By: Curtis Clark
When was the last time you took a good hard look at your service department? There are certain things that can truly pick up efficiencies in your service department as well as build morale and lead a workforce that will bring gross profit into your dealership. The Service Department can be the dealership’s biggest driver for not only retaining business, but gaining new business. Here are a couple of things you should be looking at to help change the course of your service department.
• How’s your morale? Times have been tough and everyone has been a little on edge. Leadership through bad times is probably more important than leadership through good times. When was the last time you gauged the feelings of your technicians about the company or their perception of the market? Technicians (and employees in general) probably see more and hear more than we give them credit for. They can also provide insight to issues that competitors may or may not be having because they’re talking to their friends who work for other dealerships. Small things, like listening, can go a long way to building morale.
• Are you establishing expectations? You can’t hold someone responsible for something that they are not aware of. When was the last time you communicated the expectations of the department to the employees? Have you told technicians what you expect? Outlining the expectations in sales, van cleanliness, and even paperwork gives people clear cut guidelines. Plus, everyone knows the baseline and will keep that in mind when working on it. The same can be said for expectations of support staff. When was the last time you outlined the expectations for dispatchers, billers, and other support staff? Sit down and outline your expectation for billing efficiency, dispatching efficiency, and quoting field/shop repairs to help keep everyone on the same page and drive revenue and profit.
• When was the last time you looked at how you’re dispatching calls? Many dealers have satellite tracking on vans and other company vehicles. What are you using it for? Many dealers use it as a policing tool (which has merit); others use it to solve customer disputes about the amount of time billed. Have you ever considered that it might allow you to dispatch more effectively? For instance, in a metro area, running a guy from one side of town to the other is not the best use of the technician’s time. It’s also not the best way to service the customer. Upfront work on setting up the satellite tracking into a dispatch program may be a little intensive at first, but with technology today there are plenty of ways to do it very effectively once set up. Plus the upfront work will pay for itself in the end with increased recovery costs, reduction in fuel costs, and even a better response time in some cases.
• How do you quote jobs and how effectively are you quoting items communicated on PM’s? These have been lumped together because they go hand in hand in some way. How do you quote work? In regards to billing hours, not all technicians are created equal. Some have more experience than others. What expectation are you setting? What is your over-quote level? How often do you have to go back to a customer and ask for more labor? Here’s a word most Service Departments and dealers hate: Flat Rates. Some manufacturer’s Flat Rates on warranty claims do need some manipulation, but they can be a good baseline that can be customized to your dealership. Are you keeping track of what it takes to work on not only the equipment you represent, but competitor’s brands? Not all brake jobs are created equal since brakes on one brand may have different quirks then the brakes on the equipment you represent. Are you capturing additional repairs coming off of PM’s? Are you using the PM as a loss leader but not getting the additional work at the effective rate? A lot of this goes back to establishing the expectations. Setting expectations for quoting will help service writers quote effectively and efficiently, while allowing technicians to go out and recover the labor or even get a little more than what was quoted.
• How are you managing your GM/FM Fleet and Rental? Beating the same drum, setting the expectations above will help in effectively managing GM/FM and Rental costs. Technicians, service writers, and managers will know what it takes to get things done and the variations in similar jobs will change. It also gives you the advantage to see where you may have an opportunity to help train a technician or see signs of an issue.
• Are you managing your WIP (Work in Process)? Items in Work In Process don’t get billed and therefore don’t make you money. How often do you go through your WIP? When you go through it, are you identifying issues or seeing a lack of billing efficiency? Do you have that end of the month billing crunch?
Many of these suggestions have a lot in common: Have you set up expectations and have you communicated them? Just like in life, you’re going to have people that meet, exceed, or fall a little short of the expectations. How you manage that will help your group grow, increase morale, increase billing, and help control costs. Helping to establish the expectations works in everyone’s favor, but it must also be communicated and followed up on. Your service department has the biggest impact on your dealership. It helps drive additional parts sales and it gives you and opportunity to make yourself an incumbent at an account that has competitive equipment. You need to strive to make your service department strong in order to outshine other dealerships. Remember, if you’re not working on the equipment you represent, somebody else is.