Affordable Education For Front-Line Employees
of Heavy-Duty Distributors
Aside from supplier-subsidized product training for
the sales staff, most heavy-duty distributors “can’t afford”
systematic education for their employees. Or at least, that’s what they
believe. Why? Consider this composite quote from some of our recent field
research:
“Because the heavy-duty parts business is
so cost-conscious and our profits are so weak, we can’t afford higher
initial wages to get better people who will stay long enough to allow us
to get any return on an educational investment … which we also can’t
afford.”
This thinking leads, of course, to undifferentiated
service. And that makes the heavy-duty specialist a mere price
taker. In turn, that insures poor profits. It’s called a doom
loop. And here’s what it looks like:
DOOM LOOP
Paradoxically, most doom loopers would agree with the
following statements:
1.
If competitors (OEM or aftermarket) have equal, if not the
same product lines, then service quality must be the edge.
2.
Consistently excellent service can only come from the best,
long-term, committed and educated employees.
3.
Finding and keeping the best employees has been a huge
on-going problem for a long time, especially in light of pressure from
truck dealers.
4.
The number one reason that better employees don’t choose
to work in the heavy-duty aftermarket is because they see limited
prospects for personal development and improving their income.
5.
Achieving perfect service with “zero-error” economics
would increase sales growth, profits and gross margin per employee. But
few employees know how to define, measure, achieve, sell, get paid for and
leverage “perfect service”… one-niche and customer strata at a time.
6.
Employees are either an educated part of the high
performance service solution or they are an uneducated, unaware part of
the low performance problem.
From Doom Loop to Virtuous Cycle
How can heavy-duty distributors close the gap between
their pennywise, personnel practices and these simple service beliefs? Is
there a distribution-specific, cost-efficient training methodology for
switching from the doom loop to a virtuous cycle?
VIRTUOUS
CYCLE
Investing in systematic education for all front-line
employees will result in better employees. Contrary to popular notions,
trained employees tend to stay around longer. Rather than becoming anxious
to take their newfound skills and run, as a group their loyalty increases.
Their attitude changes from that of an employee to that of a stakeholder.
When Is A Good Time To Educate All Employees?
If most heavy-duty specialists couldn’t afford to
educate all employees in good times, how can they consider starting now in
the grip of a tough recession? Here are a few quick reasons.
·
Across the board hiring and wage freezes, followed by cuts
will do nothing to unlock the hidden profit and human potential within
your businesses. Instead, companies need to strategically focus on
profitable and profit-growing customers while shaping up or out the losing
ones.
·
A strategic turnaround, not a financial one, emphasizes the
winning elements while revitalizing profit-growth and personnel
motivation.
·
If you don’t start wiring your employees’ hearts, minds
and wallets into the general economic productivity and prosperity of the
company, then they will leave for better companies when they start hiring
during the next economic upturn.
·
The virtuous cycle of best-service economics will actually
grow profits in bad times. But of greater significance, when an economic
upturn takes place, virtuous cycle companies will benefit earlier and to a
greater degree. So why not invest in long-term improvements sooner rather
than later?
·
Other, more open-minded competitors will get a head start on
turning the negative problem of educating all employees into a strategic
advantage.
Affordable Training for Front-Line Employees
Is there a way for some of the bottom 90% of all
distributor executives (who make only one-quarter of the return on
investment that the top 10% make) to decide that it is time to stop
working harder for less? Yes there is, but it took two 25+-year journeys
by Merrifield and Wade to discover and develop.
In the ‘70’s, Bruce Merrifield was turning around
paper distribution companies for a growth-by-acquisition chain. As he
discovered productivity insights through experiments at different
branches, he would summarize them in problem/solution memo-format and
collect copies in binders at each branch.
Using this training system, he could get new managers
at both old and new branches up to speed for understanding and using a
growing number of “productivity tactics.” The system worked well
enough to out-perform the competition and achieve sustainable, superior
economic results for all of the company’s stakeholders.
The memo system did have some shortcomings. We were
surprised to discover that some managers, while effective in their
occupational niche, were also functionally illiterate. They read so slowly
that they couldn’t remember what they read. They preferred audiotapes to
listen to during their drive time.
Few of the managers were good trainers when
productivity tactics needed to be shared with others at the branch level.
They would dilute and/or pollute the educational story and they rarely
reviewed the educational material often enough (5 - 15 times) so that even
the slowest learners could really “get it.”
With the popularity of VHS and its growing
availability at branch locations, educational stories on productivity
tactics can be told, solving the functional illiteracy problem…
especially for operational people who didn’t speak English as a first
language. The tapes also allow a low-cost way to get a pure message to all
employees at all locations with as many repetitions as necessary.
“High
Performance Distribution Ideas for All” a new videotape product from
Wade&Partners and Merrifield Consulting. It has 53, 10-minute
segments totaling over 11 hours of programming with a 285 page
“Implementation Guide.
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