Several years ago one of my more enlightened and proactive client-dealers said to me, “I know I don’t really need more opportunities to do business; I just need to do a better job of measuring and managing the OTDBs I already have.” He then asked for my help to develop and implement a traffic management process for each of the five operating departments within his multi-rooftop automotive dealership group. Over the next several weeks, Up To Speedwill present a mini case study focused on the objectives we established and the challenges we faced in building these departmental processes.

The dealer principal clearly recognized the relationship between dealership sales and OTDBs. He also understood that each of his dealerships would need to undergo a significant cultural shift in order to accomplish his traffic management goals. Fortunately his Group COO had been recruited from a public dealership group where OTDB measurement and management were well-practiced disciplines. In fact, the Group COO told me that at that previous employer, the departmental traffic management data received as much attention from the management staff as the numbers on the financial statement.

The dealer principal, Group COO, Group CFO, and I agreed that the first step was to get the dealership GMs, controllers, and office managers on the same page that we were on. To do that, we created a draft vision statement intended to clearly described what we were going to do and why, and held a group meeting with this group of key managers to discuss this new initiative. With everyone’s input, this document was improved and approved for presentation to the managers of the operating departments at each store. Once this step was completed, the managers of the specific departments (e.g. all parts managers within the dealer group) were tasked with the responsibility of determining what needed to be measured, how it would be measured, and how the information would be score-boarded. These department manager meetings were facilitated by the Group COO.

The first speed bump that the management staff encountered was in determining how the dealership (or departmental) CRM systems could best be utilized for the measurement and management of information. This task became more complex because the group was currently under contract with three different CRM providers. After a considerable amount of investigation and dialogue, senior management determined that none of the current CRM providers could offer a satisfactory solution, so the dealer principal authorized the search and pursuit of other potential CRM vendors. Please note that although the single CRM finally selected by this dealer group most closely matched the desired OTDB measurement and management criteria, none of the CRMs investigated could match 100% of the desired standards at the time the competitive analysis was performed. The dealer group still needed to measure and manage some of the OTDB metrics on a manual basis using Microsoft Excel.

The second challenge that senior management faced was anticipated. We knew that some of the department managers, perceiving more exposure to personal Accountability Management, would push back against this culture change. We also knew that, unless we could achieve 100% buy-in and commitment from the department managers, we would not achieve the level of buy-in and commitment we needed from their subordinate revenue producers. Several one-on-one “attitude adjustment” meetings between the Group COO and a few department managers were required to overcome this opposition; fortunately, none of the department managers needed to be “de-hired” during implementation of this important culture change.

In future articles I will discuss how this traffic management initiative was applied specifically to the new vehicle department, the used vehicle department, the service department, the collision center, and the parts department.

Measuring and managing OTDBs is a topic that is discussed in the management training courses offered by the NCM Institute Center for Automotive Retail Excellence. To view the content for these NCMi courses, click here to access a list of classes.