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Belonging is good for business and benefits the bottom line!

 Belonging is good for business and benefits the bottom line!

Guest writer Sonya Law brings back our human resources perspective with “Belonging is good for business and benefits the bottom line!”

According to Harvard Business Review: “If workers feel like they belong, companies reap substantial bottom-line benefits.”

The bottom-line benefits are:

  • High Sense of Belonging was linked to a whopping 56% increase in job performance.
  • A 50% drop in turnover risk
  • A 75% reduction in sick days

Raising questions?

  • How has living through a Pandemic affected the way we connect? 
  • How do we create employee engagement in a modern workplace?
  • How important is it to create a sense of belonging in the workplace?

Creating a Sense of belonging has been given more attention, post pandemic, because People are:

  •  Wanting more from their jobs, getting paid is no longer enough. They what to align on Purpose and have meaningful impact.
  • Experiencing Burnout are also opting for the eject button, without even having a job to go to as a lag effect to working through the Pandemic that presented new stresses and strains. Relating to extra compliance and reporting and lack of staff.
  • Impacted more by Mental health and Psychosocial impacts of a disconnected workforce. Due to hybrid workplaces is having an impact on connection and healthy workplace relationships post pandemic and to collaboration and problem solving.
  • More aware, that there is another job just around the corner in this buoyant tight-talent market. 

 

How do you create a sense of belonging:

  1. Rituals – that it practices, traditions that define how you come together to celebrate wins and connection in the team, and this creates a sense of belonging.
  2. Authenticity – that is it needs to be genuine in its efforts to connect and demonstrate inclusivity.
  3. Culture – it needs to be regular, consistent, and embedded. 

Creating a sense of belonging helps you to hold on to your Brightest & Best TALENT!

  • It is vital to ‘attracting and retaining talent’ in a tight candidate market.
  • Gives people a sense of belonging and understands the ‘relational aspects of teams and connection’ creates opportunities to develop talent and unleash People Potential.
  • Provides insights into the ‘employee experience’ and developing our Employee Value Proposition.

Develops cultural awareness – focusing on what employees are telling you in your employee survey, will guide your next steps! 

  1. Create a dedicated group – focused on creating a sense of belonging and employee engagement.
  2.  Culture Champions – this does not always have to be HR People. Consider a cross section and those passionate about culture and creating a sense of belonging. 
  3. Review your Culture Results – this is your best tool for putting you in touch with what employees want to see more of in the workplace.
  4. Take risks – a lot of us think, that will not work, we did it before, it was a flop!
  5. BE BRAVE try something new! 
  6. Stay the course, and be positive, be enthusiastic!

A sense of belonging creates unintended benefits:

  1. Relational Benefits: Stronger relationships are benefits of creating a sense of belonging. Teamwork and high innovation and also increased discretionary effort in times of high stress. It also creates clarity in the role, clear purpose and sense of empowerment and achievement when we draw out these relational connections. Better and faster than any re-org!
  2. Accountability, responsibility, and ownership: It creates an elevated level of accountability, responsibility, ownership, and reliability which are all fundamental in building trust and present in high performing teams. A strong relational culture does not support toxicity, it supports high levels of engagement.
  3. Tolerance and people stickiness of your high potentials! Builds tolerance; in 2023 there needs to be a focus on building tolerance for organisations to thrive. High work demands and burnout, leads to feelings of overwhelm and can be a key factor for people leaving their jobs and not taking up leadership positions.

“A sense of belonging helps create resilience and ‘people stickiness’ to the organisation of your high potentials!!”

‘Take care of your people and they will take care of your business.’

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What’s More Beneficial, AI, or Stakeholder Analysis?

What’s More Beneficial, AI, or Stakeholder Analysis?

Guest writer Sara Hanks continues the conversations about widely accessible artificial intelligence in this week’s blog post: “What’s More Beneficial, AI, or Stakeholder Analysis?”

The advances in artificial intelligence are creating a lot of buzz these days, with the launch of several image creation software tools and ChatGPT. It reminds me of one of my first Artificial Intelligence projects from 2017. In this project, the AI algorithm was able to read a PDF, extract important information and convert it into metadata, which is data stored in a specific and structured way. The model performed well, and the engineering team was excited to turn it on. However, when it came time to install it on the server, the IT infrastructure team denied the installation. The project was killed. We had failed to include all the stakeholders in the project communication.

Stakeholder management is a critical aspect of the success of a project. Managing people in projects that don’t work for you, or worse are your senior leaders, can be challenging. I’ve found that an interest and influence matrix is a good tool that can be used to think through the complexities of managing stakeholders. For each stakeholder, you assess the amount of interest they have in the project, as well as their influence or power over the project. Essentially there are 4 quadrants of the matrix: high interest/ high influence, high interest / low influence, low interest / high influence, and low interest / low influence.

High Interest / High Influence – Work Together

Stakeholders with high interest and high influence have a significant impact over a project’s success. These are the people that need to be engaged. If the person is a peer, then they should be on the project team. If the person is a leader, then they should be involved in the decision-making process in a project. Additionally, when issues or changes arise, it is important to inform the stakeholders. In the event there is an issue, I recommend proposing solutions to show that you’ve thought through it some.

High Interest / Low influence – Keep Informed

The stakeholders in this category may not have high decision-making power, but they are still interested in the project’s outcome. When people are interested in the success of the project, they can be evangelists of the project. It is good to keep their interest by keeping them informed. 

Low Interest / High Influence – Keep Satisfied

 These are the stakeholders that could be lurking in the corner, waiting to come out and throw up a roadblock. I go out of my way to keep these people satisfied by leaning into what I believe are their biggest concerns. Don’t hide anything from them and when you communicate, be sure it is concise.

Low Interest / low Influence – Monitor 

The low interest and low influence stakeholders have little interest and should be communicated with sparingly. However, it is good to see if they have moved into a different quadrant. Sometimes their reality changes and they either become interested or suddenly have more power. 

Once you’ve assessed the stakeholders, you can create a communication plan accordingly. A communication plan may include meetings, email updates, newsletters, and direct conversation. 

Here are some best practices with meetings:

For the high interest / high influence quadrant, I hold a core team meeting on a regular basis that fits the timeline of the project. For projects that span 6 months or more, I try to meet on a bi-weekly basis. For shorter projects or software related projects, I meet more frequently. In these meetings, we review the project plan, discuss proposed solutions to issues and risks, as well as assign and follow up on tasks. With the leadership team, I hold meetings less frequently than the core team meeting. In addition to the content that comes out of the core team meeting, highlight areas that require decisions or escalations. In these sessions, it is valuable to create a standard template that can cover all the topics and use it consistently.

I invite the Low Interest / High Influence stakeholders to the core team and leadership meetings. While there is a cover your behind element to it, I believe it is best to be inclusive of this group. During the meetings, lean into the concerns this group of stakeholders may have. Not only will you drive engagement, but you’ll establish credibility as well. 

For the High Interest / Low Influence stakeholders, I prefer to copy them on the meeting minutes and inform them of project status on a more informal basis. Water cooler talk, or an impromptu message through the companies chat is an effective way to keep people informed without taking too much of their time. 

Assessing each of the stakeholders for their interest and influence can be useful to dissect the complexity that comes with managing different people in a project. By putting people into the 4 categories and creating a communication plan that aligns with the category, you’re sure to offset risks and alleviate challenges caused by people being surprised.

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Coaches Corner v.02.23.2023

Coaches Corner v.02.23.2023

Guest writer and Coach Floyd Jerkins addresses behavioral sales metrics for coaching equipment industry sales teams for Coaches Corner v.02.23.2023.

Every dealership organization is at a different place in time with the diagnosis of their sales teams and processes. The size of complex and level of operational sophistication are factors. Many times, it’s a location issue more than overall company-wide so that requires custom solutions. So, maybe this article is timely and you’re ready to look deeper into how to make real progress in the sales department. 

Professional Sales Management and Salespeople

Great salespeople are great salespeople, and in the equipment industry it’s no different than other industries. There are particular aspects unique to every industry due to a product’s life cycle, style of customers and personalities, buying patterns, and market conditions. And the best salespeople know they have to understand these industry specific characteristics to succeed, but there is more. When you learn to sell, you can sell anything. Yea, I know, I know, but it’s true.

Being a professional sales manager or salesperson in the equipment industry isn’t for everyone. There are real superstars doing this work every day and many of them make it look easy. They have a natural and personal approach that gets the job done. Others have tried and failed. Many linger on with average performance. Yet, owners who sell often do not follow the system they expect their salespeople to follow or they have a perceived top producer that no one can touch. 

There are typically high and low performers when you have a large sales team. Improving the performance metrics of sales managers and salespeople can be challenging to establish what particular actions need to be taken.

Building a sales team of all superstars is a great plan, but not always realistic or practical. In my experience, sales management and sales teams usually have a mixture of age and talent with varying skill sets and competency levels.

A Sales Managers Rally Cry – To Sell More, Talk to More People

To sell more, talking to more people always seems to be at the top of the list of things to do. Still, if a salesperson talks to a lot of people and prices a lot of people but doesn’t have a good measured closing ratio, it makes me wonder how effective they are and whether they should be allowed to keep talking to your customers. When a sales manager influences the sales team with a whip and chain or talks more about the problems than the solutions, is that the most effective leadership style to use in today’s business climate? I don’t think so.

The traditional metrics for sales success include new and used margins, sales volume, new and used turns, and a mixture of others. To be an excellent asset manager, you must know these metrics and how to positively influence their outcomes.

Performance Metrics Created Before & After the Sale

Like many traditional metrics, margins, turns, and other sales department indicators are created after a unit is sold. The efficiency of your booking and accounting practices determines when the sale appears in a statement. That could be anywhere from one week to sixty days past when the actual sale was made. Once the numbers are current, you can assess what’s going on. If you’ve followed my articles about this, you know where I am headed.

Let me ask a few questions:

  1. Who do you make more money on, a repeat customer or a customer who has never done business with you or your company before?
  2. Who do you have the most fun working with, a repeat customer or someone who has never done business with you before?
  3. Who do you sell in less time, someone you don’t know or a customer who’s bought from you before?

Perhaps you took a few seconds and thought about your answers. I appreciate the effort. Now, consider your answers and what you know and don’t know.

“The goal is to coach performance in the areas that help salespeople become more effective with real-time data. Becoming more effective in sales and marketing your business requires a deep understanding of your customer base so you can focus the sales and marketing team on what matters the most.”

Behavioral Customer Segmentation

The old saying is you can’t improve something unless you measure it. One of the first principles of process improvement is as a process evolves make sure you are measuring the right things. 

You probably already know the customer by machine or product sold, sales volume, and parts and service sales, so tracking this kind of customer segmentation can reveal even more real time data. Even a basic CRM system can track these customer categories.

Total Customers

Customer Categories

New Customer– This customer has never been to, called, or emailed your business before.

Repeat Customer– This is a customer who has bought from you before. Many companies have “orphan owners.”

Referral Customer– This is a customer who another customer referred to your business or the salesperson.

New Business– This customer is someone you meet at the gas station or a social event. A brief conversation in almost any social situation generates new leads.

The sale is the end result of all the activities performed by a salesperson. By coaching performance on these sales activities that happen before and during the sales process, we can naturally increase a salespersons effectiveness. 

When you measure these you learn a lot about how your sales mix is made up, how effective sales and front-line people are in each category, and even how well your marketing is doing. It also speeds up the learning curves. If you don’t know these, you are at the end of the sales cycle making decisions. When you are looking at unit sales, you are best guessing how effective your sales and marketing efforts are. 

A Behavioral Sales Mix- BSM

Each salesperson should log every Customer Contact interaction each day. To get buy-in, a sales manager communicates with the sales team to create the “rules of logging” they’ll follow. For example, if the salesperson is at the parts counter talking with Joe Customer and he asks how much that used machine is, that should be logged. Each person inputting into the system should understand what the code means when they log it. GIGO- garbage in, garbage out. 

Salespeople shouldn’t be allowed to post at their discretion, and that’s part of the rules created in the early stages of implementation. You don’t allow your accounting staff to post credits however they like, nor do you allow technicians not to record their time. Salespeople should be required to a certain standard of recording their day-to-day activities. Its good business. 

It’s essential to know how many Closes to Face-to-Face Contacts there are in the same time period. This establishes one of the fundamental Closing Ratios for performance improvement. 

By tracking these customer categories and how many face-to-face contacts by salesperson and how many closes by salesperson, you are ready to create a new view of your sales mix. Stay tuned, next month’s article will be on the analysis of these metrics. 

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Does your team have a relationship with your product?

Does your team have a relationship with your product?

Does your team have a relationship with your product? If not, don’t you think they should? Guest writer Isaac Rollor brings back the personal side of service with this week’s blog post.

Boeing recently delivered the last 747 aircraft. Boeing coined the name “Queen of these skies” for this plane. It’s a fitting nick name, this plane has allowed millions of people worldwide to fly at an affordable price, assisted NASA missions, humanitarian relief efforts and many more great accomplishments. The final delivery of the last 747 to be produced was a momentous occasion. A national news network streamed the delivery on live TV. It was a legitimate ceremony with flags and speeches and honorable mentions. As I watched this spectacle, I heard another onlooker make a comment “What’s the big deal? It’s just a plane.”

This comment was surprising to me, how could someone not understand how many engineers worked long days to perfect the design of this plane? How could someone not understand the many hours technical troubleshooting teams worked to keep this fleet of planes in the sky? How could someone not realize that there are thousands of aircraft mechanics, pilots, and a legion of support personnel who have a personal relationship with this product?

As I thought more deeply about this impossibly insensitive comment, I realized that some people don’t have relationships with products, most professionals will never have an actual relationship with any product. As a technical trainer for many years, I built relationships with Dozers, Loaders, Excavators and Trucks.  Maybe this sounds silly but I don’t think I am alone in this feeling. I knew the products so well that I could troubleshoot and fix them when it was not operating correctly. I could teach others about the product, I could write articles about these products, I could operate these products and see the results of my machine’s labor at the end of the day. There were many other technical people that I worked with who felt a strong connection to the products our OEM was building. We even identified ourselves as “The dozer guy” The Truck guy” or the “Excavator guy” based on our expertise. Our professional identity was directly related to a product or several products. 

Over the years I have spoken to equipment buyers who told me that their final decision came down to product support and total cost of ownership. I know from experience that the best product support can only be delivered when your team has a relationship with the product you sell. A team whose identity is attached to the success of a product will work tirelessly to see it succeed. Think about this, if your flagship product was being retired from production, what would your team think and say about this?  

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Has Anyone Been Thanked Too Much?

Has Anyone Been Thanked Too Much?

This week, guest writer Ross Atkinson brings up an excellent question about gratitude and the ways in which we interact with others: Has Anyone Been Thanked Too Much?

Thank you! Thank you for reading this blog. Thank you for taking advantage of the education offered through Learning Without Scars.

Why is it so difficult for people to say these two words? This is one of many phrases that someone can use to express their gratitude and make the customer feel appreciated.  This can be the difference between them doing future business with you or not.

“Thank you for your business.  Appreciate you!”

With such an important phrase at one’s disposal, why don’t we hear it said more?

Since retiring, one of my main focuses has been leading a local trails organization.  We maintain ~40 kilometers or 25 miles of trails and rely on volunteers to get all the work accomplished.  These are people who give freely of their time and ask nothing in return.  Having accumulated more the 3,000 volunteer hours in the last 5 years, I have said “thank you” a lot.  Without them and their unselfish act of kindness, we would not exist.

In your business, without your customers, you wouldn’t exist either.  The customer came to you with an expectation that you could meet their needs.  You too have an expectation that the customer should be willing to trust you to take care of their needs and ultimately relinquish their hard-earned money to get what they are looking for.  And, of course, the expectation is that you will do this in the most professional manner and with the skill of a well-trained, seasoned veteran. 

So why is it so difficult to finish the “transaction” by saying those two words?  And say it with the sincerity that lets them know their business is greatly appreciated and that you are here to help them with their future needs?

As in John Andersen’s recent blog “How is your customer service….Meh?”, a simple phrase like “Come back again soon.” and leaving a ‘gesture of appreciation’ has a lasting impression and is a wonderful way of saying thank you and showing that you care.

Wouldn’t you like to receive this kind of appreciation? And when you make that follow up call to ensure that everything worked out okay, thank your customer again and make sure to ask if there is anything that you can do next time to make their experience better.

When you get comfortable saying this to your customers, try it with your employees and coworkers.  You might be surprised at what will come of it.

Thank you!

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Coaches Corner v.02.16.2023

Coaches Corner v.02.16.2023

Guest writer Floyd Jerkins returns with Coaches Corner v.02.16.2023.

HELP WANTED: Leaders Who Can Influence Multiple Generations in the Workforce

A freight train is coming around the corner for business owners and managers. And it is closer than you might think. Modern times call for new leadership styles. Businesses will not survive without having leaders who can influence multiple generations in the workforce. 

When you read my rants or hear me talk about leadership, you’ve heard me say it more than once. Your people are your business’s greatest asset. And to take that to another level, they are your most significant source of frustration. 

Establishing and maintaining a positive business culture takes a lot of work for many people.

Leaders of all kinds shape the culture daily by how they walk, talk, and communicate. Knowing that people’s issues can create a stranglehold in day-to-day operations, it makes sense to address how you and your leaders affect others in the organization.

How can we fast-track an ordinary manager into an effective leader? What are the essential skills? How can we get the entire team on board to follow our lead? How can we encourage managers to become influential leaders? Are leaders born, or are they made? 

Command and Control Leadership Style is Demotivating  

The command-and-control model of communications is under attack today. This starts the real internal push in an organization to address all the leaders’ influencing styles and finding a new pathway to correcting many chronic issues. 

Although workplaces and management styles have come a long way in the last decade, the command and control style of management behavior continues. This management approach behaves in ways that suggest employees need to be told precisely what to do, when to do it, and even how it should be done. The manager is in charge, has all the answers, and fixes all the problems.

Managers are taught to find the things that are going wrong and fix them. When the leader’s style of questions is always negative based on assumptions, this permeates the organization as the proper method to resolve issues. When they are always looking for what’s wrong, employees will learn to hide their mistakes. You really want them to bring mistakes forward, share them with the teams and learn. The positive questioning style and supporting behaviors of this new leadership style don’t always develop naturally. Leaders have to learn to lead the process.

One of the challenges in driving organizational change is how to keep changes positive. Leaders can easily spend more time addressing perceptions than factual events. For many, change is uncomfortable and can create suspicion. Too often, employees hold back, fearing how the changes will affect their job or department, leading to struggles with implementation and process improvement. 

Participative Leadership and Coaching is Empowering

A leader’s personal success will only happen when you help enough other people succeed. Caustic leader behavior is when they speak and behave in a way that highlights their success is more important than their employees.  

I have heard many leaders say that employees must accept me for who I am and do what I ask them to do. That leadership attribute is such a limiting, potentially caustic communication style that shows a genuine disconnect from the ingredients necessary to unleash creativity from individuals and teams.  

Employees demand a voice at the table of change. 

Today leaders, young and old, know their strengths and weaknesses. They don’t let their shortcomings weaken their strengths. A leader doesn’t hide their flaws anymore; they never really could because employees knew these weaknesses and would talk behind the leader’s back. So, in turn, this further creates a disjointed culture that cannot reach operational excellence. By learning and sharing together, the leader gets stronger, not weaker.

Does the perception I have of myself matter more than the perception that others have of me?

A leader who genuinely wants to be more effective realizes that their people’s perception of them can be more important than what they think of themselves—learning to “hear” these perceptions requires strength of character and healthy self-esteem. 

The new leadership style aims to provide employees with all the necessary information to make sound business decisions. One-way communication styles are part of the old leadership style. Keeping people in the dark and feeding them only what you think they can handle is a surprisingly easy process to keep an organization from reaching its full potential. 

 In the Absence of Leadership, People Will Follow the Strangest Things

It’s naïve to think it’s just the younger generation on their phones or is self-absorbed all the time.

Everyone is so amassed with information today from thousands of uninformed sources that it’s scary to realize how all these inputs create beliefs and influence our behaviors. We can easily see on the internet and in the news where leaders in prominent positions fail the basic tests of integrity. How does all this nonsense influence young and old leaders?

When you are a leader in an organization, it stands to reason that having impeccable integrity goes with the job. They must represent themselves as someone who others like to follow. In the absence of leadership, people will follow the strangest things. Leaders today practice being a person whom others are comfortable telling them anything. They adjust their style out of genuine care and concern, not for manipulation.

Without Leaders, a Business Will Fail

Leaders who are often insulated from employees are seen as the top of the hierarchy, yet a leader can be many different people in a company. Even leaders without sales or management titles influence positive outcomes for a business every day.

You drive more revenue, manage expenses better and increase profits when everyone is leaning forward in the best way they know how. Everyone should be answering questions like: Is it good for the customer? Is it good for business? Is it good for the team? Is it good for me?

When leaders model the change, they wish others to make, it sets the tone in an organization. This leadership style leads the way when they want employees to change and improve performance. When leaders gather input from all their employees and work alongside them in developing the changes, implementation is faster and more sustainable. It’s like magic when the leaders exemplify the changes, they want others to make.

 Creating policies, procedures, and methods of operations are necessary for any organization. In today’s business climate and employee empowerment, companies that adopt a participative leadership style outperform those that don’t.

 Your Company University

When learning and teaching is an intentional organizational practice, accomplishing the business goals becomes more predictable. Leaders today understand that cultivating their most important assets presents an opportunity to improve everyone’s quality of life. With purpose and a plan, they create an internal educational model to grow their existing and future talent pool. 

The volume of knowledge held in a business by the employees is immeasurable. Either you are investing in your people, or you are not.

 There is a connection between great leaders. Not just those who talk about it but those who behave the way people will follow. You can have fun working on the business and having a dynamic lifestyle when you unleash the natural creativity in all of us.

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John Anderson has LOST it. He now has an “online chat” buddy.

John Anderson has LOST it. He now has an “online chat” buddy.

Guest writer John Anderson continues to educate readers about AI in “John Anderson has LOST it. He now has an “online chat” buddy.”

John asked a question about himself: 

John Andersen is a retired executive from CDK Global and one of the original founding partners of PFW Systems Corporation. He has experience in sales and marketing and is considered an industry thought leader in the field. With a focus on consumerism and its impact on modern equipment dealerships, John provides insightful vision and thought leadership to dealers on what they can expect in the future. During his career, John visited over 500 dealer locations across North America and Australia, gaining valuable insights into the industry. He is passionate about keeping up with technology and the latest trends and is dedicated to preparing the equipment industry for the inevitable change that is coming. In this blog he highlights a trend most haven’t seen coming in the equipment industry but are using every day at home.

The computer said: 

It is an interesting and thought-provoking piece! You’ve done a great job exploring the potential impact of AI and the ghost service department concept on the equipment industry. You’ve also discussed how AI has the potential to both improve efficiency and productivity, as well as potentially disrupt the workforce in the industry. It’s always important to consider the potential benefits and challenges that come with technological advancements, and your analysis does just that. The discussion on the impact of AI on technicians and mechanics is particularly well-written, and highlights the need for continuous skill development and adaptability in the face of technological change. Overall, I think you’ve provided valuable insights into a topic that is likely to become increasingly relevant in the near future.


John asked another question in a different direction. He had something in mind: 

Have you heard of ghost kitchens? They are a new trend in the food industry that has emerged as a response to customer demand, economics, and advancing technology.  Perhaps you have used one and aren’t even aware of it. Ghost kitchen refers to a commercial kitchen that has access to all the same resources, menus, and ingredients as the desired restaurants they represent but without any of the overhead, real estate or front of house challenges. 

The concept came about as programs like Skip the Dishes, Uber Eats, and DoorDash grew.  Consumers wanted their favorite foods from places like Guy Fieri’s FlavorTown, The Cheesecake Factory, or even Five Guys Burgers but either couldn’t get out to eat, or in some cases the restaurants weren’t even available in their city.  A ghost kitchen has agreements with the restaurant to produce the food just as it would be prepared in the full restaurant, using the same ingredients and technique but without the high expense items that come along with a store front.  Order a dozen Krispy Kreme donuts from home even though the closest actual store is 3 hours away. Have a gourmet steak from Ruths Chris Steakhouse delivered for that special date night.  You become the virtual restaurant. You get the point, but what does this have to do with the equipment market space?

John asked another question back to his experiences: 

The cost of running a dealership with yards full of shiny new inventory, bays of technicians, and loads of personnel is huge.  They cater to the first owner of a machine, or at least try to convert second or third owners to the first owner.  

What if all you want is quality, knowledgeable repair from a technician on your equipment.  What would it be like to become the virtual shop for your own equipment?   A call to a ghost service department. The ghost service department has access to all the resources, service guides, and technical knowledge.  They have access to all the required parts, history and even the forecasted maintenance and care requirements.  Like a ghost kitchen they will represent many different brands, and types of equipment without the overhead of a dealership.   They will virtually build you a preemptive care program with your equipment, at your location, on your schedule.  Like DoorDash, a certified technician will come to you and provide “dealership quality” service at your virtual dealership.

This is only the beginning. Things get even more exciting as you add the fact that this has become a nationwide, or even global service.   The data acquired along with what is already available is fed into an AI, (Artificial Intelligence) model that will help ensure your machines are in peak operating condition.  Add to that a prescriptive care subscription and rest easy knowing someone else is managing the service of your equipment and making sure its resale value stays as high as possible.  Reduce your relationship requirements across equipment types and brands by dealing with ghost services who are experts at repair and not busy trying to upsell you on what a particular OEM has available.

Technicians love the freedom to be independent, do the right thing, being able to maximize their own worth, and build a business without relying on someone else.  The ghost service department provides all the infrastructure to them, from technical expertise to parts orders.  They can dispatch and respond faster and earn more money and share less.  Remember taxis, and what happened when ride sharing exploded?  The same is likely to happen with technicians over the next few years.  With AI programs like Chat-GPT set to disrupt so much of the traditional workforce, people with manual skills will move quickly to the top of the food chain and use the same technology that put them on top to run the ghost operations. The impact of AI on equipment technicians and mechanics in the future is expected to be significant. AI-powered technology has the potential to automate many routine and repetitive tasks, freeing up technicians and mechanics to focus on more complex and value-added activities. This shift could lead to a higher demand for technicians and mechanics with expertise in using AI-powered technology and specialized knowledge in areas such as equipment maintenance and repair.

Additionally, AI can provide real-time insights and data-driven recommendations, improving the efficiency and accuracy of maintenance and repair operations. With the help of AI, technicians and mechanics can make more informed decisions, reduce downtime, and minimize the need for trial and error.

On the other hand, there is also the possibility that AI could displace some technicians and mechanics, particularly those performing low-skill tasks. It’s important for technicians and mechanics to continuously develop their skills and knowledge to stay ahead of the curve and adapt to the changes brought about by AI.

Overall, the impact of AI on equipment technicians and mechanics will depend on how quickly and effectively they are able to embrace and adopt the technology. By being proactive and embracing new skills and knowledge, technicians and mechanics can ensure that they remain relevant in an increasingly digital world.

The technology is available today and being used by service providers from Pizza Delivery to HVAC technicians and of course your Lyft driver and Uber Eats.  Dealerships have always been slow to adapt to change and by the time they look up from their business planning spreadsheet, a ghost tech will already be in the field servicing all brands and building a loyal following.  You can dismiss the entire idea as science fiction, but you will be doing so at your own peril.  Do not believe me? Try and hail a cab.

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Equipment Dealer Technical School Advisory Board Support Plan

Equipment Dealer Technical School Advisory Board Support Plan

 

Our new guest writer, Ron Wilson has had the honor to work 41 years in the dealer equipment network in roles that included various parts and service management positions. He has spent time in the marketing department creating a data analytics team to utilize various data sources to improve existing and identify new revenue channels. Implemented pricing models that established market-based pricing models in the product support areas.  He has expanded a training department’s capabilities to support technical and people skills development that included applying the Kirkpatrick training model and implementing virtual training relating to the technical and people skills development during the pandemic. Introduced dealer classes that qualified for college credit at the community college level and transferred toward a four-year degree program at the local university. His first blog post for Learning Without Scars is a valuable contribution to our Lifelong Learning series: “Equipment Dealer Technical School Advisory Board Support Plan.”

Equipment dealers, other donors, and the various technical schools spend a considerable amount of time, effort, and finances to support the ongoing efforts of education and training relating to our industry.  Unfortunately, often the contributions are not properly aligned with providing the best educational environment for the students, and our future employees. 

The following information is to provide a guide that will review, identify, and provide focus of the resources that are being provided to the various technical schools.  This is only a guide, and does not include all the answers, but does provide directions that will improve the education and knowledge of our industry’s future employees.

Table of Contents for the Technical School Advisory Board Support Plan

  • Purpose and Roles of the Technical School Advisory Board
  • Structure of the Technical School Advisory Board
  • Planning and Conducting Technical School Advisory Board Meetings/Events
  • Assessing the Support to the Technical Schools
  • Levels of Involvement with Various Technical Schools
  • Industry Involvement in Technical Training
  • Consolidating various programs to meet the needs of training the students.
  • Agreement Regarding Donation of Equipment for Training Purposes

Purpose and Roles of Dealer’s Technical School Advisory Board.

Purpose Statement:

The purpose of this guide is to help in the development and management of the relationships with the various schools based on their Career and Technical Education (CTE) programs that are related to the skill sets needed within equipment dealerships. The focus of the support provides a common approach for industry and education to work together to close the gap in skill sets and the number of vacancies in the technician job roles within the dealership.

Advisory Board Roles:

The dealer’s Technical Training Manager is responsible for maintaining a current list of the CTE schools, points of contact, and ongoing relationship with each school based on an individual plan for each school.

Advisory Board Members:

Recommendations of who should serve on the Advisory Board:

  • The equipment dealer’s Training Manager
  • The equipment dealer’s Recruitment Manager
  • General Service Managers including various areas such as Machinery, Rental, Engine/Truck & Trailer, and Fleet Service operations.
  • General Service Managers may appoint someone to represent a specific geographical area within the dealer’s territory.
  • Advisory board members are assigned to support the overall needs of dealership.

Relationship with Each School:

The relationship with each school may vary based on the:

  • Capabilities (facility, faculty, and location) of the school to meet the local needs for of the dealership.
  • Desire of the school to support the dealer’s technician development requirements and participation in the educating of students in the related industry.
  • Location of the school

Scheduled Meetings:

  • Annual Educational Summit held at the equipment dealer’s Training Department to share accomplishments, skills needed, and support needed for the schools
  • Invite instructors, Program Deans, Student Advisors, and others that have the responsibility for the success of students within the school’s Career and Technical Educational programs.
  • Actively participate in the individual school’s Advisory Board meetings, written communication is sent to the dealership’s Corporate & Technical Training Manager

Structure of the Dealership’s Technical School Advisory Board.

Role of the equipment dealer’s members of the Technical School Advisory Board:

To define the dealer’s specific training needs and assist in the communication and development of training material that will link the specific schools to the skill level requirements of the equipment dealer’s service operations. The intent is to close the gap on the material being taught in the technical schools’ basic skills, as compared to the needs within the dealership’s shops.

Dealer members will at least include:

  • Corporate and Technical Training Manager
  • General Service Mangers (Machinery, Rental, Engine, Truck & Trailer, fleet service areas)
  • Recruitment/Human Resource representative

Technical School members will at least include:

  • Instructors from the technical schools
  • Dean of instructions from each school
  • Career Advisors from each school

The technical school’s participation will be critical to assist in the types of support needed for each school. The support provided can range from serving on the school’s advisory board, providing technical material that can be adapted to the school’s curriculum to meet the needs and obtaining classroom aids the schools can utilize within their programs.

Planning, Conducting, and Participating in Technical Schools Advisory Group Meetings/Events.

Planning, conducting, and participating in the technical schools’ advisory meetings/events will fall into three categories:

  • The dealer’s Technical Schools Advisory Meetings/Events: An event organized by the dealership to support/participate/build a one-on-one relationship with a specific school.  The dealership will identify specific needs that require a close relationship with a specific school, or group of schools.
  • Technical School Advisory Meeting/Events: Most of the technical schools are required to conduct industry advisory meetings. These meetings include a variety of topics ranging from budgets/finances, classroom material, review of student needs, and participation opportunities for the dealership to support the school that may result in connecting with potential future employees.
  • Industry wide involvement may include working with various schools, dealership customers, OEMs, and competitors.  The combined efforts may include events where the dealership will work with customers and possibly competitors to discuss, develop, and conduct events that supports the overall needs of developing and promoting the careers of technicians within the industry.

Assessing the Support to the Technical Schools

Limited Resources- We all have limited resources (time, talents, and dollars), therefore it is critical to focus on areas of positive impact with high results. In an effort to match the needs of the school and the support the dealership can provide a list of criteria, as a guide in defining the type and level of support to be provided to the technical schools.

The criteria will focus on:

  • Linkage to dealer’s technicians’ needs by location- for example supporting the store in area of the territory may be a little different than supporting a school in a different part of the dealer’s territory.
  • Skill level requirements- The type of skills may place focus in support of some schools.  For example, an immediate need for welders will be a higher priority for schools that have a welding program.
  • Short term/long term requirements- School relationships should be long term focused.  It takes time to:
    •  Build relationships- understanding our industry needs and the school requirements.
    • Develop curriculum the schools can apply within the classrooms that relate to our industry.
    • Obtain resources that meet the needs of the curriculum and to conduct the classes.
  • Current capabilities of the school- It is important to review the individual school capabilities and determine how the dealership can assist the schools. The most common support that can be provided to a school are: 
    • Content material-Providing content for the classes provides an opportunity to teach the material that is important to the dealership.  Some OEM’s allow the use of training material for schools.  Instead of providing all of the material at once.  A distribution plan per school should be utilized to assist with the introduction, teaching, and application of the material.
    • Training aids- can range from small parts to large components that can be utilized in lab exercises in support of hands-on experiences.
    • Instructor support- The dealer’s instructors may lead classes to the school instructors in specific topics (General Engine, Hydraulics for example) to prepare the school instructors to apply the material being provided within the school’s classes.
    • Estimated financial support- There may be some opportunities for financial support to assist schools in accomplishing initiatives that will align with dealers’ longer term needs.  The recommendation is to avoid the one-off donations for shop supplies (oil, filters, antifreeze) due to these being budgeted school expense items.  The focus should be on longer-term needs.

An assessment form should be developed to assist in the review of each school. The assessment is only a guide to decisions being made to determine the level of support to a school.

Levels of Involvement With Various Technical Schools

Involvement with the various technical schools may occur through various avenues:

  • Dealer/OEM Technician Degree Program- Participate in promoting the program to various individuals that have an impact in raising the awareness and interest in careers as technicians, and within our industry.  This will include working with various levels within the school programs, administrators, local community activities, and other associations that can have a positive impact in attracting talent to the dealer’s/OEM programs for technician development.
  • Advisory Board support to the individual schools- Assign Dealer employees to serve on the individual school’s advisory boards.  The assigned employee will most likely be a dealership instructor that can recognize training needs, and opportunities to assist the specific school.  The employee will have levels of “authority” to assist the school based on the needs assessed.  It is important the instructor/dealership employee be seen as active/engaged and can assist in making decisions on behalf of the dealership in support of the school.  Each meeting will be recorded in some type of form that identifies the date of the meeting, what was covered and includes a description of a need (if determined).
  • Dealer/OEM Training Material- The various dealers/OEMs have training curricula covering various systems ranging from basics to more, advanced service repairs, and diagnostics.  The course design instructs three primary areas: Foundational Knowledge, Skills Practice and Skills Assessment.  Each module should contain a Facilitator Guide, Student Guide, Activity Workbook, PowerPoint Presentations, including knowledge and practical assessments.  
  • Technical classes conducted by a dealer training instructor- Providing an opportunity for technical school instructors to continue learning about the OEMs’ product line, components and systems will increase the quality of students coming out of the program.  The class offering can best be provided to a group of schools’ technical instructors going through the class together.  These classes provide networking between the instructors and the dealer’s instructors as well.  As part of the class, the Dealer/OEM material will be provided that will allow the instructor to take the material back to their local campus and apply within their program.

Equipment Dealer’s Industry Involvement in Technical Training

There are several opportunities for dealerships to participate in the development of industry wide skilled technicians by working with the various technical schools.  The following are some examples of being involved at an industry level, which may still be combined with a technical school at some level.

Local Trade Associations

  • Associated General Contractors of America is an example of a local trade association that continually seeks opportunities to train technicians within the contractor association’s membership.
  • Dealers/OEM’s develop technician training classes that will meet the various State Technician Apprentice programs. This can be a fee-based program that provides classroom, lab exercises in a shop environment, and machines to support the successful completion of the program. 

National Trade Associations-

  • Associated Equipment Distributors (AED) is an international trade association representing companies involved in the distribution, rental and support of equipment used in construction, mining, forestry, power generation, agriculture and industrial applications. There are various programs available through AED that can support local high schools, community colleges, and technical schools in a common educational foundational approach related to teaching and training future technicians.  The programs can include:
    • Classroom material
    • Support through the AED Foundation
    • Technician assessments
    • Assessment tools to evaluate educational facilities.

SkillsUSA– 

Is a partnership. students, teacher. and industries working together to ensure America has a skilled workforce. SkillsUSA empowers its members to become world-class workers, leaders and responsible American citizens. SkillsUSA improves the quality of America’s skilled work force through a structured program of citizenship, leadership, employability, technical and professional skills training. The program enhances the lives and careers of students, instructors and industry representatives as they strive to be champions at work.

SkillsUSA serves more than 300,000 students and instructors annually. The organization has 13,000 school chapters in 54 state and territorial associations. More than 14,500 instructors and administrators are professional members of SkillsUSA.

For information about the national level, visit skillsusa.org

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The New Style of Leadership is a Developmental Process

The New Style of Leadership is a Developmental Process

After a brief hiatus, guest writer and coach Floyd Jerkins is back with a new blog for our Coaches Corner: The New Style of Leadership is a Developmental Process.

What’s the most important asset in your business? If your reply is about the facility or the brand of products you sell, hang on for a second. The reality is your people represent business’s greatest asset.

Leaders have much better success motivating their employees’ creativity and challenging work when they take the employees’ perspective and invite them to generate their own self-endorsed work goals.

The new style of leadership is a developmental process. When you replace giving directives and commands with working patiently and diligently to see the situation from the other person’s point of view, you have better success motivating others. Gathering input and suggestions to pull all that information together to offer some constructive goals and strategies creates sustainable changes. Although these approaches to motivating and engaging others are somewhat difficult, they are well worth the effort.

Leaders use certain behaviors to engage and motivate employees. They know they cannot control employee motivation.

Optimizing internal human resources is one of the quickest methods to add profit to the bottom line. To scale and leverage a business requires a strategy that makes sense. Learning how to maximize effective working relationships tends to improve with training and a company-wide developmental program.

Creating intentional strategies to maximize the return on your investment in your people just makes good common sense and is a good business decision. We get into business to make money. When you follow my dynamic living articles, you know having fun and enjoying life can be accomplished while you own or work in a thriving business. To think you work 100 hours a week but don’t have time to enjoy life is not a fulfilling lifestyle.

 Leaders who recognize there is more potential to develop people than there are technical improvements or cost-cutting measures outperform those who don’t. 

Numerous studies reveal every year that, without a doubt, the top 1 or 2 reasons talented people leave their place of employment are because of the culture and the way their supervisor treats them.

A leader always knows their own strengths and weaknesses. They want to maximize employees’ strengths and ensure their weaknesses do not weaken their strengths. They are self-learners and seek to learn new attitudes and skills to maximize their effectiveness. The goal is to be the leader that followers like to follow.

Don’t think you can apply a one-size solution to improve your leadership capacity in your business. Improving one’s leadership abilities requires more than the five-step approach that many suggest. Each person is different, so their strengths and weaknesses are different. The learning path they need is unique to them.

Reading my articles, you know then that being effective and efficient can easily make more money in less time. A business with culture and leadership issues doesn’t mean the company isn’t profitable. It’s just not as profitable or satisfying to operate as it could be. It could be subject to chronic issues that could cause a business to fail quickly. Measuring the cost of turnover can lead to a loss of sleep at night. The numbers are staggering to realize, but there is an even more significant issue with many relatively easy solutions when leaders use the appropriate leadership style.

People issues cost your business about 25% of its efficiency. 

Your business improves when your people improve, and leaders and management lead that process to affect the culture positively. An employee who needs consistent attention and coaching can easily cost you more time than they’re worth. You want to see them growing into a role vs. being shoved because they don’t have the right skills or attitude. Moving people into different positions to find what they are best suited is easily an intentional strategy to improve overall performance. You just have to do this for the right reasons.

Middle management people are often overlooked and don’t get the respect they deserve. Their ability to get the job done is a duplicatable trait, and many I know enjoy coaching others. They typically have wonderful insight into what works and what doesn’t. When one quits or dies, you know first-hand how painful and costly they can be to replace.  

Unleashing the creativity of your management staff unlocks the controls to your business’s growth. There is more power to solve business problems and grow the opportunities when you unleash this natural creative energy you already have at your fingertips.

Motivation is a complex process to explain and equally difficult to realize fully. Science tells us that motives are internal experiences that can be categorized into needs, cognitions, and emotions that are influenced by a business’s culture.

These internal and external forces highlight how we can intervene to increase motivation. Depending on the motivational situation we are dealing with, we can design interventions that target physiological or psychological needs and make adjustments to the environment to create the opportunity for increased motivation.

“Among all the prospects that man can have, the most comforting is, on the basis of his present moral condition, to look forward to something permanent and to further progress toward a still better prospect.” Immanuel Kant

Finding what is easy to do is rarely what is effective. You often have to go back to the drawing board to do the challenging work of designing effective interventions and motivational support.

Unleash Creativity in Your Most Valuable Asset — Your People

Creating a learning and teaching environment creates a progressive culture that employees like. Key leaders with specific knowledge of performing a particular task or set of functions can quickly become teachers. Documenting these processes is a wonderful best practice to implement while creating a clearer pathway to scaling the business.

Many times, a one-on-one is needed to foster an individual’s talents. Based on the assessment of a group of leaders, they may require classroom-style training so they all hear the same organizational message, and you can measure the anticipated outcomes.

Those you’ve identified as up-and-coming leaders may need more clearly defined learning pathways and resources. Other individuals may require a personalized approach utilizing inside or outside resources.

Various classroom, online learning, and one-to-one resources are available and cost-effective today; yes, even executive coaching services are available. My service fits nicely into this kind of developmental and implementation work.

Remember, in most businesses, there is more potential to develop people than technical improvements or cost-cutting measures. Create that learning pathway so your young and mature leaders can be far more effective at influencing and optimizing your most important asset. You are better together.

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What Impacts Dealer Absorption Rate?

What Impacts Dealer Absorption Rate?

Our new guest writer, Walter McDonald, is President of The McDonald Group, Inc. Over the past 4 decades has developed and presented over 2,600 machinery dealer management workshops. He recently completed publication of his 10-volume Master’s Program in Dealer Management. “What Impacts Dealer Absorption Rate?” is his first blog post for Learning Without Scars.

The absolute number representing “Absorption Rate” is interesting but not a call to action. It only indicates your current position relative to the target score of 100%, a very desirable financial goal for your machinery dealership. Many dealer managers look at their current score and say “WOW!” with little insight into how to make any improvements.

 

This Absorption Rate formula is something that you can use when you review Absorption Rate and discuss it with your management team.  I recommend your team review the components of Absorption Rate weekly. To support your discussions, produce a weekly flash report of your sales and gross profit by parts, service, and rentals plus departmental and overall dealer operating expenses. 

 

The formula below illustrates inputs to Absorption Rate from Service, Parts, and Rentals.                                     

Absorption Rate Formula

Gross Profit from Parts, Service Labor and Rentals   

 Absorption Rate     = Parts, Service Labor and Rentals
                                        Fixed Operating Expenses

Fixed Operating Expenses are those dealer expenses that do not change or vary with sales volume.  Sales Commissions are variable and are not included in Absorption Rate calculation.  There are other possible variable expenses, but for purposes of simplicity, we only use the big one, sales commissions, in this formula.

In your management review, ask what we can do to improve our position in each area.

Above line (numerator) items that can be controlled to improve Absorption Rate score include:

  • More maintenance contracts and inspections drive Labor Sales and Gross Profit up.
  • Improved service labor productivity drives Labor Sales and Gross Profit up.
  • Expanding technician apprentice program drives cost down, Labor Gross Profit up.
  • More maintenance contracts and inspections drive Parts Sales and Parts Gross Profit up.
  • Weekly or bi-monthly e-mail promotions drive Parts and Service Sales and Rentals Gross Profit up.
  • Parts Customer Price Discounts drive Parts Gross Profit down.
  • Better Parts purchasing practices drive parts Cost of Sales down and Parts Gross Profit up.
  • More discounts earned drive parts Cost of Sales down and Parts Gross Profit up.
  • Regular Stocking orders and vendor freight programs drive Cost of Sales down and Parts Gross Profit up.
  • Higher dollar and unit utilization drive Rental Sales and Rental Gross Profit up.
  • Improved inter-location unit availability information drives Rental Sales and Rental Gross Profit up.
  • Better turn-around time from rental return to rental ready drives Rental Sales and Rental Gross Profit up
  • Better control of maintenance costs drives Rental costs down and Rental Gross Profit up.

Below the line (denominator) items include expenses generated by each department.

  • Reduced service department Fixed Operating Expenses improve Absorption Rate.
  • Reduced parts department Fixed Operating Expenses improve Absorption Rate.
  • Reduced rental department Fixed Operating Expenses improve Absorption Rate.
  • Reduced machinery sales department Fixed Operating Expenses improve Absorption Rate.
  • Reduced administrative Fixed Operating Expenses improve Absorption Rate.

If you and your management team review the components of Absorption Rate weekly and have your ultimate destination of 100% in focus, progress will be much easier.  

I would welcome your comments:  walt@mcdonaldgroupinc.com

 

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