For many of us, “you can’t manage what you don’t measure” is something we have subscribed to since the dawn of time. Monitoring and reviewing how well something is working is not a bad thing to do on a regular basis for any of us. I’d be remiss if I didn’t mention that there is a humanistic side in all of this as well as the financial and tasking sides of things we measure and manage.
The humanistic side of measuring has to do with having our managers looking at their job performance on a regular basis and using it to empower their performance. Shining the light on and keeping the mirror up is a great reminder that it’s not just about showing up. It’s a reminder that how well things are being done shows the effectiveness of the individual doing the job. If your managers do a good job, it shows in the metrics, and if they don’t, would your managers know it?
As I visit dealerships I often see department heads that are not monitoring or reviewing how well their departments are doing on a regular basis. They oversee tasks daily, but many department heads do not understand what the task accomplishes, what it demonstrates daily, or the financial implications of their actions.
Here’s something else to think about when it comes to the tasks side of things: Don’t confuse task management with overall department management. One needs the other to be successful and many department managers equate their success with task completion, and nothing else coming into play (profitability, expenses, etc.). If that’s the case, that’s on the dealer principal. If they don’t know what it takes, how do they measure what they don’t know? If they don’t know, how do they grow as managers of productive and profitable departments?
It could be a parts manager that proudly boasts, “We did $4,000 over the counter today,” but has no idea what dollar amount needs to be done daily in the department to show a profit, or to meet expenses. It may be the sales manager that knows you’ve got six units that “have to go,” but would that manager also tell you and be watching what percentage and dollar amount of your flooring line is tied up in those units as well? Does your service manager monitor what the department’s effective labor rate is? More importantly, do they understand what affects and diminishes the dealership’s posted labor rate? Do your department heads monitor and manage the business side of their respective departments?
Great management requires an understanding of the business side of things, as well as the daily tasks management of any department. Greater management requires that we as dealer principals (I still feel like one) are clear with our managers on how and what we want them to monitor and report to us, daily, weekly and monthly. Give them the knowledge and education to do so. Holding them accountable for doing so and being consistent in our expectations is not a bad place to start the road to improved department management in any business.
It’s the start of a new year, let’s make it a great one. — MM
Mark Mooney is director, retail performance for Pied Piper Management Company LLC, a Monterey, Calif., company that works with motor vehicle manufacturers and dealers to maximize performance of dealerships. One of Pied Piper’s most popular services for the powersports industry is Pied Piper Prospect Satisfaction Index (PSI) sales mystery shopping to help turn more motorcycle shoppers into motorcycle buyers.