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DEALERSHIP STAFFING & RETENTION
CHAPTER 8
Change Management
No one likes to change; it forces employees out of comfort zones and well-worn routines. Whether that’s an organizational change or a technology switch, it doesn’t seem to matter much: the bigger the change, the greater the turnover and dissatisfaction—all of which hurts productivity.
Thing is, change does happen. And when it does, it’s up to management to lead the way in a calm and confident manner. That’s vital, because it keeps the bond of trust strong between employees and management.
“It is not the strongest or the most intelligent who will survive but those who can best manage change.” - Charles Darwin
COMMUNICATION HELPS SOFTEN CHANGE
According to the Society for Human Resource Management (SHRM), 55% of employees surveyed rated trust between employees and senior management as very important to their job satisfaction. When change is mismanaged, trust erodes. If your dealership is facing transformation, remember to be as transparent as possible, as inclusive as you can be, and up front about the details.
“55% of employees surveyed rated trust between employees and senior management as very important to their job satisfaction.” - Society for Human Resource Management
THREE WAYS TO MANAGE CHANGE
Managing change isn’t easy, but it is possible. Here are four steps you can take to help manage change and make dealership transitions easier on everyone involved.
1. Get everyone on the same page
Explain the good, the bad, and the ugly. Help your employees understand what problems you’re trying to fix and how you’re trying to fix them. Let them know what kinks you think the dealership will likely encounter as the team implements the changes and how you hope to solve them. Make sure that, by the time the change is being made, you’re employees all understand what is changing, how it’s changing, and why that will make their job easier.
2. Keep it simple, keep it clear
Changes, especially technological changes, can become real complicated real fast.
But they don’t have to be.
Make sure that when you’re training your new employees and rolling out new changes, that you’re not making things more complicated than they need to be. Train your employees how to complete their daily routine in the new system. By keeping the training focused on the day-to-day usage it will prevent employees from becoming overwhelmed with the bells and whistles of newer technology.
3. Ask others about their experience
It’s important to give employees an outlet for feedback about the new technology. Create a feedback portal (online, message box, anonymous Google form) where employees can share their thoughts about the new technology or processes. Then, address the feedback with the team and talk to your technology provider about how they can help your employees. It’s possible that there are training sessions or user communities to help your employees navigate the new technology.
CHANGE IS MANAGEABLE
Changes are almost always hard, but they’re possible.
Just make sure to get everyone on the same page, keep your initial training simple, and ask for feedback from your employees.
Start with these strong resources to learn more:
- Harvard Business Review: Overcome Resistance to Change with Two Conversations
- Digital Dealer: 10 Ways to Help Your Dealership Employees Embrace Change Like Champs
- Dealertrack: Successful Dealerships Embrace Change
CHAPTER 9
Women and the Dealership
According to the National Automobile Dealer Association’s (NADA) Annual Dealer Workforce Study, at the end of 2016 only 19.4% of active employees on new-car dealership payrolls were women, just an eight-tenths-point rise from 2015. What’s more, NADA also found that women made up just 8% of the nine key dealership positions: general manager, sales manager, service manager, parts manager, F&I manager, service advisor, sales consultant, parts consultant, and service technician. Yet women represented 91% of administrative support positions. These figures cast a light on stark lack of diversity in the automotive sales industry.
CHANGING AN OUTDATED APPROACH TO RECRUITING
The statistics from NADA’s Workforce Study reflect a critical dealership staffing issue. For example, a recent study by Automotive News called Project XX found women still face harassment in dealerships, as well as difficulty to improve their career status. 68% of women report being told they are too aggressive or bossy, while managers tell another 50% of women employees they are too quiet and passive.
To combat this, hiring managers and dealership leaders must change their recruiting approach and evaluate career paths and compensation packages. Considering that women make around 80% of all auto-related purchase decisions, it’s a good move.
SUCCESSFUL WOMEN EQUALS SUCCESS FOR EVERYONE
When an experienced sales employee leaves, it costs the average dealership around $20,000 to hire and train a new employee to replace them. With turnover rates being what they are, the average dealership could save $500,000 by reducing turnover. That’s $8 billion nationally.
With female sales turnover being so high, a lot of dealerships could recoup this cost by making their workplace more female-friendly. It just makes financial sense.
“(Research shows) 39 percent of women would rather deal with women in the car showroom, compared with 10 percent of men who prefer to buy cars from other men. On the flip side, 13 percent of women prefer to deal with men, and 11 percent of men want to deal with women.” The New York Times
PROGRESS DRIVES DIVERSITY
Diversity has, and continues to, plagued many male-dominated industries. And hiring managers have struggled to fill the gender gaps created by long-standing biases and reputations that businesses such as auto dealerships carry. But, there are many best practices that smart hiring managers can implement to attract and retain more talented and diverse candidates to fill roles available at their dealerships. Here are a few tips for improving your process:
1. Pay attention to your job postings
The way Human Resources outline job postings can immediately turn away candidates who may already be qualified or easily trainable. Research has shown that male candidates are more likely to apply for roles they’re around 60% qualified for, while women will continue to look for a closer match. Make sure you’re not just listing off countless certifications and skills that aren’t deal breakers and instead focus on the growth aspects and career trajectory of the position.
2. Don’t hire for your current tech stack
A lot of hiring managers make the mistake of matching technology tools to new hires only to change and upgrade a few months later. The fact is: technology changes fast. Hiring to fill a niche technology role might solve your needs now, but it’s better to find a candidate who’s willing and able to adapt and stick around through multiple changes and shifts in your systems.
3. Offer more inclusive benefits—for everyone
One way to appeal to women who may consider a career within your dealership is to offer compensation, leave, and benefits that are inclusive to the entire family. After all, when jobs take care of every member of a family, it establishes support that doesn’t simply adhere to out-of-date roles for moms or dads.
“Not only does paternity leave allow men to have more time to bond with their children, it also allows women to return to work sooner because their spouse is able to provide childcare. A paternity policy allows both parents to care for the child and both parents to return to work, rather than encouraging women to stay home while men stay in the office.” - womeninautomotive.com
Discover more ways to modernize your dealership’s hiring practices and become more inclusive here:
- New York Times: Business; As Car Dealers, Women Are Scarce but Successful
- eDealer Solutions: NADA Workforce Study
- Dealertrack: Unlock Root Causes of Employee Turnover
CHAPTER 10
Employee Training & Development
A good salesperson makes everyone happy. Customers come back and they refer friends and family. The influence of their production lifts other team members to compete with the new standard of sales. A salesperson who sticks around and builds a network is an asset to the dealership from a profit, cost, and customer service perspective. According to Cox Automotive, 42% of new car buyers returned to make a purchase from a dealer based solely on their previous purchase experience.
“Over 50% of new hires in customer-facing positions, like sales, aren’t trained enough to do their job effectively.” - Cox Automotive Staffing Study
TRAINING IMPROVES RETENTION
All of it comes down to one fundamental question: After you hire ‘em, what do you do? Cox Automotive surveys found that over 50% of new hires in customer-facing positions, like sales, aren’t trained enough to do their job effectively.
That amounts to assigning a newbie to shadow a veteran for a week—a flawed approach that some experts say will cost the typical dealerships thousands of dollars in lost sales and expenses.
If you’re looking for ways to improve your employee training, we have some suggestions.
KEEP IT SHORT
Research shows that long training sessions aren’t as effective as shorter ones. It’s hard to retain new information and the more new information an employee is introduced to, the harder it will be to retain any of it. It’s much better if your employees can retain most of what they’re taught in shorter training sessions than it is that they remember nothing from a long one.
A TEAM APPROACH
To reduce turnover, boost profitability, and improve customer satisfaction, DPOs need to be directly involved in the training of new-hires and the ongoing training of their entire staff. Yes, having training practices in place at the beginning of an employee’s tenure (rather than defaulting to on-the-job learning over a longer period of time), can lessen a dealership’s financial investment in any one employee, softening the sting if that employee decides to leave. But more importantly, by offering key insight at the outset of an employee’s career, DPOs can build strong relationships with their employees, giving them both a big-picture view of the business (and the importance of their roles) and forge friendships that reach beyond the bounds of a “temporary employment.”
TRAINING PAYS OFF
It shouldn’t come as a surprise that there’s a strong correlation between top performing dealerships and low employee turnover. According to a recent survey conducted by consulting agency McKinsey & Company, top performing dealerships “had turnover rates that were 17 percentage points lower than those of dealers in the bottom quartile (54 percent versus 71 percent, respectively). These top performers were also “more than three times as profitable as average ones” and “more likely to provide formal training to their employees (57 percent versus 40 percent of the poor performers). It also found “high-ranking managers at average- and poorly performing dealers focused less attention on recruitment and frequently weren’t even directly involved in hiring decisions.” The takeaway? Top dealerships invest in training and see the return on investment in reduced turnover.
“Anyone who stops learning is old, whether at twenty or eighty. Anyone who keeps learning stays young.” - Henry Ford Founder of Ford Motor Company
BRING IN THE EXPERTS
Successful trainers are masters of their craft. They are able to captivate the room and empower trainees to try their new skills. Whether it’s a technology vendor doing on-site training or a business performance manager advising your dealership strategy, you should budget for subject matter experts to train your team.
Here are more resources to drive success in your employee training and development practices:
- AutoDealer Today: Developing a Great Training Program
- Dealer Marketing Magazine: Professional Development Is More Important Than Ever for Dealership Staff
