Watched a Dealership Lose $50K Because They Skipped ONE Step

Top 100 on Spotify, and going live on Fridays 0:00

Steve Shaw: And we are back again. Dave Rogers, what is going on?

Dave Rogers: You know, too much, Steve. Just too much. Everything's good. How you been, buddy? I haven't talked to you in a while.

Steve Shaw: Everything is good on my end. Like I said, I'm back in civilization in Tampa, Florida, enjoying this amazing weather before I hit the road again pretty soon. Good stuff. What's happening in your world?

Dave Rogers: We just wrapped up another month, and I'm getting geared up for another one. I'm going to take a couple of vacations this month, so it'll be a little bit of a break: some long weekends, going to see my grandkids and doing a little traveling. I can't wait. But in between, it's the same grind everyone else in the car business is doing.

Steve Shaw: Hey, you know what we need to talk about? Before we get started, we've got to tell everybody the big news. A couple of things. We're in the top 100 podcasts on Spotify. We were number 96 on Spotify as of this morning. That's pretty awesome. We rarely talk about ourselves, but we're growing substantially, to almost 4,000 subscribers and an infinite number of views. But what everybody doesn't know is that we are about to go live

on Fridays.

Dave Rogers: That's right. We haven't told anybody. Big secret.

Steve Shaw: This is it right here. We're going live on Friday afternoons at 4 p.m. Eastern, starting in June. That's going to be pretty cool. We hit that milestone, we're doing well, and I think it's going to be exciting. So we've got to tell people that June 5th, I believe, is our first live episode: one hour of Fixed Ops Focus Live. We've got to blow the doors off like we always do.

Dave Rogers: Yeah, we've got to get some guests on. We want at least two guests lined up for each show.

Steve Shaw: We'll have a couple of guests. Might even bring a vendor partner in. I think we're going to surprise a few people. I think people will be really interested, whether it's Friday afternoon wrapping things up on the East Coast or having lunch on the West Coast, in watching Steve and Dave talk about fixed ops. Fixed Ops Focus Live.

Dave Rogers: Don't forget about those guys in California. One o'clock in the afternoon, they'll be just finishing up lunch, or surfing.

What is a process? 2:29

Steve Shaw: Exactly. By the way, I had some people from San Francisco reach out to me, and that's pretty exciting. Craig's on his way to San Fran pretty soon. Thank you, Fixed Ops Focus, for that. Hey, I have a real question for you, and we talk about this all the time. Dave Rogers, what is a process?

Dave Rogers: You put me on the spot. It can be very simple. It's a series of steps, is really what it is. If I put it into ChatGPT... hold on a second, let's see what ChatGPT says. "A process generally means a series of steps or actions taken to achieve a particular result." A particular result.

But it's lacking in most places, in most businesses. It's not just the car business. It's a lot of different places. We refer to it almost every episode. Last episode we were talking about used cars and process there.

I think it's one of the things most people just aren't trained on. They haven't learned it or read about it. And I think a lot of times that's why people have problems in their business.

Steve Shaw: I'm a process junkie. That's one of the many things I'm a junkie for: op codes, process, a few other things, training as well. No matter how you slice it, if you don't have a process, you don't have anything. They say a goal without a timeline is just a wish. I don't know what you call it if you just do a series of steps.

A series of steps that leads to a desired outcome, that is a process. So I think it's important that we talk about what a process is and maybe how we put one in place.

Dave Rogers: If you can't define the end result, you're wasting your time. It's insanity. So you have to start with that, whatever it is: the drive-through process, the reconditioning process, the service write-up process. The write-up probably causes 90% of your aggravation every day, because you don't have a process in place to write up a proper repair order or take a proper appointment. And where's your little sign? If you haven't put it in writing...

Steve Shaw: Did you document it?

Dave Rogers: Right. It didn't happen. That's where I think most people fail. Listen, we were all like that when we first started in this business. You became a manager. You were given the keys because your boss got fired. The car business is like ancient Egypt. The pharaoh dies and everyone moves up a rung. As long as you're in the same family, you've got a chance of being the pharaoh, and in the car business it's kind of the same sometimes.

But you moved up to manager and nobody told you. You don't know what a process is. You don't know how to make one. You don't know how to monitor it. You don't know how to see if it's flawed. To me, the biggest thing about a process has always been seeing the red flags along the way that tell you people are deviating from it.

Start with the end goal 5:59

Steve Shaw: Absolutely. And I know we've talked about this.

A lot of guys out there are making process improvement manuals, writing out the process, writing books and so on. It warms my heart, trust me, and I don't want anybody to take offense. But sometimes I wonder. I know some people will use AI and say, "Hey, write me a write-up process. Write me an X, Y and Z process." But what is the end goal? ChatGPT can write a process: "This is how you walk around a car." Well, what is this process designed to do? What's the goal?

We don't even teach the walkaround early. I think a walkaround is the most advanced thing you can do in the service write-up process. And if you don't know the goal... What's the reason we're actually walking around a customer's car? I'll ask people, "Do you do a walkaround?" "Yeah, I walk around it." Well, why? What's the point? Again, I applaud everybody who's starting their service manuals, their advisor training guides or whatever they're writing. But is there an end goal in mind for

every single process? Is it well thought out to achieve that goal? I'll use the quarter-time process. The write-up process, certainly for express, has to achieve a 15-minute multi-point inspection. At the end of this process, can you get a multi-point to your customer within 15 minutes of that customer signing the RO? If it can, okay, you've got a process.

If not, what's the point of it?

Preflight checklists and the sailboat 7:33

Dave Rogers: Right. And if it fails, you have to go back and look at the process, take away the hurdles, take away whatever stops you from getting there. My dad was a pilot for the airlines years ago, but he also had his own planes. He built them, took them apart. He was a mechanic. They

work on their own planes, like race car drivers work on their own cars. He'd be working on the plane, pull it out of the hangar, and he knew everything was there because he just worked on it. But when we went to the airport to take the little plane out, he did the same walkaround every single time.

Steve Shaw: Yeah, absolutely.

Dave Rogers: He did it professionally when he worked for the airlines. They have a book they go through, a checklist. And think about it: the end result is "I don't want to crash." I used to use that example all the time when I was a manager. It didn't matter if we'd flown for twenty minutes and landed. He still did the check before we took off.

Move the flaps, move the ailerons, make sure there were no rivets loose, every single time. I'd say, "Come on, man, let's go, let's get out of here." Nope. It doesn't need to be that drastic an end result for you to want a process.

Steve Shaw: But it should achieve the end result. It should get you where you're going, no matter what.

Dave Rogers: Absolutely. And there are going to be things that happen. Could you have an accident? Could the engine blow up? Are there things you can't see? Of course. But that doesn't mean you don't take every step necessary to control what you can control. It's like the 30-minute oil change you talked about at the Ford store out there. You had to put processes in place to get that done in thirty minutes, or you were going to eat it. There's a penalty. So take that stuff seriously.

Steve Shaw: It's interesting to me, because I was a student pilot. I honestly never achieved my coveted private pilot's license.

But I'll tell you about the process. I was a service manager in Southern California next to Zamperini Field in Torrance. We were open extended hours, so I'd leave for lunch and go learn to fly, and as a student pilot I learned that process of going through the checklist. What I ended up becoming was a sailor. I never got there with flying, but I became a sailor, and I sailed my sailboat all over the Caribbean.

And what learning to fly did for me was that the minute I got my sailboat, I wrote a process. When you go on the boat, what do you do? If you're taking people out, what do you do? What's the undocking process, and what's the docking process? If you don't do all of those things, you don't understand it, especially if you have guests on your boat.

Same thing. There was a procedure, a process, even if we were just going out for the day from one island to another. "Okay, before we go out, everybody needs to know X, Y and Z." We had to walk through the process in the event of a water landing, in the event of hitting a sandbar, in the event of crashing your sailboat. Everybody needed to know where the first aid kit was, and they certainly needed to know where the life jackets were. And even in my drinking

days, I would not leave the dock without all of these checklists handled, up to and including hours on the engine, the oil in the engine and the generators and so on. It was important to follow those steps, because people's lives are in your hands. And I'll say the same thing about our business. We take customers' livelihoods into our hands

every single day, and it's almost an afterthought.

You can only control the process 11:52

Dave Rogers: No, you're right, absolutely. There's a safety part and a danger part to this business too, not to mention people's livelihoods depending on the vehicle. With motor vehicles, there's a safety concern if you don't do the work right. I agree 100%. I used to grind the process, but I wasn't a big put-it-in-writing kind of guy until I got into Five Star and some of the manufacturer-driven processes that actually put it in writing.

I've said it before, I think they did overkill on some of that, but I get the point. When you look at the way you run your daily operation, you have to solve for problems. You're putting a process in place to make more money, make people more efficient, or ease the customer's aggravation,

have a safer work environment, or make sure you have a quality control process so you don't leave lug nuts loose. All of these things are super important, and you have to look at it that way. But most of us, and I throw myself in there too, because I've done it in my career, just don't sit down and look at things in a logical, process-oriented way. And you've got to be a little tough. You're going to ask people to do things they don't want to do.

You have to be firm in your convictions. And like you said, and we've said before, you've got to have an end result that makes sense, it's got to be communicated to everybody, and they've really got to agree with it.

Steve Shaw: I found it interesting when I had my event down in the Keys a couple of years ago. Mike Murphy, an auto dealer with a bunch of stores here locally, said there's only one thing in the world you can control,

and that's the process. We can't control people, how they do things or how they react. But I can control the process. I love that idea. It's almost like railroad tracks, or guardrails. This is the process we follow. Here's a standard on this side and a standard on that side, and as long as you follow it down the middle, we're good. If you get outside the box, outside those guardrails,

then, if we agreed to it and reviewed it, and everybody said this is the best way to do it, regardless of how it got implemented, it's in the book. If you get outside those rails, I have not only the responsibility but also the authority to say, "Come on back here to the middle." It doesn't mean I don't like you. It doesn't mean we can't have a cocktail after work or still be friends. But it is absolutely my responsibility as a manager to drive you back

to the center of those rails. If I don't do that as a manager, what's the point of going through it? And I'll shut up in a second, but I honestly think people appreciate clear-cut guidelines in the store. When there are clear-cut guidelines, I believe our associates appreciate that, and having their feet held to the fire.

Dave Rogers: Especially the technicians. They want the rules put out. They don't want to follow them individually, but they want to make sure everyone else does. I'm kidding, but they do like rules. They really do. When you're mechanically inclined, you like rules and processes. I think I've mentioned this before, maybe on this podcast or another one.

When I found out the human body was made of 70% water, it hit me. Water and electricity will both always follow the path of least resistance.

So if you leave people alone and don't give them a process, they're going to shortcut it. They're going to skip steps. They're not going to follow the path you want them to. You have to be there as the guardrails to put them back on track. And there have to be little red flags in your daily routine that let you know someone's deviating. Otherwise you'll have a fire burning, and it's a time waster. You'll have to put your fireman's hat on and go put out a fire because someone skipped a step.

I think the challenge in this business is that you're so busy putting out fires, you never have a chance to turn around and prevent them. That's where you have to get a little cerebral at night and start thinking about these things. And that's where putting it in writing helps. I can't see any reason why you wouldn't.

Write one process at a time 16:40

Steve Shaw: Going back to my interview with Bob Cawley, we talked about our process improvement meetings, and we had those

regularly. I'm not telling anybody today that you've got to have a meeting every other week or whatever. But I think a lot of people don't hold meetings because they don't know what to talk about. I don't want to get a bunch of people together for a bitch session. But I'm such a fan of those process notebooks. Okay, let's just take one. We'll generally do this at a four-store group or something. "How do you want to write a ticket?" And let's write that process

down. I've had many guys write it from when the door opens, or when a car pulls in, until the ticket is signed. Write that process down. Okay, now we have it documented.

Then: what's the point? What's the point of documenting all of these steps and what should happen from when the customer drives in until the guest signs the document? Is it simply to make it convenient? Are we trying to sell things? Do we want to make sure we get all the correct information? All of that should be in there. Maybe we want a correct, well-written repair order, like you said, so the tech

can actually fix that car correctly. So we work backwards. Obviously we want to make it convenient for the customer. We want it to be transparent. And at the end of the day, did the process achieve those goals? In our walkaround class we ask why we walk around a car. Does your walkaround process achieve the goals you set: transparency, selling, and CYA?

I don't care what's in the process, but did you cover the dealer's assets? Did you sell something? And did you make it customer-friendly? If those things are met, you have a good process, and you work backwards from them. It's not "Hey, I'll write down all these things we do for whatever willy-nilly reason," like some of the manufacturers do:

"Press the blinker. Have the customer step on the brake." Why? It's all bullshit. That has nothing to do with the main goal of the write-up process. I might have gone off on a tangent, but I think it's important that we really look at these things. And where I was going is this:

we don't do them all at once. It's not coming out with a manual of every process. Let's write these down together with our teams and say, "The goal of this write-up process is X. How do we accomplish it?" Great. Does that include a walkaround? Great. So write the process, work on it for ninety days, talk about it, fix it, love it, and make sure you're an expert before you even think about the next process

in the dealership.

Start with a pain point: the write-up 19:41

Dave Rogers: We have so many metrics, indicators and surveys, it's not hard to find an area to work on. Say you're a general manager, and you're tired of your sales manager complaining that every night after service closes, there's a blowup in the showroom because somebody didn't know how much the bill was, blah, blah, blah. It's always in the middle of desking a deal. It's always when you're shorthanded. It never fails. I feel bad for sales managers, because I've watched it happen.

Then start there. "Okay, let's work out a process so this doesn't happen as often, or ever." What does that start with? You mentioned it a minute ago: a proper write-up of the repair order. Did you get the cell phone number? Did you get the email address? Did you verify who you're supposed to call? That's the mistake most people make at write-up.

You come up to the counter and they say, "Phone number?" You give them the phone number, and that's it. They never bother to check. "Steve, am I calling you or your brother? The car's not in your name. Who should I call when I need work approved?" Nobody bothers to ask these stupid little questions, because there's no process in place. There are nine million metrics and different things you can solve with this. But most of the time

it starts with the write-up. It starts with the information you get, reviewing the menu, reviewing the customer's information, reviewing the history. Those are basic fundamentals, and for some reason we just don't do them, because there's no process in place and nobody's holding people's feet to the fire. Or they make a process so complicated nobody can follow it. That's the other one.

Steve Shaw: Like a pay plan sometimes. They make a process so complicated: how can I follow this? That's why we get people involved. I could write a brilliant process for your store and tell you how a 30-minute oil change could get done. I live in Tampa and you're in Philadelphia, and I'm pretty sure about nineteen people in that store would say, "It won't work, because of this. Steve, you don't know." I'm not an expert on what happens at a Honda store in Philadelphia. But if I

sat down with those nineteen men and asked, "How should this work? Where should the car be parked? What should happen?" and let everybody, even the porters and the cashiers, have an opportunity to tell me why I'm wrong... I know this is a terrible word to say here, but that's being a leader.

That's being a leader: not being afraid to sit in front of your people and have them say, "I'm sorry, Steve, but that's not going to work here," and then listening and accepting their way of doing business. So often we just want to throw the manual at people and say, "This is how we're going to do it. Too bad."

Dave Rogers: Right. "Follow the rules or get the hell out." You can't do that anymore. It's hard to find anybody who wants to work forty hours,

not just for you, but anywhere. There's a shortage out there. So you can't be willy-nilly about it, my way or the highway. You have to explain it. You have to tell them what the process is for and get their input. Otherwise there's no buy-in. And you mentioned leadership, which I know is another one of our podcast episodes. That's where management and leadership come together. The manager part of you is

putting the process in place. You see the problem. But then you get together with your people, and that's where you develop the leadership

skills. People are going to look at you like a leader, because you asked for their input, got them involved and treated them the way you should. That's how you become a leader. They're not going to follow you with willy-nilly processes. "All right, everybody, here's what we're going to do: drop our pants to our ankles and run through the shop." That's not leadership.

So that's where management and leadership come in. Put the process in place, and then you've got to sell it to your people, or get their input and their buy-in. One of the two.

Pass or fail 23:58

Steve Shaw: Exactly. My last book was called The Art of Pass or Fail, which really had to do with overcoming objections and handling our customers. But when we teach coaching and a lot of other things: you either pass or fail in this world today. You're either going to follow the process and end up with the result you set out to have, pass, or you're not, and you fail. I think there's a time and a place for a yellow zone. Let's just say

fine, maybe in certain cases you want that. But I look at it this way: if our process is designed to do X, did we achieve X? If we didn't, we failed. There's no trophy for failing. There's no participation trophy. If you hire me personally as a trainer, there's an expectation that you get X, Y and Z results. If I don't deliver those results, I fail. You hire any third-party

vendor, and they should provide whatever results they say they will. If they don't, they fail. It's not, "You came close, Steve," or, "Well, we were walking around cars because we don't want any dents, dings and scratches, but we got one, so that's a yellow." No. Look, if you got one dent, ding or scratch you didn't catch,

you failed. If you crashed your airplane one time, you failed. There's no yellow zone when you're fifty feet or ten thousand feet off the ground. You either pass or you fail. It either works or it doesn't. And I think it's important to have those guidelines: we're going to put this in place, we're going to do it, and we're going to achieve those goals. Or why do it?

Dave Rogers: There are people out there going, "Yeah, but you're managing the participation trophy generation. Nobody wants to hear that there are rules or ramifications." I get that to a certain extent, and it's probably true. But you've got to be the driving force, firm in your commitments, making sure everyone stays on track. If you have a store where you're losing technicians, with terrible turnover,

there's a bad process somewhere. Either you're not hiring correctly, or you're not doing annual reviews, or you're not touching base with people enough. If people are just leaving you, there's a process problem. It could start when you hired them, if you hired a bunch of people without vetting them. Or you're not sitting down with your people, getting their input, talking to them, making sure they get raises when they should, and holding people accountable. I don't think anybody comes to work and says,

"I want to do a shitty job today." Maybe some people, but not most. "I want to do a shitty job today and do whatever I can to infuriate my boss." I doubt they come to work that way, but I think you drive them that way sometimes when you don't pay attention to them. If your store isn't busy, are you looking at your appointment process? Did you look online? What is your process? There are so many avenues you can go down with this stuff.

It can be mind-boggling, even overwhelming, for some people. So they just avoid it. That's what happens.

Follow the car, the key and the RO, plus the GM tip 27:23

Steve Shaw: Yeah. "That's how we've always done it. The keys are over there on the board, or you can put them in your toolbox, or you can take them home." I love the exercise we'll often do: where does the car go, where do the keys go, and where does the RO go? Follow each all the way through in three separate columns, on three different flip charts. There are so many touch points from an RO, a key and a car perspective.

Every touch point is a minute. Every touch point could be five minutes. So what are we doing? We're causing everybody heartache. We're causing our technicians to lose their time. We're causing all this to happen because we don't have a well-thought-out flow from when the car comes in to when it leaves, and then following up with the customer, and so on. So I think it's important that we really

look at that and set those things in place. I'm not sitting at my normal desk, so I don't have my sign that says, "But did you document it?" But I think it's important to sit down with our people and talk about the end goal. Why are we doing this? Why are we having this meeting? We're going to talk about this process, make it stick and make it great, and eventually we'll go on to the next one. I think we're getting to that point. If you've got any final thoughts, wrap us up with a GM tip of the day.

Dave Rogers: I'll do the GM tip of the day. We're twenty-eight minutes into this thing, and everyone's ready to take a nap. Listen, it doesn't have to be complicated. You don't have to solve all the world's problems in one visit. You've got to build a little credibility. Pick a pain point. Find something in the dealership that's causing aggravation, whether it's customer aggravation or employee aggravation. It doesn't matter.

Just find something that's a real irritant. There are plenty of them. Then get some people together and figure out a way to work around it. And then, as Steve says, and I think it's the right way, document it. It doesn't have to be fourteen inches thick with paragraph after paragraph. It can be a simple flow chart, but there need to be steps people follow, and it has to be teachable. That's the biggest thing. You can't just hand someone a piece of paper and say, "Here, have at it."

So find the pain point, whatever it is, and play with it. Pick some low-hanging fruit. Find an easy one, get some buy-in and show your leadership skills. It could be service, sales, anything. Give it a shot, figure it out, and then start the paper process where you document these things. Put together a little binder, and then it becomes your...

one guy I heard said it becomes the playbook. That's really what it becomes. That'd be my GM tip.

Steve Shaw: Awesome. Very good. Well, let's get out of here. About thirty minutes. We kept it on time this time. Again, everybody, we'll see you live on Fridays starting in June. Appreciate everybody. Dave, I'll talk to you next week.

Dave Rogers: Sounds good, man.