing a service team member costs thousands of dollars for each occurrence.

Regardless of whether the team wears suits or work coveralls, management dictates from above is a problematic approach. 28 Service Drive JULY 2015

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DICTATE FROM ABOVE IS WRONG STYLE

In order to increase employee retention rates and reduce turnover, let’s consider WHY the advisor or tech probably left in the first place. All too often, people do not leave a job – they leave their BOSS! For many years, our industry has operated on a command-and-control model to manage service departments for acceptable performance. While this approach may have proved effective with past generations of workers (baby boomers), it is not a model that will attract or retain current and future candidates for employment. We as an industry must evolve beyond the idea of getting people to do things because they have to (or else) into getting them to do things because they want to. To bring about such a culture shift, dealership and service department leaders must move from being positional to relational. In more everyday terms, what I mean is that connecting with team members on a personal level is the key to keeping your best people.

REACH OUT TO YOUR STAFF So, how will you know when you have moved beyond being a positional leader? Let’s look at this from a practical point of view. Let’s suppose it’s the end the scheduled workday (6 p.m.) in your service drive. What are your people doing at 5:45 p.m.? Are they ALL working hard to squeeze out every last drop of productivity for TODAY? Or, are most of them simply chatting up their friends before heading home for the day? At closing time, are you asking, “Where’s Joe” only to see his car tail lights leaving the lot? This is daily reality for positional leaders, who manage service staffs with high turnover and low morale. To evolve into a relational leader, they must learn to move toward their employees and not wait for them to come. The relationships that develop between supervisors and their staffs, as well as the relationships between team members, become the glue that holds the service department together. When things get stormy, the connections between your team and yourself are what will produce a winning outcome. The alternative outcome is, lacking such positive relationships, when times get tough people will just abandon ship and go elsewhere.

“If the service staff need to get something off their chest, it is part of a leader’s job to be there for his people.” ServiceDriveToday.com

3 QUESTIONS TO ASK ROUTINELY Begin by checking in with your people on a regular basis, in effect asking them these three questions: •

How are you doing at home/work?

•

How do you think the team is doing?

•

What can I do to help?

You should be having this conversation and asking these questions at least once or twice per week. Some days, you won’t make it past question No. 1. That’s okay; if the service staff need to get something off their chest, it is part of a leader’s job to be there for his people. Or you could take Henry Ford’s approach output-above-everything … “Why is it that I get the whole person when all I really want is a pair of hands!” How do you establish the direction for your department? How does your team participate in that process? Attracting and retaining top talent means accepting the fact that people will stay when they feel both appreciated and acknowledged.

SMART HIRING AFFECTS RETENTION While all of these things will help, the employee retention solution begins with employee selection. Recruitment must become an ongoing activity that occurs before you ever need to fill a job opening. Begin by defining the staff-selection process for your service department. Insisting on multiple interviews in your process is a great start. And, the “rule of threes” can help increase your success rate with new hires: 1.

Conduct three interviews

Have three different managers conduct those interviews

Conduct these interviews on three different days

By integrating the use of multiple interviews with different managers, you will achieve a well-rounded picture of each candidate. We all bring our personal bi-

ases and filters to the candidate-selection process. By including two additional managers in the selection process, we can keep one person’s biases from eliminating a productive candidate and on the flip side identify potential problems before onboarding a new hire. The use of an assessment tool helps increases the likelihood of hiring the best candidates. Ask yourself how many times you have hired someone and thought, “This person is going to work out great” – only to be disappointed after just a few weeks or months?

ID THE TRAITS OF TOP PERFORMERS Identify the top performers in each of the key roles in your department. Then use an assessment tool to identify these top employees’ skills and personality. While you can buy many good tools, I would recommend you consider DiSC Profile, PI Predictive Index, Omnia Group or Gallup Strength Finders. The investment for each is often less than $50 per applicant and can save you thousands of dollars in the long run. In John Maxwell’s top-selling book “The 21 Irrefutable Laws of Leadership,” his “law of magnetism” states that as a leader, I attract who I am and not whom I want. Write down the top three characteristics of a person you want on your service team. Now ask yourself: Do you possess those same characteristics? If the answer is yes, then the likelihood that you will attract someone with those characteristics is high. Just keep in mind, while we all think we’re great, cloning your entire team to be just like you may not be the best idea. The strength of any team is in its diversity of skills and thought. Remember that effective leaders are like thermostats: They have the ability to adjust the temperature of their teams. Followers simply record the temperature like a thermometer. Work to become a thermostat and watch your employee retention soar!

Smart service managers check in daily with their advisors and techs. KIRK MANZO President of The Manzo Group As a best-selling author, internationally recognized speaker and professional trainer, Kirk has conducted hundreds of in-dealership programs throughout the U.S. and Latin America and was a featured speaker at the 2015 NADA Annual Convention in San Francisco. As a certified member of the John Maxwell Team, he facilitates mastermind groups, in-dealership workshops and coaching services based on Maxwell’s strategies for leadership and communications. Visit his website at LeadershipIsInfluence.com.

JULY 2015 Service Drive 29

TAKE A SLEDGEHAMMER

TO THE WALL BETWEEN SERVICE AND PARTS DEPARTMENTS Increasing the interactions between their managers and staffs, in both professional and personal settings, can pay dividends. BY CHUCK WENZLER

was watching TV the other day and saw a commercial for an online game called “Game of War.” I don’t play these games but it appeared the goal in this one was to capture other kingdoms and build walls to keep your enemies out. I imagine the player with the largest kingdom wins. The more I thought about it, the premise of “Game of War” reminded me about life inside some automobile dealerships. Each department is its own little (maybe large) kingdom and often builds walls around itself to keep the other departments while it pursues its own agenda. Each kingdom has its own king (the manager) and warriors (employees). Rather than pursue peaceful coexistence, the kingdoms battle over which is the largest and most prosperous, vying to overthrow the other departments in the dealership pecking order.

30 Service Drive MAY 2015

Just think how well off ALL the kingdoms would be if they were to leave their egos at the gates, knock down the walls and work together. Managers in a dealership cannot live within their own departments. They must constantly work to break down dividing walls, understand each department’s needs and expectations, and strive to help the entire business benefit.

WHY RIVALRY STARTS IN 1ST PLACE I’ve asked many times what causes such walls to come up between the service and parts department at auto dealerships. Overwhelmingly, the primary factor has been trust, or the lack of it. Distrust between service and parts managers creates an “every man for himself” attitude; walls go up, separate kingdoms arise.

The walls can also be built based on perceptions regarding pay plans and the behaviors they can incent. Managers may be hesitant to help other managers for fear of having to “give up” profit. Another reason is competition, as both service and parts want to be known as the dealership’s best department for profitability and growth, and to win favor from the dealer or corporate ownership. It’s understandable that a manager wants to have the highest-performing department and can forget about the role other departments play in making that happen.

SHADOW OTHER GROUP’S MANAGER Okay, enough about why walls come up between service and parts departments. What steps can their managers

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take toward unification? Over the years, I’ve seen the tactic of having managers and key employees work in the other department work well often. For example, let the service manager shadow the parts manager for a week, experiencing day-today activity in that department. He’ll walk away with a renewed appreciation for what it takes to manage a parts operation, and with familiarity with the parts staff on a more personal level. During this time, the two managers can discuss the needs and expectations of their respective departments and how they can work together on processes and procedures to achieve them. Afterward, the parts manager can spend time shadowing his counterpart in service and get the same perspectives.

OPEN UP DEPARTMENT MEETINGS It’s also worth inviting the other department’s manager to your departmental meetings. One dealership with which I was affiliated had a particularly difficult time breaking down walls between the service and sales departments. Service held both “morning huddle” meetings and monthly meetings. It was decided that the new and used car sales managers should be required to attend one morning huddle per week and bring along a salesperson, and also to attend the monthly service meetings. Conversely, the service manager had to accompany a service advisor to one morning sales meeting per week, and also attend one weekly sale meeting each month. At managers meetings, the dealer required the service and sales managers to report what their people were experiencing with the crossovers. In a short period of time, the two departments achieved newfound respect for one another. Plus, the parts and collision managers began voluntarily attending the sales and service meetings and sometimes even morning huddles. Communication between departments improved dramatically, and during the managers meeting they began to discuss and plan what they needed to do as a team to take the dealership to the next level and what each department could do for the other.

“Managers in a dealership cannot live within their own departments. They must constantly work to break down dividing walls, understand each department’s needs and expectations, and strive to help the entire business benefit. collision center team, and so on. Again, this let the managers spend time with staff from other departments, and for those employees to get to know the managers as people.

YOUR GOAL: IMPROVED TRUST At the end of the day, any step you can take to minimize mistrust between the service and parts groups is a worthy activity. Mistrust often arises from the failure of each department to visualize or understand the bigger picture of the dealership’s goals. Managers distrusting one another foments an every man for himself attitude and construction of walls and kingdoms. Too often, managers are quick to judge other managers negatively. But, trust can be built through communication

and mutual respect, by getting to know the other department’s manager and staff and finding out what makes them tick. So how many kingdoms exist within your dealership? What will be the first steps your department takes to break down the walls built when those kingdoms were created? What will be your plan moving forward to improve interactions with the other department, and how will you communicate it? Get to know the service or parts manager with whom you work. Try to understand what he deals with on a daily basis. Identify his needs and expectations. ALL of a dealership’s departments need to work together as a management team. Join forces to ensure the dealership’s success, then enjoy the success. This is not “Game of War,” after all.

NO ICEBREAKER IS TOO CHEESY In one store, I was allowed to sit in on an all-store meeting during a dealership visit and watched the general manager start with an icebreaker. It was one he used when several newcomers were at the meeting. All attendees wrote their names and jobs on a piece of paper, along with three things about themselves – one of which was a lie. The sheets of paper then were folded into airplanes and launched. Everyone had to pick up a plane (not his own), introduce the person who made it and guess which item was the lie. Now, this is clearly a soft skill and not a new kind of icebreaker. But, the GM found his team liked it when newcomers had been added to the group. There are many such icebreakers to try. The key thing to remember is you’re aiming for interaction between the service and parts departments and their staffs, and to lighten the mood.

UTILIZE COMPANY OUTINGS For that matter, have you tried an off-site activity, like a picnic or ball game for the service and parts staffs? At dealership picnics, I have tried organizing competitions like softball, kickball and volleyball pitting department against department. The caveat was, I would appoint managers to be captains – but not of their department’s team. Rather, the new car manager would lead the service team, the parts manager took the helm of the

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CHUCK WENZLER Consultant and Coach at M5 Management Services Inc. Chuck is a fixed operations professional with more than 25 years of managerial experience. He has worked for several dealerships and later moved into training and consulting, both independently and for AutoNation and M5. He specializes in fixed operations clients at M5.

MAY 2015 Service Drive 31

20 That Chart A Course To

Habits And Qualities

Success In Service And Parts The best service departments are teams of problem-solvers.

Smart investments in your own skills, your time and your customers will help your department stand apart. BY GRANT CARDONE

t a dealership, average performance ensures a service or parts employee ensures you will be underpaid, as average people are always underpaid. If you’re not going to be great in the service lane or behind the parts counter, what makes you think you are going to be great anywhere in your life? Here are 20 qualities that are required to set you apart from the average people you compete and/or work with.

1 BUSINESS-BUILDING

Great parts and service people help build a business. They aren’t just trying to make another sale. That said, you must make those extra sales in order to make your position more valuable in the marketplace. Bottom line: The great ones are always making extra sales as a way to build a business, not just to bring in revenue.

2 LEVERAGE CUSTOMERS

“Great service people will always ask their customers why they want something done, not just what they want done. Ask great questions, listen more and talk less, so that you can better accommodate what the customer values.” 32 Service Drive JULY 2015

Don’t ever make a sale and then just forget about that customer. The last sale you make should always open a door to a new relationship and new customers. Ask for referrals from customers who get their car serviced in your drive.

3 LISTEN MORE, SPEAK LESS

Developing an understanding of the customer’s wants and needs will bring you to a solution faster and close the deal. Great service people will always ask their customers why they want something done, not just what they want done. Ask great questions, listen more and talk less, so that you can better accommodate what the customer values. When value exceeds price, price will no longer be an issue.

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4 OVER-COMMIT, OVER-DELIVER

There’s an old sales mantra, “under-commit and over-deliver.” However, you aren’t going anywhere in fixed ops by under-selling and then suddenly surprising your customers with great service. You must over-commit and over-deliver.

5 EFFECTIVE USE OF TIME

Great producers know how to invest their time on activities that ring the register. They don’t simply talk to customers with no goal in mind. Concentrate on using every moment on more effective production in your department. Don’t waste your time on activities that can’t lead to a sale or that don’t produce anything, now or in the future.

6 NEWER, BETTER, FASTER

Be extremely concerned about time. Time is a killer in business today. Fast is the new big. Great service and parts people know their game, their products and their options, and consistently work on improving themselves to make each transaction faster.

7 INVEST IN YOURSELF

Be willing to invest your time in networking, community and relationships. Great service and parts people know the difference between a contact and a contract is the letter “r” – which also stands for “relationship.” Invest in your community, church events, school and neighborhood events so that you become seen as a reliable person with whom to do business.

8 BE A FANATIC

In whatever position you hold in the dealership, you need to become fanatical about the selling game. Quit trying to act like you are NOT a salesperson. You are and you must be. The best salespeople I know are obsessed with their customers and helping them with products and services, thus expanding their business.

9 BE SELF-RELIANT

The greats don’t depend on favorable economies for their outcomes. Instead, they rely on their own actions. If you’re a great performer in your job, you’re going to do well in any economy, because you effectively create your own economy. You run your own race and make something happen despite the environment.

learning to become the greatest service and parts person in your market. If you don’t close a business deal, don’t think of it as a failed attempt. You should know that some attempts pay immediate dividends, others don’t – but both are investments in your business.

13 NEVER GIVE UP

Remember that growing yourself helps grow your business. So, if you experience a failed attempt, try to regard it as an opportunity for the future. Never give up on customers who decide not to have their vehicles serviced at your dealership or who buy their parts from an independent shop. Believe that someday, those customers will choose to buy from you as long as you follow up with them.

14 CONTROL TIME

Great service and parts people manage to squeeze productive hours from minutes and weeks out of days. They are like magicians with time. They don’t manage time; they create it and make it work for them.

15 SOLVE PROBLEMS

Look, if you want to dominate your marketplace and become the top-performing service or parts department, you must come to view problems as opportunities. When a problem comes along, it is a chance to devise a solution – and solutions equal sales. If you don’t have any problems to solve, then you aren’t doing enough to build your success.

16 VALUE TRAINING

Great performers invest in their education, development and personal motivation because they know these are the most powerful tools of the service and parts departments, and for that matter of any sales professional. You need to continue to invest in your game ( much like a professional ball player), even in the off-season.

17 REINVEST IN BUSINESS

The greatest service and parts people invest in their careers, their businesses and their customers. They understand this is all an investment in their future. Investing in your facility is like watering the lawn. If you take care of your career, business and customers, then the growth – and money – will eventually come.

18 HIGH PERFORMANCE STANDARDS

Hold yourself to higher standards than even your management teams do. No manager can know your actual potential. You are the only one who can push yourself to your true potential through higher standards of working, living, being a part of your community and building your business.

19 PERSONAL ACCOUNTABILITY

Hey, you don’t need others to hold you accountable. You need to hold yourself to the highest standards of accountability, in your service or parts department and in your personal life. To be the best, you must possess leadership skill and desire, unequaled motivation and 10 times the purposefulness of your competition and co-workers.

20 THINK, PLAN, PREPARE

Great service and parts people are constantly in “think, plan and prepare” mode. This discipline allows them to continue to build their client bases and keep their pipelines and service floors full. You can’t ever have an “off” button if you want massive success. Look, many of my friends in the car business are great at sales because they take massive action and push all aspect of their success. Success is their duty, obligation and responsibility. Be great, nothing else pays much.

Excellent parts and service departments are always looking for an extra sale to help solidify the dealership’s book of business.

10 SUCCESSFUL POWER BASE

Great service and parts people surround themselves with overachievers and have little time for those who don’t create opportunities. People with this mindset sometimes are viewed as being disinterested in others, but the truth is that they’re just not interested in low production. They don’t want to waste time on people who can’t get anything productive done.

11 GOOD ENOUGH IS NOT GOOD ENOUGH The greatest service departments I have seen never accept “good enough” as a standard for acceptable work. These service and parts professionals don’t need anyone managing them. They push themselves to their own highest potential.

12 FAILURE IS NOT AN OPTION

Don’t view unsuccessful customer interactions as failures. Rather, view them as investments in the process of

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GRANT CARDONE Entrepreneur, Writer and Commentator Grant, a national speaker and motivator, is a respected, highly regarded master salesperson whose passion is to teach people how to sell themselves, their products and services regardless of economic climate. His books, audio packages and seminars provide people of all professional backgrounds with the practical tools necessary to achieve high levels of success. Follow him on Twitter @grantcardone.

JULY 2015 Service Drive 33

Service writers needed a clear statement about the crucial efficiencies they had to follow.

RETOOLING A SERVICE DEPARTMENT:

A BIGGER JOB THAN EXPECTED What a digital marketing consultant learned in trying to persuade fixed-ops employees to follow new processes and marketing tactics. BY PAUL POTRATZ

t seems like yesterday when I received a late-night phone call that changed a lot of my perceptions about how to market a dealership’s service department. It was my friend Don, which seemed odd since he is an early riser. Despite my detecting tension in his voice, his news was good; after 17 years of trying, he was getting a shot as a general manager, of a Honda store in Charleston, S.C. He needed to be there in two weeks. Don is a very driven, process-oriented guy with little patience for people who are complacent or utter, “This is the way we have always done it.” He was going to train the dealership’s service teams on the processes he demanded, the word tracks and reporting he required. He also planned to change the service pay plans and the pricing for service and parts. He needed my help in marketing and social media processes, and the associated training of the service and parts teams.

34 Service Drive JULY 2015

SERVICE EMPLOYEES WERE SKEPTICAL

Neither of us realized the stresses and difficulties we would face. The knew pay plans required everyone to take pay cuts, because they had been compensated based on the wrong performance indicators, which did not motivate them to work harder or follow Don’s processes. Service staff filed complaints, quit or generally were very negative. What they failed to realize was that the new pay plan could double their income if they followed the process and hit their individual key performance indicators (KPIs), department goals and cross-department goals. We outlined what key efficiencies a service writer must follow to increase cost per repair order. This was important because we needed clarity for everyone, and it was imperative that I align the marketing strategy and message to services, parts and accessories.

“Neither of us realized the stresses and difficulties we would face. ” ServiceDriveToday.com

MARKETING PIECE FOR CLIENT ‘LOVE’

Nearly 40 percent of our marketing strategy and budget was for education and reminders to our target market. It was consultative marketing. We also did flash sales and issued plenty of enticing coupons, which made up another 40 percent of marketing. The last 20 percent was the “client love strategy”: PROCESS: Every client visit requires the same walkaround and inspection process, to ensure needed repairs and accessories are suggested. CLARITY: Ensure the service writer clearly understood the eight services and three accessories in which we wanted to see growth. CONFIDENCE: Practice, practice and practice the word tracks for the services and accessories we needed to grow. The key was not to be package-seller but rather a consultative sales professional who earned respect and trust. Every morning, the service team held 15-minute meetings to review individual KPIs for the day. At the end of their shift, their performance was evaluated and written on a big white board for all team members to see. I have found that you must limit KPIs to five or fewer, and they must be measured with fact and not opinion.

TRAINING PRIORITIES We trained on:

EDUCATING ON THE PROCESS AND WHY: We had a couple of service writers create social media videos of the walk-around inspection process. These videos explained the walk-around and why it would save the customer money and help keep their families safe in a properly maintained vehicle. They were used extensively with social ads, video pre-roll, and the “Thank you” sign-up pages for service appointments. SELLING THE BY-PRODUCT: We created videos of the services we wanted to grow. We shot video of the service tech doing the repair, and had him explain the things he looked for and what the benefit was to the service client. This proved helpful, as we soon found out that the majority of service clients would search for the service they needed so they could educate themselves. We call this the “WebMD search” of vehicle repair. In other words, when was the last time you had a rash or something and you did a self-diagnosis online? These videos showcased our team and created them as the authority. It built trust and increased gross profit.

C. SHARING IS CARING: The service writers, techs and parts counter staff started using Facebook. While we never were able to get many on the platform, the few we did made a big difference in the success.

AT END OF DAY, SUCCESS

Were these efforts generally successful at this dealership? The answer is yes. It went from 56 percent fixed coverage to 137 percent, and from $820,000 in retail to $3.2 million over three years. It became a top five Honda store in the U.S., even though Charleston is situated in what many would call truck country. Where were we mistaken: In our beliefs that you could motivate people by money and that you could build a highly profitable dealership just by running some paid search, radio, print and direct mail pieces. Achieving that goal requires clarity, process, training, listening, responding, measurement, change and creative strategies that speak to your customers. It also requires daily persistence. Since this project concluded, Don left Charleston and is now part owner of a four-franchise dealership outside of Philadelphia.

MARKETING CONTENT HAD TO ENGAGE

We how had clarity, training, process, pay plans and measurement in place. Now, on to my parts: marketing and training. As I mentioned earlier, the marketing was almost 40 percent education-directed to the target market. We tackled marketing with: ENGAGING CONTENT: We created videos, white papers for download, and specific pages on the website. This content matched our goals of what we wanted to achieve in services, parts and accessories. This is where most dealership service departments fail, since they never create engaging content. Rather, they tend to purchase some mass-sold videos or text content, or don’t try to understand the next logical steps of consumer behavior. MOBILE STRATEGY: Mobile usage now drives the highest conversions. So, it was important that all content, calls to action, chat tools, text-to numbers, click-tocall numbers, mobile apps and mobile websites work without flaw. Due to the market’s mobile penetration, we needed to dominate on social sites like Facebook, YouTube and Twitter. LISTENING: We utilized multiple surveys monthly to educate on the importance of the various repairs. The surveys also provided an extensive inbound marketing list and allowed us to segment individuals based on services, parts and accessories we would be most likely to sell to them. Our surveys proved the most cost-effective, with the highest return of profit. At one time, we had 17 different surveys running at the same time. Mobile penetration was extremely high, and we knew the value social media would provide us. Still, when we began training on social media, we found it was one of our hardest tasks, due to the team not really understanding social media and thinking they were stupid.

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At the end of the day, efforts to revise the pay system and marketing plan succeeded.

“Where we were mistaken: In our beliefs that you could motivate people by money and that you could build a highly profitable dealership just by running some paid search, radio, print and direct mail pieces.” PAUL POTRATZ COO of the Potratz agency Paul and his team specialize in all aspects of internet marketing. He has been quoted in the New York Times, the Wall Street Journal and the New York Post, and on CBS. He also has been a featured speaker for NADA, Driving Sales, Auto Dealer People, Dealer Elite and Automotive Digital Marketing. Visit his website at www.exclusivelyautomotive.com.

JULY 2015 Service Drive 35

TEST YOUR WILLINGNESS TO HELP OTHERS LEAD A self-exam that takes only minutes can reveal your inclinations as an ‘empowering leader.’ BY TOM KUKLA

mong the important questions that successful leaders should frequently ask themselves is, Am I helping others develop their potential as a leader? Leadership is all about bringing your people up around you, and leaders who neglect to empower others tend to be insecure. With that in mind, below is a quick test for your to self-assess your willingness to be an empowering leader, along with a key to interpret your score and decide how to follow up.

Rate yourself on each question on a 1 to 10 scale, with 1 being Never and 10 being Always. Add the ratings for all questions to get your total empowering leadership score. A perfect score would be 100.

If you scored 100, congratulations! You are an empowering leader. LEADERSHIP COACHING TIP: Commit yourself to developing leaders who empower others, as opposed to only developing followers

Do I believe in people and feel they are an organization’s most appreciable asset?

Do I feel that team leadership can accomplish more than individual leadership?

I look for potential leaders and quickly assimilate them 3. Do into the organization?

4. Do I invest time developing people who have leadership 5. potential? 6. Do I enjoy watching others get credit for what I taught them? I allow others the freedom of personality and process, or 7. Do do I have to be in control? I give my influence publicly to potential leaders as much 8. Do as possible? Do I desire to raise others above my own level of leadership?

9. I hand the leadership baton off to a teammate and truly 10. Do root for him or her?

Assess their leadership talents and learning style preferences Develop a plan for their growth

If you scored 90 to 99, give yourself a pat on the back. You are well on your way to becoming an empowering leader. LEADERSHIP COACHING TIP: Focus on your weakest area of development

Identify potential leaders

Develop a plan addressing only that skill set. Include: • Reading leadership articles/books specific to your area of development • Keep a journal of weekly activity toward improvement • Work with a mentor

Reassess your rating in six months

If you scored 75 to 90, you have built the foundation of effective leadership. Examine areas where you need to strengthen. LEADERSHIP COACHING TIP: Focus on your two weakest areas of development plus one area of strength

Develop a growth plan for each of the three areas, with specific milestones, to include: • Selected readings focused on leadership and growth • Three activities per week in which you specifically address each of the three areas • Meeting with a mentor monthly, to keep you accountable to your growth plan

Reassess your rating in three months

If you scored 50 to 74, you are doing okay as a leader, but you have the potential to do much better. LEADERSHIP COACHING TIP: Focus on two strength areas plus one of your areas of development

Develop a growth plan, with the help of your supervisor, for each of the three areas that includes: • Selected readings on leadership and growth • Three activities per week in which you specifically address each of the three areas

Do I plan to have others take my present position?

• Meeting with your supervisor weekly to assess your progress and keep you accountable to your growth plan

Reassess your rating in three months

3 TOM KUKLA Principal and Founder of Tom Kukla Credere Leadership Tom is a highly experienced Leadership coach, speaker and trainer. Prior to founding Credere Leadership, Tom spent 38 years in retail and medical sales, sales management and management and leadership development. He developed a world-class managementtraining program from the ground up in the highly competitive pharmaceutical industry that served hundreds of sales and marketing colleagues. As a John Maxwell certified coach, teacher and speaker, Tom offers organizations management and leadership workshops, seminars, training and coaching in order to guide the personal and professional growth of managers of all levels and tenure. You can reach Tom at tom@credereleadership.com.

36 Service Drive JULY 2015

If you scored below 50, you have a lot of work to do as a leader. The good news is, you can practice these skills at work, at home and in the community. LEADERSHIP COACHING TIP: Identify your career aspirations and determine where you want to be in the next 12 to 36 months.

Do your aspirations include a role as a single contributor or a leadership position?

Develop a career development plan with your supervisor that is focused on your career aspirations

Reassess your rating in 12 months

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