January 2010, Auto Dealer Today - WebXclusive
Regardless of the Activity
I am often amazed at the differences between dealerships. Why do some dealers hit such high levels of success and others struggle? Why do dealerships do well for the first year or two, and then numbers drop off? The answer is in the leadership at the store! Yes, it really is that simple. Effective leaders keep their stores progressing by setting and clarifying expectations.
My 12-year-old son just finished up his football season. His team lost in the first round of playoffs. Normally, to even make it to the post-season would be an accomplishment for most teams; however, his team is extremely talented and definitely should have gone farther. I watched as the team got worse each week and finally got blown out 38 to zero in the playoffs.
I bring up the subject of coaching football as it is very similar to running a dealership. In football, there’s a head coach, offensive coordinator, defensive coordinator and special teams coach. In a dealership there’s a dealer principal (head coach), sales manager (offensive coordinator), controller (defensive coordinator) and marketing/promotion coordinator (special teams coach). The objectives are really the same between football and business. You must win! Success is defined as winning, whether on a scoreboard or an accounting ledger. You aren’t paid to try, you’re paid to win. Winning is measured by performance and results. Winning is not the amount of time you put in or how hard you try. You must have results!
Back to my son’s football team, I watched this team go downhill as the season progressed and could clearly see the lack of adjustments that needed to happen. The losses were not from a lack of effort on the players’ part, but rather adjustments that were not made at the coaching level. A good leader will make mistakes; however, not learning from them and changing creates an irresponsible leader the team will not respect.
A well-run dealership will have a coach at the helm who monitors all aspects of the operation and keeps it producing. Well-run dealerships are no accident. Show me a successful store, and I will show you a successful coach. Good leaders work with their teams and make adjustments as needed to keep progressing. They don’t get caught up in lost causes or immerse themselves in rescue missions for personnel who are not progressing. Leaders lead by personal example and not personal convenience. Respect is earned not deserved. Anyway, I think you get my point; successful dealerships must have quality leaders.
Some successful traits I have seen in leaders are:
1. They use pay plans, bonuses and incentives that reward above-average performers and above-average results. They do not reward mediocrity.
2. Winning coaches always accept responsibility for the failure of the team. They realize that the poor performance on the field was a result of poor planning and preparation before the game. They give credit to the team for successes.
3. Effective leaders are consistent.
4. Three pecent of the population achieve more than the other 97 percent combined because they believe failure is not an option. This does not mean that leaders don’t fail, but when they fail, they learn from their mistakes, make adjustments and improve. Successful leaders adapt and adjust when necessary to reach bigger goals.
5. Successful leaders are accountable for the job they are doing and hold their teams accountable for their jobs.
6. Effective leaders know that feelings follow action. They lead by example
I said it before, and I will say it again. Successful stores are no accident. The difference is in leadership. The car business is set up so there are not a lot of economies of scale that make big or small dealerships better. This is a very unique aspect of our business, thus the real success comes from within the inner foundation and falls squarely on leadership!