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EI vs. AI: Emotional Intelligence vs. Artificial Intelligence

EI vs. AI: Emotional Intelligence vs. Artificial Intelligence

This week, our guest writer John Andersen helps us see the clear difference between reality and the artificial in “EI vs. AI: Emotional Intelligence vs. Artificial Intelligence.”

With all the technology and buzzwords floating around it is easy to get lost, confused or sometimes plain lied to. Marketing spin, new names and great acronyms can supplant common sense and knowing better. Manufactured solutions are different than organic solutions and the commitment to following it is also vastly different.

 

Let me give you an example. I have the good fortune to live minutes from Walt Disney World for much of the year. While I am getting a little old for most of the rides and have done everything you can imagine, I still manage to go to one of the parks about once a week. I have taken to studying how they manufacture a guest experience. From avoidance of shadows in high photo locations to the smell of popcorn that seemingly is pumped into the air during parades or fireworks. Subtle music, barely audible in quiet zones to bring down your pulse rate, or rhythmic tones during a line cue to help build anticipation. The imagineers continue to tweak, study, and implement new ways to enhance the guest experience. The intel they gather and maintain on guests is astounding, overwhelming and valuable. They spend millions of dollars maintaining the experience and finding new unique ways to entice the money from your wallet and keep you onsite and engaged. If it’s all you know and all you see, you could believe it is real, but eventually your inner voice will call out, “Artificial!!!”

 

In contrast, this week I have parked my home on the seawall of the Atlantic Ocean. There are still thousands of people around me as we prepare for the Daytona 500. Much like Disney, it’s all business and profit driven. At the urging of a wise old friend, I got up to see the sunrise since there is nothing between me and the ocean except thirty yards of sand. It was predawn when I went outside and stood on the sea wall. On both left and right were people standing quietly with cups of coffee, dogs, and partners. Nobody looked awake and all were silent. It started as a pink glow but within minutes the sun was breaking from the water and fully exposed. My face warmed and the hairs on my arms stood up. It was like I was being filled up with faith, hope and energy. Bathed with light that nobody else had seen yet. We all stood there for 20 minutes or so before one by one our tanks read full, and we left to start our day. Sunrise is so much different than sunset. It radiates peaceful enthusiasm, and positive momentum. A sunrise sends specific signals to the brain and body that can’t be manufactured. In this case your inner voice doesn’t call out, it whispers…” Thank you.”

 

That’s the difference between AI and EI. Artificial Intelligence versus Emotional Intelligence. AI will be pervasive in so many areas of your life over the next decade. It will change the way you do business and how you operate inside and outside of work. You can expect higher levels of service, refined experiences, and likely better and cheaper products. In this utopian environment setting yourself apart will require something organic, real, and different. That requires a skill AI can’t learn. That is where the great will become the exceptional and businesses and customers alike will seek you out. That is harnessing emotional intelligence. We all have it, but the drive is being overshadowed by the noise of AI. Finding a blend of both will lead you to the top of your potential markets and success. Last week I attended a symposium virtually with the greatest leaders in AI and technology. Each had a viewpoint about how technology would change the world for the better and the worse. However, one phrase stood out and much like the sunrise this morning, I can’t ignore what it meant. AI will never supplant EI because AI doesn’t have a gut. Surround yourself with data, predictive models, and AI of all types. Use it to elevate your abilities, skills and services but seek out EI. EI is found in Passion, Wisdom, and Instinct where AI is based on Data, Intelligence, and Modeling. 

 

This brings me back to my Daytona 500 outing. A computer could generate the race, but it’s the spirit of the drivers that engage us. Like the sunrise, you need to feel it!

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The Basics of Marketing, how to avoid the “What were they thinking” Moments

The Basics of Marketing, How to Avoid the “What were they thinking” Moments

Guest writer Bonnie Feigenbaum introduces her lecture series with this debut blog post: The Basics of Marketing, how to avoid the “What were they thinking” Moments.

Marketing is all about creating a connection between your company and your customer, a permanent place in their lives for your product and a permanent place in their heart for your brand.  In 1971, as a very young child I remember belting “I’d like to teach the world to sing in perfect harmony, I’d like to buy the world a coke and keep them company… “learning the iconic Coca-Cola Hillside singers’ ad by heart.  The ad was so popular that Coca Cola had Hilltop Reunion in 1990 and brought back the singers to recreate the commercial.

There are many times I watch marketing campaigns roll out and wondered who was the marketing genius who came up with that! For example, McDonald’s does so many customer connection points right and really raised the bar on creativity in my mind when they launched their pizza line in 1989. The traditional golden arches were angled to make the Zs in pizza to communicate with one picture and one word that this is McDonald’s Pizza, a logo within a logo.

In 2018, I was intrigued by Nike’s decision to use Colin Kaepernick as their brand ambassador. I read the article by the Montreal Gazette columnist Scott Stinson, “Nike stands with a bet that outcry from Trump and his allies won’t cost them business.”   Kaepernick choose to “take a knee” using the moment of the U.S. national anthem to protest racial injustice and lost his football career in the process. The US was sharply divided on whether Kaepernick protesting during the anthem was disrespecting the flag. Nike, it would seem, was placing a large bet on the support their target market has for the issue and on Kaepernick’s sacrifice connecting with them.   Would the tagline, “Believe in something.  Even if it means sacrificing everything” resonate?

Nike’s choice did create a social media fervor as some more ardent opponents of their choice of influencer created a boycott hashtag and posted videos of them burning their own Nike shoes, socks and carving the Nike swoosh out of their garments. I would like you to remember one thing these people already paid for the products. Nike already had their money. The only person who was losing was them, as they had to spend money to replace the martyred items. Ironically, putting in practice the Nike/Kaepernick tagline. Nike did their research right, sales increased in the wake of the controversial advertising campaign, with online sales growing by 31% in the holiday weekend after the ad launched, according to researcher Edison Trends.

However, there are other times where I wonder to myself, what were they thinking and how did nobody throughout the whole creative and control process clue into the customer disconnect.

Let us go through some of my favorite fails

Urbn Outfitter was founded in Philadelphia in 1970 and is an international clothing corporation that has retail stores located in Montreal.  My fashion marketing students were trying to determine why there was a significant decrease in sales over the past year.  The Urbn Outfitter store brand sales were declining while the parent corporation’s other brands Anthropologie and Free People’s net sales had increased by 2% and 5% respectively at the same time. Through research the students were able to prove that in general the retail sales for the target demographic had been enjoying a continuous increase in revenue. So, what was the problem?

They investigated further and discovered that the year earlier Urbn Outfitter had launched controversial clothing lines featuring edgy and questionable mental health and body shaming crop tops with messaging like “depressed” and “eat less” while their direct competitor, Forever 21 T-shirts proclaimed positivity with “eat more” and “love yourself” on their tops.

 

We also discovered that some of their product line choices left a lot to be desired.  There was a Kent State University sweatshirt with blood spatters on it, a black and white horizontal striped T shirt with a 6-point yellow star on it reminiscent of the Holocaust and T-shirts in a colour Urban Outfitter identified as “Obama black”.  For the life of me I cannot understand how these items got through the approval process.

 

Another example of product fails because the company did not even think to take the customer reaction into account is Simons, a Quebec retailer. In September 2018, Simons launched a line of bralettes, a type of women’s lingerie. The story goes that when the Simons team was looking for a vision for their new lingerie line, they looked at inspiring Canadian women that were respected and admired. The line was meant to honour women who made historic contributions to Canada. The bralettes were called the Elsie, the Clara, the Nellie and the Beverley. So, while the last names were never used, the ad copy made it clear that the designs were inspired by aeronautical engineer Elsie MacGill, trailblazing lawyer Clara Brett Martin, suffragette and politician Nellie McClung and jurist Beverley McLachlin, the first woman to be appointed Chief Justice of the Supreme Court of Canada.

Now Simon’s never sought permission from the estates of the first three women to use their names or even to ask if they wanted to be bralette brand ambassadors. Nor did they ask the sole living “honoree,” the Right Honourable Beverley McLachlin who had just retired in December after spending 28 years at the Supreme Court including almost eighteen as Chief Justice.

After receiving a call from McLachlin, the president Peter Simons, immediately gave in to her demands for her a public apology and a request to get involved with fund raising campaign for the Cornerstone Housing for women emergency shelter organization in Ottawa.

 

In his apology, he stated that he sincerely regretted the naming mishap citing the lack of judgment on his part and that they decided to discontinue and destroy all materials related to the line following the call. During the media storm, I wondered where were the women in the room?  I noticed a line in one article, “Simons apologizes for bra named after former chief justice Beverley McLachlin,” by Tara Deschamps of the Canadian Press where Simons acknowledges that there is a deficiency in their corporate culture, a lack a comfort of the staff to stand up and express concerns.

That is what my basics of marketing series is all about.  I will give every employee the tools to spot the potential problems and recognize the opportunities to improve the customer experience.  But it is up to the management in the company to embed that into the corporate culture, empowering their employees to put customer connections above corporate politics.

We will start by reviewing the marketing process which is a good opportunity to show a relationship between several concepts we will be discussing, during the lecture series. During the first half of the series, I will focus on introducing marketing, the marketing environment and then market research. I will explain how we use the secondary data to develop marketing information systems. We will then delve into Consumer Buying Behaviour, comparing it with Business and Institutional Buyers’ Behaviour. We will then discuss the segmentation and positioning process that work in conjunction with the company’s marketing strategy. We will also cover the marketing mix, where we implement our strategy using our 4 Ps-Product, Price, Place & Promotion. In our final lecture, we will put it all together and discuss how to prepare the full marketing plan.

I look forward to helping you discover the full potential and powers of a full formed marketing process for your company.

If you have any questions or comments, please feel free to contact me by e-mail at bfeigenbaum@sympatico.ca.

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Applying Services Marketing within the Equipment Dealers Business Model

Applying Services Marketing within the Equipment Dealers Business Model

Guest writer Ron Wilson offers an instructive guide in this week’s blog post: “Applying Services Marketing within the Equipment Dealers Business Model.”

Marketing plays a critical role within the equipment dealership. Two of the basic functions are to promote the Products and Services for the equipment the dealership sells and services. To successfully accomplish this there are two types of marketing utilized:

  • Product Marketing- focuses on a specific product, features/benefits, comparing one product to another, product application. 
  • Services Marketing– Utilizes marketing strategies that apply customer-centric approaches, builds trust with the customers, and how the dealer’s services can support the customer and the products that were purchased. The offerings will often include benefits, promises, commitments in savings, safety improvements, turn time commitments, and firm pricing. All of which are focused on building trust and relationships.

The remainder of the article will focus on the history and application of Services Marketing.

A Brief Timeline of Key Developments in the History of Services Marketing 

  • 1950s-1960s:  The Services Sector arises as the economies shift from manufacturing to service-oriented markets.
  • 1970s: The 4Ps of marketing were expanded to include People, Physical Evidence, and Processes.
  • 1980s: Growth of Services Marketing Literature grew to academic research and focus services marketing, which included an emphasis on service quality and customer satisfaction.
  • 1990s:  Digital transformation and customer experience evolved due to the internet and digital technologies/
  • 21st Century:  Services marketing continues to advance with the inclusion of data analytics and artificial intelligence with a focus on improving interactions and personalizing of the customer experience.

The formation of Services Marketing has focused on the challenges and addressing opportunities within a unique market.

Apply Services Marketing in the Heavy Equipment Dealers Business Model

Services Marketing applied in the heavy equipment dealer’s business model will contribute to the enhancement of customer satisfaction, customer loyalty, revenue growth, and introduction of new product support offerings.

 

Strategies to Effectively Implement Services Marketing within the Dealers Territory

    • Identify and Understand the Customers’ Needs:
      • Understand the specific needs and preferences of the customers within specific markets. For example, in many cases the needs of the small fleet owner will be different than a large fleet owner, or governmental agencies.
      • Identify the challenges faced by the customers, including frequency and severity of the application.
  • Segmenting and Targeting of the Market:
      • Segment the market based on factors such as fleet size, industry, type/size of machines, local work environments (weather, altitude, job site restrictions)
      • Identify how tailoring the services can assist in meeting the needs of each segment.
    • Develop Value-Added Services:
      • Offer value-added services such as equipment maintenance, machine inspections, mobile air conditioning repairs, field machining services, extended warranties, hydraulic component rebuilds, machine second life rebuild options.
      • Operator and equipment maintenance/repair training for customers.
      • Proactive services connecting machine GPS data to schedule PM services, notifications of machine alerts such as overheats and over speed occurrences focused on preventing down time, improving utilization, and extended the life of the components of the machine while providing touch points with the customer.
    • Communication of the dealer offerings:
      • Clearly communicate the value-added service offering that includes additional benefits and features based on the needs of the customer. These needs would have been collected through customer surveys, focus groups, historical customer response surveys.
      • Utilizing various channels to communicate the offerings through online platforms, brochures, Product Support, Sales Representatives, and Parts Counter Sales personnel are a few examples of communicating the offer to the customer.
    • Build a strong online presence:
      • Establish and continually review and update the user-friendly website.
      • Utilize social media platforms, customer events, community events, local industry trade events that will provide an opportunity to share customer success stories and provide insight to the dealer’s approach of addressing customers business needs.
    • Customer Education and Training:
      • Offer training programs for customers that provide an opportunity to expose and familiarize the customers with the features and benefits of the services provided.
      • Provide educational content, reference materials, and tutorials that empower the customers and enhance their skills.
    • Responsive Customer Support:
      • Implement a responsive customer service process that addresses questions and concerns quickly.
      • Offer multiple channels of communication, including phone, email, and live chat. Quick and accurate responses are important.
      • Utilize the information received to modify and improve the messaging of the services offered.
    • Services Guarantees:
      • Provide service guarantees such as quick response times for maintenance requests, warranty offerings, firm pricing, timely invoicing.
      • Clearly outline the terms and conditions of the service guarantees to avoid confusion both with the customer and within the dealership’s service areas, such as the service department and the warranty department.
  • Feeback Mechanism:
    • Establish a feedback process to gather insights from customers about their experiences with the new service offerings.
    • Utilize the feedback to continually improve and modify the service offerings.
  • Collaborate with the OEM:
    • Partnering with the OEM can enhance the service offerings through program support, technical and historical information of other dealers that may have implemented a similar service offering.
    • Leverage the OEM certifications to build trust and credibility to the dealer’s offering. Fluids Lab certification, Root Cause Failure Analysis Certification, Hydraulic Technician Specialist, Certified Equipment Training Instructors are examples of certifications that can add value to an offering.
  • Promotions and Loyalty Programs:
    • Promotional campaigns will highlight the new service offerings.
    • Implement or link to an existing loyalty program to encourage utilizing the new offering, reward repeat business, bundle with other offerings. All are intended to build long-term partnerships.
  • Networking and Industry Involvement:
    • Participate in industry events, trade shows, and associations to stay updated on industry trends and build a network of contacts.
    • Collaborate with other businesses in the heavy equipment industry to expand the service offerings. An example would expand the hose and fitting business from the customer’s machines to re-hosing of garbage truck fleets as an expanded service offering within the waste/landfill customer base.

The above strategies can effectively assist the dealer apply the services marketing principles to create a competitive advantage and build long-term relationships with the customers.

Closing Remarks

While both services marketing and product marketing share common marketing principles, the unique characteristics of the dealer’s services offerings require different strategies and approaches to meet the marketing needs of the various customers.

Services marketing emphasizes the crucial elements such as customer-centric, variability (among customers), intangible (the tractor business is a people business), relationship building and delivery of exceptional customer experiences.

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Market Share, Sales Participation and Closure

Market Share, Sales Participation and Closure

Guest writer Kurt Pease is back with a blog post on the topic of “sales participation, market share, and closure,” and the ways these elements can be improved upon in your business.

Leadership teams at both the dealer and manufacturer levels dedicate considerable attention to strategizing ways to expand their customer base. The primary objective behind this effort is to increase revenue by attracting a larger number of customers. Stakeholders from both the dealer and manufacturer levels are inclined to invest in companies that consistently demonstrate year-over-year growth in profitability. The term market share is the most used metric to gauge growth. Participating and closing deals are both terms that directly impact market share. Let’s dive deeper into these concepts:

Market Share:

Market share refers to the percentage of total sales within a specific market that a company or product holds. It is an important sales metric that indicates a company’s competitiveness. A higher market share often leads to a larger customer base, increased parts and service needs, and higher dealer revenue. The Association of Equipment Manufacturers (AEM) collects data on new equipment sales from participating original equipment manufacturers (OEMs) to calculate market share. This data is categorized by county, machine type, and horsepower. Market share is determined by dividing new dealer settlements by the aggregate AEM data, typically reported on a monthly, year-to-date (YTD), fiscal year-to-date (FYTD), or rolling 12-month basis. Sales participation and closure directly impact market share.

Sales Participation:

Sales participation measures the engagement of a salesforce with their assigned customer base. The goal is to achieve a 100% participation rate, where every customer provides an opportunity to quote when purchasing equipment. This metric is calculated by the dealer or manufacturer using new dealer settlements and AEM industry data. The formula is:

(New Equipment Settlements + Quoted but Lost) / (Industry Settlements – Dealer Owned Rental Fleet)

“Quoted but lost” refers to quotes entered into the dealership’s customer relationship management (CRM) system, which either result in equipment purchases or are marked as lost customer sales. The dealer-owned rental fleet is excluded from the denominator to focus on sales influenced by the sales process.

Closure Rate:

The closure rate calculates the percentage of deals in which the sales team participates but does not close. Reasons for non-closure can vary, including customer brand preference, machine availability, salesman-customer relationship, and pricing. Price is often cited as a primary reason for non-closure. On average, dealers participate in 50% of opportunities and close approximately 50% of those deals. Multiplying these percentages together gives an estimated dealer market share of 25%. When forecasting an increase in market share, it is important to identify whether the focus will be on increasing participation, closure, or both.

Increasing Sales Participation:

One method for increasing sales participation is to utilize UCC1 data during sales meetings for salesperson coaching and customer engagement. For example, the UCC1 new equipment data can be downloaded into mapping software, which helps visualize customer and machine details. This approach enhances engagement and response from sales teams. Sales meetings provide an opportunity to review past sales details, use the map and data points to identify customers who purchased from a competitor, and check if quotes were generated by the assigned salesperson in the CRM.

Follow-up questions to be asked:

  1. Was the customer identified in the CRM?
  2. How is the customer call frequency classified in your CRM? (A, B, C, D, or E). For example, were they to be called on a weekly, monthly, quarterly, semiannually, or annual basis?
  3. Based on the CRM details, did the salesperson complete call reports based on call frequency?
  4. Did the salespeople participate in the deal?
  5. Why did we lose the sale (closure)? Possible reasons include price, availability, equipment features, and salesperson relationship.

If we participated and lost the deal, at least we earned the right to quote. However, if we did not establish a relationship by not calling on the customer, it presents an opportunity for further investigation. Sales managers can ask key questions based on CRM data to gain insights into customer engagement and sales performance. Understanding the reasons behind lost sales and integrating them into future strategies is crucial for increasing market share. Increasing market share requires actively participating in more deals and closing on those opportunities. Awareness alone is not enough; salespeople must quote to generate market share.

It’s worth noting that customers may not always share the real reason why they did not purchase from your salesperson, making it an imprecise science. Price is often given as the reason for a lost sale. Understanding how sales participation and closure rates are calculated, as well as the underlying data that drives these metrics, is critical for effectively increasing market share.

By understanding the importance of market share and the data that drives this metric, leadership teams can manage their sales teams and lay a sound foundation to generate year-over-year growth in both revenue and profitability.

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Exceed Revenue Goals

Exceed Revenue Goals

Guest writers Debbie Frakes and Steve Clegg are back with a new and relevant blog post this week which covers the topic of how to meet and exceed your revenue goals.

Revenue and transaction trends tell a story about your company. They allow you to recognize sales patterns and understand what activities, processes, and methods lead to consistent business growth. Without this information, you won’t be able to make sound decisions for your company. Tracking and acting on revenue analytics and trends will help you answer the following critical questions: 

  • Who should you target for marketing initiatives? 
  • Which products or services should you focus on? 
  • What customers and prospects should your salespeople spend time contacting?

If you don’t determine the right answers to these questions, then you won’t be able to meet your revenue goals, let alone exceed them. 

How to achieve your revenue goals. 

When it comes to drivers of revenue, two of the most important analytics are the number of transactions and customer retention. They explain exactly what is happening in your business and where you may be falling short. These two revenue analytics go hand in hand, because the longer someone works with you, the more transactions they will make. 

Below is an example of a business whose new customers during the past 12 months make up 51% of their total number of customers. The numbers show how the behavior of these customers changes over time, if they keep working with you. 

Average transactions

Year 1: 3

Year 2: 13

Year 3: 18

Average revenue 

Year 1: $39,099 

Year 2: $154,537 

Year 3: $178,789

These revenue analytics show that the longer a customer works with you, the more valuable they become to your company. For this reason, when it comes to meeting and exceeding your revenue goals, retaining customers over the long term should be a primary focus of your sales and marketing teams. 

Act on revenue trend information. 

Tracking revenue analytics is great, but they won’t do you any good if you don’t actually use the information to your advantage. The area where you can make the largest impact towards meeting and exceeding your revenue goals is by improving customer retention and increasing purchase frequency. Remember, for most companies, the longer someone works with you, the more lucrative they become for you. Here are some methods for boosting your company’s customer retention and purchase frequency: 

  • Regular emails – It’s important to consistently communicate with your customers. We recommend sending several emails a month highlighting the products and services you offer, reminding them to purchase, and establishing yourself as the expert in the industry and their go-to source for assistance. Emails sent out by our partner, Winsby, typically double or triple customer purchase frequency. 
  • Offer targeted suggestions – View your customer purchase data to recognize patterns and anticipate what they may need or when they might be getting low on a product. Then you can send them a message or give them a call that is specific to their current needs. 
  • Use customer satisfaction surveys – Regularly ask for feedback from customers about how they feel about your company and how well you are fulfilling their needs. By conducting customer satisfaction surveys, you’ll find out about problems and have the opportunity to solve them before a customer leaves you. Customer satisfaction surveys conducted by Winsby typically boost retention by 20% – 30%. 
  • Calling prospects to expand your email list – Calling provides new leads and introduces customers to your company. Winsby clients see an average increase of 60% in customers’ purchases when they have been called. 

The effectiveness of Winsby email and calling services. 

Customers receiving Winsby emails typically purchase two to three times more often than customers who don’t receive emails. Here is an example the results that an equipment dealer saw with Winsby emails: 

The Winsby calling program identifies decision makers at the companies you’re targeting and then adds them to the email list. Here are the results for a dealer they work with: 

Understand the types of purchases customers are making. 

In addition to looking at customer retention and number of transactions, you also should be tracking types of purchases. Identifying which products sell the greatest quantities will help you focus your marketing and advertising strategies better. Products that are normally purchased more often will deliver a greater ROI for your marketing campaigns than less popular products would.

Once you determine your most frequently bought products, you can then place greater resources behind them and see a higher return. 

Take full advantage of revenue analytics. 

By understanding which customers produce the most value for your business and which types of products and services result in the most transactions, you can better target your sales and marketing efforts. You’ll reach and exceed your revenue goals if you focus on retaining your current customers and push the products that generate the most money. 

Our partner company, Zintoro, will track these key revenue analytics and many others, as well as provide specific strategies for improving them. Their portal shows you exactly which customers should be called when and which products should be promoted. They are the answer for equipment dealers and other businesses who want to make sense of their numbers and use them to their advantage. 

If you want to understand your revenue analytics and use proven strategies to exceed your revenue goals, contact Zintoro today for a demo. Today many businesses rely on outdated data and backward-looking reports for planning. Zintoro generates greater than 95% accuracy in their 12 month forecasts to see the future and plan versus reacting and continually trying to explain the past. 

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The Little Things Do Matter

The Little Things Do Matter

Learning Without Scars’ new guest writer John Dowling is a United States Marine veteran who has had a successful 25-year career in the Product Support Industry. He started as an equipment mechanic and worked his way up to be a field service mechanic. John was promoted to service manager and eventually to branch manager of a heavy equipment dealership. Then he accepted a position as a field service representative for a major heavy equipment manufacturer. In his last role before entering the recruiting and consulting industries, John was Director of Product Support at a 9-location heavy equipment dealership.  John is also the author of the book Service by the Boxes, a manual on how to run and develop a best-in-class service department. “The Little Things Do Matter” is his debut blog post for us.

Years ago, when I was a Director of Product Support at a dealership we had much success early on, but at one point we plateaued and became complacent. This happens sometimes when success comes too easily or too quickly for an organization. So, I put together a training campaign for my parts and service managers to get back to basics. I was trying to communicate to them that being best-in-class in product support is a game of inches, not yards. Doing the little things right is what matters. I was reminded of this in B.J. Frogg’s book Tiny Habits. Doing the little things right and completing the small tasks drives momentum and creates motivation to continue to push on to do the bigger things. Jesus of Nazareth quoted in Luke 16:10 said “One who is faithful in a very little is also faithful in much.”     

 

Creating habits or processes in the parts and service departments is key to creating and developing a best-in-class dealership. If you’ve been in this industry for any length of time you’ve heard the statement, “The sales department sells the first machine and parts and service sells the rest.”  Which is a true statement. Ironically enough when a dealership is struggling with market share, they never focus on the real driving force. Which is the product support side of the business. Now you can use discretionary money, cut your margins, run a sales campaign, and increase marketing spend to try to recapture market share but all these activities will be short-lived. At some point, the other manufacturers or dealerships will discount their prices more and produce a cleverer marketing slogan or campaign. Eventually, the dealerships are just spending a lot of money and enter the never-ending cycle of who can get to the bottom first.

 

When I say focus on product support, I do not mean that the sales department or executive management blames all the dealership’s shortcomings on parts and service. What is meant here is that to maintain market share and sales revenue you must have a robust and effective parts and service departments. And yes, this means having the right people leading these departments, but being best-in-class is more than having the right people on your product support team. You must have a process, and everybody must know and follow that process.

Now let’s get back to our main point. We must create a culture of building “tiny habits” or doing the little things right. A good well defined documented process ensures that we do the little things right. In my new book Service by the Boxes, I break down the service process into ten individual steps or boxes. At the end of each chapter, we discuss each of the boxes or steps and I give examples and show how being best-in-class at each stage of the work order process is just doing the little things right.

 

What are some of these little things that any dealership can do to drive customer service? Remember customer service will help you maintain your market share. Chick-fil-A dominates the fast-food industry and one of the little things that they do well is saying, “My pleasure.” 

Here is one for the service department. Confirm machine hours and serial numbers on every machine that is dropped off for service. The top two reasons warranty claims are denied or delayed processing are because of incorrect hour readings and incorrect serial numbers. 

Here’s another one for service, open a work order the same day the machine is brought in for service. If you review your RIP (Repairs in Progress) report daily this will ensure that a machine is not lost or forgotten. I have seen service departments cut two to five days from their total repair time just by opening the work order the same day the machine came in.

One more little thing about service. Technicians complete their service report the same day they complete the repairs on the machine and turn it in. All the hard work has been done. If the technician does not do the little thing right and does not turn in a completed service report the same day he completes the repair, he can prolong the “work order life cycle” time, which decreases customer satisfaction and trust in the dealership. Not to mention this has a major negative impact on the dealership’s cash flow. 

 

Now to parts. Pull all in-stock parts. If a part goes on a counter ticket or a work order it should be physically removed from the parts inventory. It should be placed on a will-call shelf or given to the service department. If this little thing does not occur, there is a good possibility the part in question will be sold to another customer. This can prolong a service repair in the shop. This can also negatively affect customer satisfaction of the one who drove an hour to buy the part from you just to discover it was sold to someone else. 

Call the customer when their part does not show up. Parts go on back-order and parts get lost in transit. This happens every day. The dealerships have zero control over it, but if we can control the narrative, we can still be best-in-class. How, you ask? We call the customer before they call us. If the customer calls us to ask about their part that did not show up, they lose trust in us, they will doubt we have their best interest at heart. If we call the customer first, let them know that the part did not show up, and inform them what is being done to rectify the situation; the customer will not lose trust in us and will perceive this as great customer service. Oddly enough, the situation is exactly the same. We might even gain additional trust from them. The customers still will not be happy, but they will not be upset with us. They will know that we are working hard for them to resolve the problem of the lost part.

 

Being best-in-class and delivering great customer service is not about doing the big and remarkable things but about doing the unimportant things. Creating a culture of “tiny habits” by developing a well-documented process that ensures the little things are being accomplished will drive your success. Not to mention increasing your bottom line. 

 

LWS Note: John’s Book is something that should be read by everyone.

 

Service by the Boxes.

 

Want to take your service department to the next level? This book provides a practical approach to service management, addressing real-world issues that dealerships face every day. With its clear and concise best-in-class practices, Service by the Boxes empowers you to drive success in your service department from day one. Increase customer satisfaction and market share with the principles in this must-read book.

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Start Your Day

Start Your Day

Our founder Ron Slee waxes nostalgic and vulnerable in his blog post this week. “Start Your Day” isn’t just a look back over six decades of a career, though, it sings the praises of all of the productive habits and accomplishments you can reach when you are an early riser.

Start Your Day

Over the course of my work life, now spanning sixty years, I have always been an early riser. That still seems strange to me in that one of the things I did to pay my way through university was to play the piano in a bar. I finished typically at 4:00 AM. I was still on the ski hill at 9:00 AM with a group of students. 

 

I started work in this industry in 1969. Pretty soon thereafter I was travelling two weeks a month, sometimes more. Being in my early twenties it never bothered me. I thought it was exciting. It was the time of James Bond and so I ate alone a lot. I always had a book to keep me company. Then I got married and suddenly, I was a nervous flyer and didn’t want to travel. That became significantly more difficult when I became a parent. I didn’t want to leave home at all. That came crushing down on me after Marlene and Caroline had dropped me off at the airport and Caroline asked Marlene if she had done something wrong that I was leaving. That gets you.

 

Travel has been a large part of my life. I have travelled over eight million miles on airplanes. Believe me when I say that is not a badge of honor. To make it more interesting it was all over the world. That means I had to deal with time zones a lot. My doctor collaborated with me in that he had me on a three-step regimen. We started over the counter and escalated from there depending on how many days it had been without sleep. Remember I was teaching two-day classes that typically ran for ten hours and then involved dinner with the students. I can’t tell a lie. I love teaching, I always have.

But in the past few years I have travelled significantly less. But my timetable is still pretty much the same. I wake up between 4:00 AM and 5:00 AM and I am typically sitting at the computer shortly thereafter. You know the routine. Read your email, respond to various issues, and other things that take you away from a normal routine start to your day. 

Then I read an article that changed that routine for me. Since then, things are different here. I have a series of things I must do BEFORE sitting at the computer. The article was by Perri Blumberg, and it definitely got my attention. Her recommendations, as with most things, are very straightforward and tend to be simple things. 

  1. Wear a variation of the same thing every day. Think Steve Jobs. Well, I did that. I had a Brown set of clothing and a grey set. A blazer, pants, neutral shirts, and shoes. I would come home on a Thursday or Friday and unpack and pack. From one color to the other.
  2. Before you get out of bed, set yourself up for a cheerful outlook. Think about everything you are going to accomplish today.
  3. Drink WATER. Hydrate yourself. You have been lying in bed all night and your body has been consuming the water you have stored in your body. It needs a fill-up.
  4. Then I move away from what Perri suggests, block out time for a high impact task. I moved to Nir Eyal, a Behavioral Scientist who teaches at Harvard for guidance. His book titled ‘Indistractable’ changed how I do my work. I have always been a “ToDo” List guy. Now I schedule my day with “Blocks”of time. It reduces the amount of stress in my day. I don’t have to finish something. I allocate specific blocks of time to things and when the alarm goes off signifying that that block of time is finished, I move on to the next time block. Imagine working one way for sixty years and finding a better way for me. I am profoundly grateful to this man.

Habits are hard to break so this morning routine is still a work in process. I do wear a variation of the same clothing now every day. I do lie back and look at the ceiling or the clouds in the sky and think of the good things I will get done. I am having trouble with the water thing. I still want my morning coffee or tea, but I am working on it. The time blocks have made an incredible difference, not just in my work but in my life.

I have given myself permission to think about my life with more focus as I get older. I wish I had started this exercise earlier in my life. Do you spend time thinking about your life? You should.

The Time is Now.

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Navigating the complexities of the truck driver shortage

Navigating the complexities of the truck driver shortage

Bob Rutherford is a 50-year veteran of the trucking industry. Thirty of those years were as a member of the TMC where he earned both the Silver Spark Plug and Recognized Associate awards for his contributions to the industry. He is also an Ambassador for the EnergyandMobility.org Conference. Today he shares a paper by John E. Dorer, “Navigating the complexities of the truck driver shortage.”

The powerful brand of CCJ reaches 96,500 subscribers within the freight transport business. Many of these are the fleet executives and managers that have the buying power to grow your business. This multi-channel brand allows for repeated impressions in effective formats.

Navigating the complexities of the truck driver shortage

A Paper by John E. Dorer

Courtesy of Bob Rutherford of CCJ.

The trucking industry, an essential backbone of the U.S. economy, faces an ongoing critical challenge: a significant shortage of drivers.

This shortage — 60,000 as estimated by the American Trucking Associations — is not just a transient issue. It has profound implications on the supply chain, affecting everything from the availability of everyday consumer goods to the stability of national economic growth.

The industry, alongside government entities, is implementing or exploring a variety of strategies to fill the gap, from recruiting a more diverse range of employees and offering specialized training to technological advancements such as autonomous trucks and government policy changes like more flexible hours of service.

Why the shortage?

The trucking industry’s labor challenge is multifaceted, stemming from a combination of demographic, economic and regulatory factors.

Aging workforce
One of the primary reasons for the driver shortage is the aging demographic of current drivers. Many are nearing retirement age, and there aren’t enough younger drivers entering the profession to replace them. At 46, according to the American Trucking Associations, or as high as 60 in CCJ’s 2023 “What Drivers Want” survey, the average age of a commercial truck driver in the U.S. is significantly higher than that of the overall workforce, 42, indicating a generational gap in the industry.

Challenges in attracting younger drivers
A variety of factors have made it a challenge for the industry to attract younger drivers. The demanding nature of the job, long hours away from home, and the perception of truck driving as a less desirable career path contribute to the issue. Moreover, federal regulations require commercial truck drivers to be at least 21 years old to drive interstate, which limits the pool of younger drivers who can enter the field immediately after high school.

Impact of COVID-19
The COVID-19 pandemic had a significant impact on the trucking industry. Many drivers were laid off or chose to leave due to health concerns or to care for family members. The pandemic also disrupted training and licensing processes, creating a backlog of new drivers trying to enter the industry.

Regulatory changes and implications
Over the years, regulatory changes have also affected the trucking industry. Hours-of-service regulations, designed to ensure drivers get adequate rest, also limit the number of hours a driver can work, impacting earnings and job appeal. Compliance with these and other regulations like the electronic logging device mandate add to the operational complexities for drivers and companies.

Economic factors
Economic factors play a significant role in the labor shortage. While truck driving can be lucrative, the pay structure (often based on miles driven or hours worked) and the lack of regular home time can be deterrents. The rising cost of living and stagnant wages in certain segments of the industry also contribute to the difficulty in attracting and retaining drivers.

Impact of the shortage

The truck driver shortage has wide-reaching implications that affect not just the industry, but the entire supply chain and U.S. economy.

Supply chain disruptions
The shortage directly affects the efficiency of the supply chain. With fewer drivers available, there’s a delay in the transportation of goods. This leads to longer delivery times and can cause shortages of products in various sectors, from retail to manufacturing. The just-in-time delivery model, which many businesses rely on, is particularly vulnerable to such disruptions.

Increased costs for consumers
The inefficiencies in the supply chain inevitably lead to increased costs, which are often passed on to consumers. The shortage of drivers can lead to higher shipping rates, and these increased costs can result in higher prices for goods. This inflationary effect can have a significant impact on consumer spending and the overall economy.

Challenges for trucking companies
Trucking companies are under immense pressure due to the driver shortage. They face increased operational costs, including higher wages to attract drivers, costs associated with driver turnover, and investments in recruitment and training. The competition for qualified drivers can also be intense, leading to a bidding war between companies.

Economic impact
Disruptions in trucking reverberate throughout the U.S. economic system. The driver shortage can hamper economic growth, affecting industries that rely on trucking for transportation of raw materials and finished products. It also impacts the labor market, with ripple effects in related sectors like logistics, warehousing and distribution.

Responses and solutions:

Recruitment strategies
Trucking companies are intensifying efforts to attract a diverse range of candidates, including younger individuals, retirees from other fields, military veterans and foreign nationals. These campaigns often highlight the benefits of truck driving, such as competitive pay, the opportunity for travel and, for immigrants, the chance at permanent residency and stable work in America. 

Training and licensing
Specialized training programs are being offered to efficiently prepare new drivers. There is also advocacy for lowering the interstate commercial driving age to 18 to expand the potential driver pool.

Technological innovations
Technological advancements, including the development of autonomous trucks, are seen as a long-term solution to the labor shortage. Meanwhile, improvements in truck technology are making the profession more attractive and less physically demanding.

Policy changes
Revising regulations, such as hours-of-service, and providing funding for training initiatives are ways the government is contributing. Furthermore, improving the efficiency of utilizing immigration programs, which allow skilled and unskilled workers, including truck drivers, to immigrate to the U.S., would benefit the industry.

A complex web of challenges makes potential solutions to the commercial truck driver shortage equally complex. Trucking companies and government agencies must be just as diverse in strategies to put more drivers on the road, ensuring stability in the supply chain and economy.

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My Journey of Career Growth

My Journey of Career Growth

Learning Without Scars is pleased to introduce our new guest writer, Kurt Pease. He was born on June 8th, 1961, in Portage, Wisconsin. He grew up in Whitewater, Wisconsin, in a family where his father worked as a university professor and his mother was a speech pathologist. From an early age, Kurt was instilled with a strong work ethic that would shape his future endeavors. His writing focuses this week upon those endeavors in, “My Journey of Career Growth.”

After completing his education, Kurt graduated from UW Whitewater in 1983 with a BA in marketing. He embarked on a successful career spanning several industries, where he held various management positions and achieved notable accomplishments.

In 1985, Kurt joined Sherwood Medical in Chula Vista, California, and later in Tijuana, Mexico. As a Master Scheduler and Production Planner, he was responsible for material, production, and sterilization control. During his tenure, Kurt designed and computerized the Production Plan, leading to increased efficiency and reduced backorders by 200% while maintaining low inventory levels. He also played a key role in implementing MRP software.

In 1987, Kurt joined Interactor America in Elkhorn, Wisconsin, as the National Sales Manager. In this role, he oversaw aftermarket sales and marketing activities, including dealer development and profit and loss accountability. Kurt successfully created a nationwide dealer organization and significantly increased potential income to $25 million through targeted dealer benefits. Additionally, he spearheaded the establishment of a $5.5 million wholesale market, representing 20% of corporate sales.

In 1993, Kurt joined John Deere Construction Equipment Company in Moline, Illinois, where he remained until 2017. He held various positions of increasing responsibility, including Territory Sales Manager, Sales and Marketing Manager, and Product Manager. As a Territory Sales Manager, Kurt promoted the sale of products and services to dealer/channel partners in the western United States. He excelled in building relationships and resolving issues between channel partners and the company. In his role as Sales and Marketing Manager, Kurt achieved outstanding results, with annual sales exceeding $80 million and independent distributor sales totaling $20 million. He also assumed the position of Product Manager, where he initiated a start-up program through the Deere dealer channel, overseeing new product development, inventory management, and advertising and promotion.

From 2017 to 2019, Kurt worked at John Deere Financial in Johnston, Iowa, as a Regional Finance Manager. He trained and coached finance managers to improve sales performance and increase market share. Kurt also developed effective channel partner relationships and supervised a team of six employees.

Most recently, from 2019 to 2022, Kurt served as the Director of Customer Support at 4Rivers Equipment, a John Deere and Hitachi dealer, located in Greeley, Colorado. In this role, he led the agricultural and construction organizations’ product support business efforts, aligning with financial and operational objectives to maximize profitability. Kurt excelled in attracting, retaining, and effectively engaging department personnel.

Throughout his career, Kurt Pease has achieved numerous accomplishments, including coaching, and motivating the largest dealer territory to maximize market share, creating replacement component programs and independent dealer organizations, and driving significant sales growth. His leadership, strategic thinking, and ability to build strong relationships have been instrumental in his success.

Currently, Kurt is semi-retired working for a local medical school. In his free time, he enjoys fly fishing in the rivers of the Colorado front range.

My Journey of Career Growth: Cultivating Relationships and Embracing Opportunities

In the journey of my career, there were pivotal moments that shaped my trajectory, often propelled by cultivating relationships and embracing opportunities outside my comfort zone. These two elements, although requiring effort and personal commitment, had a profound impact on my growth and success.

Building Meaningful Relationships

Building meaningful relationships is the cornerstone of any successful career. Whether it’s with colleagues, mentors, or industry peers, the connections we foster can open doors, provide valuable insights, and offer support during both triumphs and challenges. It is often surprising how these connections can come from individuals we least expect. Throughout my career, I have found that every position change or promotion was a result of a relationship that had been previously cultivated. My resume was rarely the deciding factor; rather, it was the bonds I had formed with others. People do business with people, and they prefer to work with individuals they have developed a relationship with. We naturally gravitate towards those who share common bonds and experiences.

During my college years, I worked as a night auditor at a popular resort. It was a wonderful job that allowed me uninterrupted study time once I completed my bookkeeping duties. It was during this time that I met Joe, a German sales and marketing executive at Interactor, a construction component manufacturer. Every night, Joe and I engaged in conversations that lasted for hours. From him, I learned invaluable insights about working for a multinational company, knowledge that college didn’t provide. Joe sensed my eagerness to learn, and even though we lost touch after I graduated, he tracked me down several years later in Tijuana, Mexico, and offered me a role as a Customer Service Manager working with companies like JI Case and John Deere. This opportunity became my foothold in the construction equipment industry. From there, my career flourished, moving from one company to another, consulting at John Deere, and eventually leading to a long and fulfilling career in that industry.

As I progressed in my career at John Deere, from Product Manager to Sales and Finance Regional Manager, I discovered the importance of reciprocity in relationships. By offering support, sharing insights, and actively engaging with others, I not only strengthened my professional network but also cultivated a sense of camaraderie and collaboration that proved invaluable in achieving common goals.

Embracing Uncomfortable Opportunities

Embracing uncomfortable opportunities has also been instrumental in my professional growth. Stepping outside of my comfort zone allowed me to learn and advance in ways that familiarity cannot offer. While the familiar may offer security, it’s often the unfamiliar territory that presents the greatest opportunities for growth. After completing my undergraduate degree in the Midwest, I decided to explore life outside of my comfort zone. My sister had landed in San Diego, and she offered me a place to live while I sought out my first post-college job. It was 1983, and the job market was tough. I was pushing out resumes with little success until a HR manager called me for an interview in southern San Diego. To my surprise, the company was looking for a Master Scheduler for a Maquiladora in Tijuana, Mexico—a role that required scheduling a factory that produced medical disposables. I knew nothing about factory scheduling, nor working in a foreign county, but I spent hours with the Plant Manager, who patiently taught me the ropes. Despite my initial apprehension, this experience taught me how to work in a plant environment where Spanish was the primary language spoken. It was a leap that bolstered my confidence and broadened my horizons. I grew up during those two years, crossing the US-Mexico border every day.

Taking calculated risks has also been a defining factor in my career progression. Whether it was pursuing a new role, exploring a different industry, or spearheading innovative initiatives, embracing change and uncertainty allowed me to seize opportunities for growth and advancement that I might have otherwise overlooked.

The Intersection of Relationships and Risk-Taking

What I have come to realize is that the most significant leaps in my career have often occurred at the intersection of cultivating relationships and taking calculated risks. The synergy between these two elements has propelled me forward in my professional journey. Leveraging connections to explore new opportunities and drawing on support networks to navigate unfamiliar terrain has been transformative. The trust and rapport built through meaningful relationships have served as a catalyst for venturing into uncharted territory with confidence and support. Knowing that I have a network of mentors, colleagues, and allies cheering me on has emboldened me to embrace uncertainty, seize opportunities, and continue evolving as a professional.

Conclusion

In retirement, I have decided to venture beyond my comfort zone by working at a local medical campus. Stepping into the realm of education and mentoring, I am ready to share my wisdom and experiences with aspiring medical professionals. Working at a medical campus will not only challenge me intellectually, but it will also allow me to connect with the next generation of doctors, nurses, and healthcare professionals. It is a chance to inspire and guide these eager minds as they take their first steps towards making a difference in the world of medicine. Although this new journey might be unfamiliar and require adaptation, I am excited to embrace the challenges and enrich my retirement years with meaningful engagement and the satisfaction of nurturing future healthcare leaders.

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What is Cultural Dilution and How to Avoid It

What is Cultural Dilution and How to Avoid It

Guest writer Jay Lucas highlights some of the risks of rapid corporate growth in, “What is Cultural Dilution and How to Avoid It.”

We’ve all heard the expression, “too much of a good thing ain’t always good.”  Can this really be true when it comes to corporate growth? Can too much growth be a bad thing? Not only does rapid growth put strain on systems and processes, but it can also have an impact on the very thing that is often central to a company’s success, its culture.

Definitions

  • One definition of culture is, “The set of predominating attitudes and behavior that characterize a group or organization.” 
  • Dilution also has a couple of definitions, “1) The process of making weaker or less concentrated. 2) A dilute or weakened condition.
  • Cultural Dilution then can be defined as making predominating attitudes and behavior that characterize a group weaker or less concentrated.

I coined the term “cultural dilution” over a decade ago to describe the effect rapid growth can have on a culture. We’ve been fortunate to have worked with numerous clients experiencing significant growth. In our observation, the challenge hardest for them to manage has been the impact that growth has on culture. Does this mean that a company must put a governor on growth to protect its culture? Or does it mean that it must sacrifice its culture to achieve its growth objectives? The idea that it is one or the other is a false dichotomy. Below are a few suggestions to help protect the culture of a team or organization during times of rapid growth.

Purpose

Clearly define and live the vision, mission, and values. Sounds easy, but the truth is many companies have them but fail to use them when solving problems, hiring, terminating, selecting clients, among others. These are not simply platitudes that adorn the halls and walls of a company or its website. Vision, mission, and values are the foundation and without them no company can withstand the stresses, good or bad, that it will certainly face.

Planning

Commit to long and short-range planning. Long range planning allows for greater vision and is a moving target. The plan should allow anyone at any point in time to stop and lift their head from their immediate task and remember why they are doing what they are doing. Having said that, it has been said that Vision without execution is hallucination. Therefore, short-range planning is also important. The long-range plan is the elephant. The short-range plan is how you make eating the elephant one bite-at-a-time possible. The company should have a regular cadence for re-establishing or creating new objectives. We suggest quarterly. Annual is not frequent enough, and monthly is too frequent.

Systems

Don’t wait to scale until the machine begins to fail. The best way to conduct preventative maintenance is through regular review of your key performance indicators. If KPIs are suffering, then the people, process and/or systems likely need some maintenance. This often comes in the form of re-configured or implemented technologies, training & development, (re-)development of policies, procedures, and even KPIs. We have learned that a balanced scorecard approach to planning helps ensure that goals in one area of the business don’t sacrifice goals or objectives in another. Competing objectives or goals is symptomatic of organizational misalignment.

People

I can’t emphasize this one enough. There are no sacred cows! It makes no difference who the person is. If they are undermining the vision, mission, and values they must get on board, or they must go. Teams and organizations must not allow tenured and even founding members to hold the company hostage as they resist necessary change. As employees are added to keep up with growth, oftentimes legacy employees resist the fresh perspective of new staff. Phrases like, ‘this is not how we do things,’ or ‘this is the way we’ve always done it’ are the kiss of death. If these resistors are allowed to stay, regardless of their inability to evolve, then you have a sacred cow.

Communication

Communication is critical. This can’t be emphasized enough. Great leaders must reinforce the vision, mission, and values of the organization. Additionally, they must ensure that everyone knows their purpose and position on the team and its importance to achieving the objectives. Change is hard but getting buy-in and frequently communicating the “why” behind the “what” is critical when managing rapid growth.

Flexibility

Cultures are living organisms. They must be given room to grow and evolve. The only aspect of the business that should remain constant is the vision, mission, and core values. Pardon the expression, but we’ve all heard the phrase, “there is more than one way to skin a cat.” There are many paths to the destination. Make sure not to hold too tightly to the past. Inflexibility will suffocate the change necessary to stay relevant and alive.

If you are experiencing rapid growth and the resulting cultural challenges, we hope this article is a benefit to you. If you need help augmenting your hiring process, we can help. Our proven process, world-class recruiting tech stack, and our seasoned recruiters are an ideal blend of resources to improve any recruiting process.

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