Fixed Ops Journal - August 2019 - F4

FIXED OPS JOURNAL

EDITOR'S LETTER

TREAT 'EM RIGHT

New study offers blueprint for dealership fixed ops staffing success

T

he shortage of talented auto
service technicians is acute and
growing. The turnover of service
advisers at new-vehicle dealerships
has come to resemble a revolving door.
Workers younger than baby boomers aren't
especially interested in dealership jobs,
including those in the service department,
parts desk and body shop.
Even as franchised dealerships must rely
on service revenue for an ever-greater share
of their profits, such dreary workplace
DAVID
realities may seem permanent facts of life
KUSHMA
for dealers and fixed ops managers. A new
dkushma@crain.com
report, though, offers cause for hope - but
Fixed Ops Journal
only if dealerships are prepared to change
editor
the way they treat their employees.
Cox Automotive's 2019 Dealership
Staffing Study notes that nearly one-third of the members of
Generation Z and younger millennials - roughly, people from ages 22
to 28 - who were surveyed for the report express interest in working for
a dealership. That rate is 10 percentage points higher than it is among
older millennials and members of Generation X (ages 29 to 54). And
these younger employees are at least as attracted to technician jobs as
they are to sales and administrative positions, the study says.
The study also concludes that the alarming annual turnover rate
among service advisers - nearly one out of two, according to the
National Automobile Dealers Association's most recent Dealership
Workforce Study - may be moderating, at least for now. These findings
are good news.
Now the bad news: The Cox study warns that half or more of service
advisers and other service employees are likely to feel disengaged from
their jobs.
That lack of enthusiasm is an obstacle to worker retention, especially
at a time of low overall unemployment. The loss of good, experienced
workers can depress satisfaction among a dealership's service
customers, and thus fixed ops profitability.
"Talent and technology are key to the future of the service
department," Tracy Fred, general manager of Cox Automotive's Xtime
brand, told me. "Dealers need to figure out how to lean into this profit
center."

Fab five
The study recommends five "tactics" - in effect, changes in
institutional culture - that can help dealerships hire and keep the
employees they want:
1. Embrace a more flexible culture.
2. Reconsider your pay and benefits plan.
3. Offer career planning and professional development opportunities.
4. Offer the latest tools and technology.
5. Prioritize workplace diversity.
How could these tactics particularly apply to service employees?
For service technicians, a better work/life balance could include

PAGE 4

AUGUST 2019

greater flexibility in their schedules - more free weekends and nights,
fewer hours overall, more vacation time. To achieve these goals, Fred
notes that some dealerships have adopted four-day workweeks and
other unconventional scheduling tools.
On pay, the Cox study finds that current and potential dealership
employees disdain commission-based compensation. Complaints
among service advisers that too much of their income depends on
commission sales are chronic, and a big factor in their turnover rate.
Fred suggests that greater efforts to show, rather than tell, service
customers what they need through objective data and inspection
reports could ease the pressure on advisers to "upsell."
Similarly, technicians routinely cite flat-rate pay plans - essentially
piecework - as a major source of dissatisfaction and turnover.
Although flat-rate remains the most prevalent form of tech pay, more
dealerships have introduced hybrid plans that also include income
guarantees.

Pathfinders
One of the greatest areas of frustration expressed by many younger
techs and service advisers is the lack of a clear career path at their
dealerships, reflected in scant training opportunities and sporadic (at
best) feedback from their managers about job performance, goals and
options.
Workers who feel their bosses don't care about them and their
aspirations for advancement aren't likely to stick around, or to be
especially productive on the job. By contrast, Fred says, good
development plans help dealerships maintain their talent pipelines.
A separate study last year by the consulting firm Carlisle & Co. found
rampant job dissatisfaction among the 35,000 dealership technicians
the company surveyed in the United States and Canada. Among their
biggest gripes: poor access to special tools, workshop technology and
diagnostic equipment.
As service departments must prepare in coming years to maintain
and repair large numbers of electronic and autonomous vehicles, that
perceived lack isn't reassuring.
Finally, diversity. Last year's NADA work force study found that barely
1 percent of dealership service technicians were women. Whatever the
reason, that blatant imbalance doesn't suggest an industry that's
interested in looking like its customer base or overcoming the
technician shortage. Similarly, just one of five service advisers is
female, although Fred notes: "Women make great service advisers."
The Cox report correctly observes that a dealership's greatest
advantage is not the economy, however robust, or interest rates,
however low, or consumer credit availability, however easy. Rather, its
biggest asset is an engaged work force.
The study offers dealers and fixed ops leaders a road map not only to
staffing success, but also to broader profitability. Will they read - and
follow - it?
Fixed Ops Journal - August 2019

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