The success of any one dealership department depends on the performance of all the others. No one department should be considered more important. Now, more than ever, dealers must rely on all departments and cooperation between them.
In many dealerships the sales department is the “golden child” of the organization, often to the diminishment of the other departments. However, there are those dealership owners and general managers who recognize the significance of all departments successfully unifying the organization and eliminating or at least minimizing barriers. Why then, in most dealerships, does sales rule supreme often to the subjugation of fixed operations? The answer is rooted in the industry culture.
Even more so than the rivalry between the parts and service departments, how the sales department views fixed operations and vice versa has broader cultural implications which hinder better relations or prevent them from happening.
Understanding why things are the way they are will assist in coping with situations between the departments as they arise. The following are the sources and possible solutions to the cultural climate leading to favoritism of sales over fixed ops.
Source of the problem: Industry culture
Unlike the chicken-or-the-egg controversy, there is no argument that the need for service and parts followed the sale of the first vehicle. From the beginning, vehicle sales define the success of the manufacturers and dealers.
Fixed ops (parts, service, and the body shop) were support functions lacking the significant emphasis accorded to sales. As a result the tone was set at the top of the industry, starting with the manufacturers. Here is some proof that you see on a daily basis.
Sales is called the front end of the business, fixed ops the back end.
Fixed ops is considered a necessary evil.
Showrooms are a prominent part of the dealership, fixed ops aren't.
A prominent industry newspaper is a source of information and statistics on vehicle sales, but offers little to nothing with regard to fixed ops.
Most industry publications put articles on fixed ops toward the back.
Although vehicle sales are still the driving force of the industry, manufacturers must take the lead in elevating the fixed ops to a higher level of prominence.
This does not mean forcing compliance programs on dealers or merely paying lip service to the repair part of the business. The manufacturers must show the same due diligence to the fixed ops as they do to sales. The sale may have occurred first, but two powerful industries — parts and service — emerged as a result.
Not only has fixed ops become a significant revenue source, but good service also increases the opportunity for repeat vehicle sales. It only makes sense for manufacturers to initiate true cultural change that will create parity between fixed ops and sales in the eyes of the dealer body and the industry.
Henryonce asked a dealer to switch the sign over his front entrance from “Sales and Service” to “Service and Sales.” Ford said, “If you don't give customers good service, you'll have a tough time making sales.”
Source of the problem: Dealership culture
Dealerships are a product of the industry. The industry, being sales driven, is reflected in the actions of dealership owners and general managers. Nevertheless, it baffles one to think that a business owner can make an investment — such as in the parts department and its inventory — and then pay very little attention to it, yet rely on it so heavily.
As one parts manager lamented, “The parts department is the forgotten department, unless someone needs something.”
Shaping attitudes between departments must begin at the top and be communicated by upper management to the various departments.
Benson P. Shapiro, a Harvard business professor, says, “Only top-level general management can provide a clear statement of a unified strategy and explicit policies for accomplishing it.
“The strategy becomes the core of shared goals that supersede individual department goals for the good of the total business. General management can consistently demonstrate commitment to building a unified interfunctional team by example: assignments that foster cooperation, meetings that stress sharing and cooperation, a tone of equity, and an orientation toward results rather than politics and internal power.”
Once strategy and policy is set by top-level management and communicated to all departments and divisions that “this is the way we work around here,” straying managers must be quickly brought back in line or replaced.
Infractions to policy can be avoided or extremely minimized if the consequences are communicated right at the point of hire.
The notion that departmental managers will take advantage of a situation and try to circumvent policy when the owner (or whoever is at the top of the management chain) is away could demonstrate: an organizational culture that supports subterfuge, the owner or top managers subtly and in some cases blatantly accepting that type of behavior or top management's incapability or unwillingness to deal with policy infractions.
It's not easy to resculpt an organizations culture. But that may not be necessary. Here are some suggestions that can help owners and managers create what Professor Shapiro calls “functional integration.”
Make it policy to educate all employees at the point of hire that no one department is more important than the other, and that all departments collectively are responsible for the dealerships success.
Meet with all department managers to openly discuss and resolve policy issues.
Make department managers and top-level managers accountable for infractions to policy.
Create internal guarantees between departments.
Source of the problem: Departmental culture
If interdepartmental cooperation is not reinforced from the very beginning, it may prevent managers from seeing beyond the problems and needs of their own departments - a situation found at many dealerships.
The result is a narrow, one-sided, inflexible view. Furthermore, the more knowledgeable some people become in their area of specialization, the more all-important it becomes in the way they think, and the less sensitive they become to the other departments. Compound this with top-management favoritism, and soon one department is looking down at the other.
Believe it or not, this is where the most progress between departments can be made. If supremacy of one department over the others is evident and tolerated, and it doesn't look like much help will come from senior management, then the manager of a subordinate department has but two choices:
Continuously track down the owner or general manager and whine about each situation as it arises.
Take matters into your hands and create a climate of mutual cooperation.
I recommend that you opt for mutual cooperation. There are likely to be trade-offs and compromises, but in the long run you'll benefit from a less stressful work environment, and you may find that your points of view aren't all that different. Here are “dos and don'ts” to consider:
Use every possible contact available to broaden your point of view and to understand the problems of the other departments and the dealership as a whole.
Make an effort to understand the jobs of other managers and what the departments they manage are trying to accomplish.
Make every effort to see where the function of your department fits into the overall picture.
Recognize that many problems cut across dealership lines, and what's best for just fixed ops or sales may not be best for the dealership as a whole.
Build barriers around your own department.
Automatically take issue with things others say.
Act as if the work of others is in competition with your own.
Respond in kind when others do something shortsighted.
Gary Naples provides parts consulting and training to dealers and manufacturers. Based in Wilkes-Barre, PA, he's written two books on parts management. He's at 570-824-1528.