It's Called Work

The four-letter word 0:00

Steve Shaw: Welcome, welcome, welcome. Dave Rogers, what is on your mind? I'm going to start asking you that now, instead of saying, "How's it going?" and going down some weather path. What's on your mind today, Dave?

Dave Rogers: A four-letter word, Steve Shaw. A four-letter word.

Steve Shaw: Well, I love it. What is the four-letter word on your mind? I've got a couple on my mind, but I'd like to know. I have a sign in my house that says, "This home is built on love and profanity." So what's your four-letter word today?

Dave Rogers: I like it. This one's actually a clean word, but it's probably profanity to a lot of people. It's work.

Steve Shaw: All right. Work! Tell me what that means. I'm not sure I get it yet, but let's hear it.

Dave Rogers: I was having a conversation today with an outside vendor and one of the owners, and we were chit-chatting about the new technology and how some people adapt to it, whether it's a software program to acquire used cars in the drive or something else. The owner mentioned it about ten times: the stores that do really well with these software programs have someone there who

works the program. I think there are too many people out there whose mindset is to put software in the store to sublet their job. You're basically subletting it. You don't want to do the work, and we've talked about this before. AI

is like a little kid or a new employee. You have to spend time training it. That's the four-letter word. You have to work it. I think we're getting lazy in our technology world. When you see people who are very successful, it's because they work the program, they work the job, they work the process, whatever the case may be. And I think it's underrated,

or let's just say it's not politically correct to tell people they're lazy, because that's another four-letter word. But you've got to work the program, no matter what it is. That was the topic today, and I think it goes with anything.

Steve Shaw: Well, that's pretty funny. I wouldn't have thought about it in that respect. But everything we talk about, whether it's skipping steps or putting in the time, it is work. If you want to be successful, you've got to put in the effort. We've got to work at it. There's no question in my mind about it.

AI, CRMs and checking the box 2:40

Dave Rogers: You go to work

every day. It's not vacation. It's not relaxing. It's not your day off. It's work. So to expect it to be easy, with no effort, is kind of hypocritical. When we were talking about the software, we were talking about the AI assistant for, let's say, the CRM for sales. This has been going on for twenty or thirty years. You get an internet lead in.

Somebody responds to the lead, manually, generally. That's how it was in the past. And then every day there's a cadence of tasks. You're supposed to call the customer on day two, send an email on day three, do this on day four, all the way out to ninety days. And you know damn well your salespeople and your BDC staff are not doing any of that work. They're checking the box. They're not making the phone calls. Let's be honest. Everyone says they are. They're not.

They're clicking the box. How many people go in and actually look to make sure it's getting done,

or look at the length of time? You'll see a phone call that lasts three seconds. What happened there? Did it go to voicemail? Did they not answer? The email leads are a lot of times templates. So when we talk about AI: use the AI. There's this belief out there that AI is going to replace people, that it's going to take jobs. I don't think that's necessarily what it does. I think it was designed to take care of the mundane tasks so your people can focus

on the important stuff. Whether it's the CRM, phone calls, client services, appointments or no-shows, it doesn't matter to me. There's a certain part of those mundane tasks you'd want to sublet to your AI. But in between that, you need to focus. Take

phone AI. If you have AI answering the phones at night or during the day and making appointments, are you looking at the desktop or the dashboard to see how many people hang up?

Because people hang up. There's going to be a percentage of people, 15%, 20%, who don't want to talk to a computer. Do you have somebody calling those customers? "Hey, Steve, I know you called the dealership and got disconnected. Can I help you?" That requires some work. If you can use AI to take away the tasks that can be automated, now you can get your people working a little more efficiently and putting in the effort to actually get some results. That was the conversation.

But it was funny listening to him talk. When he talked about the stores that were successful, it always involved somebody in the store who worked the program.

Get out of the office 5:32

Steve Shaw: Well, you could talk about the playbook.

I was talking to a potential client today about the playbook. "We have this great playbook." But what does it do? It requires somebody to work it. I've got to go out and watch and manage and oversee and ask, "Is somebody following the plays in the playbook?" The other day we were talking about role playing and how people feel about it, and it sort of cracked me up. Again, let's go

back to Major League Baseball. Could you imagine if the All-Star player said, "Yeah, I don't want to take batting practice today. I don't want to do drills, because I just don't feel like it"? That's work. That's effort. But where I think you're going is that there's work for the manager. Our job isn't automated. Should I not

work when I get to work, and go have a production meeting every day? Or I can sit in my office and type a couple of keys, because it's easy. It's easy for me to sit in my office at 7 a.m. and do my reports. That's bull crap, to be nice about it. Your reports don't have to be done at 7:05. There's a more important job, which requires some effort. It means I have to get off my ass, walk out to my shop, stand in front of a group of men and say, "This is the good, bad or indifferent from

yesterday." And then I pick up my work in process and walk my parking lot, and do the things that actually drive income for my store, instead of sitting here punching a bunch of keys on my keyboard. Hopefully it's all automated anyway.

I'm going to go on a rant, man. Why do general managers or dealers say, "Send me a report in the morning"? It's because they want you to work. They want you to know what your numbers are. They know the numbers as well as you do. They're saying, "I need to know that you know what's going on in your store." And it's absolutely true. It's a lack of effort on people's part. "Yeah, I made it to the show."

They made it to the show and put their feet up. My buddy used to call it ringing the bell. "Man, he rang the bell." No, man. You rang the bell. That just means you've got to work a lot harder.

Dave Rogers: Well, you're right. It is directed at the managers. Years ago, I took the class for Franklin Planners, which Covey bought at some point. You used to list your tasks A, B, C, 1, 2, 3. And what did they always tell you? Don't do the C's first. Don't do the mundane little tasks first. Pick the hardest thing and do that first in the day, because then you feel like you accomplished something worthwhile.

That goes for anything in your store, whether it's

sitting with your advisors, training your advisors or talking to your technicians. It requires you getting up off your ass and doing it. There are too many people, general managers included, sales managers, who just want to fire emails off. To me, it's a form of procrastination. I call it bureaucratic procrastination. They fill their day up with these tasks,

and then they go home and probably tell their wives, "I worked my ass off today." "What did you do?" "I sent a hundred emails. I opened fifty and I sent a hundred." That's not work. It's administrative. We've gotten to the point where people think, "I go into my office, I run my reports, I look at the numbers," and they consider that a job well done. That's not a job. That's a task. It's administrative. That's not what you're paid to do.

One of the definitions of a manager is getting things done through others. Well, they don't just do it. You've got to teach them. You've got to train them. You've got to work the plan. That's what it all boils down to: how much work are you putting in to make your team better? You can sit in your office and bitch all day, but that's not getting the job done.

Pay plans and why training gets a bad rap 10:03

Steve Shaw: And the mantra in our business, and people will slap me around and I'll probably get some nasty phone calls: we design pay plans to encourage people to do certain things. The reason is that we don't want to do them ourselves.

I'm going to give you a pay plan that's convoluted, where you've got to follow a grid, because I don't want to have a meeting with you to talk about it. I'm hoping you hold yourself accountable, so I'm going to pay you a certain way, instead of what every other business in the world says: "Here are our standards. We're going to hold you accountable, and you get paid accordingly."

For some reason, some consultant a long time ago designed a pay plan so people would be self-motivated. And then? Go sit in your office and have a Coke. Well, guess what we got. We've got pay plans that are convoluted, people don't understand how they're getting paid, and I'm sitting in my office as a manager drinking a Coke and hoping everything comes together at the end of the day.

Dave Rogers: I've always been amazed by Best Buy. You hire these techie kids right out of high school or college at 20 bucks an hour, whatever they're paying them, and every single time you go to the cash register, they're trying to upsell you on a service contract.

Every single time now, they're trying to get you to sign up for $99 to join the Best Buy club, which gives you some kind of price guarantee for ninety days. You have to do a little work and register, but that's what they do. And this kid makes $20 an hour.

Maybe they get a spiff, maybe they get a plaque on the wall if they do the most service contracts, but they're not making 100 grand a year on commission. Meanwhile, you've got to beg your service advisors to recommend an alignment. You've got to beg your technicians to take a video. You've got to beg your service advisors to review the multi-point. The pay plan is supposed to drive the behavior you want.

But that's where most people fail. They put a pay plan in place that drives bad behavior, and that's not what you're looking for. You're looking for good behavior. The only way it gets better is if you get up off your ass and work next to them, coaching them and training them. Again, the four-letter word, man. You've got to work. You just have to do it.

Steve Shaw: It is. And I'd bet the general majority of people watching us, because of the email I got, which I forwarded to you... she said, "I watch your show and I feel like you're in my head," or, "You're saying my exact words." It's because there are a lot of us out there who work our asses off to get where we are. We've gone through the fire. We've done the steps. And then there are so many people who are not

working, and that's where we all get brought down. I could say the same thing about my part of the industry. Consultants will all hate me, and most of them do anyway, but a lot of them say, "I'm going to teach the stuff I was taught in 1987, and keep teaching it, because that's all I know," instead of working to understand what people want today. What's the behavior of today? They're just teaching all this old shit, and that never works.

Does it work a little bit? Yeah, they're doing some kind of training, so that helps. But is it going to give a dealer the biggest impact? And then there are other people out there working hard to help people improve and do their jobs, and we get a bad rap,

because "training doesn't work. I don't do training because I tried it once." Well, you tried it with somebody who didn't give a shit. You tried it with somebody who was ineffective. So we all get a bad rap. I'd say the same thing about my part of the industry, and about dealers, and about good people like yourself and others who are really putting in the effort to help their dealers improve performance. So you're right. People have got to work. We've got to get off our ass

and go do something.

What gets you to one level won't get you to the next 14:12

Dave Rogers: And I don't think people are necessarily lazy. I think they've just got bad habits.

I remember when I was a technician, I saw the advisors all sitting in the air-conditioned office goofing around, having fun, laughing. I said, "One day I want to do that, because that looks easy." You're in the shop under the hood, sweating, under the dash. It's 120 degrees in the car, because we didn't have air-conditioned shops back then, and somebody brought in a black-interior car and you had to get under the dash with sweat dripping in your eyes. So you looked at that and went, "I want to do that." Then you become a service

advisor, and you realize it's not all fun and games like it looked. You actually have to do something. Then I looked in the other office and saw my boss, the service manager, sitting in his office on the phone and on the computer, and I thought, "I want to do that job. That looks easy." I think that's the perception we all have moving into those roles. But that's not what you do to be successful. It's perception. I don't know if it's delusion. I don't know what it is.

When you look at it, there's a lot that goes into those jobs, and you have to learn it and embrace it. And then you've got to work it. You really just have to work it. And if that means getting other people to do their job, that's work. That's not an email. That's work. Get up off your ass and make them work.

Steve Shaw: I watched the greatest videos a couple of years ago about the people who climb Mount Everest. They go through the whole thing: you start at base camp, then you get to the first level, and a group of people don't make it. Then the Sherpas sit and have a conversation with the people who made it: "Okay, this is what we have to do to get to level number

two." You go from base camp to level one to level two, and I think it's four or five levels, if I remember correctly, to the top of Mount Everest. How many people in the world have ever made it to the top? A very, very small percentage. Out of all the people who start each journey, only a few rise and make it to the summit. And what they said was that what gets you to level one

doesn't get you to level two, and so on. Now you're at level four, on your way to the peak, and it's a whole different world going from level four to touching the top and planting your flag on Mount Everest. That hit home with me.

When I was training a while ago, it was like: you're great at what you do. You're an advisor, and whatever your level is, two hours a ticket, fine. You're at three hours, great. What's going to get you more? Are you going to do the same thing, like you were talking about on the previous podcast, and hope you get better? We do the multi-point inspection red, yellow, green, because it was created in 1997, and we had a 30% closing ratio then. We've got a 30% closing ratio now.

Are you going to do the same thing, or are you going to think about doing it differently? Doing it differently requires you to think, it requires you to work, and it requires you to learn a new skill. If you want to go from base camp to planting your flag at the top of Mount Everest, it requires effort, and it requires you to change that effort the higher you go up the mountain.

Dave Rogers: I had a boss one time who used to bucket people by the gross of the store, let's just say in service. You'd have a guy who was good from 50 to 100,000 in gross, but he couldn't get the store over that. Another guy was good from 100 to 200, but he couldn't get it over either. So there were different levels. You get a guy like Damon, running forty, forty-eight techs in a fifty-three-bay shop, and that guy is looking at different ways. He's trying different things. What got you to 100 or 200

isn't going to get you to four or five hundred. Maybe if you went from a ten-bay shop to a twenty-bay shop, that gets you part of it. But it's not going to get you to 300,000.

If that was a 100,000 shop, you have to do different things. You've got to streamline. You've got to adapt to the customer. You've got to figure out different production methods, whether it's appointments or something else. Too many times people get comfortable and rest on their laurels. "Okay, I'm at 125,000, and when I took over the store it was at 40,000. The boss loves me and we're doing great." And five years later you're still at 135, 140. Wait a second. That's not 10% gross growth

every year. You've got to get to the next level, and it requires some effort.

Growth beyond inflation 19:02

Steve Shaw: And with inflation right now... this always cracks me up. The average dealer grows X percent every year, five, six, seven, eight, 9%. And somebody goes, "Yeah, we're up year over year." Well, if you're up the same as everybody else, that's because of inflation. That's just the economy. What did you do specifically to take your store further? If the world's up 5% and you're up 10%, okay, you've got a 5% swing. What are you doing differently from everybody

else? When you can share that with me... that's what I'd like to know. That's why I don't consult anymore. What have you done in the last X, Y and Z days that sets you apart? What have you specifically done to improve the performance of your store? I like to ask that question.

Dave Rogers: Well, it's true. You go in January 1st and get a labor rate increase. Maybe you get a parts retail increase. You raise your labor rate ten bucks an hour, whatever that equals as a percentage. Okay, you raised your door rate, you raised your prices, you raised your warranty labor rate. Tell me what you really did to add any money to the bottom line.

I always measure net as a percentage of gross. I'm always looking at that. If you're going up in gross but your percentage of net is going down, you're spending money doing this and you're not getting me a return on my investment.

In the public world, we used to use a term, I think it was a Wall Street thing, called flow-through. You'd look at this year's numbers for the dealership. Let's say you were at 2% net to sale. If you were going to add all this extra gross and all these extra sales to the board,

you should be at a higher percentage next year, two and a half, three, because your expenses shouldn't change that much. A certain part of your expenses is baked in. You're going to have a little more, because you'll pay out a little more in commissions, and you might spend a little more on advertising. But the flow-through from the gross on the top line to the bottom line had better be better than your old average. Let's say 30% of your gross was going to the bottom line,

and you increased your gross a hundred grand. It had better not be just an extra 30,000. It had better be more. We want to see 40,000. We want to see 50,000. They used to grade you on that every year. That's the same thing you're saying. Just because you got me a couple of extra dollars in sales... what does that mean in a dealership? I now sell $40,000 cars instead of $30,000 cars. The price of the car went up, so my revenue went up, but that doesn't mean my net went up. It doesn't mean I did anything different.

Steve Shaw: What's that formula? It's another ATCON thing, where we talk about how much it costs you to make a dollar, what every hour costs you. You go into stores where it costs you $5 for every hour you produce. Great, keep doing it, but you're still losing money. You can produce more hours all day long, but you're still losing five bucks on every one of them. That's ridiculous sometimes.

Dave Rogers: I used to evaluate stores. You go in and look at a store that loses a hundred thousand dollars this month. That's the net: they lost a hundred thousand. And they ask, "What do you think we should do?" I'd say, "All right, pretend you're in quicksand. Stop moving."

"Why?" "Because the more you do, the more we're going to lose. Don't sell another car. Let's figure this out before you do anything, because every time you sell a car, we lose money. Every time you do this, we lose money." I used to tell them that all the time, and they'd get all mad at me. And I'm like, no, we've got to do something different here.

We're not getting the right margin. We're paying out too much. Our expenses are too high. You sublet $45,000 to outside services this month so you didn't have to get up off your ass or have your people answer the phone. It all boils down to the same thing. You have to figure this stuff out and change the way you do things. Again, it's that four-letter word. You've just got to do it, man.

Take away the hurdles 23:21

Steve Shaw: It's a crazy world. And you're right. Every little thing is work. We can sit there and rely on AI or rely on this or that. But it's work. We've got to put in the effort, no matter what position we hold in the organization. It's got to be on my shoulders, as the manager, the advisor, the associate. I've got to look at it and ask, "What am I going to do every single day to improve that dollar for my owner?"

If you're not growing your business at a certain percentage, our dealers could take their money, put it in the bank or a CD, and get a better return than some stores are giving them. Why is he allowing us to piss his money away?

Dave Rogers: Think about the cost of a dealership now: 15, 20, 30 million dollars. You could take 30 million dollars

and go buy land, buy Bitcoin, buy stocks, and get a higher return on your investment than 2% net to sale every single year. Depending on the store, these dealerships are valued at ten times earnings, not counting blue sky, just the regular numbers. Okay, that's ten years to pay it back. But

I don't want to break even in ten years. That's not the goal. The goal is to make money and pay down the investment or the loan, whatever it is. And when you go back to a manager, step one is making sure your people are working.

You have to make sure they're doing their jobs, coming to work and being efficient. Your job is also to take away their hurdles, so they're not fighting hurdles to do their jobs. That's your job. That's work. It might be work to go get in somebody's face. You might have to go to your sales manager and tell him to stop parking cars in the service department, because your technician doesn't want to walk a football field to get the next car. The cars that are going to be worked on should be closest to the building. The cars that are done

and ready to be picked up should be backed up on the side where the customer exits the building. We can't be parking used cars that were demoed three days ago in those spots. It requires you to get off your ass and work. You've got to take away the hurdles. Why is your technician taking fifteen minutes to find a car? That shouldn't be happening. That's the job as a manager. Make sure that stuff gets done.

Standards come from the top 25:46

Steve Shaw: If I liken it to my career, and I've said this a couple of times, I had a couple of guys who were my mentors. I love them to death. I grew and learned because of them, but they didn't take any shit. I could not walk into them with an excuse. It was not accepted. And as a trainer,

I get hired by fixed ops directors like yourself, or by a dealer principal himself, and there are times when I have to have those conversations: "Bro,

if you want this done, it has to come from you." It could be a simple process. It could be a walkaround. It could just be using specific language. But I'll tell the dealers you've got to do it. Bob Cawley, the minister, the preacher... one day Bob and I were in a conversation, and he walked out, and he had twenty-five, thirty service advisors on the drive, and he saw they weren't walking around the car like they were supposed to. He lined them up against the

wall, and he said, and I'm going to give a secret away, "Listen to me, you no-good MFers. We have a process. You're going to walk the process, you're going to work the process, or you can walk right out that door." And the whole group of twenty-five guys were like,

"I can't believe he said that." And I've said that to dealer after dealer. If you expect your managers and your people to do what I'm working on with them, then in your own way, you've got to line up every advisor on the drive and say, "Listen to me, this is how it's going to be done." When it comes from the man whose name is on the sign, that's when it gets attention. I think it all starts at the highest level. Those are the hardest

conversations I have. But when ownership does it,

a manager only has to hear his dealer say something like that once, hopefully, and then he gets the message. We know the owners, and we know they're not mean people. But if an owner came down to a service advisor and said, "Listen to me, bro," however he says it, it would scare the shit out of somebody. It's not like our advisors have piles of income saved up so they can be without a

job, so it would scare them, enough and in the right way. Call that management or leadership or whatever you want, but it's accountability for the process they want. And that's what I want for my dealers: to say,

"This is the standard of working at our store, and if you're going to work for me, you're going to work your ass off." I hear that from Damon. I certainly heard it from him: "My ownership has standards. This is how we do business, and it flows downhill."

Dave Rogers: Well, that's where leadership

versus management comes in. You need a leader to paint the picture and the vision, to help with the culture, which we hate the word, and to set the standard. And then you need managers to execute the plan. I'm of the belief that if you're a good manager and you do things the right way, put the process in place, and your people start making more money and having success, you will earn the leadership banner. They will follow you.

You become a leader, in my mind, by starting as a good manager. Not everybody is Vince Lombardi. Vince Lombardi was a great head coach, probably the greatest head coach, Belichick or whoever you want to say. But before that he was the offensive coordinator for the New York Giants. He was in the trenches. He was a worker. He made things happen. Before that, he was an offensive lineman in

college at Fordham, I think, part of the Fordham five or whatever they called it. They were mythical. He did the work and he earned it. So when he went to Green Bay and became head coach, people listened to him and followed him, because he had the track record, the knowledge and the expertise. He knew how to manage things, and then they adapted to his leadership and it all blended. He won the first Super Bowls. That's the kind of stuff

people want to skip. They want to say, "I'm a servant leader. I'm a leader. I'm this." No, you earn that. That's how it goes. You earn it by being in the trenches, doing the job and working your ass off. Just my two cents.

Costanza syndrome and the GM tip 30:29

Steve Shaw: Right. And on the exact opposite side, you've got the guy who thinks he's working because he's out there taking the trash out or washing a car. That's bullshit. They're just finding shit to do because they don't really want to work that hard. I remember

seeing a service manager washing cars and changing oil and doing all this because he thought, "I'm really being helpful. I'm helping everybody." No, you're not, bro. You're just creating busy work because you don't want to do your job. Go hire somebody to do that. If you've got to change oil more than one time, you're not a good manager. I'd say you've failed miserably and you have a poor

perception of what the job is. It's not that you wouldn't do those menial tasks, but it's not your job to do them. Your job, as you say, is getting things done through your people, with your people. It doesn't mean I have to go clean the drain or do an oil change or wash a car. That would be absolutely ridiculous.

Dave Rogers: Listen, I had a manager who, when he was an assistant manager, was in the service drive. He was a good salesman. He's always been a little long-winded and a little anal about different things, but he directly helped

bring the store's sales and revenue up. Give him credit where credit's due. Then once he became the manager, you couldn't find him in the service drive where he had been so successful. What was he doing? He was out back fixing the oil burner. He was making coffee for people. He was doing all these little stupid things. And of course he was frazzled, because he had a to-do list an arm long that he never got done. He wasn't returning calls or helping customers.

All the people he'd built relationships with on the drive were leaving voicemails he never got to. So what happened? The CSI tanked. The numbers were flat. You try to explain it to him, and he says, "I'm busy all day." Yeah, you're busy making coffee. You don't need to be out there making sure the oil burner is on. You can hire somebody to do that. They just get busy working. "But I'm the service manager. This is what I do."

That's not what we're paying you to do.

Steve Shaw: I call that Costanza syndrome, from George on Seinfeld. When George was working for the Yankees, he always looked stressed out, like he was working. His desk was a mess. Bro, that's George Costanza right there. You're doing shit. I've coined the term: Costanza syndrome.

Dave Rogers: It's perfect. Did you ever see the episode where they're sitting in the diner and Elaine says something to him, and they ask, "How do you do it?" And he says he just sits there going "Jeez," so everyone leaves him alone, because he acts busy.

Steve Shaw: That's exactly it. That is Costanza syndrome, 100%. And a lot of our managers have it, man. It just cracks me up.

Dave Rogers: I think it's a bad habit. It's bad visuals. It's not having a mentor. It's a lot of different things. But people have got to wake the hell up, get up off their ass and get this thing fixed.

Steve Shaw: Well, we'd better wrap up there with Costanza syndrome. Give us a GM tip of the day about work.

Dave Rogers: I love it. Like you said, that's where leadership comes in with the general manager. You're supposed to be painting the vision and doing the work of the owner. The owner sets the culture, hopefully, but you're the GM, his right-hand man, the vocal part of it, and you have to make sure people are doing their jobs. Get up off your ass. Sitting in your office sending emails all day isn't working either. Sorry. I know there's administrative stuff you have to do as a general manager, but you don't have to do it at 9:01. That's not when you have to

do it. You could do it between 12 and 1, when everyone's out to lunch. You should be walking around. Get up early and go into the service department, maybe not every day, maybe once or twice a week. Make sure people are doing their jobs, help take away some of the hurdles, and make sure your managers are up off their ass doing things. Like you said, at 7:05 there are better things to do than run reports.

You should be in the service drive. You should be giving your advisors a pep talk. You should make sure the loaner cars are lined up. Make sure the doors are open. How many times have you gone to a service department where there's a line of people outside because you open the door at 7:30 and all your advisors are sitting inside?

Steve Shaw: Don't get me started.

Dave Rogers: Push the button on the door, open it up, let them in early, and let's get them written up, so there's work for the technicians. These are the things a GM needs to do. Get up off your ass and change the culture, change the perception, by getting people to do their goddamn jobs.

Steve Shaw: Right on. I couldn't agree more. Well, let's get out of here on that note. Everybody go to work and make some money. Awesome, Dave. Thank you.

Dave Rogers: Thanks, man. Have a great one. Talk to you.