Think back to 2006. Think specifically about how technology has influenced our everyday lives. Do you remember what the business environment was like?
In the last 10 years we have grown used to having immediate access to information, and absorbing everything digitally in the moment. But when you look at the timeline of technological advances, it is shocking to realize that it has only been nine years, (yes, I said nine!), since the iPhone was released, revolutionizing the way we interact and find information. Even more of a shocker is that it was not until 2010 (only SIX years ago) that Apple released their first iPad, moving consumers from digital readers, to full functioning tablets. Now think, how prevalent are phones and tablets in our daily business and personal lives now? How have these devices changed the way you and your team conduct business? How does it impact the way your customers find and interact with you?
“In order to build a multi-generational successful automotive business, it is essential to take time from the daily grind with your leadership team to think and plan strategically about the predictable, potential and possible changes that could impact your business.”
So you may be thinking, what the heck does all of this have to do with succession planning? It’s pretty simple, the speed of communication, absorption of data, access to information and the ability to share all influence the sustainability of your business. Are you taking time to step away from the daily grind to think strategically about how your business is impacted by technology advancements? How your business is impacted by economic, political and generational changes?
If you have had any exposure to the strategic planning process, a critical step is walking through the SWOT Analysis – Strengths, Weakness, Opportunities and Threats. Often times there is a substantial amount of time spent working through how to leverage strengths and overcome weaknesses, while opportunities and threats are brushed over with less strategic thought or follow through.
Strengths and weaknesses are real, we can feel and measure them, but since opportunities and threats consider how outside influences impact your business, the discussion generally feels lofty and hypothetical. However, more than ever, we are in an age of constant change, and if someone can dream it, it will likely happen, and faster than you expected.
In order to build a multi-generational successful automotive business, it is essential to take time from the daily grind with your leadership team to think and plan strategically about the predictable, potential and possible changes that could impact your business. With the advent of “self-driving cars,” we are not that far off from being in the world of the “Jetsons” – so you must take time to consider all of the outside influences, and employ big thinking to ensure your dealership(s) aren’t operating like the Flintstones. Consider some of the following current trends and how they may be impacting your business?
- Autonomous Vehicles
Ten years ago, what was your perspective of the possibility of a manufacturer being able to bring an autonomous car to market from a technology and government regulation perspective? It is expected that manufacturers will face technology and government policy issues, but with the exponential growth of technology, autonomous driving may not be as far off as you may think.
- Automobile Technology
The increase in the use of technology to power and maintain a car, as well as the comfort features offered to consumers, creates additional challenges and opportunities. Is your dealership equipped to service and maintain cars with advanced technology? Will there be a day that your service department can “remote-in” to the vehicle in order to diagnose it before making a service appointment?
Is it possible that Uber and Lift reduce customer’s motivation to own multiple cars? How could you repurpose your real estate to generate revenue to appeal to changing buying behavior? In speaking to a friend the other day, his son just turned 16 but has no motivation to get his driver’s license. When I was 16, I was at the DMV at 8:00 a.m. first in line; however, my friend’s son’s perspective is why drive when I can Uber or Lift? I can get to where I want to go and it is cheaper.
- Global Competition
How have Internet sales broadened your target geographical market but has it also introduced more competitors than you were used to 10 years ago? Customers have information at their fingertips and can shop deals from a variety of sources in an hour, where 10 years ago they would have had to physically visit each site, which naturally limited their options. Also adding into Internet sales are companies like Carvana. You may have customers visiting your dealership to simply test drive; but are buying from other business’ because of a variety of value added services they provide – best deal, easy service, convenience, organizational environment. What “sticky” value add service can you provide your community to attract and keep customers loyal to your brand?
The long-term success of your business is dependent upon thinking big and finding ways to turn threats into opportunities.
In engaging with our clients in strategic planning initiatives, there are many touchpoints where technology is impacting dealerships today. The following are two concentrated areas that can present themselves as either an Opportunity or a Threat to your success:
We used to rely a lot on the referral from family and friends, the “word-of-mouth” reputation of a product or service. We found out about new products and promotions through “cold calls,” our local newspapers or from the displays hanging in the actual store itself.
Today, buyers are now, more than ever, finding you. Sure, our marketing messages are still reaching them, but the sophistication of the buyer, combined with the instant access to data and information – buyers have the ability to conduct multiple levels of research on what they want, and from whom they prefer to purchase. Competition is no longer just with the store across town. Competition is everywhere, and with the Internet, it is global!
Value Add Customer Services
When looking at the value add customer service, technology is an amazing friend. In a landscape where the competitive environment is large, and the value proposition diminished, finding ways to communicate with your customers in a timely, friendly and flexible way (meaning, leveraging multiple channels based on what works best for your customers), will set you apart from your competitors. A few great examples:
- In your service department: If a customer is in for a service, provide a text update to them for when they can expect the service to be completed. Or, if a part is needed to fix an issue, offer up a way to show them the status of their order and delivery!
- New/used car sales: How long is your sales cycle? Is your customer sitting there for a handful of hours on a weekend or beautiful day? Our lives have become so full, and many of us don’t have a lot of free time. How can you leverage technology to move your customers through the sales cycle so they can enjoy their new car and their day?
Leverage social media to allow your customers a platform to brag on you, and in turn, share their experience with their network.
Confirming mission, vision and core values are also tried and true concepts of strategic planning. If you drive these philosophies throughout your organization, they shape culture, and give your people direction to focus on the right things critical to the success of your dealership. Defining your mission and vision also creates clarity towards the business you are in – keeping you focused on what is important regardless of the outside influences. For example, as a car dealer are you in the:
- Car business?
- Transportation business?
- People business?
Whatever you identify as your vision and mission, you can then better determine how you want to approach opportunities and threats impacting your organization.
Author: Jeff Bannon
Jeff Bannon is a partner of The Rawls Group which has helped business owners with their succession planning since 1973. Well-respected in his field, Jeff is a highly requested speaker and has published numerous articles on this subject.