Can’t Find Technicians?

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Can’t Find Technicians?

Guest writer Alex Kraft challenges the pattern of blaming entire generations of people for labor shortages in his blog post “Can’t Find Technicians?”

I get a chuckle when I hear the narrative around “can’t find people who want to be a diesel technician.” I’ve heard it since the day I started my career in 2004. The same message persists today. Nothing has changed. I find it counterproductive to try and blame individuals by questioning work ethic and calling generations lazy. Many topics aren’t that complicated, people respond to incentive structures. The main reason the technician labor pool has been lagging is purely economic.

Anyone who’s worked in the equipment industry would agree that diesel technicians are a highly skilled labor force. Many say they are the “lifeblood” of the dealership. Throw in some cliches, like “customer support sells the next machine” or “we’re a service company that sells machines,” and you start believing that service is the most important department within an equipment dealer. I’ll cut to the chase: so why aren’t technicians paid more? If they’re highly skilled (and in high demand!), are relied upon to fix $400,000+ machines, and preventing customer downtime is so important, why aren’t technicians paid more? The wage scale hasn’t changed much since I began in 2004. Depending on geography, top tier technicians today earn around $40-$45 per hour. Do the math, that’s $85k-$95k per year. That’s a fraction of what sales reps earn per year. There’s no shortage of equipment/rental sales reps, but there’s a shortage of diesel technicians. Yet the industry leadership continues to ask aloud, ‘why can’t we find more technicians?’

There’s been a huge uptick in the younger generation pursuing software engineering careers. Why? Two key factors: there’s a growing demand for the role and it pays extremely well. Our company employs software engineers. The market rate for software engineers is $85-$120 per hour. I’d bet the “teach your kids to code” movement wouldn’t be nearly as popular if $30-$40 per hour was the going rate for those jobs. I haven’t even begun to delve into the job environment! Diesel technicians work in harsh conditions (extreme temperatures), it’s physically demanding, and high stress. Hey, it’s mid-July in Arizona/Florida/Texas/Louisiana, we need you under this wheel loader for 8 hours today getting filthy, and we’ll pay you $27 per hour. Repeat the same thing tomorrow, and the day after…Maybe two years from now, we’ll bump you to $32 per hour. And we wonder why more people aren’t signing up for this. It’s now well documented that UPS drivers earn up to $49 per hour!

The market demand is clearly there. The overall equipment market continues to grow YOY, creating an even larger supply of machinery that will break down. Do we collectively believe that there’d be a shortage of diesel technicians if there was a path to earning $200,000 per year? Imagine that marketing campaign. Here’s a career path that doesn’t require boatloads of college debt AND the ability to earn $200k+ annually. Or we can continue regurgitating the same talking points for another 20 years and just wish things would be different. I know what path we’re taking at Heave.

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The Importance of Mindset

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The Importance of Mindset

Guest writer Alex Kraft addresses the challenges of starting a company in “The Importance of Mindset.”

As we hit year 3 of Heave, I wanted to share my biggest challenge starting a company because it’s not what I thought it would be back in July 2020. In the early days, I thought the biggest challenge starting a company was building a product. Finding talent to build technology, supervising the build, and getting the product to market was all brand new to me. This certainly wasn’t easy (and the continual product improvements we’ve made since), but I’ve learned that managing my mindset is the hardest part.

Starting a company is an exciting time. You’re full of passion, belief, and energy. You go into it understanding the odds are against you and that you’re fighting every day to gain relevance. But you believe that at some point (soon) others are going to see what you see:  your product is ten times better. than what’s out there or that others are going to recognize the great idea and want to partner with you.  What I wasn’t prepared for and has proved the biggest impediment is the avalanche of “No’s.”  No’s come from everywhere. Potential customers tell you ‘No,’ investors dismiss the idea within 5 minutes, even those who you were sure would help you, say NO. Plenty of people laugh and ignore you. This is where the reality check happens. This is why entrepreneurship is so hard. How do you stay motivated and keep pushing forward when the world says NO? Small wins help but most of us are wired to focus on the negatives. For the past 30 months, I’ve been engaged in a battle with my mind. 

I found two things helpful over the past 3 years. First, I tried to read as much content as possible on other companies’ origin stories. We tend to view successful companies today through the lens that they’re an overnight success story. Nothing could be further from the truth. Every company faces crucial life or death challenges along their journey, many times in the early days. It’s these decisions that make or break the company. Things that seem common sense today aren’t so obvious early on. It’s also reassuring that talented people behind iconic companies didn’t have all the answers from the jump. They learned over time and listened to the market. This research helped our team determine ‘pivots’ along the way and necessary tweaks to keep us breathing. Time is a precious asset for a start-up. 

The opposite can also provide context:  researching companies that failed. Finding out where they made critical missteps can help someone anticipate issues within your own business. I’ve learned one of the most critical CEO functions is to determine what’s around the corner and to have a plan. Unforeseen circumstances can create panic, which is the worst thing to happen to a company. Employees look to leadership in challenging times for the confidence that the team is prepared and will have the answers for whatever comes their way.

Perspective is important, but the battle comes when human nature kicks in. We all want to be liked. We seek consensus and to be part of a group. I was listening recently to a podcast with famed investor Mike Maples Jr. and Daniel Ek (Spotify founder) when it clicked for me. They were discussing how breakthroughs happen. Mike Maples Jr. mentioned that breakthroughs only come from a contrarian perspective. The people who aren’t afraid to say, “nope, the current way isn’t the right way. Here’s a new way….”  The lightbulb went on for me. 

To accomplish something great or to achieve a breakthrough, one must be comfortable as the outsider. These individuals don’t expect others to agree with their viewpoint or embrace their idea. This is what I didn’t understand or appreciate. The breakthrough builders focus on making an impact—rejection comes with the territory. They put the customer at the center of everything and work towards solving a problem. The customer’s opinion is the only one that matters. If you deliver an A+ in customer experience and deliver results, everything else takes care of itself.

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The Lazy Management Problem

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The Lazy Management Problem

Guest writer Alex Kraft takes his cue for timing from Tom Brady’s retirement (again) in his blog post, “The Lazy Management Problem.”

I’ve wanted to write something on this topic for a while and Tom Brady’s retirement presented the perfect opportunity. I’m not surprised at many sports stats, but this graphic highlighting Brady’s excellence in his 40s compared to his 20s blew me away. More TD passes from the age of 40–46 than in his 20s? Ridiculous.

First Career – 21,564 Passing Yards – 147 Passing TD’s – Three Super Bowl Wins

Second Career – 40,018 Passing Yards – 309 Passing TD’s – Two Super Bowl Wins

Third Career – 27,632 Passing Yards – 193 Passing TD’s – Two Super Bowl Wins

Where am I going with this? We all see the same articles every day covering a labor shortage and others questioning the work ethic of the younger generation. There is some truth to both premises, but no one ever talks about the employer’s role. From my perspective, companies bear some responsibility for this problem by not having any structure to develop their employees. 

There is a lazy management problem. 

Everyone wants a Tom Brady in his 30s and 40s, they don’t want the 6th round pick Tom Brady that needs a ton of coaching and development. Those early Patriot teams relied on a strong defense and a conservative offensive game plan. Brady made some key plays at opportune times, but he was largely a ‘game manager’ early in his career. The Patriots developed Brady and gave him more responsibility as he improved. The offense evolved into a more aggressive pass-happy scheme that relied on Brady throwing 40+ passes per game, which was the exact opposite of those early Brady led Patriot teams.

I have seen the lazy management problem in heavy equipment my entire career. Every sales manager wants to “manage” the A+ sales rep who kills it every year. Conversely, they want to fire the low performer immediately. I’m not suggesting that every low performer can become an A+ contributor, but how many managers do you see devoting considerable time and effort into helping those low performers improve? It almost never happens. Everyone wants to go on sales calls with the A+ sales rep to their biggest accounts. Rarely do they collaborate with the young struggling rep as they try and build their territory. The younger inexperienced employees become a nuisance to the managerial layer. We get easily frustrated by the basic mistakes they make, by the “stupid” questions they ask, and how they just don’t seem to get it.

The same climate exists with younger technicians. How many companies have a formal plan to develop inexperienced technicians? Sending technicians to a product training school every 6 months doesn’t count. There doesn’t seem to be much thought put into what jobs these younger techs should focus on. Instead, managers are in reactionary mode dispatching an available technician to the next repair job without any real understanding of their capability. If that technician screws up the job, he or she isn’t any good. It is sink or swim. Companies are expecting everyone to hit grand slams right out the gate. We are setting people up to fail and blaming them when things go wrong.

The excuses are all the same. Managers will complain about how they are a lean company and don’t have the resources available to provide ongoing training. Blah Blah Blah. Why are the excuses always pointing to what other people need to provide? What then is the role of a manager? What are managers paid to do? Their collective laziness is making the job an unnecessary layer. This reality is devastating for organizations. It creates employee burnout, frustration, and leads to more turnover. I have seen this firsthand. I remember jotting down names of former coworkers in different positions over the years. The numbers were staggering. With some self-reflection, I realized that it was unlikely that we hired incorrectly those 50+ times, maybe the problem was our company not supporting/developing those 50+ people?

My intent is not to place blame solely on employers. I wanted to point out that the discussion around labor mostly seems to blame workers for not choosing a certain path or for a lack of work ethic. There is a joint responsibility between employees and companies. Not everyone works as hard and is devoted like Tom Brady. His desire, work ethic, and selflessness are huge parts of his unparalleled success. But the Patriots organization deserves a lot of recognition for helping him grow into the player he became. Maybe instead of hoping that more people decide to become technicians or younger people work harder, we ask ourselves ‘how do we help our existing employees become the best version of themselves?’ Control what you can control. I bet anyone reading this can think of a few managers they have worked with over time who would’ve said, ‘this kid Tom Brady sucks…he’s a 6th round pick for a reason!”

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Coaches Corner v.12.22.2022

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Coaches Corner v.12.22.2022

In Coaches Corner v.12.22.2022, Learning Without Scars’ guest writer Alex Kraft pays tribute to football coach Mike Leach.

R.I.P. Mike Leach

College Football coach Mike Leach sadly passed away unexpectedly this week due to a heart attack.  While he’s not as widely known as the big names like Nick Saban, Dabo Swinney, Jim Harbaugh, and Lincoln Riley, Coach Leach has been just as influential within the world of college football.  Coach Leach was in his third season at Mississippi St., but had successful stints at Washington St. (2012-2019) and Texas Tech (2000-2009).  For someone who is a casual football fan, those three programs are not considered traditional “powers”.  Leach built his reputation on the ‘Air Raid’ offense which is a pass happy offense predicated on spreading out a defense.  There have been 12 games in NCAA history where a QB has thrown for more than 600 yards in a game, SEVEN of those 12 QBs were coached by Mike Leach. Some other career highlights include a record of 18 wins as an unranked team versus a ranked opponent and coaching Washington St. to their only 11-win season in 103 years of playing college football.  

At this point, I’m sure you’re wondering, what does Mike Leach have to do with a website that bases curriculum around the heavy equipment industry?  To me, there are a few parallels and lessons that can be applied in business from Mike Leach’s coaching career.  First, Coach Leach was a strategic thinker.  For those that aren’t familiar with the recruiting landscape in college football, Texas Tech, Washington St., and Mississippi St. don’t get ‘5 star’ recruits.  Leach was always at a talent disadvantage against conference foes like USC, Texas, Oklahoma, Alabama, LSU, and Georgia. This is what led to the development of the ‘Air Raid’ offense.  Leach knew that he couldn’t compete against the other teams playing the same style of football, with lesser talent.  Acclaimed writer Micheal Lewis penned a feature for the NY Times on Mike Leach back in 2005, as Texas Tech was gaining notoriety winning games many in the college football world thought impossible.  Lewis detailed Leach’s uncommon thinking around offense, comparing football to chess matched with a demolition derby.  In the article, Lewis interviewed other football coaches about what they noticed was different around Leach’s approach.  Former NFL head coach Jim Schwartz referenced how Leach would space out his offensive linemen, between three and six feet apart, which would result in forcing the other team’s large 330 lb. defensive linemen to travel further distances to reach Texas Tech’s quarterback, giving them more time to throw the ball. Another concept of the ‘Air Raid’ was built around removing two traditional positions, fullback and tight end that seldom touched the ball, and adding two more wide receivers.  Every play routinely included five wide receivers running a variety of deep routes, which tired out the defense.  Leach’s teams would train hard in the offseason to be the better conditioned team, using more plays to their advantage.  The ‘Air Raid’ produced passing yard records almost every year, with different QBs, and point totals not seen before in football.  One of my favorite quotes from Lewis’s article is from Coach Leach’s agent, Gary O’Hagan.  O’Hagan talks about how much he’s asked about Leach by other coaches and people within the football world: “He makes them nervous; they don’t like coaching against him; they’d rather coach against another version of themselves.”  

Another principle of Mike Leach’s offensive system is simplicity.  One might assume that an offense known for 50+ point outbursts and routine 500 yard passing games would have a huge playbook that confuses a defense.  Actually, Leach’s teams thrived on the opposite.  Coach was a huge proponent of having fewer plays and becoming a master at execution.  His teams would run the same play from multiple different formations, but the concepts remained the same.  This allowed his players to know every intricate detail and execute with precision and speed in the heat of the moment.  As football fans we’ve become accustomed to the weekly sight of a football coach holding a giant laminated play sheet that looks like a Waffle House menu on the sidelines.  Instead, Coach Leach was known for having a crumpled-up piece of paper in his back pocket that he would mark off his plays for the game in pencil.  

If you’re a college football fan, you’ve probably seen some clips of Mike Leach interviews where he banters about which mascot would win in a hypothetical fight or what Halloween candy is overrated.  Funny banter aside, Leach’s curiosity was a huge factor in his success.  While attending BYU for undergrad, Leach didn’t even play football (he played Rugby)!  In the NY Times article, Michael Lewis writes about Coach’s off-season habit of picking a new topic or person and learning as much as possible about it.  One year it was Geronimo or Daniel Boone, the next it could be whales or Jackson Pollock the artist.  While at Washington State, Leach taught a seminar titled ‘Insurgent Warfare and Football Strategies’.  One of the final assignments for the class was for students to each submit 2 football plays for the coach to review.  If he liked any of the plays, he would use them in a real game!  Could you imagine if Nick Saban were to take play suggestions from the Alabama student body?  It’s no surprise that his pursuit of learning complimented his unorthodox approach and helped his teams reach a bowl game in 19 of his 21 head coaching seasons.  

How does this apply to the equipment world?  First, the art of strategy.  CAT dealers are like Alabama, Georgia, and Texas.  Their facilities, capital, and the brand name are all the equivalent of ‘5 Star’ recruits at the big-time football programs.  Therefore, it doesn’t make much sense for a Komatsu/Deere/Volvo/Sany dealer to compete against CAT using the traditional approach.  If CAT dealers have more people/resources and employ an ‘old school’ business approach, competitors could use that to their advantage by embracing technology and offering a more touchless experience.  Study your competitor and do the opposite.  Don’t fight the battle on the same terms, that’s probably what CAT dealers want everyone to do.  Like Leach’s agent says, ‘they’d rather coach against another version of themselves’, yet when you look across the industry there is no effort to carve out a unique value proposition.  It’s a copycat game, when the resources aren’t the same.  As for simplicity, there are very successful dealers who have a specific identity.  For example, a “paving house”, where all the dealer does is focus on road products since it is a very specialized offering.  Same with a compact focused dealer (Bobcat/Kubota).  The opposite also proves the point, how many dealers are lackluster because they can’t both be a rental and sales dealer, or compact and heavy dealer? If you have a ton of different brands, how can you make sure you have enough trained technicians for all the product lines?  Simplicity is key to excellence.  Lastly, curiosity can greatly improve company culture and result in massive improvements across the organization.  When other dealers are focused on ‘this is how we’ve always done it’, the pursuit of new ideas can be the driving force to taking market share and winning over new customers.  

Some people may be surprised how much attention Mike Leach’s death generates, as he never won a national title or an outright conference championship.  That is sadly part of the bottom-line results culture we live in today. What stands out just as much as his accomplishments is the lasting impact, he made on some of the game’s most recognizable individuals today.  Players and coaches such as Lincoln Riley (USC), Patrick Mahomes, Sonny Dykes (TCU), Josh Heupel (Tennessee), and Kliff Kingsbury all have been influenced by Leach’s system.  One of the lasting impacts is the change in the entire Big 12 conference, which went from an old school conservative playing style to a wide-open pass first league now known for points scored.  His courage to remain true to himself and not conform, along with his unique style no doubt led to a successful career that garnered great respect from his coaching peers. I for one definitely admired his approach from afar and appreciate his contributions. 

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Getting Better

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Getting Better

Guest writer Alex Kraft faces a topic we all think about in our day-to-day lives: improvement. How do we go about getting better?

I’m a rookie at social media.  While it’s never been that appealing personally to me, I do recognize how it can be beneficial for companies to build awareness, brands, and interest.  Companies can share their successes and promote key customer relationships in an informal way that resonates much differently than the email marketing blasts.  For whatever reason, there is also a steady diet of inspirational/motivational cliché posts.  Every time I log on, I’m hit with posts from people telling the world to “get better every day,” “get 1% better today,” “crush it today.”  But these comments are empty statements.  For those of us who actually want to improve, how does one get better?  

I have a habit of always wanting to go deeper on a subject.  Two common answers to this question are practice and experience.  Both are important components but don’t tell the whole story.  How many of us have worked with someone who doesn’t hesitate to let you know, “I’ve been doing this for 26 years”, and they are mediocre at best?  Experience provides context and can help individuals be prepared for situations that arise.  You are less likely to encounter a scenario that you haven’t seen before, but that doesn’t make you better at your job.  As for practice, I’ve learned how you practice matters more than the time spent.  As an avid golfer, I was stuck at a 15 handicap for ten years, spending hours at the driving range.  It got me nowhere until I learned the art of purposeful practice.  I cut my range sessions down to 15-20 minutes with a specific goal and did it more frequently.  I dropped my handicap in half within 18 months.  What can I say, it only took me ten years to figure it out.

Within the last few years, I’ve come to understand the other pieces to what drives improvement.  In my opinion, personal growth and improvement comes from four areas: (1) trying new things, (2) forcing yourself to do things you don’t like to do, (3) having humility to recognize that you don’t have all the answers, and (4) losing.  How did I come to this understanding?  Fatherhood.  Experiencing these with my kids as they’ve grown over the past 4-5 years has helped me realize the blind spots that I had personally.  As I introduced new activities or sports to my kids, it was important to encourage them and provide support in the form of: “no one is an expert when they start”, “it’s ok to fail; we can practice tomorrow”, “the only way to know if you like something is to try it out”.  Next, I forced them to do things they didn’t want to do.  It’s funny how the things we avoid have one thing in common—they are usually the best things for us.  Whether it’s eating healthy foods, daunting exercises, hard tasks that will take a ton of time and effort, all these examples generate the most benefits.  Humility naturally comes from the flurry of questions that young children will throw at you.  As tempting as it can to be respond with “Because I said so”, a parent quickly learns it’s the least effective response.  I was forced to search for answers and come back prepared.  Lastly, losing is the best impetus for improvement.  Winning, while it feels great, often breeds complacency.  It can be taken for granted and very few understand ‘why’ they win.  No one wants to hear any critiques either—you’re a total buzzkill if you go down that road.  When you lose?  Suddenly people are more attentive during those car rides home or at those next practices.  Losing teaches us lessons, if we care about improvement, we take to heart and use as fuel to get better.  We don’t want to feel that pain of losing again.

I guess I’d found myself in a rut.  Despite plenty of ambition, it’s difficult to know whether you are improving at one’s occupation.  It doesn’t just come from more experience and more time.  I needed the refresher that fatherhood brought. The reminder of children being a blank canvas.  It’s helped me tremendously, not just at home, but professionally.  It dawned on me that I was giving advice that I wasn’t living myself.  Embracing that beginner’s mindset has encouraged me to implement new ideas at work without fear of them succeeding or not.   I’ve learned that pursuing new skills actually transfers into other areas that I didn’t realize would benefit.  For example, I find myself calmer when unforeseen issues arise.  I’m more comfortable in these uncomfortable situations, whereas my younger self probably wasn’t as helpful when problems arose.  Anyone who’s worked at a start-up is well acquainted with searching for answers and losing.  Creating something from scratch begins with an idea, but you cannot go to market based solely on what you think will work.  It’s imperative to research other company’s journeys to foresee any potential vulnerabilities or pitfalls you may have and how to navigate around these hurdles.  In this process one must put aside ego and remove confirmation bias.  Losing comes in the form of the constant ‘no’s you hear from potential customers and investors.  Ultimately losses (if you pay close attention and don’t make excuses) help build a better product, a stronger value proposition to the customer, and a better company.

To summarize, improvement is an active pursuit.  Personally, I never lacked the desire or the will to get better, but I needed to remember how it happens.  I’m confident that any parent reading this will agree that we can learn just as much from our kids as they learn from us.

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Unbiased Customer Feedback

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Unbiased Customer Feedback

Today, guest writer Alex Kraft explores customer comments in this blog post on the importance of unbiased customer feedback.

Customer surveys are all the rage these days.  I wouldn’t be surprised if the kid’s lemonade stands down the street started texting a survey after each purchase made.  I had a recent positive experience that caught my attention though and is the purpose of this blog.  It isn’t necessarily about the frequency of surveys, its more about the employees’ communication to customers.  It seems like in almost every instance, the consumer is told what scores are acceptable.  It usually happens like this: “just to give you a head’s up, you’ll be getting a survey and it’s really important for us here.  Anything less than 5’s across the board hurts us”.  Of course, I don’t want this person negatively impacted by my answers.  I understand that many companies use surveys as an incentive compensation opportunity, but doesn’t this practice contradict the entire purpose of surveying for customer feedback?  Customer feedback is critical to understanding performance, market perception, and expectations.  But this approach detailed above has become all too common and misses the mark.  To me, identifying areas to improve is the most important part of customer feedback.  

So, if customer surveys are largely pencil whipped, how can an equipment dealer get real critiques?  What many do is go on a customer tour of their 10-20 largest accounts.  I understand how important it is to stay close with your largest accounts, I’m not suggesting otherwise.  But this won’t get you any closer to areas that you can improve.  These customers get the best of everything from your dealership:  best pricing, most attention, and best access to your senior level teams.  When one of those 10 accounts has an issue, the fire alarm sounds and everyone within the dealership comes to the rescue. Funny enough, you don’t need to ask as almost everyone in the dealership knows exactly what these customers’ experiences are with your company! 

I learned this lesson when I worked for a dealer and again once I started Heave.  In my dealership days, I remember meeting a large account that rarely gave us business.  We’d get the occasional rental and quote every purchase, but when it was time for them to sign the contract, the other dealer walked out with the signature.  We had one of our top salesmen on the account and he was a true professional, calling on them weekly.  I don’t remember what prompted us to ask the question, but I do remember the meeting when we just flat out asked, “what are we NOT doing that _______ dealer is doing?”  The customer described their experience with one of our competitor’s service departments as the deciding factor.  He mentioned that our competitor serviced their machines on the weekends and off-hours.  When they showed up for work on Monday, their fleet was ready to go with invoice in hand and that is why they continued to buy from our competitor.  He said, “no one else in the market has ever come close to this experience, and when we need service from the others it always interrupts our operation.”  This was a great eye opener for me as a leader.  I learned that day where the bar was for us if we wanted to earn, not only this customer’s business, but most likely many of the other top accounts in the area.  This is not something I would have “learned” from reading customer surveys. 

I visited many customers when launching Heave.  We had a vision for what the platform could look like and how we could serve customers.  There were two customer visits that stood out, as both customers told me that Heave ‘wasn’t for them’.  If I was ten years younger, I probably would have gone into a pitch trying to convince them that they should use our marketplace.  But the purpose of the visit wasn’t a sales call, it was an information gathering meeting.  For me, this was an incredible learning experience to understand from their perspective why Heave didn’t provide value.  These two meetings were pivotal in helping us shape our product and strategy. Without this feedback, we would’ve continued to struggle defining who Heave is built for and probably wasted a ton of time pursuing the wrong customers.   I can’t thank those two individuals enough for the respect they paid me by being honest and unbiased.  

Every dealership knows a group of customers who don’t really buy from them but that they know well.  These are the customers who can be incredibly helpful if they’ll give you the time and be honest.  One great quote I’ve learned years ago from an executive was, “customers vote with their wallet”.  Maybe there’s a group of customers that have quietly shifted their buying behavior towards a competitor the past few years.  We’ve all run through the list of customers parts sales- are there customers that buy parts from your dealership but don’t have corresponding service revenue?  My point is that these are the perfect interview candidates.  When you start losing business, the typical knee jerk reaction is always, ‘they must be solely buying on price’.  Rarely is that the case.  But it makes us feel better because our inner dialogue tells us that there was nothing we could do. Our job as leaders is to put the effort in and dig deeper to find out where we are falling short. The other thing worth mentioning is that it’s ok if you can’t put an immediate fix in to some of the issues that arise.  For the example I gave above about servicing equipment on weekends and off-hours: our dealership didn’t have the manpower or expertise at the time to shift in this fashion.  The point is that it’s much better to know where the bar is set than to make internal excuses or to simply not know what is driving market decisions.  This feedback helps shape long term goals within the dealership. I think you’ll be pleasantly surprised what people will tell you if you approach it in the right way and create an environment where customers feel that they can be open and that you’re asking for the right reasons.  

And a quick reminder:  when Ron sends out a survey asking whose content on his site you’d prefer to read more of, please don’t forget to rate mine near the top.  “All 5s’” for this guy…

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What Makes a Great Customer Experience?

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What Makes a Great Customer Experience?

Guest writer Alex Kraft asks a question that matters deeply when you are in customer service: What Makes a Great Customer Experience?

I recently had an awful customer experience with a large retailer.  I’ll spare the long-winded details because we’ve all been there. From the 30,000 ft. level, what’s incredible is how everything falls on the customer to make things right. All I did was purchase something and now I’m the one who has to exert a ton of effort to get the refund or a resolution? How is it my problem? The experience made me appreciate what makes a great customer experience and/or great customer service. I’ve started to pay more attention to this in everyday life.

For this blog post, I don’t want to necessarily discuss equipment related themes as Ron has other contributors who’ve spent 40+ years in heavy equipment service departments. I’d rather delve into what factors into a positive customer interaction. What makes customers want to come back to your business?

Two major components that we all appreciate as consumers are competence and a ‘give a damn’ factor. Competence is something that you can recognize very quickly and puts a customer at ease. I think of a restaurant. We’ve all had a server that within 60 seconds you know will be attentive, knows the menu, and has a great demeanor. It makes your entire experience better knowing that the person waiting on you is competent. It doesn’t have to be a five-star restaurant either, this can be your local chain or even a coffee shop. We’ve all had the opposite as well: where the server is overwhelmed, isn’t able to answer questions concerning the menu, blames the kitchen, and has a poor attitude. Many times, we wonder, ‘why is that person a server if they don’t like interacting with people?’

I’ve had ongoing shoulder pain for a few months. Upon returning from vacation, I decided that I had to do something, so I booked a massage. When I arrived, I told the therapist about my shoulder. Just by looking at me, the therapist says, “your hips are out of alignment, your right shoulder is higher than your left, and it looks like your right leg is a tad shorter than your left. All of these things contribute to your shoulder pain”.  Before the massage began, I knew that I came to the right place. Afterwards, I’ve made a couple adjustments to my daily routine, and voila! My shoulder feels a lot better. Apply that to your teams. You don’t necessarily need a customer survey to have an idea of how your people represent your company. Does your sales team exude competence when dealing with customers? When you speak with your sales team, do they speak in generalities or do they have a command of your products and their customers? Do your parts and service representatives embody competence when customers need help?

My personal favorite is the ‘give a damn’ factor.  I don’t know of any formal ‘give a damn’ training classes, but maybe Ron will add one to his curriculum. What I’ve seen happening at more companies than I can ever remember, are employees that are quick to tell you that they can’t help you. This manifests itself as ‘I’m sorry, that’s not my job’, or ‘sorry, I can’t help with that’, or “you’ll need to speak to ______”. While I was waiting at this large box retailer, the person in customer service answered the phone with ‘How may I direct your call?’ They couldn’t pass the customer off fast enough.  Yet every single company touts their “customer service”. What customers want is to feel like their issue is YOUR issue as a company. They want someone to take ownership of their problem and see it through to resolution.

You don’t have to be an expert to give a damn. Those employees that understand this concept personally see to it that the customer ends up with the appropriate person who can solve their problem. They don’t make the customer start all over from the beginning, try to find someone else, and retell their story. Companies that are great customer service companies make sure to drill these points home to everyone. This isn’t ‘going the extra mile’, it should be what’s expected on a daily basis.

We find reminders every day of great customer experiences. I encourage you when you’re at lunch, at the doctor, Whole Foods/Publix, wherever you visit, compare those visits with how you believe customers feel when dealing with your company. Like I mentioned above, we don’t need surveys to tell us certain things. If you’ve been at your company for a while and know your people, I’m sure you have a good idea. Trust your instincts, maybe it’s time for some refreshers.

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Positioning: Who Are You For?

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Positioning: Who Are You For?

 

Guest blogger Alex Kraft discusses positioning in today’s blog, with the important question of who you are positioning yourself for? Who is your message meant to target? Are you a partner to your customers?

When you work for an established company, there are certain things that get taken for granted. Customers in the market know your brand and they’ve experienced your products. Opinions are formed based on experience. For young companies, the art of positioning becomes incredibly important.

Wikipedia defines ‘positioning’ as ‘the place that a brand occupies in the minds of the customers and how it is distinguished from the products of the competitors”. How do potential customers perceive your product when they haven’t experienced it and it’s not established? What I’ve learned over the past 18 months is: words matter. It’s remarkable how certain words trigger different responses and can create opportunities or worse, close doors in your face.

One of the major challenges with positioning is that everyone seems to use the same words, regardless of whether they are accurate or not. As I’ve written before on this site, Heave in its simplest form allows dealers/sales reps to quote contractors equipment (for rent or sale) easily on their mobile device. I’m very proud of what we’ve built so far and couldn’t wait to tell the industry….so terms like ‘platform’, ‘marketplace’, ‘e-commerce’, found their way into our positioning. The problem is that every tech company says that they are a platform/marketplace/e-commerce solution. The result is that you get drowned out amongst the crowd and no one remembers anything. Even worse, a customer will just assume your product is the same as one that they’ve maybe had a poor experience with, because of that similar description (without even trying it!).

For equipment dealers, it’s similar. Pick a dealer, any dealer. Don’t tell me who they are, let me guess: do they have the ’best’ or ‘quality equipment’, with ‘THE BEST SERVICE’? Are they ‘customer first’?

Are they a ‘partner’? I remember when I started as a Volvo salesman and attended a factory training session. Naturally I wanted to learn the areas where we had a competitive advantage, something tangible. One thing that I left armed with was Volvo’s superior fuel economy compared to the competition. Unfortunately for me, I was flipping through a Construction Equipment Guide the next week and I see ads for Case promising the ‘best fuel economy in the industry’, same as CAT, Deere, and Komatsu. Now Volvo is just another brand promising the same thing as everyone else. I had to go back to telling customers we just had the ‘best service’….

With Heave, we created something new and started with a blank slate. I became frustrated early on as we met people in the industry. ‘Why don’t they get it?’, I would ask one of my partners. It seemed so simple to me, but I lived it every waking moment. The more I read and researched other companies, the more I came to understand how important positioning is, and how it can set companies apart. I didn’t realize the skill involved in articulating an idea concisely with an economy of words. Once I had an appreciation for the nuance involved, we began tweaking our positioning. As we met with clients you could tell that it was resonating more, and we were getting closer. The final ‘aha’ moment for me was something that I believe every dealer/OEM can also learn from.

Positioning goes together with identifying a target market. A mistake that I know well is not recognizing your ideal customer. In the early days of Heave, I was afraid that if there were 100 potential customers, we needed to appeal to all 100. We couldn’t afford to have a smaller potential pool of customers I thought. Thankfully, I came across a sales trainer named Josh Braun. Josh’s content opened my eyes to how successful salespeople don’t try to sell or pitch to everyone; they focus their efforts on those who fit the solution. It finally clicked for me. Heave is not for the 15-20- year veteran salesperson who has the same 15 accounts for the past 10 years. Heave is for the younger, inexperienced, hungry sales reps who are new(er) to a territory and building their book of business. Have you ever noticed that those who say that “it’s a relationship business” are the ones who’ve had the relationships for 20 years? That saying is code for “this is MY customer, go find someone else!”  This exercise was incredibly liberating for our team because it brought clarity to our mission and removed a ton of pressure. Now we weren’t wasting time talking to those who weren’t a good fit for our product. Do I believe that Heave could help that 15-year veteran salesperson? Of course, but why push a boulder uphill? Go talk to the 50,000 equipment salespeople in the US who are tired of cold calling offices and jobsites, that keep showing up and never get past the gatekeeper. Their manager offers solace by telling them, “Don’t worry, it’s just part of it.  It took me 24 months to get my first crack at quoting Contracting. Now they buy 5 machines per year from us.” That is our ideal user and our positioning followed. Now we were speaking directly to them.

While equipment dealers aren’t starting with a blank slate, there is opportunity to stand out since everyone has been using the same terms since the 1960s. Don’t make the mistake of just copying the competition. You don’t have the same resources as the competition, and you don’t get credit for the ideas if you just are copying what someone else does. Who are the customers that your competition doesn’t serve? Maybe this fresh positioning could be tied to embracing the technology driven changes occurring in the industry? Maybe your positioning can be focused more on certain products or customer segments? On second thought, consistency is your friend, and you can’t go wrong with ‘We take customers to lunch, sign paper contracts, and we stock a lot of parts.”

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Business Friction

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Business Friction

Friction is a fact of life. In our industry, friction calls engines to mind. Today, our guest writer Alex Kraft defines and explains friction in business.

I’ve always been interested in how words and terms find their way into common discourse, seemingly out of nowhere.  The last few years, the words ‘culture’, ‘friction’, and ‘AI’ (Artificial Intelligence) are constantly mentioned.  I’m not smart enough to break out ‘AI’ and culture is a bit played out at this point.  I wanted to dig a little deeper on friction, specifically what type of friction exists in the equipment dealer today.

What is ‘friction’ in business?  I typed that phrase into my Google machine, and this is what returned: “anything that prevents or dissuades customers from buying your products or services”.  I was reminded of a great Bill Belichick quote the other day that made me think of friction in business.  Belichick was addressing the team after a key loss to a rival and his message was, “you can’t win until you keep from losing”.  The parallel that I see between what Coach Belichick professes and friction is that they are self-inflicted.

In football, teams prevent themselves from winning by turning the ball over, committing penalties, or mental lapses forgetting to cover certain players, dropping passes etc.  Equipment dealers prevent themselves from winning in a variety of ways.  The first example can be a bad experience with a company’s website.  How does your website look on a mobile phone, where 70% of all traffic views web pages?  What can a customer do on your website? Can they get pricing?  Can they schedule a service or buy parts?  If your website just has online forms (do you fill out forms on websites?) or ties to an OEM page that lists machine specifications, is it advancing your brand or generating interest in your company?  Another practice that I’m sure keeps dealers from winning is the lack of pricing transparency online.  The industry has struggled with this for eternity.  I started as an equipment salesperson in 2004.  I’ve competed against all the major brands.  I’ve had customers show me hard copy quotes from all my competitors.  Yet, when I look online at dealer’s websites and their online listings on sites like Machinery Trader, the pricing displayed is not true market pricing (I’m being polite here). What is the purpose of showing pricing online if it isn’t actionable?  If customers stumble onto your site, how many are turned off and don’t inquire?

The last example that I’ll explore concerning friction in equipment sales is the prospecting/quoting process.  Dealers have outside sales teams that are taught to cold call jobsites and customer offices.  Talk about friction. If a customer needs pricing or information, they must call a salesperson.  What if I don’t know who my [insert brand] salesperson is?  Friction.  Most dealers don’t list their salespeople on their website with contact information. Friction.  If I’m a customer and I want to compare quotes, now I call multiple salespeople? Friction. What if there’s been a change in sales reps? Friction.  If I miraculously get someone on the phone, do they have the answer right there for me?  Most likely, no.  They must call me back.  Friction.  Ok, it’s been a few days, but I have my price.  Is it your best price?  No, it’s negotiation time.  Friction.  Best case, everything has gone well, you’ve breezed past all these hurdles, now it’s time for that sales contract and finance application process.  I’m sure all your documentation is electronic?  Friction.

The basis of friction in parts and service is the effort required for customers to get anything done.  Online parts ordering is still in its infancy and many dealers/OEMs don’t even have it yet today.  This leads to customers calling a landline, hoping to get someone to speak with to order the correct parts. Reporting a service issue is similar- call a landline and hope to get someone on the phone (how often do you get right through?).  Maybe some customers text your local dispatcher.  What happens when that person is out sick, on vacation, at lunch, or leaves?  If you believe I’m exaggerating, call the phone numbers listed on your website to put yourself in your customers shoes.  I’d wager that you won’t be pleased with the findings.  After the initial conversation, what is your communication like with the customer regarding status of technicians and estimates for the repair?  Many dealers still don’t provide estimates before working on the machine.  Invoicing the customer for work performed when they have zero expectation for what the repair cost is a perfect recipe for customer dissatisfaction.  Not to mention how long it typically takes to invoice the customer.  All these facets add up and can make customers ask themselves, ‘do I want to do business with this dealer again?’

Circling back to Coach Belichick’s quote, what I’ve described here is all within a dealer’s control.  Nothing mentioned above has anything to do with your competition.  I’m afraid that for years equipment dealers run through these processes and think to themselves, ‘well, but our competition is the same and we aren’t any worse’. If that’s the case, imagine what kind of employees you can recruit with that slogan and what your sales pitch is to customers!  I encourage leaders to look within your departments and using another Belichick term, self-scout.  The tendency has always been, look at our top 10 customers and see what their experience is like.  This is a flawed approach because their experience is not the reality for the other 98% of your customer base.  The goal should be figuring out how to offer those 98% the same level of A+ service the top accounts enjoy.   We are in a different time today and there are many tools available that can help dealers solve legacy issues.  If you take all the possible reasons for customers to say ‘No’ off the table, you may just end up with a growing piece of your competition’s market share.  Ask yourself, when was the last time the New England Patriots gave a game away?

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Adaptability

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Adaptability

Guest writer Alex Kraft tackles the importance of adaptability for all of us in our businesses, and our lives.

In order to Succeed you have to be Adaptable.

What do Nick Saban, Domino’s Pizza, and Ritchie Brothers Auctioneers have in common?  Adaptability.

Every equipment dealer everywhere has uttered the words, ‘because that’s the way we’ve always done it’. I’ve heard it a million times and I may have said it once or twice.  Adaptability is becoming a larger separator between the dominant players in an industry and the middle/lower tier companies.  I’ve always been impressed by market leaders that continually work to improve and adapt to changing market conditions even when they don’t have much incentive to.

As a huge sports fan, I’ve always enjoyed the parallels between sports and business.  Nick Saban is undoubtedly the most successful college football coach ever, having won seven national championships.  For those who don’t follow college football closely, they may view him as a hard ass, but to me his success stems from a willingness to adapt.  Saban’s early teams were the conservative type, focusing on suffocating defense and a run-first offensive approach that limited mistakes.  No one could argue with the approach as SEC titles and national titles piled up.  If there ever was a person who could rest on his laurels and point to the “this is the way we’ve always done it”, it was Nick Saban.  But what makes Coach Saban a legend is that he’s never satisfied and he’s constantly seeking improvement.  Even with his extraordinary success, he looked at the teams that beat Alabama and noticed similarities with their offensive schemes.  The rules had changed in the early 2010’s to lean more towards the offense, specifically the spread passing scheme.  Instead of being stubborn, Saban leaned into the new age offensive schemes and Alabama has become the most dangerous passing program in the country over the past 4-5 years (averaging almost 48 points per game!) with 11 1st round picks on offense since 2019.  Football fans have all seen the examples of the legendary coach in his last few years struggling to adjust to rule changes, differences in athletes from prior decades, and the overall style of the sport.  It creates this sad state where we all think to ourselves ‘the game has passed him by’.  I don’t ever see anyone suggesting that about Nick Saban because of his incredible ability to be open minded and adaptable.

Domino’s Pizza was near bankruptcy in 2008 as its share price dropped below $3 per share (today it’s >$400 per share!) and they were losing franchise locations.  This led to a few changes including the launch of some new products and a completely new pizza recipe.  Next, they launched a campaign with a promise to deliver pizzas in “30 minutes or less”.  When the competition just copied the program, Domino’s was searching for an edge.  The true catalyst that changed the entire company’s future was their ability to adjust to the smartphone revolution and embrace digital ordering. In 2011, then-CEO Patrick Doyle challenged the internal team to create tools to allow customers to order a pizza while waiting at a stoplight.  The average stoplight takes 17 seconds to turn green and Domino’s has 34 million different possible pizza combinations.  Impossible?  Quite the opposite.  Anyone who’s ordered a Domino’s pizza in the past 5 years can attest to the ease at the entire process from order to receipt.  It isn’t just about launching an ‘app’.  Domino’s was at the forefront of the “pizza tracker”, along with experimenting with autonomous delivery vehicles and electric bike deliveries in certain markets.  The Domino’s AnyWare program allows customers to order directly from consumer 3rd party ‘apps’, such as Slack, Google Home, Amazon Alexa, a text message, a Smart TV, or even a tweet!  Today, over 60% of their orders come from digital channels.  With such an intense focus on customer experience, Domino’s launched an ‘Innovation Garage’ to continually test and implement new ideas.  This culture has changed the entire perception of the company, to where they are more often characterized as a tech company than their standing as the world’s largest pizza company.

Ritchie Brothers Auctioneers is a great construction industry example of adaptability.  I just attended the big February sale in Orlando as I have every year since 2008.  The RB Auction has become a destination, a networking event for so many in the industry over the years.  One would think that a pandemic such as Covid-19, which brought ‘social distancing’ and outright travel restrictions would absolutely crush a company that holds in-person auctions, right?  Wrong.  Long before Covid-19 struck, Ritchie Brothers Auctioneers laid the foundation for online bidding at their in-person auctions. Ritchie introduced online bidding back in 2003, but it was their IronPlanet acquisition in 2017 that cemented their leadership position in selling equipment online.  I was surprised to learn that prior to Covid, Ritchie’s online sales exceeded their in-person sales.  Having been in this industry since 2004, I can’t imagine how much resistance RB must have had internally when the idea of selling used equipment online was posed.  Especially for a company that started in 1958 auctioning furniture at a rented hall.  It seems like a stroke of genius today with our current conditions, but those seeds were planted long before it was popular.

The 3 examples above are success stories.  Unfortunately, there are plenty of examples of the opposite, of rigid companies like Blockbuster movie rentals.  At its peak in the late 1990’s, Blockbuster had over 9,000 video-rental stores, employed over 84,000 people, and had 65 million customers.  The story is well known now that Netflix basically begged Blockbuster to buy their fledgling operation in early 2000 for only $50 million.  Blockbuster turned them down and today Netflix is worth $195 Billion, and Blockbuster is out of business.  This is the ironic part to me:  if I’m chasing a competitor, I’d want them to keep everything the same. Please don’t change.  Yet that seems to be the trap that most in the equipment industry have fallen into.  If you’re 3rd/4th/5th in market position and you’re not pursuing new ways to do business, what do you think happens next?  No one just falls into a better market position by staying the same.  Learn to adapt or you may just be holding a position for someone else to come and grab on their way up.

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