Article

Accountability In The Ranks: Measuring Performance Goals

August 2007, Auto Dealer Today - WebXclusive

by Michael Rees - Also by this author

As a dealer, you have at least somewhat of an entrepreneurial spirit. I don’t know how you came to be in the position you are now, but something, at some time, pushed that button for you to become “the boss.”

You probably thought this was the answer to your dreams, the perfect opportunity to run things exactly the way you want to. You had things that were going to be done and nothing and no one would stop you from doing it.

So, what happened? Quite simply, it’s called a lack of accountability.

I know when I became a dealer, nobody taught me how to hold my people accountable for the jobs I wanted them to do; I just told them what I wanted and expected them to do it. I had passed one of the great tests of ownership. I was able to delegate, and that’s just what I did.

I was soon faced with the same problem many dealers are faced with today; I wasn’t getting the results I signed up for. I was thankful for having a friend who ran twenty groups for most manufacturers in Europe, and he was able to help me. He taught me how to hold people accountable, and as soon as I started doing that, the difference in results was huge.

This is what he taught me:  Let everyone know exactly what you expect of them (full job description, including expectations of performance).  Make sure they have the tools to do what you expect of them (training, support etc.).  Let them know how they are doing against your expectations.  Sounds simple doesn’t it? Let’s go further into each of these instructions.

Have a look at the job descriptions you gave your managers (do they even have one?). How detailed is it? Try to cover every aspect of their jobs, especially your expectations of definitive results. Make sure they know what you expect of them on a daily, weekly, monthly, quarterly and annual basis. These expectations need to be quantifiable and realistic.

Now that they know what to do, do they know how to do it? Have they been given the adequate training so they can perform to expected levels? If not, set an agenda to get this done. Do they have the necessary support (personnel, computers, etc.)? Do they have the desire? They must use their knowledge and skill to form a habit in order to get results.

It is vitally important to let them know how they are doing. Ideally, this is done daily, weekly and monthly. Many times managers are informed about their performance just once a month, on production of the financial statement. TOO LATE! They cannot do anything about the month that just passed.

Most dealers I come into contact with do not have any of the above in place, and doing so means doing something differently. This is where a lot of people struggle. We are afraid of change, afraid of possibly upsetting our good people by holding them accountable. You need to make a decision now to take back control of your business; don’t let the tail wag the dog.

Start tomorrow. Here is how:

Ask your managers to give you a report on where their department is for the month so far. This report should include everything that is measurable. For example, in the sales department the manager should be able to tell you the following:

•      Number of new vehicles delivered
•      Gross profit (front) on those new vehicles
•      Profit per new vehicle (front)
•      Gross profit (F&I) on new vehicles
•      Profit per new vehicle (F&I)
•      Number of used vehicles delivered
•      Gross profit (front) on used vehicles
•      Profit per used vehicle (front)
•      Gross profit (F&I) on used vehicles
•      Profit per used vehicle (F&I)
•      Total Gross profit new and used
•      Total gross profit per vehicle
•      Individual salesperson numbers on the above
•      Number of opportunities to do business so far this month
•      How far we got with each of these opportunities (meet and greet, demo, negotiations etc.)
•      Percentage of those opportunities turned over to management before leaving
•      Monthly track to show how the month will finish if you stay on the current pace

A simple Excel spreadsheet will do all of this very easily for a manager and it only takes about 10 minutes a day.

Go through the different departments and make a list of the “measurables” that you would like to know about. Hold a daily accountability meeting with each department head to go over the results so far. So this doesn’t become cumbersome, here is an example of a dealer’s day:

9:00 a.m. Review the previous day’s numbers. Department heads should e-mail reports or put them on your desk first thing each day. Review the monthly travel rate (month end projection based on current activity) and compare it to your monthly goal.

9:30 a.m. Meet with fixed operations and determine their goals for the day

10:00 a.m. Meet with the sales manager and determine his goals for the day. These should be upbeat meetings. Ask what his or her plans are to obtain the goals set? Review performance logs with managers (customer log, daily doc, phone log, appointment log). Speak with the salespeople, technicians, parts people and office staff. Just say, “Hi.” They want to feel as though you know they exist. Congratulate those you know who are doing well. You may be amazed at how well this is received.

4:30 p.m. Discuss the day’s activities/results with managers individually
 
Goals can ALWAYS be met! You just have to find a way.

Remember this: Employees do what you INSPECT, not what you EXPECT! If you start this, you will wonder how you ever managed before. I promise.

Vol 5, Issue 6

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