Do You Really Need PRODUCT SUPPORT PSSRs, or CSAs?

Do You Really Need Product Support PSSRs, or CSAs?

Guest writer Bill Pyles shares all the ways we really do need Product Support SRs or CSAs.

Most larger equipment dealerships have a robust PSSR (Product Support Sales & Service Rep), CSR (Customer Support Representative) or CSA (Customer Support Advisor) that has been in the making for years. This group of Product Support men and women are an integral, value-added, sales and profit generating part of the entire dealer organization.

But maybe you’re a smaller dealer and looking to get to the next tier of the Product Support ladder. 

This blog is for you!

The CSA acronym is my personal favorite as I truly believe the words customer support advisor best describes the position. The CSA is the direct link between the dealer and everything Product Support related. A well-trained CSA offers the options that meets the financial and equipment requirements of the customer. Should a failed engine be repaired, rebuilt, or replaced? Is the machine a production machine or a backup? Is the machine scheduled to be sold out of the fleet within the next six months? While the machine is down, are there any other critical areas of the machine that need inspected and repaired before going to failure? Customers get very angry when a leaking final drive went to complete failure, resulting in a machine down situation just after leaving your shop.

If your dealership sells and services tracked type equipment (excavators, dozers and tracked loaders) I know your aware the largest cost of ownership is the undercarriage. The undercarriage is a system into itself. Your CSA should have a complete understanding of the undercarriage system. A simple proper track adjusting discussion with the customer demonstrates a knowledge that will save him dollars and downtime. Getting a customer maximum undercarriage life will save thousands of dollars over the life of the machine. 

You’ll also need a good machine population file. It’s tough to forecast sales not knowing your opportunity. A good machine population file will identify the aging, location, and hours on the equipment. By the way a good population file is beneficial to sales, many machines are removed from the fleet after so years and hours. New sales opportunities!

Typically, the 80/20 rule is the typical CSA customer list. The top 20 customers assigned to a CSA typically take of 80 percent of their time and resources. Dealers will need to develop the unassigned fleet customers and the “middle segment”, customers who have your equipment but do not purchase any parts or services.

You’ll need an annual CSA meeting to discuss trends, sales forecast, changes in the market and to celebrate over and above accomplishments (just picture your last whole goods sales meeting).  Is the GM or dealer principle attending? The GM and or dealer principle must make an appearance to show support and comment on the current business environment and congratulate the high performing CSA’s. A well-developed CSA program will give you much to celebrate!

But who does the CSA report to? The dealer principle? 

I once worked for a regional vice president who upon returning from an executive meeting was convinced, we should terminate the CSA program, all of it, today, now.

This executive meeting was held during one of the severe cyclic downturns in heavy equipment sales. Dealers were struggling to survive and expense control was job one. Elimination of the CSA program would save accelerating expense dollars. His rational was simple, if severely flawed. We have a good product and if a customer experiences a failure, he will simply pick up the phone and call us. And with our new snazzy web site, the customer will simply log on and make arrangements for needed parts and or service. After thinking this over maybe for 60 seconds I countered with the elimination of the whole goods salesmen using the exact same logic; we sell good equipment and if a customer needs a new machine or a long-term rental, he will simply pick up the phone and call us. Fortunately, neither plan was put into action, we survived the downturn and came out stronger on the other end.

The sales manager? Maybe not a good choice as the sales manager has enough on his plate with inventory, inventory aging, salesmen, OEM programs, order windows, financing and fleet deals. A CSA reporting to the sales manager may turn into a delivery driver for a bucket, gathering hours for a trade in or running out docs to be signed.

The parts manager? Maybe not a good idea as most part managers are outstanding at managing their inventory, over the counter fill, stock orders, counter activity but not managing a parts and service sales person.

The service manager? Not here either. Service managers have many balls in the air dealing with shop service, field service, training, warranty, the pothole in the parking lot (a little sarcasm) OEM’s and technicians. Not much time to manage a CSA. 

A CSA without a direct supervisor soon becomes a “floater” or Product Support orphan employee.

A better solution would be a Product Support Sales Manager or a position with a similar title. This person would have 100% accountability for a successful CSA program. He or she would work closely with parts and service management in writing CSA goals that are in alignment with company goals. The Product Support Sales Manager would do the CSA’s bi-annual and annual performance reviews as well administer incentive plans and salary increases, create annual sales forecasts and work closely with the OEM representatives regarding OEM Product Support programs.

A Product Support Sales Manager is the mentor, manager, and coach in developing a CSA. CSA’s must have a career plan with defined goals in sales and service activity. I worked at a dealer who had an outstanding Product Support Sales Manager, super high energy. I truly believed this man could inspire CSA’s to sell snow plows in Miami Florida! 

A CSA MUST participate in technical training for the products the dealer represents as well as management level training in negotiating skills and people skills. A successful CSA will have a basic understanding of oil sampling, why on time PM’s are important and an excellent understanding of repair, rebuild or replace options. These skills development can be better managed by a qualified Product Support Manager who reports directly to the dealer principle.

CSA Vehicle: Car or Pickup Truck.

I’ve had responsibility for CSA’s and have experience with both the CSA company vehicle being a car or truck; pros and cons for both. If you give your CSA a car allowance and he or she uses their personal vehicle, you’ll soon find the car parked and a company truck “borrowed” for the day to run out some rebuild pumps and a cylinder or two. Car allowance or not, the CSA will be reluctant to damage or have spilled oil in the trunk or floor. In my opinion a pickup truck sporting the dealer’s name and logo is your best choice. Graphics today look sharp on the job site and rolling down the highway. And when on site, if there is something that the CSA can help out by running something back to the shop, it will not be a problem. However, you’ll want to avoid your newly minted CSA into becoming a parts runner. I do suggest that when a CSA plans his day, he or she will check with will call to see if there are some parts he can bring out and check the service WIP (Work In Process) to see if the customers he’s calling on today have any equipment in the shop and get the status, the customer will ask, be prepared!

CSA Salary & Expenses

CSA salary and expenses are usually split 50/50 between the parts and service departments. I’ve heard arguments that a CSA will sell more parts than service and parts should pay more of the percentage. Most CSA programs are salary and commission based. Another responsibility of the Product Support Sales Manager.

But keep in mind, a dealer’s best margin comes from labor sales. It’s the responsibility of the Product Support Sales Manager to steer the CSA into higher labor sales. If a customer needs a reman engine and the CSA provides a quote for the reman engine, the labor to do the remove and install must be included. I think Michael Jordan once said he missed every shot he did not take. The same applies here; don’t quote the labor and you surely will not get it. Your competitors may be quoting the same reman engine AND the labor. The customer likes the turnkey repair and asks your competitor when they can start. Always provide a professional estimate/quote and follow up with the customer. Add value and close the deal!

Customer Support ADVISOR

When I was a newly minted Product Support Sales Manager, I thoroughly enjoyed customer visits and scheduled customer meetings. I’d wait for an opportunity to ask the customer if a recent issue, wrong parts, late service call, etc. he brought up was discussed with his CSA (I did not use the CSA’s name). If the customer replied “oh you mean the guy who measures our tracks” then we’ve failed to make the ADVISOR relationship with the customer. A good gap we need to close. CSA’s need to listen when the customer talks and suggest solutions to equipment problems. I know we’re providing value when the customer asks the CSA “what do you think?” When the customer says those words, the rest is up to you to deliver the outstanding Product Support that makes you the “go-to” dealer!

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Digital for Data’s Sake

Digital for Data’s Sake

Our new guest writer today is Sara Hanks, sharing her knowledge about going digital for data’s sake. In her own words, Sara introduces herself: My career launched 22 years ago as a mechanical engineer but shifted quickly into continuous improvement when I became a Lean Six Sigma Black Belt. Early on, I learned the value that could be extracted from data and the importance of digitally collecting that data. After several years in manufacturing, I transitioned to leading programs and teams to do Digital Transformation. Eventually, I was promoted to the Senior Director of Data Analytics, leading a team of data scientists, gaining firsthand experience with machine learning and artificial intelligence. Currently, I am the Director of Continuous Improvement at Wabtec Corporation, a supplier in the Rail and Mining Equipment industries.

I enjoy bringing joy into the workforce by solving a problem, creating user friendly digital products, or providing easy access to data. In 2020, I launched Leverage 4 Data to provide a platform to do all three – create a solution to digitize workflows with an intuitive user interface and accessible data.

Digital for Data’s Sake

Digital transformation has been a buzzword that has been talked about for years, yet many people struggle with what it means. Often, when asked about digital transformation, more jargon appears, and we are swimming in a sea of acronyms and terms like CRM, ERP, and Digital Twin. What exactly is a digital twin? I am not going to go into that here, but I will talk about digitization. I like to simplify the concept by talking in terms of the business processes. Digitization is taking an existing business process and transitioning it into the online digital world to drive value. Improving the customer experience or implementing technology to retain younger talent are some of the benefits to digitizing processes. However, my favorite outcome of digitizing a key process is the creation of data. 

Focusing efforts to extract value from the data can be daunting. Here are four examples of how data from a digitization can improve operations, costs and even culture.

Creating KPIs to Measure Performance

Recently, I had a dental procedure done. When I arrived and was checked in, I noticed that the receptionist looked at a paper logbook to verify my name. The same logbook was used to make my next appointment. I was shocked! They lacked a system to track a major part of their business, managing appointments. How could they know who failed to show up or how often people canceled? What about tracking how long the actual appointment took vs. the scheduled time to make sure procedures were planned well. It is difficult to improve what you don’t measure.

The easiest place to measure the effectiveness of a process is with a time-based metric and a quality metric.

  1. A time-based metric. Speed is everything – how fast are customer orders being fulfilled, how long does a service event take, what is the cycle time associated with procuring parts? When the process is managed in a digital platform, such as an eCommerce platform, or an ERP, there are time stamps for each event, providing the ability to measure the total time, as well as the time it takes for each step of the process. Creating KPIs for overall process can create a mechanism to add urgency and improve the time.
  2. A quality metric. Whenever a time-based metric is introduced, it is important to balance it with a quality metric. I remember when my team introduced a cycle time metric on customer issue management, unfortunately a quality metric was not added. The solutions to the customer issues were delivered quickly but occasionally resulted in rework, and sometimes costly rework. When the data is in a platform, it is possible to calculate the rework or first pass yield of a process. 

Improve Operations with Insights

I’ve seen plenty of operating rhythms that reviewed KPI scorecards. Bringing a scorecard with red on it to the leadership team, was sure to be met with scolding. What I found surprising was how little the leaders asked questions when the KPI was green. Wouldn’t that be insightful? I like to understand why the red exists, as well as the green metrics. This is where dashboards and visualizations can help. Visualizing the operational data in a dashboard is one of the simplest, yet impactful ways to use the data to improve operations. 

My teams have made some amazing analytics dashboards and visualizations. One dashboard built allowed the service teams to visualize the best performing shops against the worst. The user could drill into why product needed service to see which workorders impacted quality. Nobody used it, even though I thought they provided a ton of value. The biggest pitfall was not connecting them to the existing KPIs.

Now when I approach dashboard development, I start with the KPIs. Perhaps they are KPIs created to measure time and quality, or they are something else that is already adopted. With a cross functional team, we brainstorm all the possible data points that could impact that metric. A visualization is built to provide an exploratory experience to drill into the data in a consumable way. I recommend bringing the visualization into the operating rhythms and use the dashboard to answer questions in the meeting. A scolding leader is likely to become intrigued. 

Reduce Stress

Another use of data from a digital system is never talked about but is probably relatable. We’ve all been there. It’s 4:30 on Friday afternoon and you receive a call from a customer or your boss. They are upset about something, and you need to find answers. The panic sets in and you start to put together the story to provide an answer. This usually involves digging through papers, email and perhaps phone calls to colleagues to find information. Data retrieval is difficult. I remember one issue took 19 hours of rummaging through paperwork over a 3-week span to identify which parts were impacted by a quality issue. When the process exists in a digital system, and the critical data is captured, answering the mail becomes much easier. The stress in these situations is reduced, making it much easier to enjoy the weekend. While the ROI is not clear, spending time fighting fires is certainly non-value add. Extinguishing them quickly is a win.

Increase Revenue from the Data

Finally, the operational data collected in your digitized processes is to identify revenue opportunities. For example, the historic services data can be used to predict future service events. Offers could be targeted to those customers to provide those services. The historic service data could be used to cross sell during a maintenance event as well. For equipment that is serviced on a regular basis, are there probable breakdowns between planned events? Additional preventive services or upgrades could be offered at a discount during the maintenance as an alternative to fixing a failure. Could the customer buying patterns identified by the dealers be useful to the OEMs, providing leverage for the dealer? 

Netflix transformed the movie renting experience by making it more convenient, i.e., going digital, but their revenue gains were from using the data to provide binge worthy shows and keep people on their platform. Imagine the possibilities for equipment dealerships.

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A Special Announcement from the AED Foundation

A Special Announcement from the AED Foundation

 

AEDF Announces Partnership with Learning Without Scars to Provide New Programs

 

AED Foundation (AEDF) is excited to announce the addition of two new programs to its catalog, in partnership with Learning Without Scars.

 

The In-Store Selling Fundamentals Program is designed for parts counter employees looking to advance their product support skills. It includes individual courses on teleselling, overcoming objections, in-store merchandising, and buyers’ needs.

 

The Service Writers Program offers instruction in the core service department functions most relevant to service writers. It includes individual courses on service organization, work order process, time management, and inspections.

 

Each program allows the user to earn IACET approved CEUs that are recognized by universities, junior colleges, technical and vocational schools worldwide.

 

 

 

 

 

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Introducing Our Colleague John Sessums

Introducing our Colleague John Sessums

Our new guest writer John Sessums is the owner of Mechanic and Techs LLC, based in Baton Rouge,  Louisiana. John’s career spans 38 years involved in equipment dealership management, and he is also an AEMP Certified Equipment Manager. As a Senior Product Support Manager and later as Wholegoods Sales Manager, Johns’s focus has always been on increasing sales by providing superior customer support. Once retired, he formed Mechanic and Techs and now offers a unique buffet of affordable Product Support Growth Solutions. M&T provides Consulting, Recruitment, Speciality Job Boards, On-Line Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental. 

I have been a past student of Ron Slee’s Quest Learning Centers, and I credit that training as the foundation of my success. As a Regional Manager of Product Support and later as Whole Goods Sales Manager, I have sent many of my employees and managers to Ron’s training seminars to learn from the GOAT himself. They each returned with a three-ring green binder that held the secret of success for themselves and their employers. Using Learning Without Scars, all companies looking to grow now have a proven method to succeed.

Every dealership is looking to grow, but most are more focused on handling day to day issues

Six years ago, after 38 years in the heavy equipment business, I launched a recruiting company focused primarily on recruiting higher-level equipment technicians. Our team created a buffet of employee management services for equipment dealerships across the country centered around LWS.

About two and a half years ago, Ron and I discussed a client who was having trouble finding the number of techs they needed. As we talked, I shared with Ron my main challenge was locating and vetting qualified people. Like everyone else, I had to take a candidate’s word that they actually had the skills they claimed to have.

Considering my company offered a performance guarantee, I needed a proven method to confirm a candidates’ knowledge and skill level before recommending them to clients. Being an old equipment guy, I also knew guarantees and refunds were great, but what I valued most was hiring qualified and committed people the first time. After talking with Ron over several weeks, I knew I had found the exact answers I needed.

Ron and I took part in an equipment industry article about five years ago about the coming technician crisis. What will now follow will be a rapid rise in wages and a gradual decline in overall tech competency and efficiency. As with technicians, the last train carrying needed Product Support replacements has already left the station and is rapidly heading towards that same bridge. Thankfully, all manufacturers offer excellent technician training, so that crisis will hopefully even out over time.

LWS will be at the forefront of product support employee training. Ron and his team have been busy formatting and transferring his thirty-plus years of knowledge and teaching onto the new LWS site for the past several years. Ron’s training seminars, books, and consulting have been considered the Gold Standard for Capital Goods dealerships across the U.S. and translated into several languages worldwide. Senior managers in dealerships across the country have vetted and approved the LWS courses. An equipment industry senior service management expert developed the Technician Assessments. While the site’s content was time-tested, duplicating Ron’s unique delivery method and personality online took time to perfect. You can now visit Learning Without Scars and view firsthand what our friend, along with his daughter Caroline, and the entire LWS team have been up to for the past few years. I think you will be very impressed.

Our company, Mechanics and Techs LLC., was designed and is staffed by seasoned semi-retired equipment industry corporate managers. We have successfully managed multi-branch Service, Parts, Outside Product Support Sales Teams, New and Used Sales teams, Rental groups and worked with a wide variety of brands and types of equipment and trucks.

We combined our many years of hands-on dealership experience to create a unique selection of affordable Product Support Growth Solutions specifically designed for our equipment industry clients. We provide Consulting, Recruitment, Specialty Job Boards, Web-Based Online Candidate Search Systems, LWS Skill Assessments/Training/Testing for those in Service, Parts, Sales, and Rental.

We will introduce you to more of our services, in more detail in the coming weeks and months. I look forward to having Mechanics and Techs working with learning Without Scars for years to come. Thanks for welcoming us as a Colleague.

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The Digital Dealership, Your Audience: Marketing Activities, Part 2

The Digital Dealership, Your Audience: Marketing Activities, Part 2

In tonight’s blog post, guest writer Mets Kramer continues his exploration of the digital dealership. Part 2 of a series, tonight we look at marketing activities for your audience. 

Digital Marketing to your Audience

Anyone who’s read marketing articles or blogs or attended a course will be familiar with the 4Ps of marketing, along with many similar acronyms.  Product, Price, Placement and Promotion sum up the core tenant’s marketers need to consider when creating a marketing and advertising plan.  In digital marketing and for the Digital Dealership this is even more important.

In the Digital Marketing world, we often speak about engagement.  Engagement is critical to digital marketing success and why reconsidering the basic tenants of marketing is so important.  In the digital world, what we see and what we want to see are determined by Engagement levels.

Over the past couple of years, you’ve heard a lot about the engagement algorithms used by social media sites and other platforms.   These platforms have two main goals, to create user engagement with the platform and extend the time spent by users on the platform.   To do this the platforms have highly intelligent algorithms that present content it calculates will be of interest to people.   This is often based on the type of content or early engagement with it.  If content has low engagement the algorithm effectively buries the content and, even if you have lots of connections, most of them will not see your content.

Creating content and marketing to your audience through digital media requires careful thought to be effective and this is where defining, segmenting and building strategies for your audience is important.  Take a moment at this point to think about how you interact with various types of digital marketing, you’re someone else’s audience segment too, it will help with your own strategy.

In the first part of this series, we looked at defining who’s in your audience, and segmenting them.  These segments can be defined by any criteria, from sales volumes to location to fleet size and industry.  What’s important is to have segments defined to create strategies.  You can define these for known contacts in your audience, but you can also create these segments in the unknown audience.   For each of these Segments of the audience, consider the tenants of marketing.

First, what is the Product you want to present to each segment?  

Is it the dealership, the experience of the people in the dealership, is it machine inventory or is it services like rental, your shop or parts?  Each of these items is of varying degree of interest to your audience. Content should be created for each of the products your dealership has to offer.   Your existing customers may want to learn more about service products.   Your prospect customers may want to know about the inventory you have for sale or about the brand you represent and the capabilities of that brand.  Your unknown audience likely needs to learn more about who you are and about the dealership in general.  This will help them to recognize and consider your other products, like machines, in the future.  Regardless, it’s important to understand all the products you have to offer as each audience segment will find different values on each product.  Furthermore, don’t forget, your content needs to be engaging, so try and use video, audio, closed captioning and imagery.

Second, what channels will you use to place the content for your audience to see, engage with or react to?

There are traditional channels, like advertising sites, billboards and magazines.  There are digital channels including email campaigns, your website, Linked In, Facebook, Instagram etc.  and there are also physical channels like signage, brochures, posters and even invoices.  What is important is to understand what audience you’ll be addressing through each channel and what the purpose of the content is.

The Channel selection can be approached from multiple directions.  Consider for each channel, “what audience segments use the channel?” or approached from the other direction, “what channels do your target audience segments use?”  You need to determine this for each audience segment.

In the last few years, I’ve seen LinkedIn be corporation and brand development focused, Facebook focuses on small contractor and community focused, Instagram looks to be Brand, Product or announcement focused etc.

Third, what will be your plan combining these 3 main aspects. Audience Segment, Contact and Channel?

For this step it is often helpful to create some matrixes.   For each defined audience segment create a grid with 2 axes.  One for Product content and the second axis for Channel.  This work will help you really think through what content to place on each channel to engage your audience.   For your digital channels this is critically important, and the work done to define your audience and your product content will help you make sure the content is engaging.  Content placed on the right channel designed for the audience in the channel will always get you higher engagement, and in return, your content will be viewed by more of your audience members.

Finally, as a Digital Dealer, how will you use Information to augment your marketing?

Using and collecting information is the hallmark of a smart and digital dealership.  Analyzing information about your audience, including feedback from marketing and advertising efforts, help you to fine tune all the above 3 aspects, content, audience and channel.  Here are some examples.

  1. Add user specific information to Email Campaigns. “Hi John, because you own motor graders, we thought this inventory item might be of interest to you”.  This can be done though tagging in the mail software and merge codes.  This content will be many times more engaging.
  2. A Dealer website that recognizes returning customers and provides shortcuts to frequently visited pages or functions, and filtered inventory or promotions based on existing Fleet. “Welcome back Bill, this section lists the functions you often visit; Online Parts, Machine Specs.  Your 410 is due for a service, here’s a link to the filter kit”

Spending time analyzing your audience always pays.   They can be your existing customers, local contractors or people you don’t know.  Building a marketing plan, for each of the audience segments you’re interested in, will help you retain the customers you have and funnel in new customers to your sales and after sales operations.

Mets Kramer

Mets.kramer@strategicevolutions.ca

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Learned Helplessness

Learned Helplessness

In tonight’s post, guest blogger Bruce Baker walks you through a struggle we are seeing all around us: learned helplessness.

Many business owners and CEOs we partner with suffer tremendously due to being in a state of learned helplessness.

It is astonishing to see people that reach out to us at Workplaces simply because they are in a state of pain and the challenges they have or perceive they have don’t have a resolution.  After lengthy discussions, the challenges they have “tried everything” to solve become less daunting and transition into something inspiring. At least four out of five times, we have the privilege of partnering with these individuals to better their business situation and ultimately achieve the goals that they work so hard to achieve. Unfortunately, once they experience solving these challenges (something they never thought possible) and, of course, do their “celebratory dance,” they fall right back into their learned helpless state due to a new challenge they face yet again.  This constant state repeating itself seems to be a drug that people seek to justify the pain of their challenge and their perceived inability to solve it.

As time goes on, the more resilient the Business owner/CEO inevitably becomes, the more they transition their business and themselves to an ongoing and sustainable state of success. This is not because they now have “better business tools” necessarily, but because they reduce falling back into a state of learned helplessness.  Those who persevere and learn this new conditioned response to challenge and, at times, failure becomes more successful consistently.

To conclude, I wanted to share a powerful story (author unknown) that I have always turned to when I feel this way and need a path back to a positive state. The story goes like this:

As my friend passed the elephants, he suddenly stopped, confused because these huge creatures were being held by only a small rope tied to their front leg. No chains, no cages. It was obvious that the elephants could, at any time, break away from the ropes they were tied to, but for some reason, they did not. My friend saw a trainer nearby and asked why these beautiful, magnificent animals just stood there and made no attempt to escape.

“Well,” he said, “when they are very young and much smaller, we use the same size of rope to tie them and, at that age, it’s enough to hold them. Then, as they grow up, they are conditioned to believe they cannot break away. They believe the rope can still hold them, so they never try to break free.” My friend was amazed. These animals could at any time break free from their bonds, but because they believed they couldn’t, they were stuck right where they were.

Like the elephants, how many of us go through life hanging onto a belief that we cannot do something simply because we failed at it once before?

How many of us are being held back by old, outdated beliefs that no longer serve us? How many of us have avoided trying something new because of a limiting belief? Worse, how many of us are being held back by someone else’s limiting beliefs?

You do not deserve to feel this way!  Your business should be a source of pride and achievement for you, whether you are significantly challenged today or are feeling helpless because you can’t find a solution.  Don’t let your ego and your feeling of learned helplessness be your guide in building your business; you will fail and not return. Instead, reach out to someone you trust, someone that will hold you accountable and show you that the solutions you seek are not far away.

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Principia for After-sales – part three

Principia for After-sales – part three

Today, Ryszard Chciuk continues his blogs on Principia for after-sales with part three of the series.

In several posts starting from Principia for Business, I am sharing my way of defining and implementing the main principles (values). In Principia for After-sales part 2, I presented my point of view on the potential conflict between private and company values, on the importance of constant reminding and following of the main principles, and how I was writing their definitions.

Now, let’s go back to my after-sales team’s main principles. They were listed in Principia for After-sales part 1. It was my adaptation of our corporation’s main values: Quality, Safety, and Environmental Care.

The No 1 is “Integrity.”

The notion of integrity is mentioned on about 500 million of webpages (only in English). So, what did it mean for us? I decided to use the Stephen L. Carter definition: Integrity, as I will use the term, requires three steps: (1) discerning what is right and what is wrong; (2) acting on what you have discerned, even at personal cost; and (3) saying openly that you are acting on your understanding of right from wrong. It was not easy to explain that definition in simple words. Lately, I found the more useful explanation. Charles Marshall in Shattering the Glass Slipper wrote: Integrity is doing the right thing when you don’t have to — when no one else is looking or will ever know — when there will be no congratulations or recognition for having done so. Where is the man who will do the right thing, no matter what the cost? Is there anyone who will act with integrity even if it means losing a job or an important business deal? Where is the woman who would be willing to act in openness and honesty if she knew it meant losing a significant relationship or a large sum of money? Are there still people in this world who would sacrifice their pride, relationships, or profit in order to maintain their integrity? Are you such a person?

These are hard questions, but you have to answer them if you treat seriously your values. And do not forget to discuss with your people how it is working. The best way is to analyze examples taken from your company life.

The No 2 principle is “Care of people and environment.”

It translates into “Always take care of your co-worker, customer, supplier, investor and of all kind of life”. Obviously, it concerns safety, too high fuel consumption, respect for the environmental regulations, stable and decent working conditions, etc.

The No 3 principle is “Profitability.”

It refers to all players of the business game you are in. You need to earn enough money to stay in business. When you fall, your customers will not be supported at the same level, at least by the time another provider takes over your business. Also, you will not be able to support customers if you kill your suppliers, and this happens just after you force them to supply products at the same quality, but for a much lower price. Then you will also be a loser. If you want to increase your department profitability by the reduction of your employees’ remuneration, they will decrease their loyalty and your company will die soon.

The No 4 is “Excellence.”

This means: “We are satisfied with nothing less than the very best in everything we do”. Today I would remove this principle from the list. Why? If you want to be recognized as the man of integrity you do not do things in a sloppy way, isn’t it?

Next time I will present some examples of how we utilized our values.

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Job Shock, Part Four

Job Shock Part Four: A New Time Bomb: An Explosion of Skilled Worker Shortages

 

Edward E. Gordon, the founder and president of Imperial Consulting Corporation in Chicago, has consulted with leaders in business, education, government, and non-profits for over 50 years. As a writer, researcher, speaker, and consultant he has helped shape policy and programs that advance talent development and regional economic growth. This week, he continues his blog series with Job Shock, Part Four.

Gordon is the author or co-author of 20 books. His book, Future Jobs: Solving the Employment and Skills Crisis, is the culmination of his work as a visionary who applies a multi-disciplinary approach to today’s complex workforce needs and economic development issues. It won a 2015 Independent Publishers Award. An updated paperback edition was published in 2018.

It is already apparent that as COVID-19 restrictions ease, a pent-up demand for many types of goods and services will be unleashed. As businesses reopen or expand to meet this boom, the demand for skilled workers will soar. It is not likely to fall for the rest of this decade. As cited in prior “Job Shock” segments, a major demographic shift, serious education deficits, and rising job-skill demands have combined with COVID-19 to undermine the quality and composition of the U.S. labor force. An April 2021 National Federation of Independent Businesses survey found that 44 percent of small businesses had job openings they could not fill, a record 22 percent higher than the 48-year average for this survey. Ninety-two percent of businesses seeking workers reported few or no qualified applicants. The U.S. Bureau of Labor Statistics reported that there were a record 8.1 million job openings at the end of March 2021. We estimate the true number to be over 11 million.

Employers Face Mounting Skills Challenges

COVID-19 has greatly increased the need for skills training. The shift to remote work has placed new skill demands on many employees. Because of the pandemic’s devastating effect on certain industries, about 20 percent of U.S. workers have left their former jobs for new types of work. A March Prudential Pulse of American Worker Survey found that about one-quarter of the workers surveyed plan to look for a different job with another employer once the current crisis eases. All these factors indicate that employee training must be greatly increased.

A significant shift in the priorities of American businesses is urgently needed. In recent years business expenditures on training and education have declined. For every dollar America’s chief foreign competitors invest in employee talent development, U.S. business invests only 20 cents. Training is mostly concentrated on managers and professionals. Only about 20 to 30 percent of U.S. employers have offered entry-level job training or provided employees with training updates. Much of what is now done is mandated by safety regulations. It is not about building new skills.

A recent McKinsey Global Survey found that 69 percent of businesses were doing more skill building than they did prior to the pandemic. However, only 28 percent of these organizations had a training department or similar facility focused on learning. The organizations that employed a variety of education/training methods reported a higher rate of success in reskilling and upskilling their employees.

Even though COVID-19 has greatly increased the need for entry-level training and reskilling, many businesses are again expanding stock buy-backs and increasing dividends rather than investing in worker skills. American companies and organizations instead need to launch new HR initiatives to fill skilled job vacancies and upskill their existing employees through a variety of means including corporate universities and training partnerships.

Human and Financial Costs

Job Shock will have a major economic impact in the United States and globally. In 2030 estimated U.S unfilled jobs range from 25 to 30 million. Globally over 95 million jobs could be vacant. The financial costs for individuals., businesses and nations will be staggering. By 2030 U.S. GDP loss could be over $2.5 trillion. Global losses might reach $18 trillion.

Job Shock: Where Do We Go from Here?

The picture that emerges from before, during, and after the COVID-19 crisis is an American workforce with an abundance of people, but a shortfall of talent for the jobs of the Fourth Industrial Revolution. An analysis of the composition of the U.S. labor market at the beginning 2020 and projecting what it might be like in 2030 if the education-to-employment system remains unchanged shows:

Seventy percent of jobs (114 million) were high to mid-skill. Only 55 million workers were qualified. The result was a 60 million job deficit. American employers tried to fill these vacancies with retired baby-boomers, workers brought from other countries, foreign students attending U.S. universities, and/or the increased use of automation. Companies unable to find skilled talent moved their jobs abroad. Thirty percent of all jobs (50 million) were lower skilled. There were 110 million workers at that level, i.e., with limited math and reading competencies. The result was a 60 million worker surplus. Many gave up looking for a job (and thus were not counted as unemployed) because they were not offered entry-level job training.The 10.5 million estimated vacant jobs cost the United States $253 billion in lost productivity and profit.

At least 75 percent of jobs (128 million) will be high to mid-skill. Only 33 percent of American workers (about 56 million) will be qualified for these jobs, resulting in a 72 million job deficit. The U.S. skilled labor shortage will deepen because 70 million baby-boomers will have aged out of the workforce, a global 50 to 95 million skilled worker shortage will limit immigration to the United States, and increased automation will demand ever higher skill levels from workers. The pace of companies leaving the United States due to skilled-talent shortages will rise.

In contrast, 25 percent of U.S. jobs (32 million) will remain low skill. If education and skill upgrades are not adopted over this decade, possibly 114 million low skill people will be in the U.S. labor force. A huge “techno-peasant” underclass will compete for a diminishing number of low skill jobs. High unemployment coupled with mounting skill shortfalls could pose a real threat to American social stability.

An estimated 30 million vacant jobs are possible. The economic loss to the U.S. economy will be between $ 1 trillion to over $2.5 trillion.

The Job Shock Crossroad

We do have the power over this decade to increase the education and skills of American workers. We can produce a workforce that meets the talent requirements of 2030. It does require coordinated actions from key sections of our society. Picture the American talent creation system as a boat with two figures pulling the oars and a third at the rudder. Parents are the rudder steering a better course for their child’s future. One oar is pulled by educators (K-12, post-secondary). The other oar is in the hands of employers providing job training and skill updates to their workers. If one or more of these parties fails at their roles, the boat goes off-course, stops, or sinks from ever larger job shock waves.

This coordinated effort needs to start at the regional level. Enlightened community leaders need to pull together to keep the boat on course. The COVID-19 pandemic has produced a storm of hurricane proportions making the need for immediate action more vital than ever.

Yet many people across America remain opposed to systemic social changes. They are deeply divided into multiple warring “tribes.” They remain at war with each other rather than working to reach agreement on vital common goals. Their acceptance of the cold, hard facts of “Job Shock” remains a hard sell.

The longer the United States delays making systemic changes to the education-to-employment system, the deeper the economic and social turmoil between now and 2030. As Lawrence Summers, the former U.S. Treasury Secretary said about employment, “Walk outside: labor shortage is the pervasive phenomenon.”

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Resolutions and Reading

Resolutions and Reading

For a change of pace, we decided to share a vlog post today in honor of this being a new year.

 

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Digital Marketing

Digital Marketing

Mets Kramer

Digital Marketing: Billboard vs Engagement

“At the moment, our research shows buyers making 90% of their purchase decision before contacting the dealer.” And there it was. I had been having thoughts like these swirling around in my head for a few months now. But when Charles Bowles at Trader Interactive spoke with me, I had no idea how much our industry had shifted.

I have a theory about Digital Marketing in our construction equipment industry and I believe it can be considered in two ways.

  • First, is what I’d like to call Billboard Marketing, which refers to digital strategies geared towards establishing and maintaining digital visibility. These approaches are often additional marketing strategies, while continuing the existing methods of communication.
  • The second approach is called Engagement Marketing and includes digital activities to connect and develop engagement opportunities with your target audience. Dealers who implement Engagement Marketing consider their digital marketing presence as transformative and suggest these methods could replace most, if not all, past marketing approaches.

There are three aspects of Digital Marketing that I would like to look at and compare Billboard and Engagement strategies. They include Websites, Email Marketing and Advertising campaigns.

  1. Websites

Most dealers have a website today, which is a great start, but the buck doesn’t stop there. Listing your equipment, providing contact information and location falls under the Billboard approach: you present your information to visitors and hope they contact you. However, for Engagement Marketing, your website should provide a virtual visit to your dealership; images and videos of your inventory, and related documents showing the quality of the equipment and records of its health and maintenance. The icing on the cake would lead the visitor to a button they can click on to take them onto the next step. (Replace “Contact for more information” with “I’m interested in Buying”) But let’s be real, this call to action isn’t the icing, it’s the entire cake! How do you measure whether you are leading your visitor into an engaging relationship? Make sure you provide ample information about the machine so they can decide on the spot. If there’s not enough detail, Bowles says 90% of visitors will go to check out another listing to find what they need. Hop onto Google Analytics to help you assess whether you’re Engaging or Billboarding.

  1. Email Campaigning

The next common aspect of Digital Marketing is email campaigning.  Email campaigns are a great way to stay connected to customers and present new products. To use email campaigns effectively, it is important to consider your audience and develop strategies in order to create a continuing conversation. Mail programs such as Constant Contact or Mailchimp provide the tools to send information to tens of thousands of people.  A Billboard approach sends the same message to everyone who drives by it – no matter who they are or what they are looking for. We don’t want to use email campaigns the same way. Instead, consider a more strategic approach, engaging different segments of your audience based off their interests. Provide a mixture of Equipment For Sale messages and industry, fleet focused education. Use the tools provided by the email platforms to understand who is interacting with your campaigns and change the messaging and frequency for each segment to further engage your audience. While email campaigns can feel like a one-way communication, change your mindset and remember, email is most effective as a conversation tool. So, create campaigns that encourage your audience to talk back!

  1. Digital Advertising

Finally, Digital Advertising, whether Google, Facebook or others, are designed to bring visitors to your digital dealership: your website.  The Billboard approach will stop at bidding on generic words (ex. Caterpillar excavator, Komatsu bulldozer, Case backhoe, etc.)  which will hopefully bring visitors to your website to see what your dealership has to offer. But let’s keep in mind that digital advertising can be expensive, so the set up and focus of your advertisements should be focused for an Engagement approach. Let’s milk every opportunity! How about bidding on specific machines that are in your inventory? Specific combinations like Komatsu D65EX, for example, will have less bidders, making them cheaper and bringing visitors exactly to what they are looking for, the machine on your website.

The digital marketplace is real and becoming the source of future sales.  All leading industries are showing signs of transformation into the Engagement model of digital marketing.  Automotive sales, Commercial trucks are some but do not forget about Amazon and similar services. We are all proof that Engagement Marketing and Sales keeps us coming back for another slice.

We will continue this discussion soon.

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