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Is Your Service Department Designed for Peak Perfo ...
Is Your Service Department Designed for Peak Perfo ...
Is Your Service Department Designed for Peak Performance?
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Hello and I welcome you to your training program which will have as its subject your service department is it intended for peak performance. My name is Daniel Surprenant and I will be your host. Without further ado, let's take a look at the topics we will cover today. How do the most productive service departments optimize their production? This may seem easy, but the reality is often different, because, in fact, factors of speed of execution, work done by technicians in their aim of will affect the total output of the workshop. Availability of parts on the shelf of the dealership or branch will ensure that the work will take little or a lot of time. Specialized tooling is available to technicians and, naturally, training and their knowledge will have an effect on optimization. And last but not least, the process of handling customers regarding the information listed on good jobs will make all the difference in the optimization of a service department. Good information speeds up performance, bad information slows down the process. Our goals for this show are to encourage you to evaluate the performance of your service department. You will be able to identify and eliminate losses of your technicians' time, establish and build a point of trust between you and your parts department. All this with the aim of working on the synergization of strengths. We should also not neglect the sales department where we must prepare new or reconditioned machinery. Let's see a first question for reflection for you. You know, everything begins and ends with financial aspects unfortunately. Are you profitable? Our show is recorded so you can't respond to me directly. But at this point, you might say yes. Yes, yes, I am. I can not not do more. Are you sure? As a consultant, yes, I focus on your achievements. This is important. But for me, the most important thing is your loss of income. And that is what you left under the table. Often the difference between a profitable department or not. Profitability is the final issue. For a business today, just covering the costs is not enough. The service must be an important source of revenue and profits for the company for years to come and especially for the future of our industry. See the table below. We observe the following table and you would compare the results to yours. Is your service department above, below or equal to the standards you see there? That's the big question. See yourself in our table one third of the total concession for gross margin, 25% as departmental profit, 40 to 50% of the total concession for net profit. Big challenges. Once again, you have to ask yourself where you stand because that is the issue. Again, analyze your numbers. Analyze your numbers and see your positioning. Your organization needs to get as close as possible to the statistical data you are currently observing. You see, gross margin guide standard, 65%. And remember, your service sales costs are your technicians' salaries. So when a technician works under warranty, retail or in-house, it costs you nothing. Total service expenses should not exceed 40% of your sales. What are service expenses? Rentals or square foot rented or charged to the department by the concession or the concessionaire, the electricity expenses for the office creatures, salaries of directors, salaries of service advisors, expenses related to the computer system. It is important to understand that service expenses do not include salaries, as I said earlier. They are part of cost of sales, linked to gross profit. And it is important to maximize our profit raw. We can talk about it a little later. The big question that remains for a department of service is “do you bill 85% of paid hours? » Here again, the table that you see at the moment illustrates very well in gold the possibilities of selling hours according to precise criteria. In our table we see assigned hours. It goes for 1768 hours. And we also see paid hours, paid to our technicians. We paid for 2080 hours paid in salary. So in application of hours, you are at 85%. Now, and according to our table, you are at the maximum according to the table. Because in fact, this tells us that there is at least 15% of hours which are non-productive, therefore not chargeable to a client for the reasons that you see. Leave, vacation, personal time, training, meeting, return to work. So we calculates a 15% of time lost, not available, which is equivalent to 208,204, which gives 312 hours not produced. You need to find the answer with your own numbers now to see if you are within the standards or parameters we illustrate. You should look for attribution equal to the hours paid, otherwise you lack work for your technicians. That’s the big dynamic. Let's look a little further now. Let’s continue our research. If I now look at the hours billed with the hours allocated. So if I charged 1768 hours to your customers and I allocated 1768 hours to your technicians, so you could me say that you have 100% efficiency, or the maximum according to the table. This tells us that there are still 15% of non-productive, non-billable hours there. So the question that remains here pending. Do you charge 85% of the hours you pay your technicians? But also more than that, if you bill your clients for 1768 hours and you pay for 2080 hours, this represents a productivity of 85%. Is this enough to guarantee your profitability? You must find the answer by looking at your own figures and using the tables provided to you presented. It is important that you find answers to know if you meet the standards of the industry. Again, you could look with the help of this table if you don't profit and you charge 85%. The answer is relatively simple. You do not have enough technicians to generate billable hours. If you don't have the technicians in good numbers, you are leaving money on the table. And here I could dig a little deeper. A vehicle on the road that provides service to your customers represents a service bay on four wheels, you will tell me. But often, we take the same individual, the same technician, that we take from the workshop, sit in the truck and go on the road. In the meantime, my workshop, my bay does not produce. Do you charge 85%? Hence the big question. If I go a little further now, then I look at the development. So the development says this. Assuming that I have 40% expenses and these expenses would be too high, you must make sure you contain your expenses and control them. As service director, expense management and I am sure of what I am going to do there. Most of you manage your expenses very, very, very, very well. Because when you swerve, the controller or the dealer will come and tell you quickly. Hey, hey, hey, those were expenses, you. So, again, I think you're all doing a good job of managing expenses. Now we will look at revenue management. Revenue management starts from one element primary. This is what we sell. We sell to the time service department. And we go look at the concept of time immediately. We call this the interaction between a good multiplier and the revenue collection ratio. In my table below, we let's see that I take the example of a technician to simplify my idea. But this prevails for more than one technician. If you have a good multiplier factor in place for the salary, so the cost of the technician is 20 dollars that you pay and use a postman multiplicative of 3.5. This means that you multiply 20 times 3.5 and that gives you a rate posted hourly rate of $70 per hour, which will be the labor rate posted at the door in the service. This is how we establish our hourly rate at the door. So, taking my example, 70 dollars an hour times 1768 hours I could call income recovery gives me 123,760 income. My factor of 3.5 with a recovery of 85%, I will have a cost of tech at 20 and over 2080 paid hours, that will give me 41,600. So, as you see, we have 123 760, 41,600. My gross margin is going to be one minus the other which gives me 82,160 and I divide that by 123 which gives me my gross profit percentage at 66%. And if you remember correctly, the standard wanted was at 65%. For this example, good man or smart, my multiplicative factor would be consistent, would be correct. I'm not saying it couldn't be better, but I'm saying that it's going to be okay. But be careful, I have a little warning. Often the technician knows what you charge your customer and how much you pay them. Too big a gap could leave him with a bitter taste in his mouth and find that you are abusing him and in turn of your customers. So, it is important to understand that when we establish a labor call with a client, it must remain confidential between the manager or the service advisor and customer. At no time should the technician know how much you will charge in labor. Hence the importance of having an organizational structure structured. If I continue my example and I bring in the following three tables, which will give me a set of evaluations, of possibilities, we say this. Recovery salaries and salary receipts inter-react to generate sales and gross margin. Moon cannot deny the other. As it is written, you need to pay attention to both. A multiple of High salary could give you the opportunity to give raises to your top performers technicians. But be careful, another element. In both cases, you will have to make it a healthy one management, no matter which avenue you take. Remember, find technicians is the most difficult action to perform these days. There are very few on the market. SO, the multiplier effect of 3.5 could easily be increased to 4.5, to 5. And think about that. All the training costs you have to pay, the specialized equipment you have to buy, these propensities should pass to someone. And unfortunately, or fortunately, it's up to our customers. You pay dearly for the training of your guys and girls. SO, it is important to maximize this and get as close as possible to an hourly rate at the door which will allow us to improve our step line, if you love your bottom line better. I think that here you understand the factor of 3.5 a little better, 4, 4.5 based on the average cost of technicians you pay in your respective organizations. You're going to tell me, ok, that's great, but do you have key performance indicators that could guide me? Well, ask the question, if they answer, yes, I have. And we will see right away. Where to find your key performance indicators? Several manufacturers offer you a guide to operational standards where you will find your performance indicators keys. You can also establish your standards based on your own results that you find from your financial statements. What to watch? What to look for? What will it be your mission as department director? What are you going to need to discover? What is your gross profit in dollars and percentage for your service department? What is your return on your dealership's assets? What is your annual sales growth at the level service? What is the shelf refill rate? Because don't forget, in service, we are directly dependent on the parts department. No parts, my guys don't work. You're going to tell me, no guys, parts guys don't sell parts, it's true. But I think that the opposite is more true than what I just said there, isn't it? Maybe I'm trying to get lost there. One thing is certain, if my technician does not have parts to install on the machine, he sits and waits. And that is expensive. The customer satisfaction index, absorption, sales per employee, per technician, these all represent key indicators and we go see some of them today. The gross profit margin as a percentage at the department level. How many pennies on every dollar of labor sales you have left after paying the technician, depending on the time you have sold your customer? The calculation is simple. You have sold 230 dollars in labor, you paid a technician 69 dollars to do the job, there is still 230 minus 69.161 dollars. That's your gross profit in dollars. You take the 161 dollars that you divide by 230, what you sold, and that gives you your gross profit. In this case, the gross profit according to the calculation that I submit to you, that gives me 70%. And the guide standard sought, we say between 60 and 65%. You're going to tell me, oh, there's 70% crude, that's good. How did I could make more crude? How do we make more crude? Relatively easy question. Do you use currently a standardized invoicing system with prescribed times for each job carried out. We'll call this times of realization. So, I'm Daniel, your technician, and Paul, my director, said to me, Daniel, here is the work that you have done, I will give you an hour for the end. Daniel leaves, I leave, I do the work, I deliver it to him in 50 minutes. SO, I just made 10 minutes of gain over the hour. Am I good? I had to work 110%, approximately, roughly. You follow me? So, often, it is this notion that we perhaps need understand that the technician does not need to know how I charged to the customer. Which is The important thing is the time I give him to get the work done. And, naturally, the other is rigor in terms of monitoring. Every good job in view production time, here we are talking about controlling the gross margin, that is the challenge. The challenge for the director to follow and, naturally, the challenge for the technician is to beat the time we gave him the prescribed time. And, as you see, with small gestures, not big ones, we can slowly but surely move towards better profitability. We continue. Another element that we often hear in our industry is absorption. I often like to say, as a joke, absorption is not the liquid we put on the muscles who are in pain. That's absorbin, it's something else. But, it's a joke. absorption, it is the extent to which the dealer's total expenses are covered by the margin gross dollar figures for parts and service departments. The calculation is relatively easy. Parts gross margin, plus services gross margin, divisible into total operating expenses Concession. So, that's all the dealership's expenses, including expenses of interest. The guideline standard is between 85 and 100%. A high absorption rate means a better ability to withstand a downturn. This helps the dealer take money and reinvest it, either in the establishment, in a branch, in equipment, in advertising, or in marketing programs sales promotions to be more aggressive. But, this money ensures that the dealer can face the future more securely. So, this is why many manufacturers talk about absorption and capacity of so-called fixed operations, parts and services to maximize gross revenues to be between 85 and 100% absorption rate. I hope that this is now clearer to you. Return on assets now. This step is perhaps more worrying for the title concessionaire, for the lessor of fund, the one who invested. Assets are said to be everything the dealer owns. THE Does the dealer produce a sufficient return to justify the total investment? Standard guide sought is 15%. We say the net operating income divided by the total assets equal to return on assets, or if you like better, return on assets. The positive impact is a desire for the owner to make acquisitions to increase his yield. So if I have a positive impact, my owner, my dealer will be inclined to reinvest these money to make it snowball. A little ball, then it becomes a big snowball. Naturally, a negative impact can, in certain circumstances, call into question the future of the dealership or branch. So the minimum we're looking for is a 15% return. Here again, if you have very good communication with your title dealer, you should have access to this information which is more than relevant, always with the aim of improving yourself. Don't be afraid to ask questions. The return on assets, if I give you an example, because often an example is worth thousand words, if I say net profit at 750,000 and my total assets at 10 million, so I say 750 000 divided by 10 million, I have a return on my assets of 7.5. This being below the norm 15% guide for return on return on assets. So you need to increase profits or reduce your assets. Inventory in service is time, so it does not affect the impact on your return of assets. But the gross margin of the service affects your return on assets. For what? Because if your gross margin is not within the 65% standard, it means that your technicians take more time, so you pay more for them. Perhaps also those who sell time discount this one. It will be important to ensure, to understand that our gross profit must be competitive in our region, so it cannot take us out of our market, then customers look elsewhere. But we must render to Caesar what belongs to Caesar, charge what must be charged, without his proposing or misunderstanding. Contribution now from the service, if you like the sales mix better. The sales mix must, for our future and the profitability of our dealership, or your branch, be put forward. The integration of parts and service departments is the solution that you should consider. Naturally, understand me well, I am not putting aside the reconditioning of used machinery, nor naturally the preparation of machinery new, and the sale and installation of accessories. But it is important that our overall sales force – and here I have just included everyone – contributes to the sales effort. No more walls between our departments. We will do 360 degree management with a common objective, to respond to the needs of our customers, whatever they may be. The ultimate goal, and I love and enjoy it say, you know, selling the machinery is relatively easy, and if I have directors salesman listening, they will jump. Tell me one thing, when you sell machinery new, you sell a desire, you sell something, and the one who buys it, he has this desire, he wants to change, he is tired of his old machine, he wants a new one. So there is a passion, there is a flavor, there is an odor. But sell a transmission service, sell a service engine, sell oil and filter maintenance, very few, very few people get up morning saying to yourself, what? My machine needs a new oil change, new filter, I'm excited, I'm going. When this happens, generally, there is a doctor who will come by to change the films of this individual. It's not an innate desire, it's an obligation. So I think that Everyone understands that the standard guide to service, by the proportion of sales, should be between 10 and 15%. Missing the guide standard does not automatically mean you have a poor performance, so be careful. But is your marketing being done the right way? Is there an integration, a disaster of the sales forces? All people can sell service and parts, just like all people can sell machinery. So you see, it's it’s 360-degree management, working in partnership together. Service trend and sales growth. If we say that growth should be 10 to 15% per year, again, increasing rare time may not be the solution. But you have to do your analysis. If as we speak, with what you are being charged to train your technicians and equipment, you see that you are in here, adjust yourself. Now, if you adjust your door schedule too high, well maybe your customers will look at that and want to go elsewhere. In all cases, the more you will work in fixed-price commercial programs, flat-rate, whose parts time is included in the price, the more difficult it becomes for a customer to know how long it took. The more you work in isolation, the price of the part, the more time you give, the less chance you have of increasing your gross profit. This may be a new concept for you, a new approach. I ask you to think. I ask you to think. What are the peace orders devoted to work orders and your income on these same orders? What is the percentage of income in gold on your work orders that are actually billed to your customers? Do you count your workforce? Do you count your labor like you count your parts prices? Be careful, it's a vicious circle. You're going to tell me, Daniel, give me a concrete example. It's all well and good, you talk, you talk, you talk, but what is a concrete example? So look. I know what I'm going to say, it doesn't happen in none of your establishments. The customer shows up with his machine, he is at the service counter, and he says to you, Mr. Surprising, I have a problem. Paul, the salesman at the sale, Told me it was a guarantee. I wouldn't have to pay anything for that, bumper to bumper. In English, they say bumper, bumper. I could take it from one fork to the other. I could take from one tire to another. Everything is guaranteed. He told me that everything, everything, everything is a guarantee. And I know what I'm saying here, that never happens in your establishments. Well, it's time for you to set the time. I'll tell you, it's not to tell the guy, hey, sales, they took you away in a balloon. No no no, we must never bite each other, there. You know, you are absolutely right, Mr. Dubé. Your machine is guaranteed against any manufacturing or assembly defects. And if it's a manufacturing or assembly defect, you won't have to pay anything. But, to define if it is a manufacturing or assembly defect, my technician will have to assess your machine. And I'm asking you for an hour of expertise. Considering what you mean by that, Mr. Surprising, you are asking me for an hour. So my rate hourly at the door, it is $100. To assess your machine, I will charge you $100. If it is a manufacturing or assembly defect, no problem, you will not have a penny to pay. If it is not a manufacturing or assembly defect, you will have to pay me. In the customer service process, we call This determines the payer as quickly as possible. And any time you don't determine the payer as quickly as possible, usually it's the dealership that will swallow up time. You see, little example. I hope this was helpful and I hope you find it helpful. So, again, bill your clients for all your hours. I have a little challenge for you. We called it the 5 minute challenge. What does it consist on? It is simple. Let's see that. The 5 minute challenge, how many minutes in an hour? 60. How much hours in a day? 8. So how many minutes in a workday? 480. So, 5 minutes in a workday is 1%. How many working hours in a year? 52 weeks by 40, 2080, my 2080 from earlier. What is 1% of 2080 is 20 hours and charging a rate of 100 dollars is 2000 dollars. So, 5 minutes per day equals 2000 dollars per year of additional profit per technician. And 5 minutes isn't long. It's not long, 5 minutes. You certainly agree with me that 5 minutes is not long, but it is a lot of money. So the challenge is simple. If I am able to find 5 more minutes to sell to technicians that I have already paid, remember, these are additional profits, not just sales. You have already paid your technicians in your cost of sale. So, 25 minutes Additional charges do not affect your cost of sale. You already have your cost of sale. Imagine you have 10 technicians. 5 minutes a day, said by the number of technicians, 2000 times 10 equals 20,000 per year. And that 20,000 is net, net profit. Excuse me for 30 seconds. I hope I wasn't too hasty. And this break was a sponsorship of my bottle of water and my little rum that I have. Thousand excuses. But one thing is certain, it is that your time for reflection, I'm sure most of you listening, the squirrel started spinning. Imagine the number of hours a man spends at the parts counter to wait for a part. Think about it. We have experts there, at the technician level, often it's the troop gathering at the parts counter. It seems like they everyone gives at the same time. I go away, I make plays. Come with me. Don't move, I'm done. I go away too, I make plays. And there, the crowd is there. And we talk about football, hockey, everything that's happening in the news. And often, these are sessions where we come out a little edified of that 5, 10, 15 minute wait at the parts counter. You see, it's minutes that make hours, that make hours, that make money. In the light From what I just said here, I'm sure that there are several of you who are saying “Hey, the 5 minute challenge isn't a big challenge. It really is not hard. It's just a matter of structuring well, of organizing well so as not to be organized. Ah, well, maybe you are, and I'm not saying maybe, you're certainly right. Challenge your technicians. Find them 5 minutes. What stands in their way? They know the challenges and, where there is down time, they can find it. It is it's up to you and through you to connect them with your challenge. Think about it. And this is very important to understand. They can find 5 more minutes through my work, I am sure of it. But, I want us to be aware. I'm talking about legitimate work. Under no circumstances, under any circumstances, should we sell anything that is not legitimate. Don’t get me wrong, friends. Making a loyal customer takes years. He only loses a few seconds. So, be careful. Any work to be done, a client, must be legitimate. We need to show him the ins and outs. If we offer him parts, change the old parts, keep the old parts, show him. Take photos. Today, it's easy with our smart phones. Get permission by sending him photos. You know, they say a picture is worth a thousand words. So it's going to be important to do things well to ensure the legitimacy of the additional 5 minutes that we want to charge him. I don't know if it's hard. I do not think so. I you made me think about that. Now, how, how do we distribute the work? Do you use a manual or computerized chart? Do you have a system where each technician has his locker or in the locker, the good work is assigned and there, and there, in order of priority. So, the one who is in front is always the next one who must take. Does he know the work they will have done in advance each morning? Are the parts pre-released for customer arrivals? SO, thus, the technician does not waste time waiting for technicians. Do they wait until after their assignment? Are they back from your desk waiting for you to do distribution? All this can be done in advance to maximize time. In certain concessions that I know, the technicians do not move from their service bay, it is someone from the parts who makes the delivery directly to the service bay. In some cases, there are computer systems which ensure that when the purchase order is opened, the parts obtaining this purchase order are automatically sent to the department parts, prepared and put in baskets for the technician at his number. Another thing, we often talk about communication. It is important to communicate with our guys in our workshop. But if you have a meeting with them all morning, be sure it's worth it. Per 5 minutes, that's 2000. Never forget that. Therefore, it is important to have mechanisms to maximize the use of time our technicians. How do they receive their coins now? Who follows up? Who follows up? If this is a special order part that decides, at what When will it be received? If it is a saille piece, the famous seille piece, who authorizes it? You see, here, we say again “did you deliver the part to the Bay? » or “does your technician have to travel to pick up the part?” » It doesn't matter what the mechanism is. When he shows up, does he wait? By each Every time he waits, the hourglass of time empties and we lose him. Best business practices often suggest that the part be delivered directly to the technician within its bay. Many do. Again, how much time do they waste at the parts counter waiting for a part or information? Hey, I have a little thing, I have a little thing for you. If you have an old parking meter, a punch clock, it is commonly called a punch clock in French, but It's a parking meter, an old one, which is useless. Think about this. Place it at the parts counter. When your technicians order the part, you have it punched on a time card. A time card that is multiple, that is to say there is no technician name, but everyone takes the same time card. Then every time When the technician shows up, he puts in his number, he punches in for his order, then when he receives his part, he punches out. Then you do that for a week of time. Next, you will calculate the waiting time. You will see that perhaps the waiting time will correspond to one more employee who could answer at the corot of full-time technicians, 40 hours per week. Thus, reducing waiting times. This will also make you understand the parts director and the director of services to yourself that you need to improve your process at the tech counter. So again, these are little tips that you can use and that I have applied in several businesses and we have had more than impressive results. You know, maybe that it is time for you to rethink your ways of doing things. This is not me saying it. I want to tell you, I'm not smart and brilliant enough to say a sentence like that. It was Albert Einstein who said it. Doing the same things over and over and expecting different results is crazy. To get different results, we have to do things differently. So Albert wasn't all crazy. How much time do you waste looking for special tools? Again, you must put in place mechanisms to facilitate the search or avoid losing the tool special. Then again, how do you know what you have? How do you know who has the tool? If it's in use right now, do you know who and when will be finished with this one or this one? When will he put it back? Are they in good condition and ready for reuse? These are the big questions that remain unanswered when I talk about the dark world of special tools. Again, in the best commercial practices that we found out from several dealers, special tools are said to be part of the inventory and given a part number with a penny cost, with a sale price of 10,000. You report the sale on the good work when the special tool is used. Now you know who has the tool and when it will be returned. The sale price will ensure that the return will be guaranteed by the technician who uses it. When you return, you pretend that a part is not required and put it back in inventory. It's a way of doing things. And there you are going to tell me, oh be careful, you are telling me that I am giving control of the management of my specialized tools to the department pieces. As a well-known ad would say, ah ah! Wife and Libri, you are absolutely right, that's what I have to say. It's a way of doing things. You can also find others. I have dealerships that have token systems, I have dealerships that have Excel spreadsheets, I have dealerships that have lockers predestined, I apologize, to the acceptance of the tool. So when the tool leaves, the gentleman or employee who takes it must put a token, a card and give a time back. All this to guide the next person who needs to know where to go. No matter what methodology you are going to take, do you have one? A good. This is the big one question. The other element is to make a margin in your workshop as a service director. You know, one of the best ways for a department manager to see what happens in his workshop is management in motion. Which means going to observe your technicians. In English, we say managing by walking around, CMWG, it is a notion that has long been described. The objective you seek is to understand the dynamics of your team and, if necessary, to make the necessary corrections in order to to increase the overall performance of your workshop. I suggest you share your observations, raise the issues you have seen and ask your technicians to find solutions. You will see, just by asking them, you will increase the yield overall of your workshop, because it is proven, beyond any doubt, that if the change comes from them, it will happen more quickly and will be the new commercial practice of your service department, because they, your technicians, chose the methodology and the way of doing things. It's easier when it comes from them. You are the conductor, it's up to you to make them resonate together. So, again man, these are elements to maximize the output of my workshop. Another element also which is not neglected, a lot of 5 minutes relate directly to the parts department and how they interact with the technicians and how they source parts. What is the response of your tablets to your requests? Stock versus special order. Did you have all your parts in one go? Do you return unused parts so that they are removed from good work and naturally shelved? Do you work together or there is a wall between your service department and your parts department? I apologize once again for the little flu that has joined me in a nasty trick. One thing is certain, the days of working in silos are over. You have to work in partnership. Working in partnership is the vision and solution of the future. They say that the partnership you have to do and often I will speak for a department of service, we often try to protect ourselves, to relieve ourselves of guilt, we often offer as an excuse to the customer that it was the parts department that did not have the part. And that's what's causing the delay. You know, we need to change this dynamic. For what simple? If the customer believes that you did not have sufficient inventory on hand to respond to simple requests like an oil painting and if this is the cause of the delay, imagine for a more complex piece. The customer will have the perception that he made an error in his purchasing choice and next time he will make his purchase elsewhere. In fact, with one of your competitors. There are people of age who say they never bite the hand that feeds you. Be frank, honest, tell the truth and you will see your customers stay loyal to you for a very long time. It's simple, it's easy. We are not looking for someone to blame, we must always look for solutions. High element, meet with parts clerks, service advisors, technicians. Once in a while, talk to each other about problems, irritants that you have between each of your departments and the irritants versus one and the other. We must develop, we must increase our level of communication. The better communication we have, the easier the relationship with our customers will be. Try, you have nothing to lose. Another element, solid building processes bridges. Naturally, building solid bridges means a reasonable investment on the part of managers in coaching stakeholders and analyzing situations. I highly recommend working in partnership with your parts manager, to work at establishments, to establish common objectives at the sales level, sale of parts. Think about this, for a dollar of labor you would sell a dollar of parts and vice versa. For a dollar of parts, you would sell a dollar of labor. In a dynamic like that, you will run out of hoteliers and space very quickly. Still there, this must be done as quickly as possible, not quickly in the sense of meeting, but in the sense of execution. We must take action, we must work on signaling, We must plan in advance for both the accessories that could be sold through sales and the customers who will come to do preventive maintenance. We must be proactive. Too often our industry has been reactive to situations, we must now shift into mode proactivity. Establish solid processes for preparing or placing special orders for all clients, including internal clients. Inform and coach your stakeholders. Today, there are statistics that prove that baby boomers and millennials, but even the new generations want to be coached, want to be supervised, want to be evaluated. They say it in surveys. They are counting on you, the directors and coaches, to achieve their goals. And naturally, empower all your employees. Remember, the real boss is your customer. Again, the next slide is a reflection one. They say, take off your sunglasses. I don't think there are many listening directors who wear dark glasses. I think that often, when we are stuck too close to the tree, we no longer see the forest. So, distance yourself, step back from the tree, look at the forest and trace the path. Road to success. Ask yourself questions. Look at your service department with the eyes of a customer, not your eyes. Would you do business with yourself? Would you do business with your service advisor? Would you do business with the person in the service truck who comes to see you? Are the work areas safe, that there is no dirt on the floor? Think about the time spent outside work accidents that can happen in your workshop, when a simple, important technician stumbles upon a puddle of oil, falls to the ground and gets hurt. You can lose it for three, four, six, a year. It is already difficult to find technicians. Imagine losing your best technician to a stupid accident. Again, you have to involve people. You know, there are technicians who like to work in the box, I will say that word, in the box. How can we get them to work more safely and break out of the box? Often peers can play and influence, working with your entire team. Be rigorous, because often the image you project can speak so loudly that your customers will not hear the words you want to say to them. They will stay stuck to the image. And God knows, again, the aging of an image is worth a thousand words. If he doesn't like the image he sees, he will go elsewhere to look for better images. I know that today, this is a show that is pre-recorded. You can't ask me direct questions. I understand. But here's what you can do to get me to answer your questions. I'll give you the steps to follow. I have over 30 years of experience in the field and I can tell you that there are no crazy, stupid or stupid questions. Only the answers can be. And believe me, I will be happy to answer all your questions without judging you and I will not make stupid or idiotic comments. You can reach me at the email address you see at formationfuture.commercialsimpartico.ca. My name is Daniel Surprenant and I thank you for the time you invested with me today. I hope you all do a good analysis of your situation and put in place corrective measures by implementing an action plan which will make all the difference towards profitability, profitability and above all optimization of your service department. Remember, finding your five minutes can make the difference in a profitable service department or not. Thank you for being with me. I wish you a good end of the day.
Video Summary
In this training program, Daniel Surprenant discusses the factors that affect the optimization of a service department in order to achieve peak performance. He highlights key areas such as speed of execution, availability of parts, specialized tooling, and customer interaction. Surprenant emphasizes the importance of evaluating the department's performance, identifying and reducing losses of technicians' time, and building trust with the parts department. He also discusses the need to prepare, recondition, and sell machinery and the financial aspects of profitability. Surprenant presents key performance indicators that service departments should consider, including gross profit margin, absorption, return on assets, and sales growth. He encourages the implementation of effective management practices, such as managing by walking around, improving communication and collaboration between departments, and establishing solid processes for special orders. Surprenant also emphasizes the importance of coaching employees and empowering them to deliver excellent service. He concludes by urging listeners to reflect on their service department's performance and make necessary improvements to achieve profitability and optimization.
Keywords
optimization
service department
peak performance
evaluating performance
financial aspects
profitability
performance indicators
effective management practices
excellent service
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