The Balanced Scorecard

If you design your Dealership from the customer perspective you will win.

In the management training we offer through Quest, Learning Centers, Inc. we offer varying levels of management development. In our Unit II classes for both Parts and Service we use the Balanced Scorecard as one of the main pillars of the learning.

The Balanced Scorecard has been around as a business tool since the 1990’s and was developed at Harvard Business School. It became very prominent as a management tool in the Heavy Equipment Industry late in the 90’s and early in the 00’s. We introduced our version in the late 90’s and have updated it twice since. Our approach is slightly different than the method taught at Harvard in that we start from the customer focus rather than the financial focus they use academically.

I believe that your employees will work harder to satisfy a customer need than they will to satisfy a management need – I very strongly believe this to be true. As a result of this belief I start the Balanced Scorecard discussion from the perspective of what does the customer need or want. Not what WE think they want but what they factually want to receive from dealerships.

We obtain this information from surveys and customer interviews. I usually suggest that dealers initiate a “Voice of the Customer” program that will ask customers the same question for one week and do this once a month. Each time a customer is communicating with an employee they are asked a question, the same question all week long. The question could be related to a special program or hours of service, it is dependent exclusively on what the dealership wants to know. At the end of the week the answers are compiled and you will have a list of five or ten most common answers to your question. Then you have something to work with on developing solutions to the needs of your customer.

If you know the needs and wants of your customers then will know what you need to excel at in your business. That is the second step in the Balanced Scorecard – Internal Excellence. The customer tells you what they want and then you need to design the solutions. This is the internal excellence portion of the Scorecard and it covers processes, forms, methods and whatever is required to excel at the internal process that will satisfy the customer need. This is the beginning of wonderful solutions for your customers and satisfaction for your employees because there will need to be additional steps in the Scorecard to satisfy the internal excellence requirements. This is the Third Step in the Balanced Scorecard – Innovation.

If you know what you need to excel at internally then you will know what tools, technology and training is required to excel. This is your investment in the business. Providing the training for your employees and the tooling and technology required so that they can satisfy the customer needs and wants by excelling at what they do.

It is reasonably simple isn’t it? If you do this; ask for customer input on their needs and wants, from those needs determine how you can excel, and importantly what training, technology, and tools you need to provide to your employees.

If you do this you will achieve all the growth and profits you want. That is part of the curriculum in Unit II. Your Parts and Service Management should not miss this important class and learn, amongst the other important learning subjects, how to stay ahead of the competition. The time is now.