Article

Set and Stay Focused on Stretch Goals

March 2011, Auto Dealer Today - WebXclusive

by Courtney Cole - Also by this author

Then Plan for a Celebration



It’s Sunday night and you’re looking forward to the week ahead. You have a million great ideas going through your head. You need to hire two more salespeople, cut an ad for the month and implement some ideas you just learned at your 20 group meeting.

You go in Monday morning to get ready for your weekly meeting and a customer is waiting for you because there is something wrong with the vehicle he purchased on Saturday. You are then handed a notice from the factory that you have been randomly selected for a sales audit.

Does any of this sound familiar? With all the distractions, how do we get our managers to fully understand what we want to accomplish this year, this quarter, this month, this week or today? There are so many things to do in this business. There is a book called “Mastering the Rockefeller Habits” by Verne Harnish, and it does an outstanding job of outlining how to keep focused on your most important tasks. This book covers numerous ideas that can lead to a huge celebration caused by massive profits. Space does not allow me to go into great depth on all the ideas, but I want to cover a few items that will help get you focused on record-breaking profits.

The Quarterly Meeting
The first thing I recommend is to get your key players out of the store for an offsite meeting once a quarter. We use the quarterly meeting because we feel this is the perfect amount of time to set a goal and make tweaks and adjustments. We schedule a half-day meeting and use this time to cover our processes: what is working well, what is not working, and where are our choke points? We also use this time to see how well we accomplished the goals from the previous quarter.

There is nothing better than having the used vehicle manager in the same room as the service manager and coming up with a solution on how to attain a three-day turn on used vehicles when the used vehicle manager purchases 60 vehicles in one day. They start to understand each other and work together to come up with a solution.

We list out all kinds of topics and then each department head is required to list the five major goals they want to accomplish for the next quarter. We also list the five major goals we want to accomplish as a dealership. We then ask each department head to write down those five items (for the dealership and for themselves) on a piece of paper that will be in front of them on a daily basis. There is something magical that happens when something is put in writing and is looked at on a daily basis. When one encounters several distractions, one still knows the overall goal for the quarter.

After we come up with the five items, we come up with one stretch goal for the quarter. The stretch goal is usually a result of accomplishing our five items.

Key Numbers
What are the key numbers that will help you attain your quarterly goal? What needs focus? Is it gross per unit, hours per RO, appointments showed? What is the most important item that you should have in front of your managers on a daily basis? In the front end, it’s gross per unit and units sold on a daily basis. Charts that show where we are currently versus our goal hang right by the managers so they see them daily.

Celebrate in Style
If we hit our stretch goal this quarter, we are taking the key managers and their wives to dinner and renting them each a room at the Conrad in downtown Indianapolis. What quarterly goal would warrant this to occur? For us, it is a combined gross that must be attained. The fixed operations must hit an objective, and the variable must hit its objective. If one misses, we can still hit the overall objective if the other department makes up for it.

Let’s say the fixed department has a goal to average $500,000 for the quarter and the variable department also has the goal of $500,000. If the fixed department only hits $450,000, we will still celebrate as long as the variable department hits $550,000. This promotes both groups to help each other.

Believe me, this gets them focused, and it is a great morale builder. If you are worried about expense, accrue for it, or pay all your bills with credit cards and then use those points to help pay for it. Your additional profits from being focused and hitting a stretch goal more than make up for the expense.

Set a stretch goal, get everyone focused, formulate a plan and your profits will soar. Now all you have to do is plan for a big celebration.

Vol. 8, Issue 1

Comment

  1. 1. John J . Lueb [ March 07, 2011 @ 12:34PM ]

    I am heading to Border's books to get this today......

    Thanks for sharing your thoughts with us..

 

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