Recently there has been a lot of conversations about AI replacing entry level jobs, and in some cases roles that are well established within the organization.

This concept hit closer to home while attending a recent birthday party where two friends shared how their children (40 somethings) had recently been laid off due to AI. One worked the film industry in the Los Angeles area, and another worked in Oregon developing virtual material for various companies.

We know it’s coming (it’s here); AI is going to have a direct impact on many jobs in the near future. We can’t avoid it; it’s going to happen. So, my question to those in the workforce is how do we compete with AI in the workforce and career fields we are employed?

Below is some information collected using AI to outline how those in the workforce can prepare themselves for the inevitable. 

The information is broken into five elements:

  • Understanding how to work with AI 
  • Careers Most Likely to be Impacted by AI
  • Careers Least Likely to be Replaced by AI
  • Adopt an “AI-Augmented” Mindset
  • Self-Assessment Worksheet of Your AI Adoption Readiness

I entered “How to compete with AI in the workforce” using a popular AI search engine. Some of the information is a result of the AI search,

Competing with AI in the workforce doesn’t mean working against it — it means learning to work differently and strategically.”

AI is not the first innovation that has/will disrupt the workforce. If we look back over time within our own work history, and back to our parents and grandparents we can identify how industrialization and technology has played a role in disrupting many jobs and careers over time. Those that recognized the challenge and began adjusting their purpose and skill set are much more likely to succeed in the changes coming to their careers/jobs.

There is also a responsibility for the government (federal, state, and local), educational institutions, and employers to be early adopters to provide transitional training and educational opportunities to assist in transitioning in the application of AI within the workforce.

Below are some examples AI recommends on how individuals can remain relevant and even thrive in a world increasingly shaped by AI (quoted from AI- I can’t explain it better than this):

Double Down on Human-Centered Skills

AI is fast and efficient — but it lacks emotion, creativity, and nuanced judgment. Humans excel at:

  • Emotional intelligence (EQ)
    “Empathy, communication, leadership, and the ability to build relationships still give people an edge, especially in customer service, sales, teaching, counseling, and management.”  This sounds simple, but we have all struggled and in many cases are providing training in these areas due to the current workforce lacking these important skills.
  • Critical thinking and ethics
    “Evaluating AI output, making tough decisions, and navigating moral gray areas are human strengths.”  Again, employers and training institutions (educational and consulting services) have provided training and education in this area to continue develop the workforce.
  • Creativity and innovation
    “While AI can generate content, the spark of originality and intuition is still uniquely human — especially in art, design, strategy, and storytelling.”  This is a great opportunity for us as individuals, teams, and leaders to continue developing the “spark” needed to continue growing our businesses, leading, and developing our employees.

Learn to Work With AI

“Become “AI-augmented” rather than “AI-replaced.” Learn how to use tools that enhance your productivity”:

  • Prompt engineering: Learn how to use AI (like ChatGPT, Midjourney, Copilot) effectively to accelerate tasks. We have some companies that are restricting employee access to the various AI tools. There are concerns that no doubt need to be worked through, but it is important to take a proactive approach and not a set and watch approach in how to blend these AI tools into our businesses. 
  • AI + human combo: In fields like law, medicine, marketing, and writing, humans who use AI wisely can outperform those who don’t. This is where the employee can excel. Using their expertise added to the tools of AI can provide a great combination and lead to job security and an avenue for career growth. 
  • Upskilling: Take courses on how to use AI in your specific field. A few years ago, I took on a role of using the various corporate data points within the marketing department. This was new role “Data Analytics Marketing Manager.”  I knew and understood the data but didn’t have the data analytics tool belt skills. After completing a certificate program through the local university, I was able to combine both skills to support my value added to the organization. This was a new offering at the university in 2015, now enters AI ten years later. If I were still in the workforce, it would be important for me to upgrade my skills to include AI.

Stay Adaptable and Continuously Learn

AI is evolving rapidly. Staying competitive means staying curious:

  • Learn new technologies
  • Stay up to date with trends in your industry
  • Stay up to date with trends outside of your industry
  • Embrace change rather than resist it

Examples: 

  • Bookkeepers who learn cloud-based accounting software and AI tools can manage more clients with deeper insights — those who didn’t are being outpaced.
  • Heavy Equipment Dealers that monitor what’s being introduced in the auto industry can gain an understanding of what’s coming in the equipment industry (OnStar and autonomous vehicles are examples).

Focus on Complex Problem-Solving

AI handles repetitive, rule-based work well. Humans still lead in complex, ambiguous situations. 

The sweet spot:

  • Cross-functional thinking
  • Systems design and improvement
  • Strategic decision-making
  • Visionary applications

Specialize in Roles Where Trust Matters

Certain jobs require a human touch:

  • Therapists
  • Teachers and mentors
  • Religious leaders
  • Managers and coaches
  • Analysist being able to interpret and identify gaps in the communication and understanding

People still value human presence when the stakes are emotional, deeply personal, and need additional clarification and understanding. 

Embrace Entrepreneurial Thinking

AI lowers the barrier to starting a business, creating content, or building products.

  • Leverage AI to prototype, market, and scale
  • Solve niche problems with unique value
  • Think like a problem-solver, not just an employee
  • Requires current businesses to be continually thinking ahead. There is less time available to spend on gathering the data and doing the analysis. AI can help close the gap.

Final Thought:

You don’t need to be better than AI at what it does best — you need to be better at being human. The future belongs to those who can use AI as a tool, keep learning, and lead with insight and empathy.

Protecting, Respecting, Remembering and Building of a Legacy

Guest writer Ron Wilson returns this week with a blog post on family businesses and the honoring of legacies in “Protecting, Respecting, Remembering, and Building of a Legacy.”

How does a third/fourth generation family business protect and respect the legacy of previous leaders and apply the lessons learned toward the successes of the future?

 

While looking back over the history of a dealership there were critical high and low points that shaped the future of the organization. For the most part we can identify those critical points and understand the impact the events had on the organization.

 

Very seldom can we identify the specific individuals that were the critical influencers. Even more complicated is remembering what actions were taken that lead us in and out of specific events.

 

Recently I was visiting with a young director at a semiconductor company that was about to go through a layoff. As a leader this young director had not experienced laying people off, what was involved during the layoff, and the repercussions a layoff has on the employees showing up for work after the layoff.

 

I asked the young director what advise his Vice President (supervisor) had shared based on his previous experience. The response was the Vice President (supervisor) had not been through a layoff either.

 

Here is an example of one, maybe two, generations of leaders that have not been through some of the most difficult challenges of leadership. In your dealership what were one or two critical events that shaped the organization and who is still around to provide input and share the experiences?

Third and fourth-generation family businesses face unique challenges in preserving and respecting the legacy of their predecessors while adapting to the modern demands of the business. 

Here are a few strategies to balance these priorities effectively:

  1. Codify Core Values and Vision
  • Document the Family Legacy: Develop a written history or mission statement that highlights the founding principles, values, and milestones of the business. This serves as a touchstone for decision-making.
  • Articulate a Shared Vision: Ensure all family members and stakeholders align on the future direction while honoring the past.
  1. Establish Governance Structures
  • Family Councils: Create forums where family members can discuss business-related matters, ensuring continuity in decision-making and conflict resolution.
  • Advisory Boards: Incorporate independent advisors who respect the family’s legacy, provide an external perspective and are aware of the specific challenges the dealership has worked through over time.
  1. Mentorship and Knowledge Transfer
  • Intergenerational Mentoring: Facilitate mentorship programs where current leaders pass on their wisdom, values, and insights to the next generation.
  • Storytelling: Encourage leaders to share stories of challenges, successes, and lessons learned to inspire and educate successors. 
  • Convert these stories to action steps taken:  Share the critical steps taken in detail that allowed the organization to take on and work through a specific challenge.
  1. Blend Tradition with Innovation
  • Honor Proven Practices: Retain processes or approaches that reflect the legacy, provided they still add value.
  • Encourage Modernization: Position change as a continuation of the legacy, demonstrating how adaptation aligns with the founding vision.
  • Visit the Past and Adapt to the Future:  When going through a challenge refer to examples of past experiences to determine what worked/didn’t work and adapt when applicable to the future challenges.
  • Historical Archives: Maintain archives of important documents, photos, and artifacts to preserve the family’s story.
  1. Education and Development
  • Train Successors: Invest in the education and professional development of the next generation to prepare them for leadership roles.
  • Encourage External Experience: Allow younger members to gain experience outside the family business before taking on leadership roles.
  • Provide the opportunities to Learn from the Past: Before a new project is taken on have the team review the challenges of the past and identify the success and the weaknesses of previous projects. The old saying “don’t recreate the wheel” but learn from the experience and move ahead quicker by avoiding the pitfalls of the past.

By combining these strategies, family businesses can honor the achievements and values of past leaders while remaining dynamic and relevant in an ever-changing world.

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Guest writer Ron Wilson covers a crucial snowball effect we experience in our businesses in this week’s blog post: “Disputed Work Orders Cause Delays in Payment and Increase Unnecessary Interest Expense.”

We are all aware of the common causes that impact the accuracy of work order reviews, closing, and the customers invoices not being paid on time.

Digging a little deeper into the specific causes and frequency for the invoice being disputed by the customer can have a major impact on the reduction of the Service Department’s receivables. We often correct and resolve the disputed invoice without determining the root cause of the issue, and the problem often re-occurs.

Reducing the disputed and aged invoices also reduces the corporate interest expense due to not carrying the aged invoices within the accounts receivables.  This can greatly improve profitability without much effort.

Some of the common reasons work orders are disputed are:

  1. Pricing Discrepancies
  • Unexpected Costs: The final bill is higher than the original estimate, and the customer wasn’t informed beforehand.
  • Disputed Labor Charges: The customer believes the labor charges are excessive or doesn’t understand how they were calculated.
  • Parts Pricing: Customers may feel the parts are overpriced or question whether they were necessary.
  1. Scope of Work Issues
  • Unapproved Repairs: Work was performed that the customer didn’t authorize.
  • Missed Repairs: The customer feels the dealership failed to address the initial issue or left something undone.
  • Over-repairing: Customers may dispute repairs they believe were unnecessary.
  1. Quality of Service
  • Recurring Issues: The problem persists after the repair, leading the customer to question the quality of the work.
  • Damage During Service: Equipment is returned with new damage or wear that wasn’t present before the service.
  1. Miscommunication
  • Poor Documentation: The work order lacks clear descriptions of the problem, repairs, or costs.
  • Misunderstood Terms: The customer misunderstood warranty coverage or service agreements.
  • Incomplete Updates: Failure to update the customer about changes in the scope or cost of the repair.
  1. Warranty and Coverage Disputes
  • Warranty Denial: The dealership claims the repair isn’t covered under warranty, which the customer disputes.
  • Incorrect Coverage Application: Misunderstanding of extended warranty or service contracts.
  1. Timing Delays
  • Delays in Repairs: The customer disputes the bill if they feel the service took too long or caused operational downtime.
  • Missed Deadlines: Promised completion times were not met.
  • The age of the invoiced work order is excessive:  Customer feels the work order is should have been billed in a timelier manner.  The machine may have been sold or the job the machine was on is completed and the customers internal billing has been closed out.
  1. Customer Expectations
  • Performance Post-Repair: The equipment doesn’t perform as expected after the service.
  • Lack of Preventative Insight: Customers may feel they weren’t informed about future issues during the service.
  1. Inadequate Communication about Diagnostics
  • Charges for Diagnostics: Customers may not realize diagnostic fees apply even if they choose not to proceed with repairs.
  • Disagreement on Findings: Customers may not agree with the dealership’s assessment of the problem.

Strategies to Prevent Disputes

Below are some recommendations to prevent the disputes:

  • Clear Communication: Provide detailed and upfront explanations of the work, costs, and expected timelines.
  • Customer Approvals: Always seek explicit approval before performing additional repairs.
  • Thorough Documentation: Keep clear records of customer complaints, work performed, and parts used.
  • Warranty Clarifications: Ensure customers understand their warranty coverage and any exclusions.
  • Proactive Updates: Regularly update customers on the status of their equipment.

These steps can reduce misunderstandings and foster better customer-dealership relationships.

Sometimes the smallest, non-flashy improvements can yield the greatest improvements.

Below is a table and a chart showing some possible  ways to prioritize reducing the number disputed work orders.

 

Cause Occurrence % Total Accumulated
Warranty 981 34.6% 34.6%
P.O 793 28.0% 62.6%
Labor Dispute 615 21.7% 84.2%
Program Credit 237 8.4% 92.6%
Freight 99 3.5% 96.1%
Core Credit 76 2.7% 98.8%
Tax 18 0.6% 99.4%
Proof of delivery 17 0.6% 100.0%
Total 2836    

The chart above shows the data in a visual format that makes it easy to see that 84% of the overall causes are related to the first three areas.  

Take each of the first three causes and identify which of the reasons listed on page one contributed to the invoicing dispute.  Implementing the proper processes, training, policies, proper communication, and coaching can quickly reduce a costly issue and improve customer satisfaction.

Once the first three have been resolved take some time to review the remaining issues.  Often addressing the first three issues will contribute to resolving the remaining issues.

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Good, Better, Best Rebuild Options

Guest writer Ron Wilson tackles the gold standard of componentry in this week’s blog post: “Good, Better, Best Rebuild Options.”

Over the years working in the service areas of a dealership (regardless of the brand) we have most likely heard the customer say the dealership “gold plates” the component rebuild. Which means: Price is too high, over builds the components, not providing options to the customers. 

Often the dealership will provide discounts on a rebuild to meet the customers’ pricing concerns. Discounting cuts into the dealers’ profit margins and doesn’t address the image of being overpriced. 

The dealership can address the complaint by providing repair/rebuild options that will meet the individual needs of the customer. The marketing concept “Good, Better, Best” (GBB) is a pricing and marketing strategy to address the various customers’ price points and the life expectancy of the component/machine. Below is a breakdown of the concept from the customer’s view:

  • Good:
    • Price level: Lowest
    • Quality Level Basic
    • Essential repair/rebuild with minimal extras.
    • Meets customer life expectancy of the component- just one more season, get it through this year and will the trade/auction/sell machine.
    • Minimal warranty expectation
  • Better:
    • Machine mid-life rebuilds.
    • Balancing out the component rebuild with the life expectancy of the overall machine.
    • Due to the increased level of rebuild an increase in warranty/life expectancy is expected. 
    • Increased price level due to increased level of rebuild (additional parts and labor) to complete the rebuild.
  • Best:
    • Highest level of rebuild.
    • Additional warranty coverage available
    • Higher expectations relating to the level of parts and labor required to complete the rebuild.
    • Maybe considered equal (or remarkably close) to a new component
    • Higher level of warranty coverage, with possibly extended warranty offering available

Benefits of the “Good, Better, Best” Strategy:

  • Market Segmentation: Allows the dealership to meet the needs of a wider customer base with varying repair/rebuild budgets and expectations. 
  • Customer Choice: Empowers and includes the customers in the repair/rebuild process to choose the repair/rebuild level that best meets their needs and financial capacity.
  • Revenue Optimization for the Dealership: Increases potential revenue by capturing sales across different price points. Many customers may be going to your competitors because the repair options are available within your dealership.
  • Provides standardized and consistency to the rebuild process: Standardization and consistency improves turn time, quality of work, and fewer job interruptions due to waiting for decisions from customers.
  • Upselling Opportunities: Provides the customers an opportunity to move up to a higher price tier based on the additional added value and features.

Implementation Tips

  • Clearly Define Features: Make sure each tier is well-defined in terms of features and benefits. A common understanding between those that have established the price, rebuilds the components, and the salesforce that communicates the various levels of rebuilds to the customers.
  • Transparent Pricing: Clearly communicate the differences in pricing and what customers get at each level. Utilize visual diagram/cut away images to show what is included within each rebuild level.
  • Customer Feedback: Use customer feedback to refine and adjust the tiers to better meet customer needs and preferences over time.
  • Regular Reviews: Periodically review and adjust the tiers to ensure they remain competitive and aligned with market demands.
  • Utilized the Dealer’s Rebuild History to Establish Rebuild Level: The dealers rebuild history can be a great starting point to identify which subcomponent to include in which rebuild level.
  • Work Closely with the Dealers OEM: Gain input from the OEM based on their historical information and awareness of other dealers that have already developed these offerings.
  • Visit with Your Customers to Identify what the various Repair Options should Include:  This can be done as part of a customer focus meeting, Parts and Service Sales team conduct interviews, and examine what the competitors are providing.

Using the “Good, Better, Best” pricing model can help businesses effectively segment their offerings, appeal to a broader audience, and maximize their revenue while being more competitive in the marketplace and providing a level of rebuild the customer can select that best fits their needs.

Look at the article The Good-Better-Best Approach to Pricing. Why every company should consider a tiered model.”  Written by Rafi Mohammed and published in the September-October 2018 Harvard Business Review.

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Reskill and Upskill Plan

Guest writer Ron Wilson brings a blog post on lifelong learning this week with “Reskill and Upskill Plan.”

I came across a book titled “Long Life Learning” written by Michelle Weise. The title intrigued me due to my interest in and commitment to Lifelong Learning.  The need for skills changes along the way and this book does an excellent job of sharing the why’s and how’s of the challenge.

Here are a few quotes from the book that will help set the importance of the rest of the article.

  • Workers who are fifty-five and older are staying in the workforce well into their 60s and 70s.
  • Many of the baby boomers will experience at least twelve job changes by the time they retire.
  • The number of job transitions will only increase with time, as people confront longer and more turbulent work lives.
  • Education has largely been thought of as a “one and done” experience.
  • Technology’s transformation of nearly every facet of our economy means that we will all need to develop new skills and knowledge at a pace and scale never seen before.
  • The future of work changes the future of learning.

Developing a Personal Reskill and Upskill Plan

The bullet points above, and many other examples in the book, identifies the importance and provides direction in developing a personal reskill and upskill plan that will be critical in success of our business, and our employees.

Developing a personal reskill and upskill plan is crucial in today’s rapidly evolving professional landscape. Here are several key reasons why it is important:

  1. Adaptability to Technological Changes
  • Technological Advancement: We have all experienced the challenges of implementing a new business system and updated technology within an organization. Industries are experiencing rapid technological advancements, requiring continuous learning to stay relevant. Automation, AI, and digital transformation are changing job requirements. In a previous blog I shared the expansion of the “Tool Belt Generation” job titles and career paths that are providing many new opportunities to the employees of today. New roles, new skills, and upgrading old skills.
  • Job Market Evolution: Roles that exist today might be obsolete tomorrow, while new roles will emerge. Reskilling and upskilling ensure individuals can transition smoothly into a new job function. Reskilling and upskilling will play a significant role in addressing the labor shortage issues.
  1. Career Growth and Opportunities
  • Enhanced Employability: Employers value employees who are proactive about their learning. A well-rounded skill set makes individuals more attractive to current and potential employers.
  • Promotion and Salary Increase: Upskilling can lead to higher responsibilities, promotions, and better compensation. Demonstrating a commitment to ongoing learning can also increase an employee’s chances of career advancement.
  1. Personal Development and Job Satisfaction
  • Increased Confidence: Gaining new skills boosts confidence and empowers individuals to take on new challenges.
  • Job Satisfaction: Engaging in continuous learning can lead to greater job satisfaction as employees feel more competent and capable in their roles.
  1. Economic Stability
  • Job Security: Continuous learning helps in maintaining job security in an unpredictable economic climate. Employees with a broad skill set are more likely to retain their jobs during layoffs.
  • Financial Resilience: With a diverse skill set, individuals can explore freelance opportunities or transition between industries more easily, contributing to financial stability.
  1. Innovation and Creativity
  • Encouraging Innovation: Learning new skills can spark creativity and innovation. Employees who bring fresh perspectives and innovative ideas are invaluable to organizations.
  • Problem-Solving: A diverse skill set enhances problem-solving abilities, enabling employees to approach challenges from various angles.
  1. Lifelong Learning Culture
  • Adaptation Mindset: Developing a habit of continuous learning fosters a growth mindset. This mindset is essential for personal and professional development.
  • Setting an Example: Individuals who prioritize their own learning can inspire colleagues and peers, contributing to a culture of continuous improvement within the organization.
  1. Navigating Career Transitions
  • Career Shifts: Whether by choice or necessity, reskilling and upskilling provide the tools needed for successful career transitions. This is particularly important for those switching industries or roles.
  • Futureproofing: Proactively acquiring new skills can future-proof a career, preparing individuals for unforeseen changes in their professional paths.

Developing an Effective Plan. 

Now that we have listed several reasons why Reskill and Upskill plans are important, let’s look at what a personal reskill and upskill plan may consist of:

  1. Assess Current Skills: Identify strengths and areas for improvement. Regularly assess the current skills of employees to identify gaps and areas for development.
  2. Offer Diverse Learning Options: Provide a variety of learning formats such as workshops, online courses, mentorship programs, and on-the-job training.
  3. Set Clear Goals: Align Training with Business Goals: Ensure that reskilling and upskilling initiatives are aligned with the strategic goals of the organization. Define what you want to achieve, and the skills required to reach those goals.
  4. Research Trends: Stay informed about industry trends and emerging skills. Look outside the dealership in other industries and how similar roles have changed.
  5. Create a Learning Path: Choose courses, workshops, or certifications that align with your goals.
  6. Allocate Time: Dedicate specific time for learning and practice regularly.
  7. Seek Feedback: Engage with mentors or peers for constructive feedback.
  8. Monitor Progress: Regularly review your progress and adjust your plan as needed. Track and Measure Progress: Monitor the effectiveness of training programs and adjust as needed to ensure the evolving needs of the organization and its employees are being met and accomplished.
  9. Encourage Lifelong Learning: Foster an environment where continuous learning is valued and encouraged.
  10. Provide Support and Resources: Offer the necessary resources, including time, funding, and access to learning platforms, to support employees’ development.

This all sounds complicated and time consuming, but start here:

  • A few roles across the organization and expand systematically.
  • Review the current job descriptions and the changes required to meet the needs of the future.
  • Identify avenues of training. This may be accomplished in-house, with local community colleges, professional dealer training organizations (such Learning without Scares), and professional certification programs. Most likely it will be a combination of the available resources.
  • Define a training path that includes length of training time, length of executing/practicing the new skills, assess the success of the training.
  • Celebrate along the way.
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Managing the New Machine Sales Pre-Delivery Inspection Process.

This week is all about logistics, with guest writer Ron Wilson writing about “Managing the New Machine Sales Pre-Delivery Inspection Process.”

While my wife and I were sitting in a car dealership and listening to the salesperson explain there is a delay in completing the pre-delivery inspection, my memories of the importance of managing the New Machine Sales Pre-Delivery Inspection reoccurred.

Pre-Delivery Inspections provide a foundational starting point for the new machine in the following areas:

  • Customer Satisfaction: Ensures that the customer receives equipment that is fully functional and free of defects and matches what was ordered by the customer.
  • Safety & Compliance: Verifies that all safety features are operational and ensures that the equipment complies with all relevant regulations and standards.
  • Quality Control: Helps maintain high standards by catching and addressing any issues before delivery.
  • Minimizes Early Field Service Calls: A measure of success can be the number of hours the machine has operated from the first day it was delivered to the date first requesting repairs.

PDI Process at an Equipment Dealership Includes:

  1. Development of a PDI list:  The PDI list is usually a list of items recommended by the OEM, and specific areas that have been defined by the dealer. There are common items across all machines and specific items that have been determined based on previous warranty claims submitted to the OEM by the dealer and local dealer requirements.
  2. Receive Equipment: When new equipment arrives from the manufacturer, log it into inventory, schedule and prepare it for inspection.
  3. Assign and Conduct Inspection: Assign the PDI task to a qualified technician, ensuring they have the necessary tools and checklists. The technician performs the inspection, following the PDI checklist and documenting any issues found. 
  4. Address Issues and Final Check: Any defects or problems identified during the inspection are repaired or resolved. Proper warranty claim documentation is completed and submitted back to the OEM. This information can assist the OEM in addressing these issues at the factory, preventing future quality issues on other machines.
  5. Prepare for Delivery: Clean the equipment, gather all necessary accessories and documentation, and prepare it for delivery to the customer.
  6. Customer Handover: Review the PDI report with the customer, demonstrate key features, and address any questions they may have. Best practices of this process should include the machine sales and product support representatives being scheduled to be at the site on the delivery date. Depending on the machine a technician may need to be scheduled as part of the delivery.

Key Aspects of a Pre-Delivery Inspection

  1. Visual Inspection and Functional Tests
    • Check the exterior and interior for any damage, scratches, or dents.
    • Ensure that all parts and accessories are present and correctly installed.
    • Verify that labels, decals, and instructions are in place and legible.
    • Test all mechanical, electrical, and hydraulic systems to ensure they are operating correctly.
    • Check fluid levels (oil, coolant, hydraulic fluid) and top them up if necessary.
    • Verify that lights, signals, and indicators are functioning properly.
  2. Safety Features
    • Inspect safety features such as brakes, seat belts, alarms, and emergency stops.
    • Ensure compliance with safety regulations and standards. This may vary by client.
    • Test any software-based safety systems for proper functionality.
  3. Software and Firmware Updates
    • Check for any available software or firmware updates to be installed.
    • Verify that all digital systems are working as intended and are up to date.
  4. Performance and Operational Checks
    • Conduct performance tests to ensure the equipment operates within the specified parameters.
    • Test the equipment underload (if applicable) to ensure it performs as expected.
  5. Documentation
    • Review and complete all necessary documentation, including warranty forms, registration papers, and manuals.
    • Provide a detailed PDI report, noting any issues found and actions taken to resolve them.
  6. Final Preparations
    • Clean the equipment thoroughly, removing any protective coverings or shipping materials.
    • Ensure all accessories, tools, and documentation are included with the equipment.
    • Perform a final quality check to confirm that the equipment is ready for delivery.
    • Additional attachments are included as defined within the sales document.

Scope Creep of the NPI Process: Over time the NPI list can become outdated and excessive based on experiences that caused a task to be added to the NPI list and is no longer relevant. Some considerations when updating and managing the NPI list:

  • Is the task still needed or has it been addressed in the OEM machine assembly process?
  • Review the time allocated to perform each task. Can the task be connected to another task that would reduce the individual time needed to complete both tasks? 
  • Have there been/can there be efficiency gains that would improve and streamline the overall process? 
  • Updating and managing the PDI process is a critical step in the overall new machine delivery experience for the customer and managing the cost related to overall process within the dealership.

Here is an example of the impact (the numbers below are not actual but we can gain a sense of the impact).

Total units sold 1,000

Average hours per PDI 20

Total Hours 20,000

Hourly Rate $90.00

Total PDI Costs $1,800,000

PDI Cost Savings 10% $180,000

As can be seen a 10% reduction in PDI cost in the above example provides $180,000 for the Sales Department’s profit relating to these 1,000 machines. This also allows the technicians’ hours to be allocated to other revenue sources.

By following a thorough up to date PDI process dealerships can ensure customers receive high-quality reliable equipment, enhancing their overall experience and trust in the dealership, and control the dealership cost of the overall PDI process. A Win-Win for both the customer and the dealership.

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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 MarketingUtilizes 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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Utilization of Business Tools: Understanding and Growing the Dealer’s Hydraulic Business

Guest writer Ron Wilson continues his study of the hydraulics side of our industry in this week’s guest blog, “Utilization of Business Tools: Understanding and Growing the Dealer’s Hydraulic Business.”

Customer and industry surveys can play a significant role in identifying and developing growth opportunities in the product support business. The following is an example of how survey information can help shape the hydraulic rebuild/repair business within a dealership.

 

Three examples of survey information:

  • Industry studies & research
  • Study the local market to evaluate the current state by using customer input.
  • Dive into the historical parts & service sales activities to support finding and identify new opportunities.

 

Industry Studies and Research

 

There are many professional trade associations that conduct ongoing studies. An example relating to the hydraulic industry is the information from National Fluid Power Association (NFPA) https://nfpahub.com/stats/market-trends/. This organization provides some free information from their website, and a deeper dive can be obtained through membership status. For example, the information below provides the dollar volume trend in fluid power shipments over the past several years. A deeper dive into more specific hydraulic markets is available from the website such as mobile hydraulic components.

Studying the Local Market

 

Comparing the local market to the national market brings a clearer view of the opportunities and areas to focus on to obtain a deeper understanding of the potential.

 

Designing the Survey of the Local Market is an important starting point.

 

The initial questions of why we are doing the study and what is the intent of the outcome.

 

  • Objective- Define the objective of the survey:
    •  Are we gathering feedback on existing programs/services?
    • Identifying new offerings opportunities
    • Identifying areas for improving current programs/services

 

Below is an example of the customer responses from three surveys conducted between 2018-2023. This allows us to determine changes in the market and customer expectations:

 

  • Ranking 1 & 2 shows the area of high importance to the customer, while 5 & 6 shows the less important. The scale was in a range of 1-10 (1 being of most importance).
  • Changes in the market can be seen in Pick Up & Delivery and Availability of Exchange. Both areas have become of higher importance over the three surveys, while Warranty, Loyalty, Local Support/Convenience, and Performed by Dealer being of less importance.
  • Without the survey we may have selected focus areas that can be costly and not as important to the customer and overlook areas that are of importance to the customer.

  • Develop the structure of the questions. 

Are we trying to identify the: 

  • Satisfaction with current services 
  • Areas needing improvement.
  • Additional services to be added to current offerings. 
  • Overall experience and suggestions with our company and with competitors

 

The information below provides examples comparing rebuild quality and pricing of the common hydraulic components. A key element shown below is the customers feel the rebuild quality is about the same as the competitors, but the pricing is considerably higher.

The above information can lead to discussions and modifications to address these two critical areas of quality of rebuilds and pricing.

 

Utilizing multiple channels to obtain survey responses can provide a broader reach of responses. 

 

A combination of the following can provide a broader view, but requires a little more management of the information going out to the customer and coming back in: 

 

  • Email (SurveyMonkey is a great tool with some limitations based on subscription level)
  • Website/social media
  • One on One visits and interviews (focus groups can be useful in this space as well)
  • Internal data showing data points from an historical view.

 

Analyzing and leveraging the results of the survey is really the important part of effort. We are looking to: 

 

  • Identify trends.
  • Segment results 
  • Prioritize Opportunities and Timelines.

The example below identifies the rebuild seal kits that have been purchased over the counter by customers, which can help identify rebuild opportunities for the dealer’s hydraulic shop. For example, a continued growth in the sales of part number A1000 may provide an opportunity to provide exchange lean cylinder for motor graders, or a rebuild program with a firm rebuild price.

The results of the questions below show the customer’s preferred pricing method. In this case Firm Quote is the preferred pricing method in all examples. If our shop only provides Time & Material pricing and our competitors provide Firm Quote, we will most likely gain business by changing our pricing strategy.

The example below shows the level of interest the customers have in utilizing the dealer’s exchange offerings, and the internal use of dealer exchange by the Service Department. 

The question below relating to Warranty Coverage may be a surprise. Usually, we think of longer warranties as a sales tool/incentive, but in some cases longer warranties may not be a key driver in growing the business. In the case below 180 days warranty is the most preferred by a wide margin. Anything below and over 180 days may not provide as much perceived value based on the customer’s input.

Implement Change based on the results of the survey information will take some time and focus:

  • Translate survey finding into actionable insights will involve:
    • Sharing the survey results with the various internal stakeholders such as:
      • Parts Department
      • Service Department
      • Product Support Sales Representatives 
      • Leadership team
    • Action plans and timelines are critical at this point. It may not be possible to implement everything at once but start with a critical few and roll the other items out within a defined time.
  • Communicate the survey results to the customers sharing the changes/improvements being implemented based on their feedback. 

Hopefully the above example shows how the use of external information, local market analysis, customer surveys, along internal historical data can provide direction, focus, and information to grow and manage your product support business.

Disclaimer- The data shown are not actual results, but modified results of an actual study.

 

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The Four “R’s” Within a Talent Management Strategy

Guest writer Ron Wilson writes about one of the critical focus points of a business plan: the employees. Here he shares “The Four ‘Rs’ Within a Talent Management Strategy.”

Many years ago, we were developing business plans for the year and one of the critical areas of focus was Employee Retention and Recruitment. Retention and recruitment have been a challenge throughout our leadership roles, regardless of the department we lead, or the industry we are a participant in.

Within Employee Retention and Recruitment there are four areas of focus:

  • Recruitment
  • Retention
  • Relationships
  • Respect

Focusing on the four areas above will improve employee retention and attract the new talent needed for the future.

Recruitment– This “R” focuses on recruitment of talent from outside the organization. Recruiting to fill the immediate and long term needs for skilled talent in our industry will continue to be an obstacle to business growth potential. Therefore, out of the box creative approaches are necessary to recruit talent.

  • Recruitment of talent from outside the organization should include a variety of approaches. There is no one successful approach in finding skilled talent and it’s important to continually evaluate what is working and seeking innovative approaches. Look at what other companies are doing (inside and outside the industry).
  • Advertisements will take a focus on what the organization has to offer as a career and a long-term employer with very competitive wages and benefits, seeking employees that will take the company into the future. 
  • Special events utilized to identify skilled talent. Some examples are rodeos, racecar and motor cross events, trade shows, and vocational schools. The intent is to reach communities where potential employees live their daily lives outside of work.
  • Apprenticeship programs will be utilized to “grow” the needed talent from within and outside the organization. Participating in community college and high school technical skills education provides a wonderful opportunity to expose the company to individuals that are seeking a company that is not only a place to work, but also build a career.
  • Shorten the time between posting a position and providing a job offer. Individuals applying for a position are ready to move forward with a new opportunity, and most likely are applying for several positions at other companies. Let’s not delay in reviewing the applications, scheduling interviews, and providing job offers. Develop a metric to measure the amount of time it takes to hire a new employee. It may be surprising the amount of time it takes to recruit, interview, and hire someone,
  • If the applicant does not match the needs of the position being applied for, is there a role that may be a better fit within your organization? 

Retention– This “R” places a great deal of emphasis on developing the talent within the organization to meet the immediate and long-term skill set needed to take the organization into the future. 

  • Development of internal talent will include the skill sets for technicians and non-technicians. 
    • The priority will include developing the skills in the basic skills needed to accomplish the individual’s current job responsibility.
    • Skills needed to prepare the employee for the next level in their career path. 
    • There should be a “building block” approach with career path options. For example, technical level 1-4 starts with the basic skill set needs of a technician to advanced troubleshooting and diagnostics. Additional advanced levels for a technician can include Technical Communicators, Service Department Supervisors/Managers, Product Support Sales Representatives, and Training Instructors. 

Respect for dealing with each other leads us through the challenges that will occur. There will not always be an agreement in everything we do, but everything we do can be managed in a manner of respect. The issues should be addressed based on the issue, and not on the person. 

Relationships that are positive between employees encourage an environment that allows growth and development as individuals and as teams. 

  • Through positive relationships the organization will recognize the needs of the marketplace and introduce competitive products and services that add value to our customers. 
  • Strong internal relationships encourage strong relationships with our customers.
  • Recognition is important to all of us. It is important we seek the opportunities to recognize individuals and teams of employees on their successes and contributions to the organization. Each supervisor should develop their own way of providing employee recognition for their areas of responsibilities. The types of recognition will vary based on the event, the location, and the employees.

The Four “R’s” play a significant role within our talent management strategy of taking care of the current employees and seeking the employees needed for the future.

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Utilizing a Personalized Employee Benefit Statement as Part of the Employee Retention Plan

Guest writer Ron Wilson offers insight into employee benefits tonight in, “Utilizing a Personalized Employee Benefit Statement as Part of the Employee Retention Plan.”

Employee retention plans have become an important part of the organization’s overall recruitment process. As we know the cost to recruit, hire, and train a new employee can exceed the cost of investing in the current employee, especially when we include the revenue lost while we are trying to fill the position.

Although effective Retention Plans have many elements, it is worth our time to focus on one specific element, a Personalized Employee Benefit Statement. Below is an example of how a Personalized Employee Benefit Statement was utilized in retaining a key employee.

A highly productive Product Support Sales Representative scheduled a meeting with me and during the meeting he presented a letter of resignation. We spent some time reviewing the reasons for wanting to leave the company, where he was going, and reemphasizing the importance of his role within our organization. As we were wrapping up our discussion, I gave the letter of resignation back to the employee explaining that I would not accept the resignation at this time and asked that he compare the benefits his “new” employer would be providing as to what he was currently receiving. 

 We would review what he found out the following day and at that point if he still wanted to resign, I would accept his letter of resignation.

Later that evening the employee called me and asked if he could withdraw his letter of resignation. During his review of the “new” employer’s benefits, he discovered their medical coverage was insufficient to what he was currently receiving and his accrued time off was far less than what he was currently receiving.

The Personalized Employee Benefit Statement played a key role in the retention of this key employee. There was work to be done to address some other issues, but we now had some time and an open dialogue to continue strengthening our relationship.

Content of a Personalized Employee Benefit Statement

There can be many elements within a Personalized Employee Benefit Statement, but we will review only a few:

    • Employee Information- Name, employee number, years of service, job title
    • Company Information- Vision, Mission, Values
    • Salary Information- Including base salary, bonus, commissions, overtime.
    • Benefits Summary- This is the most important piece of the statement. Most employees do not see, and may not fully understand, some of these benefits and the cost.
      • Health Insurance- including premiums, deductible, and coverage, along with Wellness programs that are available. (Dental, vision, prescription drugs, etc.)
      • Retirement Benefits/Stock Options- This would include 401(k) match and other retirement plan information.
  • Life insurance and Disability insurance coverage
    • Paid time off (vacation, sick days, holidays)
  • Tuition Reimbursement and Training that has been provided to the employee.

There is no doubt many other examples you can recommend be added to a personalized employee benefits statement based on your organization’s information.

There were two key elements that contributed to the employee deciding not to resign. The medical insurance coverage provided by the new employer was insufficient due to some family medical needs and the new employer’s time off was insufficient to what the employee was accustomed to receiving.

The ability to quickly access this information and spend time with the employee to ensure their understanding of what is included within the current plan, what they may be giving up provided an environment of transparency and building trust. 

This discussion may also identify areas the current employer may need to address as it relates to a competitive benefit package.

To effectively build a Personalized Benefit Statement requires:

  • Information pulled together from payroll, benefits, training, and other key databases to consolidate into an individual employee statement.
  • Supervisors and Human Resources personnel being comfortable discussing the information and listening to the employees as they identify the areas of most importance to them.
  • Provide the personalized employee benefit at least once a year and be accessible to address the immediate situations that arise.

What would you include in a Personalized Benefit Statement? Have you had similar situations and were able to retain an employee that was resigning?

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