The Many Hats of the Auto Dealership General Manager
By Richard A Nimphie | Submitted On October 24, 2012

The general manager acts as an extension of the dealer/owner and, as such, not only assures the successful direction of long and short-range objectives, but is also responsible for the discipline, morale, and effectiveness and well-being of each person employed by the dealership. He/she develops efficient managers and works through them to see that mutually agreed upon goals are accomplished with minimum friction and maximum efficiency. They instill through their actions a sense of "What can I do to assist you in accomplishing your tasks"? This, then in turn, should become the philosophy of each manager in the dealership, a role of assistance to their associates which transcends eventually to ultimate customer satisfaction.

Early in my career, it was drilled into my head that general managers were responsible ( among other duties ) for people and process. First and foremost, having the right people who "Get" the overriding philosophy of the dealership's guiding principles is essential to the assurance of successful goal accomplishment. Secondly, training proven customer-first processes for every function in every department on an ongoing basis has to be a daily regimen. Finally, INSPECTING WHAT YOU EXPECT is second nature to a great general manager as well as their management staff after these processes are rolled out. These processes should include everything from save-a-deal meetings to service drive efficiencies, monthly planning/forecasting to giving in-store directions to customers, sales process to special order parts order/delivery. The process should be in print form, given to the appropriate associates and trained over and over again.

The general manager inspection process can not be over emphasized. A term in one of my college text books (Go MSU green/white! ) was M.B.W.A. I have practiced "Management by Wandering Around" my entire career. This entails inspecting processes, the facility, interfacing with customers, tuning in to all associates needs and spirit, inventories for display and cleanliness and being involved with daily sales prospects. Reporting daily progress to all associates on their goal accomplishments is also essential. The general manager is the scorekeeper and her/his communication to those "on the line" of the daily score must happen in a motivating, non-threatening fashion. Often, the GM who roles up their sleeves in the middle of the action to assist on the spot, will have gain a greater degree of respect from associates and "show them the way" to a higher level of performance.

Standout general managers manage their businesses from benchmark indexes. They know and monitor each month: gross as a percent of sales, pre-tax profit as a per cent of gross, market penetration, hours per R.O., fixed coverage, each expense item as a per cent of gross, used car sales as a ratio to new car sales, inventory aging guidelines, return on assets, receivable aging and of course, CSI indexes, just to name a few.

General managers should be constantly recruiting. Typically, this is only done on an after the fact basis once an associate leaves their employment. Recruiting out of extreme necessity as opposed to an ongoing search for future employees with the right "DNA" often results in increased turnover. Personality profiling will greatly assist the recruiting efforts in addition to interviews by multiple managers. In this regard, the general manager should train all management staff in proper interviewing techniques as most have had little or no guidance in this process.

General mangers today have many sophisticated tools at their disposal to help inventory management. Determining model-year mixes for used vehicle inventory is a science, which if not approached methodically, can be very costly. Subscriptions to various online services greatly assist in make and model selection, and pricing. Simply turning this over to an "experienced" manager who goes by their gut instinct is a recipe for disaster. Trust me, otherwise you could end up with an used Ferrari on your lot when what you really need are vehicles mostly representative of your franchise nameplate.

This article was inspired by a Christmas gift many years ago from my management staff. They presented me with a baseball cap with several different lids and accompanying titles on each of them, representative of dealership functions. There are not enough lids to fit the average cap. I have only scratched the service here as managing a retail automobile dealership is complex and multi-faceted. It entails long hours, can be stressful, but certainly rewarding. I have had the benefit of great mentoring along the way and realize that providing the same to those who seek it, is extremely fulfilling.

The author has been in the retail automotive business in dealership management and ownership for over 41 years including being the operating partner of Lexus of Tampa Bay and Lexus of Clearwater. He has a B.A. from Michigan State University, is a graduate of General Motors Institute Dealer School, was president of The Toldeo Auto Dealers Association, president of the Ohio Car and Truck Rental and Leasing Association and former member of the Lexus Dealer Council.