Management vs. Leadership #MondayBlogs

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Management vs. leadership is a topic that comes up in many of the programs I teach.  It is often easy to miss the difference.  When we are managers, we see ourselves as managers of people.

You manage processes, not people.

You lead people.

It is not enough to manage the process: you must have clearly defined goals and procedures that everyone has agreed upon.  The days of the “invisible” employee should be behind us.

Remember Patrick Lencioni’s 3 signs of a miserable job –

  • anonymity
  • irrelevance
  • immeasurability

None of your employees need to be anonymous in your workplace.  We spend so much time at work, we all know each other quite well.  The same applies to irrelevance – with a leader in place who has sought and received feedback, each staff member has a voice and is entirely relevant to the work at hand and the future success of the department and company.

Immeasurability.

How do your employees know when they are doing a good job?  It’s important to ask this question, as both praise and constructive criticism play a key role.

Just some food for thought for you this evening.

The time is now.

Parts Management Webinars

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Our webinar learning series begins next week, with our Parts Management webinars on TeleSelling, Basic Inventory Control, Warehousing, and Pricing.

Our one-of-a-kind conference format for webinars enables you to have an interactive learning experience, without any of the travel.

This program is designed for all of the management and support staff in your parts department.

Please visit https://learningwithoutscars.org/webinars/parts-management/ to reserve your space today.

The time is now.

Thought for the Day: Capital Goods Industry Management

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Continuing with the philosophical, I want to share with you one of the approaches that I used when I was in a leadership position as an employee.  One thing I teach – and this does not just apply to Capital Goods Industry Management, but to management in every industry – is that we manage process.  We lead people.  Obviously, I was very engaged with my team.  Here is one of my standard approaches.

 

  1. What do I do that you like and you want me to continue doing?

 

  1. What do I do that you don’t like  and you want me to stop doing?

 

  1. What do I do that doesn’t really matter to you?

 

The responses to these questions allowed me to have a clear view of what my team thought was important.

 

The time is now…

A thank you for the AED

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Today I had the opportunity to read December’s issue of CED magazine.  This is the last month I will be a contributing writer to the magazine, and I am touched and thankful for the tribute the Associated Equipment Distributors wrote in their magazine.  We have had a wonderful professional relationship over these many years, and I wish you the best in your new endeavors.

 

December 2014_AED Article

 

The time is now…

 

Parts Management – Purchasing & Expediting

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The part you DON’T have in stock is what sets you apart from the competition.

This Tuesday, December 2, 2014 at 12:00 p.m. PST, Learning Without Scars will be presenting a one hour webinar on Purchasing & Expediting for your parts business.

  • learn about expediting with a purpose
  • Rule #1: before going home, every part must be either supplied or located to be supplied to the customer
  • Purchasing – what to do when your supply chain doesn’t have the part you need

This webinar will give a fresh perspective, and fresh methods, for providing parts to customers and mechanics on the same day they need them.  These solutions will make your Parts Business stand above the rest in your field.

Before you go home every night, remember Rule #1.

To register for this webinar, please follow the link: https://learningwithoutscars.org/webinars/parts-management/purchasing-expediting/

The time is now…

Parts Management – Instore Merchandising

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How can we create a successful and interesting retail store in our Parts Businesses?

Next week, on December 2, 2014 at 9:00 a.m. PST you can find out in a one hour webinar from Learning Without Scars.

You will learn:

– how our walk-in business has changed over the years

– other examples of successful merchandising from companies like Harley Davidson, Ski Doo, and Arctic Cat

– what an appealing layout looks like

– how to keep your retail area fresh and vital

– how to increase revenues through the instore merchandise available to walk-in customers

Our retail space is an often overlooked area in our Parts Businesses.  By merchandising our brand, we can drive traffic back into the Parts Business, and improve our visibility among our customer base while expanding that base.

Please sign up to join us for this informative session by using the following link:

https://learningwithoutscars.org/webinars/parts-management/instore-merchandising/

 

The time is now…

Roles, Responsibilities, & Expectations – Parts & Service Management

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It is more than job descriptions and standards of performance

Management gurus and management theory changes like the wind. From Peter Townsend to Peter Drucker to Porras and Collins and Lencioni and many more. It is much more than a cottage Industry it is a full blown educational and consultative foundation. We have gone through multiple iterations of significant things we MUST do.

We must have job descriptions and then we have to have standards of performance for each job function. That was a starting point way back when. Then we got into vision and mission statements and other buzz words. Or how about Total Quality Movement and Continuous Quality Improvement. Now let’s not forget Six Sigma and all of us needing to become “black belts.” Oh and now we have “Lean Management.” In the midst of this we have the Balanced Scorecard and Activity Based Management. Don’t get me wrong. There are a lot of benefits to each of these various “movements.” It is not just a series of passing fads. After all I grew up with Industrial Engineering. At the AED we have the Product Support series. The Handbook. The Opportunities Handbook and the Best Practices Handbook. It is a cookie cutter solution to all of our problems that we are looking for in all of these theories and from each of these guru’s. Would that it were that simple.

But let’s take a breath here and get back to some basics. There is a terrific new book out there from the Chairman of Koch Industries, called the largest private company in the world. In it one of the subjects broached is roles, responsibilities and expectations. I think that this is an extremely important book and it contains a series of good pieces of advice to contemplate.

The roles of the individuals in the parts department and the service department and the product support sales department. What are those roles? What do the employees think those roles are? How about their responsibilities? I believe this is important. Do each of the employees have a clear understanding of that which they are expected to be doing within the company? No, not their job descriptions what is their role? Or have they got to the place that they know what the process is and they repeat it as often as is necessary. This is the curse of our American business structure. We teach you how to do the job and then expect you to do it over and over again until you get really good at it. The Asians with Kaizen have a much better approach; Do the job better each and every day. Do the employees invest their intellectual capital in improving their jobs? Or do they find out how to do the job and then just keep on keeping on? This is a symptom I find in a lot of dealerships. People are doing what they are told to do and working in the business. They are not working ON the business. Do you understand the distinction there?

I believe that the employee who is doing the job knows how to do the job better than anyone else. Particularly better than the boss. So with the arrival of summer I thought it would be good to have each of us read this book on holiday. And then to ask how we can improve our daily lives by doing our jobs more effectively, more with the customer in mind, and more with making ourselves live fulfilling lives. Don’t forget In Search of Dignity by R.C. Sproul either. He reminds us that everyone wants to feel they have made a difference in their lives.

That brings us finally to expectations. What are the expectations that the employee has for their job? What are the expectations that the company has for each employee? This is much more than job descriptions and standards of performance. It becomes almost a “what do you want to be when you grow up” question. Those of you that are still reading might think this is too soft a subject but expectations are hard things. The struggle to attract and retain talented employees is all about expectations. Keeping employees happy keeps customers happy and makes money for the owners. This is not easy stuff.

So there is your vacation reading. The Science of Success by Charles Koch of Koch Industries in Wichita, Kansas. A great read and it is full of excellent points for your consideration and implementation.

Happy reading.

The Time is NOW…

Parts Management – Customer Service

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What Drives Good Customer Service

Attracting, developing, sustaining, and retaining customers is the key to profitability.

In the world of customer service, we seem to be saying one thing and doing something different. We don’t walk our talk. But we are not alone as a group of service providers who are interested in what our customers need and want. This has become an epidemic in industries worldwide.

Microsoft commissioned a major survey back in 2007 as well. Its conclusion was that the number one business issue for service providers was “customer relationships.”

The survey noted: “They value innovations that support improvement in the customer experience, and they paint a picture of corporate cultures that prioritize customers.”

The survey conclusion also asked, “Why is it that their actions don’t support this belief?”

This is a similar conclusion that I reach in my consulting business. When intellectually we know what needs to be done, why is it we just don’t get it done?

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This might be a cute comment, were it not so serious. The world has clearly changed. Products are much more capable and technology is definitely influencing how they can be used. The opportunities for clients to obtain products and services from a variety of suppliers have never been so numerous. How will we defend ourselves and protect our customers from competition?

We have a serious need to provide much better training, technology, and tools to our employees, especially the ones we charge with the responsibility of satisfying customers in the parts and service groups. Without good system information, these critical employees are dead in the water.

And so far, we haven’t provided them with much good information. Many times the first question we have to ask the customer in parts support or service inquiries is, “Who are you?”

How friendly is that opening for a discussion with a potential consumer? Does it bolster a “customer relationship”? I think not. Go back to the conclusion from the Microsoft survey and note the “innovations that support improvement in the customer experience.” What have you done over the past year to enhance the customer experience in your business? More importantly, what are you planning now?

My suspicion is there was nothing in the plan last year and this is not a subject included in many of your businesses’ annual planning cycles. You know that process, don’t you?When you set budgets and create forecasts. This planning cycle needs to be focused on the customer experience, not only on your profit and loss. Companies that focus inwardly are destined to fail. It is the company that focuses on keeping their customers happy that will succeed.

Let’s look at the top focuses of the companies surveyed in the Microsoft survey.

It is very clear and straightforward to me, and I am sure to you as well. The view of the market in 2009 is cloudy and mixed at best. We might have a somewhat brighter outlook based on the more environmentally sensitive mood in the country, but the economic outlook is much more difficult than at any other time in my experience.

Yet I know that parts and service business opportunities will increase. I also know that you know your opportunity to increase business in the parts and service area is huge. But I also think it is clear you either don’t know what to do or don’t want to do it. That is a difficult position to be in, isn’t it? The customer expects us to provide leadership to them. They expect us to provide the support they require for their needs.

So do yourself and your customers a favor and ask what they want you to do for them. Don’t be shy. They will willingly tell you what it is they want and need. But be careful. If you ask and they tell you, then you will have to act. If you don’t act, you will be in more trouble than if you hadn’t asked at all.

Last month we looked at your most valuable service attribute as a business—your employees. This month we’ve looked at retaining your customers, the people who provide everything in your life.

Are you ready for the challenge? The market, your employees, and your customers wait for your answer.

Service Management Webinars – 10/22/14

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A quick update for our readers:

Tomorrow we offer two Service Management webinars!

10/22/14 9:00 a.m. PST – Labor Rates

10/22/14 12:00 p.m. PST – Service Organization

These webinars offer a streamlined, convenient, transmission of information to managers, supervisors, and staff within the Service Department across the Capital Goods industry.

Please visit www.learningwithoutscars.org to register for your webinar spot for tomorrow!

We look forward to “seeing” you online.

The time is now…

Confessions of a Service Manager ~ Bill Pyles

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We are introducing a new area for our blog. We are asking experienced Industry professionals to write on a subject that they think would be of interest to our followers.

Today, I am introducing Bill Pyles. Bill has 40 plus years in the OEM product support arena.

He worked for Caterpillar, Komatsu and John Deere dealers in various locations across the USA.

He has worked most, if not all, positions in Product Support from technician to Executive.

He still is actively engaged in the business and still thoroughly enjoys being a part of the equipment industry and looks forward to every new day.

Bill has been married for 42 years to his wife, Diana, and has two sons that are currently working in the OEM dealer world, one with a Cat dealer and one with a Deere dealer.  He is also fortunate enough to have five grandchildren.

Bill is also a U.S. Marine Corps veteran. Semper Fi.

I hope you enjoy, as I do, reading Bill’s thinking on a wide range of subjects over the weeks and months ahead. Welcome, Bill.

The Time is Now…

Confessions of a Service Manager

I’ve been working in Product Support most of my life.  Most of those 30 years have been primarily focused on service department product support.  I spent time as a shop mechanic, field mechanic, shop foreman and service manager.  I learned a lot during those years.  I learned:

  • How to move labor and material around on a work order to make the times look good.
  • How to avoid any lost time by charging time to sales, rentals, and used equipment.
  • How to handle warranties by sending a less-than-qualified mechanic because “it’s warranty” and it would be “good” training: and what the hell, the manufacturer is paying for it.
  • That if the boss’s hot button was “reduce training” or “reduce expenses,” you simply moved that time to building maintenance or repair of shop tools.  If expenses were high, you shifted them to cost of sales.
  • The importance of taking care of my customers first by letting the sales department wait and wait and wait.
  • That a two-week backlog was good: hey, three weeks was better.  Keeping this backlog ensured I would make my numbers for the month.  The customer would wait.
  • That you never sent work to another branch or even asked if another shop was slow.
  • That if I had a big job, I never called another store for help to take care of other jobs.  Remember the “backlog.”
  • There was never enough time in the day, so when vendors delivered oxygen and acetylene bottles, bolts, nuts, shop supplies there was no need to check the delivery before signing the delivery ticket.  Nothing ever “falls off the back of the truck.”
  • That sales, rental or used equipment never received any warranty on shop or field repairs.  Remember the “budget.”
  • How to sandbag monthly sales.  If we meet budget this month, hold off any more billing until next month.  I have a budget to make then, too.
  • Never to call a customer for additional work a machine needed, while the machine was down.  He’d yell at me if I suggested additional work needed to be done.  It was always easier to say nothing and if the machine failed after it left the shop, he’d call me.
  • If a machine was coming in for a final drive repair, I’d order ever nut, bolt and gear and air freight them in.  I might need them and if I don’t, the parts department will just put them back on the shelf.  No big deal.

During those times, life was good.  My numbers looked good.  I had a backlog, and the boss was off my back.

Then I became a Manager.

Then I became a General Service Manager and was included in management meetings I never knew existed.  I discovered there were other departments challenged to be efficient and profitable – just like me – and unless all departments worked together, it would not happen.

  • It took a little while, but I began to realize why the sales manager was not always so willing to let me have a loaner for a service job I screwed up.  Those labor hours I was writing off to sales, rental and used were actually showing up on his P&L!
  • Those new, used and rental machines were expensive assets that I kept putting to the back of the schedule so I could take care of my customers.  I didn’t know the company was missing opportunities and thousands of dollars because we had no machines to rent or sell.
  • I learned warranty training was expensive.  Those dollars actually came back in the form of warranty expense.  You mean the manufacturer didn’t pay for 10 hours of labor to replace a fuel filter?
  • I discovered the time I invested swapping labor and material around did nothing for the actual bottom line.  What?  I spent hours doing that!
  • I learned a backlog was good but a satisfied customer was better.  I’d visit customers and ask why he sent a machine to another company.  Usually the answer was “Bill, you guys do good work and I don’t mind even paying a little more for good work, but I can’t wait three or four weeks every time my machine goes into the shop.”
  • So I learned to work the overtime when required.  I learned to ask other shops for help and sometimes I even suggested the customer send the machine to another branch that could get him in and out the quickest.  SOmetimes I even offered to pay the additional hauling to get him there!
  • I learned things do “fall off the back of a truck.”  Have you ever been offered a deal too good to be true?  Hey, it fell off the back of a truck.  I went through an audit after the company decided to change oxygen and acetylene vendors.  The vendor came in and did an audit on all the bottles we rented over the years.  We could not come up with $6,500 worth of rented bottles.  They must be lying all over America’s highways.
  • I learned if I didn’t contact a customer for needed additional work, the machine would leave the shop (“Hey, I did what he asked!”) and would fail soon after – on the job.  The first thing I’d hear would be, “It just left your %#@*&% SHOP!” – and I should have called him and fixed it then.
  • I learned that the boatload of parts I ordered for the final drive repair and returned to parts created a lot of expense.  No one told me there were shipping and emergency charges, and we didn’t stock the part because there was no demand.  I learned those expenses were showing up on the parts manager’s P&L.
  • I found out someone had to take the time to do the parts entry, place the order, receive it into inventory, carry it to the shop, pick it up after I returned it and create another return ticket.  They they’d create a location in the warehouse (remember, we did not stock it), and let it sit until the next authorized parts return when the company might get 50 cents on the dollar!  Wow, no wonder when I asked for help on a disputed service invoice, I’d get a cold stare from the parts manager.

The Old and the New

My point (yes, there is a point to all of this) is there are two types of service management – the old and the new.  The old type will not survive at today’s distributorship.  Managers who think like that are being replaced with managers who are concerned with the entire company’s health, not just the service department.

The new service managers are discovering that working together – sales, parts and service – makes a much more enjoyable job.  Time spent hiding expenses rather than addressing the issue is a complete waste of time.  The real cause of the expense is never removed or identified and swapping time becomes routine and a drain on your time.

Direct and constructive communication with other department managers is key to making our company successful, profitable and raising customer satisfaction.  Believe it or not, it starts with the service department!

You can connect with Bill on LinkedIn at  www.linkedin.com/pub/bill-pyles/12/a24/7ab