Tag Archive | "Guest Editorial"

The More Things Change …

I’m a firm believer in that old cliché, “The more things change, the more they stay the same.”

Over four decades of sales and management, I have seen remarkable advances in the technology that we use to move information around between customers, prospects and providers. Those changes have dramatically impacted the speed of communication which, in turn, has only increased the importance of process and accountability.

The pace of business today has been completely transformed from just a decade ago, let alone 20 or 30 years back.

Economies of scale still matter and the big can still beat the small, but more and more I am witnessing the fast beating the slow and the smartest beating the smart.

The rules have changed in many areas of our competitive arena and they will continue to.

The principles of sales however, have not. The process of thorough fact finding to identify needs and problems that can be solved with provider solutions has not been replaced by computers, it has simply been accelerated. The importance of follow-up in the sales process has not been replaced by a computer, it has been elevated. The value of fulfillment on deliverables has not been replaced, it has increased. The importance of response time has not been reduced, it has been shortened. And the value of closing the sale by addressing every objection is timeless.

So, let’s look back and take a look at a few examples of how “The more things change, the more they stay the same.”

Looking back to the ’70s, when I started my sales career, I can remember pulling up to a pay phone and making calls from my window for an hour. There were no cell phones, so our daily sales activity included the time we spent calling a message service and returning calls. Suddenly, the cell phone appeared on the scene. We could now call from the car and, Presto! Another hour of productive time.

Unfortunately, our competitors soon had a cell phone too, and the advantage was gone. What did not change, however, was the process of deciding who to call and how to call. If we avoided returning that call to an irate customer before the cell phone, we still did it with the cell phone. If we avoided that follow-up sales call before the cell phone, we still had call reluctance with the cell phone. Cell phones made some of us more efficient but once we all had one, only those that followed disciplined processes took advantage of the tool.

At about the same time, the fax machine came along. We were one of the first to get one at a price of something like $3,000 (ouch!) and I remember how excited we were to use it. We soon learned that hardly any of the dealers or suppliers also had a fax machine so we couldn’t use it until everyone caught up. But once they did, the pace of communication accelerated again and suddenly our efficiency jumped a notch. What did not change, again, was the way we used the new technology. If we were remiss in our follow up before the fax machine, we continued to be after we had one. If we didn’t take the time to keep a contact directory before, we probably didn’t have one after. “The more things change …”

Then the PC came along and everything really changed. Add a dose of Internet, and suddenly the one-man operation had parity with his competitor giants. Mix in some e-mail, add a Blackberry and smartphone, and we are all in the same game, in the same race, in the same gate.

What I continue to marvel at, however, is how the same people keep making the same mistakes, at the same pace, the same way, for the same reasons.

My primary business activity is the direct delivery of income development services to auto dealers in Michigan, but we also own a wholesale and brokerage division that acts as an administrator, insurer and claim center. We touch every aspect of the process that makes up our industry and we have to communicate directly with consumers, dealers, insurers and regulators.

I see the same patterns regardless of the level of technology involved. Certain insurance company contacts respond in a timely and efficient manner and some do not. The speed of their network and e-mail has no effect on their business etiquette. If they were remiss and slow before they had e-mail on their phones, they still are with it.

It’s the same at the dealer level. There is a culture in every organization that drives the behavior of its staff. Before all the bells and whistles I have listed in this article, I can remember which dealerships answered the phone promptly and routed you to the person and/or department you were looking for and can remember the ones that did not. The advent of the auto attendant allowed some dealers to accelerate their excellent service and it allowed others to hide behind it and simply add to the delay in seeking remedy. At the top, one dealer used technology to enhance customer satisfaction, and one used it to get away with doing less. “The more things change …”

And then there’s the issue of cell phone etiquette. I have a pet peeve when it comes to cell phones. I did just fine when I didn’t have to deal with the distraction of making and receiving calls during other conversations and activities and I still do. I recently read a book that included a section on cell phones and driving. It cited research that showed that using a cell phone while driving had the same effect as being intoxicated when reaction times were measured in collision situations.

Sure, you can reduce the calls you have to return by taking them while you are with someone else in a meeting or at lunch but I have learned long ago that I gain a measurable advantage by avoiding the use of my phone when I am in a negotiation or in a meeting. I am always encouraged during a delicate negotiation when my opponent is taking calls and allowing other technology-related distractions to take his mind away from the task at hand. Knowing that he has to refocus his mind repeatedly, and that he often misses details from the process before the call he just took, while often an inconvenience, it is often profitable for me.

At seminars, I see many in the audience combing through their e-mail on their phones during presentations. In an effort to be “more efficient,” they may miss a key takeaway or an item that could have been used to make a difference in their sales efforts. We trade one advantage for another. “The more things change …”

In summary, the innovations of our time have only magnified the strengths and weaknesses of our planning and structure. The exponential acceleration of business tools and their related provisions serve only to separate those who have superior processes from those who do not. Fifty years ago, those of who had disciplined business plans and the ability and desire to execute them would separate themselves from those who did not over a long period of time. Today, it happens quickly.

I encourage my associates to remember that process and accountability are the secrets to success, not the machines that we use. A better mousetrap in the barn is of little use when the mice are in the kitchen of your house having a meal.
The more things change, the more they stay the same. Planning, execution, and disciplined work patterns led the way to success in the past and they still do today.

Posted in Meet the ExecutiveComments (4)

2011…A Year of Feast or Famine

In 25 years of working in this industry, I have never seen an opportunity quite like the one that exists today for consultative agents who support income development in the retail automotive distribution channel in North America.

For the third year in a row, the manufacturers have built fewer vehicles than have been scrapped. The average age of a vehicle on the road today is quickly approaching 10 years and we are having another cold, snowy, car-killing winter.

What does this mean to our industry? I don’t have the credentials to predict the market for 2011. However, I do have 25 years of working in this industry and a common sense view of what we can expect. Early in my career we had winters like the last two and the pain of owning an older car that jars every joint in your body when hitting huge pot holes is exponentially increased when the maintenance and repair bills are realized in early spring. Quite simply, the pent-up demand that exists in our industry today is unprecedented.

As agents, do we maintain status quo and go along for the ride, or do we embrace the opportunity and become the lightning rods for change that our industry so desperately needs?

The dealers left standing are grateful to be in the business. The great news for us is that the entitlement attitude that permeated the dealer body is gone. Our dealer customers still in the game have a new attitude of gratitude and they know they have to be “in it to win it” as they approach this new market.

However, what most of our dealers don’t have is a plan that is much different from the plans that were in place prior to the upheaval we have all experienced. Therein lays the opportunity for feast in 2011.

As agents who have struggled to keep our businesses solvent and growing while doing the same for our customers, it is tempting to ride the tide of an increasing market and take some well-needed rest. Beware! This is the famine trap of 2011. Giving in to this temptation will blind you to the opportunities that are thick around us. It will also put you and your customers at risk should another industry downturn or upheaval be hiding over the horizon.

To avoid this trap and grab the brass ring of opportunity in 2011, I would suggest a few New Year’s resolutions:

1) Be the voice of optimism within your company and in your market. Albert Einstein once said; “It takes five people with positive energy to make up for one with negative energy.” The older I get, the more truth I find in that quote. In our current market, being a positive influence is essential. Our dealers need to hear “glass half full” views from us every time we see them. It is too easy to listen to the media, disgruntled suppliers or so-called experts that never seem to shut up. Our job is to set an “expect to win” mentality with everyone we come in contact with. We can change the attitude of the world, if first we change our own.

2) Commit to becoming a student of the business all over again. The changes our industry has experienced in the last 10 years have been greater than the previous 50. We can expect only more change as we move into the future. As consultative development agents, we have to recommit ourselves to learning everything there is to know about our business as it exists today. We also have to be aware of and master the major issues that have an impact on our customers today. We can no longer be content with knowledge of how we used to do things. While those lessons gave us a foundation, most are no longer applicable. Focusing on just the F&I department of a dealership is not enough to keep us viable. It is imperative to expand our expertise and understanding to include the sales departments as well as the service and parts departments. The dealers total profit picture is going to be the measuring stick used to gauge our effectiveness as development agents in the future.

3) Set goals with defined realistic objectives, combined with accountability models so you can’t forget about them. Without clearly defined goals in this new economy we risk becoming a rudderless ship cast adrift in a sea of uncertainty. Writing down clearly defined and obtainable goals for both your dealers and your own business; and then creating a plan to achieve those goals within a specified period of time is the key formula for success. The goals will need to be adjusted from time to time as your work toward them but by writing them down with a plan and scheduled review dates, you will be able to achieve what is most important.

In our agency, the single most important aspect of what we do for our sub-agents, dealers and dealer management staff is to ensure that they work this same formula. It makes all the difference in the world and is more important now than ever before.

4) Commit to reviewing all of your products from the perspective of the dealer and the F&I manager. As agents, we naturally bring products to our dealer customers because they generate a commission for us. However, now is the time to take a look at all of our products, not only from the dealer’s perspective, but also from the perspective of what’s in it for the F&I manager to market it and whether it is the best available product.

The dealer needs to be assured that the products do not create a contingent liability when creating front-end profit generated through the sale. Our products need to support more than just F&I. They need to help retain customers in sales and service as well. Finally, our products should also generate back-end revenue and provide equity-building opportunities. As agents, a total dealer profit perspective must be understood and demonstrated to our customers if we want to keep them in the future.

The F&I manager review of products has to be done through the prism of how to successfully present the product in conjunction with all of the other products. Training in real-world terms has to be done to ensure the products are viable and support the sales and presentation method. We need to drill down to feature F&I as part of the sales delivery and customer retention process in our stores.

5) Look at the dealers profit opportunity in all departments, but primarily the service department. Fixed absorption isn’t just a great industry buzz phrase; it is the key to survival in the future for our customers. We have to support this initiative. When I first started in the retail automobile business, I was hired as an F&I manager. I was familiar with credit insurance and when service contracts were explained to me they were represented as “Blue Cross/Blue Shield” coverage for your car. Of course, I never read the actual service contract and represented the product just like that to the poor customers I initially came in contact with. A very painful experience with a customer in the service department caused me to amend my presentation to be more accurate. Also, working for a forward-thinking dealer helped bring my focus back to the importance of the service department as he insisted that all managers rotate for a month in each department to see first-hand how we impacted each other.

That experience helped me understand the importance of a collective effort in dealership management. I also became aware of the value “fixed-absorption” played in the viability of the dealership. Twenty years later, we still need to pay particular attention to the real need our dealers have to generate revenue in service. We have to deliver cutting-edge processes for our customers to use to claim what is rightfully theirs; service department revenue. Make the commitment in 2011 to understand how you can help your customers increase their absorption and service retention.

6) Commit to a service mentality. Ensure you provide world-class service without ego or entitlement. One of the dangerous traps that is easy to fall into is that of entitlement, especially with mature agencies that have many long-term dealer clients. It is easy to measure the volume of work that has been done for a customer and forget to treat them as we did when we just landed the account. Familiarity breeds contempt. That call from a pushy office manager at 5:45 p.m. on a Friday could be easy to blow off and handle Monday. Resist that temptation. Every customer is a gift, treat them and everyone in that manner. You never know when that seemingly insignificant employee will be the glue to keep you in an account or will verify your value to the dealer.

Feast in 2011. Remember your success is determined by the success attained by those you serve. When something goes well in an account, deliver the credit to the people in the dealership; correspondingly, when something goes wrong, take responsibility for whatever it is and drop everything to correct it. Be the customer service standard in your market!

Because of market conditions and opportunities, the goal of growth and excellence in 2011 is more than obtainable. Resolving to have a clearly defined plan to realize that goal will separate you in the market place. Scheduling periodic progress reviews will put you on track to ultimately feast in 2011.

Posted in Meet the ExecutiveComments (9)