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In my last blog, "Why Aren't Your Customers Loyal?" I discussed the connection between customer loyalty and employee happiness. My belief is that many dealers are wasting money on customer loyalty programs if they are not also focused on making their employees happy and on creating a great place to work.
I am proud of the fact that Auto/Mate was recently awarded with a "Best Places to Work" distinction by our local business journal for the fourth year in a row. In 2013 our company also received a "Top Workplaces" award from the Albany Times-Union for the second year in a row.
But as I scanned the list of companies on each list I couldn't help noticing that not one dealership made the "Best Places to Work" list (out of 30 companies in New York's capital region) and not one dealership made the "Top Workplaces" list (out of 45 companies).
Out of curiosity, I dug a little further into similar "Top Workplaces" and "Best Places to Work" lists compiled around the country. Out of 2,224 companies that made these lists in various markets only 29 dealerships were ranked, or about 1.3% of all companies.
Why aren't more dealerships on their local "Best Places to Work" and "Top Workplaces" lists?
Most dealers I know are actively involved in their communities; in local clubs, charities, causes and events. Many dealerships are family-run enterprises, and claim they treat employees "like family." It seems to me dealerships should have a natural advantage in these types of rankings because they are locally focused.
The incentive associated with creating a great place to work is clear. If you read the interviews, comments and reviews associated with the "National Top Workplaces 2013," (compiled by WorkplaceDynamics) the best companies to work for are more profitable than their competitors, and their leaders credit their success to their ability to keep both employees and customers happy--in that order.
I can attest to this connection: it's no coincidence that in addition to being named a "best place to work" four years in a row, Auto/Mate continues to enjoy an average 20% growth every year. Our DMS was ranked the top DMS is NADA's most recent dealer satisfaction survey, and we have received the "Highest Rated" dealer satisfaction award from Driving Sales for two years in a row.
So how can dealers create a great place to work?
According to the millions of surveys that "Top Workplaces" has conducted over the years, these ten factors are what drive the highest levels of employee happiness:
1. Leaders of the organization caring about their employees' well being.
2. Being able to trust what the organization says.
3. Having confidence in the leadership of the organization.
4. Being paid fairly for the work performed.
5. Feeling valued in the organization.
6. Understanding the long-term strategy of the organization.
7. Being treated like a person, not a number.
8. Having adequate staffing levels to provide quality products/services.
9. Employees liking the type of work they do.
10. Retirement plan benefits.
In my personal experience, the three following management philosophies are the cornerstones of what makes a great place to work.
1) Employees are the Number One Priority.
How do you prioritize the following: shareholders (owners), customers and employees? In that order? I like to use Southwest Airlines as an example of a company that makes employees the number one priority. In 2008 when the economy went south, most airlines laid off a lot of their employees. Southwest's CEO refused to lay off a single employee. He insisted he was not going to put the company's stock price ahead of the well being of employees. How do you think that made the employees feel? I would say very good, and today Southwest is well known for its excellent customer service and high levels of customer loyalty and profitability. As Herb Kelleher, the CEO of Southwest, once said, “If the employees come first, then they’re happy…. A motivated employee treats the customer well. The customer is happy so they keep coming back, which pleases the shareholders. It’s not one of the enduring green mysteries of all time, it is just the way it works.” This is how the leaders of great companies set their priorities: employees first, then customers, then shareholders (in a dealership, this means the principals). If you take care of the first two, the latter will benefit.
2) Employees Trust Their Leaders
In a great place to work, employees trust their leaders and believe the leaders are doing what's best for them--the employees--not what's best for the leaders. In a great place to work, when the leader of a company says he or she is going to do something, they do it. They also identify and state clearly what the company's values are, then ensure those values are adhered to in the day-to-day management and policies of the company. They lead by example. A good leader has a vision for the company, shares that vision with the employees, and explains management decisions to the employees.
If your employees trust what you say and believe that you are genuinely looking out for their interests, if they are excited about your vision and see how they will benefit from it, they will go all out to help you achieve that vision, grow the business and meet other goals that you have set. If employees feel valued and know how their roles contribute to the company's success, they will take personal ownership in helping the company to become successful. Ultimately, this benefits the leaders as much as it does the employees.
3) Rank Does Not Have Privileges
What is the role of a manager? If you ask your managers what their primary responsibilities are, many will say it's their job to set goals and to ensure that everyone is doing what they're supposed to be doing. Many managers believe that the employees in their department work for them; that is, the employees are responsible for helping the manager to meet the goals set for the department.
At Auto/Mate, my philosophy is that managers (including myself) work for our employees. I tell my managers that they work for the employees in their department, not the other way around. Our primary job as leaders is to ensure that our employees have what they need in order to do their jobs to the best of their ability. Think about this for a moment. Think about the look you would get from your Sales Manager when you told him he “works” for the lot attendant and not the other way around. Well he does, in a sense. Assume that the lot attendant has major issues in getting keys for the vehicles. Can’t find the keys, can’t move the vehicles, can’t sell the vehicles, etc. If he tells his manager he has this problem (in many dealership this would never happen but that’s another blog) and the manager works to address the problem (new key machine, better process with the sales people for return of the keys, etc.) then who works for whom? Employee had a problem, manager fixed the problem. How do you think the employees feels? Much better than if his issue fell on deaf ears. A manager's job should be to ask, what do I need to do to make my employees' jobs easier?
If your dealership tends to have high turnover and low morale, it may be time to put some time and effort into creating a great place to work. Make it a goal to get your dealership listed in the "Best Places to Work" in your local business journal. What do you think makes a great place to work?