Woud You Have Fire Him?

You may have heard the story about USC head football Steve Sarkisian’s bad behavior and profane language at a team function this past weekend. (Not his first offense.)

His team was 9-4 last year and is ranked No. 8 in preseason polls. At this point he has not been fired and probably won’t be.

Often in the automobile business we tolerate bad management/bad behavior because they produce. Actually, what we tolerate is horrible leadership. Dealers will often look the other way and justifying doing so because they have a hotshot manager that is producing.

Without a doubt having productive management is important, but at what risk? At the risk of destroying the culture you’re trying to create and even worse a potential lawsuit.

I fired a lot of great talent over the years. People who could really get it done. It wasn’t worth the heartburn. It wasn’t worth all the crap. It wasn’t worth destroying the morale by keeping them around.

I would have fired Coach Sarkisian. Would you? That’s all I’m gonna ask? Tommy Gibbs

I’m Not Against Packs

Often when I’m speaking to dealers I come across as being against packs. I’m not against packs. I’m really not. I always say if they are working for you, by all means stay with them.

I don’t have any facts to back my numbers up, but if I were guessing, I’d guess that 75% of new car dealers around the country are using hard packs, soft packs or both.

Of the dealers still using them, I’d guess that 25% are using them in such a way that they are having some success and improving their bottom line.

The other 75% are hanging on for dear life and actually hurting themselves, if for no other reason than the psychological damage it does to the sales and sales management team.

In order to do volume in used cars you need to have a “costing advantage.” By “costing advantage,” I mean what’s added to the car once you own it, which includes packs and reconditioning.

For most dealers when they pack cars they are creating just the opposite.

If you know your history, you know that the reason dealers added packs and charged full retail from the service department to the used car department was because sales managers worked from cost up.

This is no longer true, as your sales managers don’t have control over gross as they once did. That’s why dealers are more and more becoming one-price dealers and saying “no” when the customer shows up and wants a discount.

So, without saying they are a one-price dealer, many dealers are taking a tougher stand as well as changing sales people’s pay plans to match their new-found pricing and marketing strategy.

Remember, as we move more toward a one price concept, the skill and pay level of the “desk managers” will be much lower than in today’s market. There will be more effort made to sell the store and the product with less effort on “penciling the deal.”

I like packs, but only if they are working. I question whether they are working as well as some dealers think they are. That’s all I’m gonna say, Tommy Gibbs

The Chain Of Command

If you were in the military you know what the “chain of command” means. Even if you weren’t in the military I’m thinking you have a pretty good idea of what it’s all about. The chain of command is critical to success in the military, sports or business.

How often does the chain of command get broken in your dealership? It’s not unusual for the Dealer, GM or owner operator to have a special relationship with those who answer to others in the store. A breakdown of the chain of command and discipline occurs when they are allowed to do an end run on management.

How many times have you seen upper management allow the sales people to run off a good manager for no reason other than they don’t like the systems, processes and disciplines that manager is attempting to bring to the table? Upper management allows this to happen due to some special bond created over a long period of time with certain sales people or favorite employees.

That’s not to say that some of these managers shouldn’t have been shown the door in the first place, but to allow it to be done based on the tail wagging the dog is totally wrong. It is insanity to allow the inmates to run the asylum. A good friend of mine who referees in the NBA often uses that term to describe how the players run the league.

If you’re in upper management and aren’t going to support your management team, then why hire them in the first place? Everyone performs better when there is a solid chain of command. The management team needs to be allowed to succeed or fail on their own merit, not based on the likes and dislikes of those who answer to them.

That doesn’t mean you can’t have an open door policy. You can, but be smart enough to know when to say you need to go speak with your supervisor about that issue.

You cannot run a successful business when people are allowed to break the chain of command. The reality is the chain of command is actually broken by those in command. That’s all I’m gonna say, Tommy Gibbs

Suppose You Had To Explain It?

I’m a baseball fan. One of the things I find interesting about baseball is after the game is over the manager of the team is required to hold a news conference and explain what happened.

Win or lose they have to talk about it to the media and people like me in the world of sports. When they win, it’s much easier. When they lose, not so much.

When they lose they try to sugar coat it a bit by talking about the things they did well. When they lose they say things like:

A. “We couldn’t get the timely hits.”
B. “Our starting pitcher had trouble locating the strike zone.”
C. “We had a couple of mental mistakes in the field.”
D. “Our bullpen let us down.”

Often the news media will press them to elaborate on this and that. Once in a while a manager will say, “We just really sucked.” Maybe not exactly like that, but that’s what they are saying.

Then they will talk about what they have to do in tomorrow’s game to get better.

Suppose you had to explain your performance today? For the week? For the month? For up to this point in the year?

What would you say?
What would you fix?
What would you change?

Suppose you had to explain it? That’s all I’m gonna ask. Tommy Gibbs

The Big “D Word…”

Being a former Marine, part of my core values as an individual comes from my Marine Corps training. And no doubt a large part of my success in life comes from being well disciplined.

Many of my disciplines have come from being an athlete where you cannot achieve any level of success without discipline.

Without question people with a military and/or a sports background make better employees/team members because they are well disciplined.

Discipline shows up in many forms in the workplace including being on time, achieving assignments, how you dress, how you talk, what you say, how you say it and who you say it to.

It’s pretty much a sure bet that if you are un-disciplined in your work life that your personal life is no different and chaos has become your best friend.

Discipline is about controlling will power/self-control over one’s desires to do the wrong or easy thing. It’s about doing the right thing when the wrong thing keeps screaming “why bother.”

Focus on improving your discipline regardless of where you have come from and where you might be today. Observe others around you who you deem to be well disciplined and start to emulate them. Pretty soon others will start to emulate you and now the tribe becomes very powerful.

“The pain of discipline or the pain of regret.” You get to pick. That’s all I’m gonna say. Tommy Gibbs

Is Business Good?

Most would agree that the automobile business is very good these days.

When business is good we often pound our chest and become lax in paying attention to some of the more important things. When you’re generating some decent profits, it’s easy to take your eye off the target.

There’s an old saying that selling cars, which equates to gross, will hide a lot of sins.

When business is good, that’s the time to amp it up. That’s the time to dial it in. That’s the time to go for the jugular.

On a daily basis you should ask yourself:

1. Are you letting certain expenses get out of line?
2. Do you have too many people?
3. Do you have too few people? Sometimes too few is just as bad as too many.
4. Have you accepted that the average gross profit that you’re getting is all the gross profit you can get?
5. Do you have the right pay plans for today’s market? For today’s sales people and sales management?
6. Have you gotten lazy about holding people accountable?
7. 50% of your advertising dollars are wasted. Do you know which 50%?
8. Are you looking under every possible rock to find used cars to sell?
9. Have your processes started to get sloppy and evaporate?
10. Are you truly engaged in the business or are you just staring at your computer?
11. Have you put training and coaching on the back-burner?

Business is good. The worm will turn. Be ready. That’s all I’m gonna say. Tommy Gibbs

Setting The Example

One of the best leadership skills to focus on is to set the right example by always doing more than is necessary.

When in doubt as to whether you’ve given enough, give some more. As a leader it’s up to you to set the pace, to set the example. It should always be about “do as I do, not do as I say.”

Great Leaders:

1. They do more than they know is necessary.
2. They do more than they know is fair.
3. They do more because it’s the right thing to do.
4. They do more not expecting anything in return.
5. They do more even when they know it still may not save the day.
6. They do more even when they know it may not save the customer.
7. They do more because they know it’s a teaching moment.
8.They do more because they don’t want to leave this earth owing anything.
9. They do more because they can.
10. They do more because they see the big picture.
11. They do more because if not them, who? Maybe you!

Never forget everyone is watching you, that’s all I’m gonna say, Tommy Gibbs

The Truth Appears

I’m not always right, but I’m often right because I pay attention and I study the car business every day. I’m not a numbers genius, but there are some numbers in the car business that even I can understand and that can’t be denied.

A few months ago I introduced my readers and clients to my 30/30 spreadsheet. Dozens of dealers send me a copy of their spreadsheet at the end of each month.

As you can see from the below examples it’s very telling. If you weren’t a believer in selling units fast there’s a pretty good chance you will be if you start tracking 30/30.

Your goal each month should be to improve the percentage of units being sold in your first 30 days of ownership VS those being sold after 30 days.

Let the convincing begin. That’s all I’m gonna say, Tommy Gibbs
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Three To Five Years

That’s about it. Five max. That’s about the number of years a person can be productive and feel challenged in any given job.

Yes, there are exceptions, but for the most part somewhere between 3 and 5 years you need to move your managers around.

I know that’s hard to do especially in smaller dealerships. But, for those not in a small dealership you need to give it some thought.

Real leadership means making hard choices. Real leadership means giving people a chance to grow.

People can’t grow when they are not challenged. Doing the same job day in and day out can suck the wind right out of you.

Yes, there are some people who do an amazing job in one position for 10 years and beyond. That’s all they are interested in doing and there’s nothing wrong with that. Pay them well and give them a pat on the back.

Real leadership is always looking for opportunities to push people along. The more the team learns the easier the leader’s job is. The more a team is challenged the more fulfilled the team is. When the team is fulfilled, it’s win, win.

Lead from the front and push from the rear. That’s all I’m gonna say. Tommy Gibbs