Creating Organizational Team Work

Creating Organizational Team Work

It is imperative that dealership personnel work together as a team to create a successful and well-run organization. Why is it then, you may ask, that department managers and those working for them think and act vertically rather than horizontally? Why is the “silo mentality,” which inhibits performance and customer friendly processes, overwhelmingly prevalent in our industry?

The answer may lie with the design of your dealership’s pay plans. We know that pay influences behavior and if your pay plans are vertically designed, they will inevitably endorse and prop up vertical-based behavior. Making strategic modifications to your pay plans will help to alter mind sets and shift behavior. Fortunately, recently we have seen dealerships start to include certain components in their pay plans, so as to obtain specific results. A case in point is paying your people off of CSI. My question is why are we not taking this approach further to say, try to improve customer retention or, for that matter, foster and encourage inter-department teamwork?

Here are some of the areas where we have operational disconnects, along with suggested pay plan components to address these disconnects and, in the end, hopefully shift patterns of behavior.

Customer Pay Service – Sales managers are not advocates for improving customer pay labor:

Objective – Encourage sales managers to actively support the growth of customer pay labor.

Normally sales managers receive a base plus a percentage of gross or adjusted gross. Replace the base and pay them a percentage of the dealership’s customer pay labor sales.

Result – Process driven sales managers will start to “manage” their pay plans and create or tighten up their systems and processes to convert sales customers to service customers on the sales floor (Get ready to see your sales managers asking the service manager how their customer pay labor sales are weighing in for the month).

Service advisors proactively selling new and used vehicles:

Objective – Increase unit sales by making service advisors, who see more customers per day than any other dealership employee, more receptive to turning service customers into sales opportunities.

Should the service advisor feel it is in the best interest of the customer to purchase a new vehicle rather than incur a hefty repair bill on their current vehicle, he gets a flat for the sale and also gets to run the customer’s original repair order through the service department.

Result – You are doing what is appropriate for the customer and for the service advisor. It’s a win-win for everyone.

Salespeople retention and high service loyalty:

Objective – (1) Retain your sales people and (2) Improve your dealership’s customer pay labor sales.

Pay your sales people on the customer pay labor their customers (those who they sold a car to) generate in the service department.

Result – Salespeople become more involved with keeping in touch with the customers and they value their patronage in the service department. It also creates a relatively stable and growing annuity-type component to their pay plans.

Dedicated back counter personnel:

Objective – Increase the level of cooperation between service technicians and parts personnel.

Include as a part of the dedicated back counterperson’s pay plan, a component that is derived from labor hours produced in the service department. More hours means more money for both the technician and the back counter.

Result – Back counter personnel and service technicians have common pay elements, making them partners rather than adversaries.

Sales pay plan to increase customer retention:

Objective – Improve repeat sales.

Pay salespeople either a higher commission or an additional flat bonus for each repeat sale they make to their customers.

Result – Sales people keep in touch with their customers with the intent of selling them future vehicles.

Accounting office personnel:

Objective – Create urgency and a sense of team work between the accounting office and the other departments.

All the accounting staff shares in a bonus pool that is based on a dollar amount per retail sale and a flat for achieving certain fixed gross levels. Consider reducing this pool by 20 percent for each day the completion of the financial statement exceeds three working days.

Result – Greater urgency, increased team work and quicker completion of the financial statement.

Some of the above pay plans require accurate data and a robust reporting system, while others rely on simple-to-manage tracking elements. Mull over whether you have areas of conflict in your dealership that could be elegantly handled through a linked pay plan, and keep in mind this does not necessarily mean a pay increase. We all know that pay influences behavior. You need to decide if you want your pay plan to help without losing your edge. The choice is yours.

This article by Jeff Sacks originally appeared in Dealer Magazine.

Jeff Sacks, president of Jeff Sacks & Associates, is an auto industry speaker, consultant and trainer and is actively involved with dealership and OEM consulting and training.
His website is and his phone number is 800-867-2160.