Tag: hiring and retaining talent

Pair Talent with Technology to Maximize Staffing Strategy

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Having trouble filling all the roles at your dealership? Then why are you ignoring the millions of applicants who want to work at your dealership? That might sound dramatic, but according to a report from the hiring and software consultants at Hireology, more than 11 million people applied for jobs at dealerships last year and were completely ignored or overlooked. So why is it still so difficult to find and keep top talent in the roles at your dealership? And, what can the technology driving your business do to help? Here’s what we’ve uncovered:

2020’s Many Challenges Are Making it More, Not Less Difficult

The figure mentioned above refers to pre-pandemic levels of job seekers who wanted to work at businesses in the auto industry. Back then, the unemployment rate was low. According to the Bureau of Labor Statistics, as of October this year, the unemployment rate is hovering around 7.9%. While that figure is improving, there are other factors that complicate the automotive industry. Record low vehicle inventory, high jobless claims, and auto loan delinquencies could signal the perfect storm for next year. And, according to Cox Automotive chief economist Jonathan Smoke in this article, “I think we’ve had a false sense of security that we are out of the woods.”

Technology is Key to Building the Right Team

When it comes to building the right team at your dealership, connecting the right people, tools, and processes is key. That’s according to Dealertrack DMS VP of Service and Support Mandi Fang. According to a Cox Auto Consumer and Dealer Survey, 75% of dealerships have adopted digital retailing within the past six months. Fang notes that this remarkable figure shows that “dealers across the country are building better digital retailing programs to reach, connect, and accommodate their consumers.” And, she notes, dealers should be actively hiring and recruiting candidates who are interested in working in an environment where they have the opportunity to work on digital technologies like the CRM, digital retailing, DMS, and others.

Focus on Your Dealership’s Hiring Velocity

Ideally, any problem that can be measured can be analyzed, broken down, and then fixed. We now know that the number of people looking to join the team at your dealership is, in fact, growing. And, you know that building a more digitized sales and service experience at your dealership creates an opportunity to attract a more tech-savvy workforce. So, what’s the next step? According to the 2020 State of Hiring Report from the experts at Hireology, it’s now time to speed up your job applicant review process. In that report, data shows it takes 54 applications on average to make a hire at most dealerships. Yet, many applicants can go weeks without having their resume or application reviewed. By simply committing to a 24 hour application review process, your hiring managers can reduce the process from 14 days to just 9. This hiring velocity metric is simple, measurable, and will result in actual profitability for your business.

Don’t miss out on the millions of millennials actively seeking out opportunities to work at your dealership. Now that your digital dealership is up-and-running smoothly, put the right people in place.

Learn more best-practices: Get the Guide today.

 

 

Now Hiring: Better, Brighter Talent For Your Business

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Hiring the right people for the right roles makes all the difference. The business of selling and servicing cars is a people business, first. That’s because people impact profits. In an interview with Automotive News, Adam Robinson, CEO of Hireology, a hiring software provider and consultant, said the “difference between a mediocre dealership and a great dealership is the strength of its people.” Yet, filling the roles at your dealership has always been a challenge. As recently as 2016, the turnover rate for automotive dealerships was as high as 43%, according to an NADA Workforce Study. Fast-forward to today, and your dealership is facing a whole new set of staffing challenges. Record unemployment, restructuring, and new technology makes finding new talent tricky. Building your dealership’s dream team is possible. But you’re going to need to change your approach. Here’s how to get started.

Build a Top Career Site to Attract Candidates

The saying goes, “If you build it, they will come.” We’re talking about your career page, that is. That’s because, according to Hireology’s State of Hiring 2020 Report, applicants who apply directly to your career site are more likely to get hired. In fact, 44% of all hires, and 57% of career site applicants are considered top candidates. Consider that people who already want to work at your dealership are already on your site and looking for open positions. When was the last time you updated your career page? Do you have employee testimonials on this page? Can candidates easily find your company values and mission statement? If not, it shouldn’t be a huge lift, and it will go a long way.

Think Outside the Box

As you adjust to new buying behavior, you should also adjust your expectations for new hires. If, previously, sales and customer service experience was required, or even a basic understanding of your Dealer Management System (DMS), consider a change. Try listing experience in technology, online retail, or software management in your job post. With so much of your business taking place online, it’s time for a new mindset.

Diversify Your Search

At the start of April 2020, many dealerships faced the difficult decision to furlough or layoff workers due to COVID-19. While most have been able to recover, rebuilding your workforce will take some time. According to a Cox Automotive COVID-19 Dealer and Consumer Sentiment Survey, 57% of people are still extremely concerned about the virus.  Your ability to conduct in-person interviews may still be impacted for some time.  You can still find the right talent to fill open positions at your dealership as long as you invest in a multichannel strategy. That’s according to the State of Hiring Report from Hireology who say “dealerships with diverse sourcing channels increase their quality applicants by 62%.” And, they claim, don’t rule out mobile ads in your approach. 80% of Facebook’s 2 billion users only have a mobile phone proving just how important mobile-first experiences can be for job seekers.

Rethink Your Dealership Roles

Business at your dealership has changed. From e-contracting, to virtual showrooms, to Sales Pick-up and Delivery (SPUD) and virtual check-ins, your business is now running as much (or more) online as it is in-person. As you look to fill positions, consider the opportunity to rethink the way your team works. As Director of Business Development for Dealertrack DMS, Tyler Anderson, points out in this article, “connecting the right people with technology and timely data is the winning combination that, I believe, will bring dealers through these tough times. I’ve seen several OEMs take the lead by hiring higher caliber sales people who are able to carry the sales process from beginning to end, and with fewer hand-offs.” The omni-channel approach to sales is now possible to many dealers thanks to more fully integrated technology. With fewer logins, less friction, and more systems working together, your staff can function at a higher level.

Your dealership looks different. But, change is nothing new to the automotive industry. As you continue to shift and grow, your staff will grow with you. With the data from industry experts, surveys, and our dealer partners, we hope your team continues to thrive this year and many more.

For more information, download our free guide.

Turn Dealership New Hires into Experts with Strategic Onboarding

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Employee turnover costs dealerships billions of dollars every year. Yes, billions. And the problem is getting worse. Payroll is rising and one- and three-year retention rates are dropping, meaning dealers are spending more and seeing fewer results year over year. This problem is only compounded by the toll of margin compression, operating costs, and the hidden impacts of low team morale and comprehensive operational inefficiency due to churn. The end results leave dealership to face a big struggle. Where can they begin to make a difference? The answer, according to the experts, can be found through more effective onboarding processes.

The financial impact of employee turnover

Calculating the total cost of employee turnover surprises many dealers. On its surface, it may look like a mere annoyance or human resource hassle. But dig a little deeper and it becomes evident that turnover is having a significant financial impact on dealerships. According to Harvard Business Review, “it typically takes eight months for a newly hired employee to reach full productivity.” While dealerships wait for their new hires to slowly climb the learning curve, they can lose between 1% and 2.5% of their revenue. These additional lost profits add up.

Employee onboarding drives faster recovery

Employees come and go in every industry. But according to the most recent NADA Workforce Study, dealerships, in particular, are losing nearly half of their workforce every single year. One way to mitigate the negative effects of this high turnover rate is to lessen the learning curve and bring new hires up to speed faster. When employees know what to expect and what is expected of them, they feel more comfortable in their work and they increase their productivity in turn.

According to the automotive experts at Hireology, a strategic onboarding process can contribute to the team “as soon as they join.” And the difference in productivity adds up. The Society for Human Resource Management has found that organizations with a standard onboarding process experience 50 percent greater new-hire productivity.

Onboarding and the DMS

The DMS is the backbone of modern dealerships and employees must be proficient with the system in order to contribute at a high level. For this reason, any dealership onboarding program must include technical training. Surprisingly, only 25% of companies say their onboarding program includes any kind of technical training.

The benefits of an easy-to-learn DMS

Dealerships with an easy-to-learn DMS have an advantage when it comes to onboarding new hires and reducing the financial impact of employee turnover. Because modern DMS platforms have simple interfaces that streamline workflows, they are easy to use and easy to learn.

For those dealerships currently considering a DMS change, ease-of-use should be a major consideration. Island Automotive Group, a 15-store dealership in New York, recently changed platforms and specifically sought a provider that appealed to its employees and made their jobs easier and more efficient. Dealership partner, Marcello Sciarrano, summarized it this way: “[Our new] DMS is a better system. It’s more cost effective, it’s easier to use, and our employees like it. To me, that’s what a DMS is all about.”

Employee turnover isn’t going anywhere. But dealerships can make a difference by building onboarding programs that include technical training on their DMS. And when their DMS is easy to learn, new hires know what to expect and what is expected of them, making onboarding easier for employees and more financially beneficial for dealers.

Hiring for Outdated Tech is An Outdated Practice

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Automotive dealerships have a lot of complex, moving parts. Inventory management and sales, parts and services, operations and accounting—everything has to work together to make the business run efficiently and smoothly. And the key ingredient driving your business? The people.

But retaining the well-trained and highly skilled staff is becoming more and more difficult. With the average tenure of employees as low as only 18 months, General Managers (GMs) and Dealer Principal Owners (DPOs) are in a tough spot. Hiring and attracting new team members isn’t easy. And here’s the secret: when it comes to finding new staff, you’ve got to keep up with the changing pace of technology. Bottom line, if you’re trying to refill a role based on outdated technology skills, you’re playing a losing game.

Hiring the Millennial Generation
Anyone born between 1980-2000 (roughly) can be considered a Digital Native, that is, a person who grew up with technology from an early start. Unlike their predecessors, this generation never experienced an office culture without access to emails, digital retailing, online advertising, and similar shopping experiences. So what does hiring a digital native, or millennial, mean for your dealership?

  • First, even though millennials are tech savvy, don’t be surprised to discover they can become error-prone and less productive by a tendency to multi-task.
  • Second, the myth that this generation prefers to interact solely through text and online methods is just that—a myth. Many millennials thrive in group settings, sales roles, and person-to-person contact.

For DPOs and GMs, it’s clear that sticking a millennial in a role where they must learn outdated technology, memorize mindless codes, and multi-task with slow technology is certain death.

Don’t Forget Priority #1
Your dealership’s number one focus should always be on customer satisfaction. Loyalty, trust, retention are all fostered by building good relationships. For the owners at Heritage Ford, anything else was seen as a total distraction. When they began shopping for new Dealer Management Software (DMS) technology, they quickly realized the need for an easy-to-use system that allowed their focus to return to priority #1: the customer.

The solution? It’s simple.
Hiring and replacing lost employees can be extremely cost-prohibitive for dealers. For many, the amount of money it takes to replace lost team members can reach $45,000 per employee! Is outdated and old technology keeping the generation of automotive talent from joining your workforce? Would an easy-to-use, forward-thinking DMS allow more tech savvy, digital natives the chance to engage with your customers without the hindrance of learning your current, clunky tech?

Learn more about overcoming your Staffing Struggles here.

 

Statistically Speaking …You’ve Got Staffing Struggles

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Dealership Principal Owners (DPOs) and General Managers (GMs) are struggling with hiring, retaining, and even recruiting top talent in the automotive industry. If you think your dealership doesn’t have a problem, you need to take a closer look.

Let’s look at the facts:

  • In 2016, employee turnover at dealerships in the united states increased by 3% — from 40% to 43%.
  • In one year nearly one out of every two employees left dealerships for greener pastures.
  • According to the NADA dealership workforce study, turnover will cost the average dealership $7.5k in gross profit… per employee.
  • Across the industry, turnover is costing $8 billion a year!

Those numbers aren’t pretty, but there is hope. Watch the video above and visit our Staffing Struggles resource page to discover more.

The struggle is real—Learn More.

 

5 Steps to Reduce Turnover at Your Dealership

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Turnover in the automotive industry is not only a huge problem—it’s a growing problem. According to a study conducted in 2016, turnover increased in 2016 by 3%, reaching 43% annually for dealerships. That means most dealerships lost around 23 employees every year. And turnover is expensive. The cost of replacing a single lost employee can reach $45,000 each year. This type of issue should be top-of-mind for every single General Manager (GM) and Dealer Principal Owner (DPO) working today. To combat this issue, Dealertrack DMS hosted a live session with industry expert John Grace and Tom Stocco, Chief Financial Officer at Van Horn Automotive Group—a 16-store dealership group with a great retention track record—for advice.

Improve Training with Better Technology Tools
Van Horn Auto Group doesn’t cut corners when it comes to training and part of that commitment includes investing in easy-to-use technology. The investment goes further as the dealership employs two,full-time learning professionals and trainers who travel from store to store to ensure proper onboarding and continued education efforts are aligned with the company’s objectives.

“When people feel empowered that they can affect change and reach their goals, I think that has such a positive effect on culture overall.” – Tom Stocco, Chief Financial Officer at Van Horn Automotive Group

Empowerment is the Key to Great Culture
“Culture” can be accused of being a buzzword if you don’t take it seriously. For Van Horn, allowing each department the autonomy to set their own goals, meeting as a team, and sharing wins and losses, together, helps drive the overall culture across multiple stores. According to Tom Stocco, “When people feel empowered that they can affect change and reach their goals, I think that has such a positive effect on culture overall.”

Adjust Your Hiring Techniques
No one gets hiring right, every time. But, patience is key. You’ve spent time and money on building your dealership’s culture, so don’t rush it. Be sure to tell the story of your dealership to each and every candidate who walks into your door. And, when you do, be open and transparent about it. Otherwise you won’t find the right fit.

Tie Your Hiring Strategy to Business Strategy
If you’re willing to invest in your employees, it will benefit your dealership in the long run. Van Horn hires employees with the expectation that they’ll stick around, and they’re willing to incentivize them as such. The dealership will help cover half the fees of a college tuition for employees going to school. This type of long-term investment keeps Van Horn’s turnover low, helps improve the career trajectory of their team, and goes a long way towards the strategic improvement of their hiring plan.

Think Differently
Van Horn’s management training includes two-day courses that include hiring best-practices and compliance strategies. But beyond that, Van Horn also takes its managers through training to grow and develop as better and stronger leaders. The investment is aimed to help each manager discover how to better motivate their teams and discover ways to improve each staff member’s career in the automotive industry. It’s this “next level” of leadership training that strategically impacts the tenure of employees.

The people side of the automotive business faces the challenges of hiring and retaining talent greater than many other industries. But, DPOs and GMs have faced many challenges before. It will be the creative innovators whose dedication to the development of their employees and the transparency of their business who come out on top.

See the entire interview between John Grace and Tom Stocco of Van Horn Auto Group here.

Data-driven Dealerships: 5 Metrics for Improving Retention

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You’ve heard it before: You can’t manage what you don’t measure. And this is true…mostly. Human Resources, Controllers, and People Ops often struggle to capture meaningful data around high turnover. Employee satisfaction on the job, training expenses per employee, and the unforeseen costs of replacing key team members can go untracked. When it all adds up, the total cost of employee turnover can reach $439,000 per year. What if you could measure the “unmeasurable” canary in the coal mine, so to speak, that indicating a positive work environment?

Measuring ‘People Ops’ can be difficult. What’s the retention rate per department? What’s the cost of training? Answering these questions should not fall to HR professionals alone. The answers paint a picture of the overall health of your dealership—which is important not just to your turnover rate, but your customers as well. When it comes down to it, unhappy employees and an knowledgeable staff lead to poor reviews. Simply put: people impact profits. Here are five metrics you can start evaluating, today, to make sure you’re hiring and retaining top talent:

1.Employee Satisfaction
Your dealership’s Employee Net Promoter Score (eNPS) is a tool that organizations use to track employee loyalty across time. It was originally designed to gauge customer satisfaction, and it works the same way. As you track it over time you’ll set a benchmark and watch your score either dip or rise.

2. Voluntary Turnover
Are you seeing your best sales people move on at a regular rate? Some churn is natural, so use this as an opportunity to conduct professional exit interviews and unlock the root cause of your employee turnover. What did your staff learn during their time onboard? Did they have any suggestions for improvement? Be open and honest—assure them they aren’t jeopardizing a key employment reference—and use their feedback for future team members.

3. Involuntary Turnover
Make sure you track this number separate from base turnover. Plus, you should keep track of any improvement plans or violations reported to management. Is this number increasing every year? How about every quarter? Do you see a troubling trend? Compare these figures year over year.

4. Managers
Do the previous figures align to your managers evenly across the board? Why, or why not? Are you promoting your managers from within with a clear career trajectory? You may not be able to measure how skilled each manager is at conflict resolution or rely on a metric that can predict which manager is better at delivering bad news, but you can (and should) track how often your managers hire and fire your staff, how long their team members stay on board on average, and which managers have the highest rate of complaints.

5. Training Budgets
This should be a no brainer since you’re likely tracking how much money is spent on several key areas. However, you should also pay attention to which types of training you’re paying for, what your staff thinks of the training, and what the adoption rate of these learning tools is. If you’re throwing money into a budgeted item that no one uses, you might as well use that money on something everyone enjoys…like donuts.

Every dealership is unique and has its own story to tell–and your staff is a crucial part of that story. Pay attention to your employees and the five people metrics that signal a warning that your dealership culture–and turnover–might be in trouble. Retention is a better business strategy in both the short- and long-run.

 

7 Tips For a Stronger Dealership Human Resources Team

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Partnering with People Ops at your auto dealership has to happen now. And it’s time to get creative because a strong labor market—with an unprecedented unemployment rate of 3.9%—means the pressure is on you to hire and retain the staff you need to run your dealership. If that worries you, then you’re probably paying attention. You’re probably realizing the your HR strategy needs to align with your business strategy–HR is no longer a silo or department DPOs and GMs can ignore. Now that we have your attention, here are 7 ways to improve your hiring strategy:

1. Filling The Seat Quickly
Don’t make the mistake of hiring the first candidate whose resume uses the correct form of “they’re, their, and there” simply to take the pressure off your overworked sales team. It’s tempting to move through the hiring process quickly, but a bad hire could end up costing your dealership even more in training, turnover, and replacement costs.

2. Making the Decision Solo
Make sure to have any candidate you’re seriously considering meet with several key team members. Get a “gut check” from everyone they’ll be interacting with and don’t make the mistake of putting this very important decision entirely on one person.

3. Failing to Offer a List of Why’s
Every candidate will be asked “why” they want to work with you. But things have changed; remember the 3.9% statistic? Your candidate is evaluating the position as much as you’re evaluating them. What unique benefits does your company offer? What tools and technology will they get to work with? What does your corporate culture look like? Does your dealership offer flexible time off or work schedules that fit with the candidate’s schedule? If you don’t, have you considered why not?

4. Overselling The Job
Make sure you’re honest about the position and everything being offered. If you’re transparent and upfront about your compensation structure now, without over promising unrealistic commission goals, you’re more likely to keep that new hire around longer once they accept the position. Don’t worry, not everyone is looking for an easy job, either. Be honest about what your team does, be proud of what you’ve accomplished, and share what you hope to do in the future. The right candidate will appreciate it.

5. Not Doing Your Homework
Job applicants put a lot of time and effort into building crafted resumes, networking, and fostering great references. If you’re not doing your research and looking into their work history, contacting former colleagues, and doing important background checks, you’re wasting both your time and theirs. Save time, money, and hours of frustration if you build this process into your standard operating procedures now, so you don’t have to worry about it later. Bonus: a little creeping on social media is to be expected on both sides these days. Everything that’s put out in the public sphere is fair game.

6. Taking Too Long
Yes, you should take your time and be thorough, but keep in mind your applicants may have other offers on the table. Don’t be surprised if they’re suddenly unavailable to take your offer if something of better or equal value came along while you kept them waiting. Top talent may also weigh your offer against another if you failed to show up at a scheduled interview time and date. Consider this: many job seekers take time off from current positions to meet with you, at a personal cost. Were you ready and willing to meet them on time?

7. Failing to Develop New Hires
According to a survey of 1,000 dealer professionals, 36% were motivated largely by personal development and career progress. If you onboard a new hire and then fail to train them, develop their skills, or simply leave them alone to figure out the nuances of your dealership’s unique expectations, don’t be surprised when they bail.

If it sounds like hiring and retaining top talent has gotten more difficult, it has. But establishing a long-term relationship with team members who drive sales at your dealership, grow your business, and who remain loyal to your company over time is valuable. Taking the time to find the right people to build that trust is an investment in your dealership’s future. Good luck!

 

Unlock Root Causes of Employee Turnover

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In 2016, the turnover at dealerships in the U.S. was 43%. If you calculate the average number of employees at every dealership, that equals more than 23 team members giving notice in one year alone! That’s a lot of churn. With figures like that, if you don’t think your dealership has a turnover problem, you might want to think again. So what’s the big deal? Take a look at the root causes of employee turnover you may have overlooked:

A Lack of Diversity
There’s a general need for change in the auto sales industry. A quick look at the numbers shows that only 19% of traditional new-car dealership employees are women. And, while dealerships are aiming to bring in more millennials to the workforce, the ability to keep this group around long-term is failing. Broadening your search to be more inclusive, working with more flexible hours, and trying creative compensation structures are a few ways to start the process of change.

Hiring to Fill Niche Technology Needs
If your technology is out-of-date, hard to use, or even just oddly specific, you may be limiting your pool of candidates. Employees are already required to learn and adapt to everyday changes to industry regulations. If you refuse to consider a candidate based on their experience with the technology you currently have (when you know it will likely change), you aren’t planning for the future.

Failing to Compete with the Competition
Demand for qualified employees is growing. This is good news for anyone working in the industry, but it does mean managers and Dealer Principal Owners need to build a solid strategy for attracting top talent. As the market for employees becomes more and more competitive, your staff has the flexibility to move on to competitors who may offer better compensation, more flexible hours, better paid time off policies, or company perks and benefits. A similar story played out in the technology industry in the last ten years, and managers were forced to get creative when it came to attracting talent.

Poor, or Inadequate, Training
No one enjoys feeling lost on the job. Employees today realize that every position they fill is a stepping-stone on a career path that needs to offer skill development and training to promote growth and success in their future. Does your dealership offer e-learning or a career trajectory plan aimed at improving their development? Is there a position in their future available for promotion or advancement? Your employees have plans for their own future—do they include you?

Highly Selective Employees
Dealerships already must compete to overcome a negative reputation. Today’s employees aren’t afraid of hard work, but they’re also more agile and tech-savvy. They know how to network and will use their skills to consider better options, whether a position is in a brand new industry, or not. What does your opportunity offer that they can’t find elsewhere?

It’s not too late to uncover these often overlooked issues to retention. You can develop strong employee relationships and attract quality team players. Discover more ways to attract and retain talent in our new eBook: 8 Ways to Reduce Turnover & Improve Retention: A Dealer Principal’s Guide to Hiring and Retaining Talent.