Last week I had a call from a young man whom I have come to respect due to his commitment, courage and tenacity as a new salesperson in the automotive field. He is a rule follower, develops solid relationships with his customers, assists his team members and remains in the top 10% in sales. The reason he called me was to tell me he doesn’t understand why his manager constantly puts him down, makes fun of him and won’t help him out when he asks for it.
As it turns out, I know who his manager is and his actions do not surprise me at all. He has always been threatened by young sharp people on the move up. He has never really developed his people and prefers to sit on his “throne” at the outdated tower. This guy is a knucklehead from the word go and it completely confuses me why the owners of this multi roof top enterprise don’t get it. This manager is infected with several things; Paranoia that someone will find out how little he actually knows, job protectionism, jealousy, laziness, lack of leadership skills to improve his people and an ego off the charts. Sadly, he possesses the commonly adopted theory that because his people get a paycheck from the dealership it is the beginning and the end of any and all consideration they deserve. That attitude, however, ends up turning off employee enthusiasm as well as ultimately harming the bottom line by lower than expected production and increasing attrition.
The question is, would you keep this manager around? Some will say “no”, some will say “with some leadership development training”, some will say “depends upon how much profit he gets the store”. The first two answers I can align with. The third is unacceptable for a multitude of reasons. Mainly because I firmly believe a manager’s primary job is his or her ability to develop and grow individuals and the team because that is what grows the store. Think about it, three year old parakeets can sit at a tower all day and pencil deals. A true leader is one who understands that in order to grow the store you have to grow the individuals and the team. A leader also understands that in order for he/she to grow anyone, they have to be growing themselves. Undertaking new ideas, reading, studying, teaching, experimenting, counseling, sharing, assisting others and so on.
Key Point: You can only lead someone as far as you have gone.
This business along with most businesses is highly dependent upon people. People are the real value in any company that wants to succeed. The new market economy is totally driven upon Human Capitol. You might not be able to spend human capital but it is much more valuable than all the gold in Fort Knox.
Too often Owners /GM’s do not see what is truly valuable to their business:
- The most important asset is human capital
- Most undervalue experience
- Most undervalue initiative
- Most undervalue integrity
- Most undervalue loyalty
- Most undervalue of continuing “new school” education
I think what coaching is all about, is taking players and analyzing their ability, put them in a position where they can excel within the framework of the team winning. And I hope that I’ve done that in my 33 years as a head coach. – Don Shula
Dealers need to understand their employees as well as themselves better so they can understand their customers in order to design a work environment and experience that will drive higher engagement and performance. It is fair to view your employees as “customers.” You motivate customers to buy from you by engaging with them, treating them with courtesy, professionalism and anticipating their wants and needs. Well, it’s not much different with those you manage; you motivate your staff to achieve at a higher level through the same exact process. The challenge of course is you must do it with daily “consistency” not here today, gone tomorrow.
Many refer to people as “human resources” and this in my mind is a derogatory way to look at things. Are people no more valuable a resource than a chair or a desk? Are they more valuable than a computer?
If your best salesperson sells 20 cars a month quits and moves to your competitor; is the impact the same as if you dropped a computer on the floor and smashed it? The computer can be replaced for $700 or less, but the person who left sold 20 cars a month at an average gross of $2000 a copy or $480,000 in gross revenue a year. Can you easily replace that? I don’t think so.
Human Capital is the collection of resources—all the knowledge, talents, skills, abilities, experience, intelligence, training, judgment, and wisdom possessed individually and collectively by individuals in an organization. These resources are the total capacity of the people that represent a form of wealth which can be directed to accomplish the goals of the company thereof embodied in the ability to perform labor as to produce economic value.
“There are only three measurements that tell you nearly everything you need to know about your organization’s overall performance: employee engagement, customer satisfaction, and cash flow.” –Jack Welch
To most people, capital means a bank account, a hundred shares of Apple stock, assembly lines, or steel plants in the Pittsburg area. These are all forms of capital in the sense that they are assets that yield income and other useful outputs over long periods of time. But such tangible forms of capital are not the only type of capital. Schooling, a training course, expenditures on medical care, and lectures on the virtues of punctuality and honesty are also capital. That is because they raise earnings, improve health, or add to a person’s good habits over much of his lifetime. Therefore, economists regard expenditures on education, training, medical care, and so on as required investments in Human Capital. They are called Human Capital because people cannot be separated from their knowledge, skills, health, or values in the way they can be separated from their financial and physical assets.
Education, training, and health are the most important investments in human capital. Many studies have shown that high school and college education in the United States greatly raise a person’s income, even after netting out direct and indirect costs of schooling, and even after adjusting for the fact that people with more education tend to have higher IQs. Similar evidence covering many years is now available from more than a hundred countries with different cultures and economic systems. The earnings of more-educated people are almost always well above average.
A measure of the economic value of an employee’s skill set is built on the basic production of labor measure where all labor is thought to be equal. The concept of human capital recognizes that not all labor is equal and that the quality of employees can be improved by investing in them. The education, experience and abilities of an employee have an economic value for employers and for the economy as a whole.
Human capital management (HCM) is an approach to employee staffing that perceives people as assets (human capital) whose current value can be measured and whose future value can be enhanced through various investments.
“Always treat your employees exactly as you want them to treat your best customers.” –Stephen R. Covey
Dealerships today face increased pressure and complexity from the toughest human capital management disruptions the marketplace has ever seen. Competition, technology (social and mobile), skill and labor shortages, compliance, and economics are all creating unique challenges that demand your attention and have the potential to influence your profitability.
Talent Management refers to the organizational processes of recruiting, on boarding, leadership development, succession, performance management, pay for performance, career development, training, workforce planning, employee collaboration, and other related practices and systems.
It is all about employee engagement. According to Gallup, the bottom line regarding low employee engagement is estimated to cost the U.S. economy roughly $370 billion a year. Ask yourself; What will it cost you and your store?
“Some 80% of your life is spent working. You want to have fun at home; why shouldn’t you have fun at work?” –Richard Branson
High employee engagement is actually critical to a company’s performance and, according to Gallup, it impacts 9 key performance areas in these ways:
37% lower absenteeism
25% lower turnover (in high-turnover organizations)
65% lower turnover (in low-turnover organizations)
28% less shrinkage
48% fewer safety incidents
41% fewer patient safety incidents
41% fewer quality incidents (defects)
10% higher customer metrics
21% higher productivity
22% higher profitability
Nice double digit increases I am sure most of you would enjoy. But how do you influence this type of intangible in a meaningful manner? Acting more as a “chief influencer” rather than a chief executive is in management’s best interest as well as an employee’s because it causes employees to respond in a positive and proactive way to their work challenges.
Employees are eager to invest more of themselves to help the company succeed, but want to understand what’s in it for them. If workers feel they have no road to advancement or achievement, that’s a big turn-off when it comes to engagement. What’s the point in trying harder if there’s no end game in sight? Who wants to play a game where there’s no way to win?
The management team needs to make the leap to a more inspirational and engaging style of leadership to help drive higher engagement. The more management makes an honest and meaningful effort to connect and motivate workers, the more workers will feel connected to the dealership and its goals.
Recently, a company asked me to take a look at three manager’s DISC profiles whom they were considering hiring. They had interviewed all three “in person” and considered them fairly equal. However, based upon their DISC profile they had landed on one candidate they felt they should hire and asked my opinion. Examining their profiles I actually choose a different candidate for several reason which I will not go in to. The interesting thing of this story is I asked the four executives this question; “How much of this person’s job will involve phone skills?” They answered, “75-80%”. I then asked them this; “So, which of you conducted a phone interview with the candidates?” They looked around the table with a blank stare at each other. Then, they asked me to develop a series of phone interview questions and conduct the interviews from my office. After conducting the interviews a different person was actually chosen for the position because they shined on the phone. The point is, take your hiring and interviewing process to new levels and you will be glad you did. In the selling side of this business (sales and service) phone skills represent the lion share of opportunities to do business. When was the last time you developed your team with contemporary phone skill techniques?
“It is common sense to take a method and try it. If it fails, admit it frankly and try another. But above all, try something.” – Franklin D. Roosevelt
Author: Chuck Barker
CHUCK BARKER is President & Founder of Impact Marketing & Consulting Group, located in Virginia. He has assisted Dealers & Corporations across the country in Sales & Service Development training programs, Management Leadership Workshops and Business Improvement/Analysis Consulting. He is a pioneer in BDC, CRM, Best Processes and Team Member Development since the early ‘90’s. Chuck has held Automobile, Corporate and International Executive positions for over 27 years. Chuck has been a monthly author/contributor for Dealer Magazine for over 11 years. Email: email@example.com.