You CAN make a difference

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A number of years ago, 2005 to be precise, Ken Blanchard and Barbara Glanz published a short book called “Johnny the Bagger.” It is based on a story than Ms. Glanz used in her talks. Her signature, for her customer service talks, was a room surrounded on all sides by colorful posters. She told stories about customer service examples in business and had highlights on the colorful posters.

One of the stories started with her receiving a call from a front line employee from a supermarket. She had spoken to the supermarket in the previous month. The call came from a 19 year old bagger named Johnny. Johnny told her he had Down’s Syndrome, he was proud of it, and that he didn’t think that he could do much to impact customer service. Then he told her about an idea he had.

He said that when he would come home from work he would think of saying he liked and if he couldn’t think of one he would make one up. With the help of his father he would write the idea on a piece of paper 6 times and each night they would print off 50 copies. He cut out each quote and wrote his name on the back.

When he got to work he put the slips in a bag where he worked and put one in teh customers each bag after he had finished packing up the groceries for them. Isn’t that fantastic? My wish for each of you is that you have a wonderful weekend and that you can each find such an idea to influence the people in your world on a daily basis.

A month later the Store Manager called Barbara. He told her a story. He was making his rounds one day and noticed that one of the lines at the checkout stand was three times longer than any other. He called for more cashiers. But no one moved from the line. He started asking and they told him they wanted to get Johnny’s thought of the day. Well as you can imagine the concept spread and before you knew it customers were being pinned with flowers that could not be sold. A Snoopy decal was used at the meat stand. All kinds of things happen.

It is many times the smallest things that can sometimes make the largest impact. Are you able to think of something that would influence your world as significantly? The time is now.

Shamelesss Promotion Part 2

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IT’S NEVER TOO LATE TOO LEARN!

We will be conducting 2 classroom seminars you won’t want to miss in Dallas:

Parts Management – Unit I

What it Looks Like When it is Right
March 19th and 20th, 2012

Service Management – Unit I

What it Looks Like When it is Right
March 21st and 22nd, 2012

For complete information:-

Check out website www.rjslee.com

Or go to www.aednet.org/seminars.

Contact; Pat Novak at 630-468-5135 or pnovak@aednet.org for answers to your questions

Shameless Promotion Part 1

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IT’S NOT TOO LATE TO GET ABOARD!

We will be presenting 4 webinar topics you won’t want to miss next week:

Service Management

Inspections
March 5, 2012; 11:00 a.m. to 12:00 noon CDT

Work Order Process
March 5, 2012; 2:00 p.m. to 3:00 p.m. CDT

Labor Rates
March 6, 2012; 11:00 a.m. to 12:00 noon CDT

Service Organization
March 6, 2012; 2:00 p.m. to 3:00 p.m. CDT

Go to www.rjslee.com for information under the Learning tab

                                                            OR

For complete information on all AED events go to www.aednet.org/seminars.

Contact; Pat Novak at 630-468-5135 or pnovak@aednet.org for answers to your questions

Tablets, PDA’s and Laptops

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Over the years we have collected labor to apply to work orders in a myriad of manners. We started from an attendance time card which the mechanics completed at the end of the day telling us what times they worked on which jobs. Then we moved to individual job time cards while still retaining an attendance time card for payroll. Then some of the companies got racy and had only one time card which fed work in process but was data entered to the payroll system. Can you imagine? Then we had one card feed both systems – think of that some efficiencies arriving. Finally technology showed up and we had scanning devices either hand held or bar code scanners to record time. A long road travelled over forty years.

The objective is still the same isn’t it? We need to collect time against a job so that we can update standard job times, record time to create an invoice for the customer and provide an entry into the payroll for the technical so they can be paid.

So now we have laptops and tablets and PDA’s. And each of these devices can be used to collect labor information.

So why not take the leap and get labor entered by the technician and give them a device with which they can place their own parts orders? I have no idea why we can’t get this done. So contact your business system supplier and tell them you want the technician to be able to use a laptop or a tablet, an iPad, Galaxy or any Android device or a Thinkpad Tablet, like I use, any of which can be connected to the internet to have access to the electronic parts catalogues and service documentation. They can get that done for you. Then both you and the technicians will be much further ahead than with what you are using today. The time is now.

The Most Important Part

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The first article I wrote for an Industry publication I called “The Only Part That Matters.” This is of course the part that you don’t have available.

I was referencing the fact that too often we are driven by metrics. Off the shelf availability has to be more than 90% of some such number. That is all well and good – but what about the 10% that you are programming yourself to accept?

Early in my career I got a call in the wee hours on a Sunday morning. It was the Vice President of Parts and Service. There was a Department of Defense station in the Arctic that needed a part for their source of power – a Caterpillar Engine. Of course we didn’t have the part. We found the part in Europe. We sent an employee on a plane to go and get it, bring it back, and then we shipped it to the customer. That gentleman’s name was Rod Boileau and although most of you won’t know Rod he is one of the men that I blame for continuing to be in this Industry some 42 years later. He provided a lesson I have never forgotten. He said “if the part you don’t give me keeps my machine down – you have given me zero.” And this simple example made his point. No part – no power – no power death.

Ever since I have been harping on the fact that no matter what you goal is for off the shelf service you are programming yourself to accept to tolerate a level of shortages. That is why my first rule in the parts business is to find every part every day before you go home. No it is not acceptable to place the part on a backorder at a supplier but you need to know that the part is available and can be shipped that day. That is parts availability. The time is now.

Maintenance

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Over the years more and more people have realized that maintenance on a piece of capital equipment is one of the more critical activities to conduct to reduce the owning and operating costs of that piece of equipment. This is true for your vehicle or washing machine just as much as for your machine.

There was a sudden recognition some time ago that the “customer” didn’t really appreciate how important maintenance was in extending the useful life of that machine. They felt, in many cases, that maintenance was simply dropping fluids and changing filters. As most of you know it is far more than that. Along with this recognition the various suppliers started to make it easy for the customer to maintain their machinery. They sold maintenance agreements and extended warranties offering the customer piece of mind and a reasonable price. But there still remained one serious stumbling block – Service Management.

Yes, in many cases, the Service Managers are in the way. You see they are very busy people. They don’t have enough people in their organization to support the current service workload. This service organization is a subject of one of our webinars next week. Check at www.rjslee.com under the learning tab for more information.

I am struck by the fact that everyone knows how to run a parts department or a service department except of course the people that actually do run the parts departments and service departments. This is one of the major challenges facing management in equipment dealers. How do we get professional management into parts and service when we don’t have sufficient respect for the work that is being done in these departments?

A new discussion on market share

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Al Wiley, an executive of Xpectmor, sent us a comment on our recent Market Share post. He says that “market share is the definitive measure of customer satisfaction.” Of course he is right. The measure of market share, however,  is what causes the dilemma for many of us.

In the equipment market it is reasonably easy to define market share. There are a finite number of transactions and everyone knows what everyone got. For instance, we have five different suppliers in the market with sales last month. Supplier #1 got 4 sales, supplier #2 got 1 sale, supplier #3got 2 sales, supplier #4 got 2 sales and supplier #5 got 1 sale. The market share is a simple matter of arithmetic. Supplier #1 got 40% market share and so on.

With the parts and service business it gets more complicated. The various suppliers into the market don’t know what the other suppliers sold during any particular period. So how can we possibly calculate the market share of any particular supplier? That is why there has not been any real definitive publication for market share.

When I first started in the Industry in the late 1960’s some suppliers used to conduct a personal survey with each and every one of their customers worldwide. Can you imagine the time and cost for such a survey? Well they did them and they published the results within their distribution network. It was not precisely accurate but it was a very good indicator of where you stood as a dealer in parts and service market share.

As more and more machines get GPS equipped and the dealers/distributors, manufacturers and customers become more adept at understanding telematics and their use we have a terrific opportunity. We can calculate what the consumption of parts and service “should” be on a machine.

This is the first problem. The customer doesn’t always follow the recommendations of the manufacturer of the machine for the maintenance intervals nor the maintenance items to be dealt with for a particular service. Similarly when it is obvious that a repair should be made with a “new component” sometimes a repair that I call “bubble gum and band aids” will be performed. You might be wondering why this is important. Well it is due to the fact that all we can do is calculate the “potential” consumption of parts and service for a particular machine in a specific application running a specific number of hours. It is this potential that we have to use to calculate our “market capture” rate. See now we change the word. It is no longer market share it is market capture.

The dealer captures the potential business based on their actual sales of parts and service. Once we have these facts nad have them for a sufficient period of time we can make a clear statement about capture rates are the success and/or failure of the particular strategy that a dealer is following. The time is now.
 

 

 

 

A calmer point about education

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Yesterday I went on a rant about education. After 24 hours I am somewhat calmer now but I would reference you to our website www.rjslee.com and under the articles tab please check August 2010 under Construction Equipment Digest. That was my take on education a number of years ago.

“The notion that a four year degree is essential for real success is being challenged by a growing number of economists, policy analysts and academics. They say more Americans should choose other options such as technical training or two year schools which have been embraced in Europe for decades.

Wow, what an earth moving change in thinking is finally upon us. Could it be that we are flooding the struggling job market with over qualified degree holders. Now don’t get me wrong a University education is a good thing. After all I made my living teaching at University for a time in my career. I believe in education. But there are gaps in our skills in the current workforce and coming generations. We can see severe shortages in many technical disciplines. Not the least of which is technicians.

Most parents today want their children to go to University. But they will clam up when asked what it is that these children should take at University or why they should go to University. They point to unemployment rates, perhaps, where University graduates have an unemployment rate of 4.9% versus 10.8% for high school graduates. But that doesn’t measure University against a Technical School education or a two year Junior College does it? They will point to the fact that a University Graduate will make $1,000,000 more in earnings over their lifetimes than a High School Graduate. Again the same problem exists; how does that compare to Technical School or a Junior College. And what about those growing student loans; they are now averaging, yes that is right averaging, over $25,000 per college graduate. That is a lot of money when it is paid back with net income dollars.

Perhaps we are getting to be asking the right questions at long last. Rather than propose that everyone should go to University let’s review the premise. What educational skills are appropriate for a new member to the work force?  The era of a general Liberal Arts degree being sufficient for the work force is passé today isn’t it? Ohio University Economics Professor Richard Vedder blames the cultural notion of “credential inflation” for the stream of unqualified students into the four year colleges, a common complaint from Universities across the country. :

Martin Scaglione, President and Chief Operating Officer of Work Force Development for ACT, the Iowa based not-for-profit best known for its’ college entrance exam, suggested nothing short of a new definition for educational success. He advocates “certification as the new education currency – documentation of skills as opposed to mastering curriculum.” As a former University educator I couldn’t agree more. We are focused too heavily on mastering curriculum at all levels of learning prior to post graduate degrees. It would be a wonderful change if we started maintaining an “inventory of skills”, certified skills.”

I am sure this needs to be updated somewhat but the premise is still there. We are in a changing world in many areas but also in education. How you attract and retain skilled workers is the challenge. The time is now.

Rant of the Day

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It is interesting watching two grown men argue about higher education. Santorum has called Obama a snob as he said that he wanted everyone to have a four year college education. The Obama backing off and saying he wanted more than just high school highlights a serious subject to consider. What should you do after high school?

I was with a client last fall and the room had about eight people. Three had Doctorates and four had Masters Degrees. I was the only person in the room without a degree, although I did have four years University training. I was wondering with all the educated people how were the “non-educated” going to make out. The problem today is that for many bachelor level degrees the level of Actual knowledge is not far above that which a high school leaving delivered several decades ago.

I keep watching the debates about education. We need smaller class sizes or higher teacher salaries. Several years ago I was asked to look at a project for the Los Angeles Unified School District. I think this is still one of the largest districts in the country. They asked me to look at their mobile equipment, school buses and the like, for maintenance and repairs. I asked to see the inventory list. They said they didn’t have one. Perhaps that is the first indication of some the problems in education. How is it being run? Well the first obvious area to look is at the school board level. Now you have to remember I am biased. I am a teacher.  But one of the first places I would look is the school boards – or more importantly all positions in education that are not in the classroom. The ratio is all upside down. We have too many people doing things that are not in the classroom and not enough in the classroom. But that is the result of the political position for education. Everyone wants a job but not enough know what to do.

Which brings me back to the current debate university or everything else?

Look at the cost of a four year “College” education and compare that to the earnings of four more years of a work life. Today there is almost a $500,000 difference. At university faculties we are starting to have more vigorous debates about the value of the junior colleges and trade schools. The American public has been conditioned over the past four or five decades to want to have a degree for their children. Consider that an article in a recent Forbes magazine noted that 15% of parking lot attendants have a college degree. I don’t think that was what was intended with the push of parents to have their children have a degree.

Today there is what is called a “skills” gap. We have lots of job openings which for one reason or another go unfilled.

There is a huge need for technicians in America. Where are we going to get them?

This is a problem that won’t go away. In the 1900’s the under educated could pursue a worthwhile career and life in agriculture. In the 1950’s that became the production line. What is the prospect today for the under educated? We need to get our arms around this problem and start to fix it or ewe truly will have a lost generation… or two. The time is now.

 

Service Technicians

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The complaints are still out there- “I can’t find any experienced equipment technicians.” Isn’t it obvious by now that anyone worth anything that has experience is going to be working already? If there is a technician available and they apply for work I am sure that you will give them a very thorough interview and background check.

We need to develop our own technicians. As obvious as that seems to be we continue to be in denial.

Hire willing young men and women (yes women) who have a mechanical aptitude and get them into a development program. Start as we did in the old days with one “help/trainee” for every two technicians. Set up a training program. Work with local technical schools and unions and customers who offer technical training. Establish a “career path” training program. It will take roughly three years to create a market ready technician.

There are wonderful programs at Oklahoma State University in Okmulgee for one which works with dealers and manufacturers to offer specific brand training programs. Caterpillar, John Deere, Toyota and Ditch Witch to name a few work with schools around the country on these programs. Check out your local area to find the schools that you can partner with in this area.

Caring about your employees, providing training and a safety aware work place will go a long way to retaining your employees. Some dealers, and extremely success dealers, have never had a layoff of technical employees. Imagine what that says to the employee.

The time to complain has long since passed – don’t you think we should start developing our own? The time is now…..