As originally appeared in AutoMédia
By: David Wilke, National Training Manager, LGM
There is no single, all-encompassing key to optimizing performance and profitability in the Financial Services Office (FSO). The solution lies instead in a series of components that, when individually strong and perfectly positioned, combine together to drive success. These five pieces of the formula are opportunities first and foremost – challenges that can be overcome in order to positively impact FSO performance.
1. People – Recruiting the right team
A dealership is a complicated place, filled with a lot of different roles, responsibilities and personalities. A key part of optimizing your FSO is ensuring you have a solid organizational structure. It’s important to evaluate staff levels (how many individuals you have in any given role), as well as the current system in place for the coverage and scheduling of your employees. There is also value in taking a broader look at your FSO structure as a whole. Is there an appropriate range of seniority levels, responsibilities and roles?
Once you’ve considered the big picture, ask yourself, “What are the ideal qualities of a Financial Services Manager?” It’s probably someone who acts confidently and takes accountability, someone who is a great seller, and someone who has accurate paperwork. If you see room for improvement in terms of talent acquisition, don’t be afraid to obtain recruiting support. It’s worthwhile to reach out to someone with expertise for coaching on how to find, interview and select FSMs who check off all the boxes.
2. Training – Prioritizing employee development
Once you’re confident you have the right people consulting with customers, it’s time to consider whether or not you’ve trained them properly. If you see shortcomings with your employees, it might be because of a lack of proper employee development. It’s crucial to empower employees and provide them with the tools they need to succeed. Offer your FSMs access to product and skills training so they can become more knowledgeable on product suites, adjust to any type of buyer personality and gain confidence in handling objections. It’s important to remember that employee development is an on-going commitment – leaders must provide oversight of training calendars and encourage employees to continually seek these opportunities.
3. Tools – The value of systems and controls
Data really is everything. The phenomenon of “datafication” – turning computerized data into something of incredible organizational value – is one of the most talked about technological trends of our time. Forward-thinking companies are driven by the data they collect. With that in mind, dealers have a lot to gain from conducting in-depth data analysis. Focus on targets and performance report cards, distribute reports to the right people, zero in on key indicators and try to extract insights wherever possible.
It’s difficult to maximize the value of your data unless you have an integrated sales reporting platform and sophisticated financial reporting practices. Look into reporting platforms that might make you more competitive and consider how you collect information for financial statements, penetration reports, and CSI reports.
4. Rewards – Motivating through compensation
In order to maintain a highly-inspired workforce, you must have appropriate compensation plans. Of course, there are a variety of compensation models that can work. Amidst all of the options, it’s important to motivate your employees with a system that rewards effort and hard work. By implementing a “directional compensation structure,” you can emphasize product prioritization and drive performance outcomes. Take time to really consider which compensation plan best suits your particular team. Additional incentive and rewards programs can supplement your internal compensation model to further inspire your employees.
5. Leadership – Generating strong store management
Leaders set the tone for the organization and are ultimately accountable for its success. Every leader within the dealership should be seen as having a significant impact on FSO performance, no matter their department. To emphasize this philosophy, leaders can be assigned specific roles and responsibilities related to optimizing the FSO. To get buy-in from other employees, the cross-departmental benefits of FSO performance should be a top communications message.
Lastly, it’s important that dealer principal and management expectations are made clear. Hold teams accountable for targets and measure results on a regular basis. Be a steadfast champion of important process changes that need to happen and be sure to follow up.
These five components shouldn’t be approached as lofty short-term goals or viewed as impossible barriers, but rather areas of focus for gradual improvement. Don’t be overwhelmed by the complexity of the factors, be excited for the room to grow in so many different facets of your business.