PLAN, EXECUTE, CONTROL, EVALUATE. These are the basic strategic management principles that, when done right, keep dealers and managers at the top of their game. But when one or more of these tenets are violated or ignored, failure will follow.
I encourage you to check out these concepts on the Internet or the bookstore. I will elaborate not on the theory of each here, but more practically on how they can affect your dealership's effectiveness, efficiency and profitability. None of these principles can stand on its own; each is equally important. It's where strategy and tactics meet at your dealership.
It all starts with a plan. Your dealership didn't start without a plan, and neither should each and every task you'll accomplish today at your dealership. If there's one thing I learned from Japanese management techniques during my time at Mazda, it's that the planning phase should always be the longest and most thoroughly developed. To get the most success out of a project — whether it's your advertising plan for the month, your new compensation plan for the sales department, taking your end-of-year parts inventory, or deciding how to improve your service department's contribution — you need to spend at least 75 percent of your energy and time on the planning phase to better ensure success. The longer you spend planning, the more likely you will prevent redos, wasted time and inefficiency.
Plan each element of your project — such as, What am I trying to accomplish? Why do it in the first place (what's the upside if I do it right and the downside if it's not done at all)? Where does it fit on my priority list? When do I need it completed? Who will do the work, and have I included them in the planning phase? What will it cost to do the work, and is the payback worth it? It's the questions that make a project a success.
It's natural to believe that proper execution will overcome a poor plan. Don't believe it. Execution will work only if your executors are executing to the right plan in the first place. As a leader, you must ensure the plan is right, assign the right executors (people) to the project, and then oversee the execution phase, especially in the beginning, to ensure they're on the right track. Success is dependent on the plan, the people assigned to the task, the training they've received to accomplish it and the regular oversight they receive during the execution phase.
For example, after you've developed a solid sales plan for the month, you wouldn't just hand it to your sales troops and not communicate with them until the month is over, would you? If they're all rookies, the plan fails. If they've not been trained properly, it fails. If their leader doesn't monitor their success regularly, it fails. Now, "regularly" depends on many factors — a twice-a-week follow-up works in some cases, daily in others, and "Dr. Pepper time" (10-2-4) is required in yet others. A great plan is worthless without a trained, knowledgeable, committed team to execute it, and a leader who knows how to lead.
Control during any project, task or assignment is vital for success. In its broadest sense, the dealer is looking to control the various resources he or she has expended to accomplish the assignment. Whether it's human resources, monetary, physical, time or something else, control of it is a key element of the overall success of the project. I'm not referring to the micromanaging kind of control employed by many control freak managers, nor to the expense control done by the bookkeeper/controller/CFO; rather, I'm referring to the team leader simply monitoring and evaluating the resources expended and the interim results obtained during the project. Properly established, control allows the leader to keep the project on task, give it a slight course-correction to get it back on track, or scrub it before it's too late and chances of success are either slim or none. You wouldn't give your sales manager a $1 million sales budget without controlling how, when and where it's used. The same goes with all resources on all projects.
The strategic phase that's skipped or totally ignored by most dealers is the evaluation phase. Did we hit the sales plan? Why or why not? Did the advertising work? Did our service special work? It's not enough to just acknowledge that "we had a good or bad month" and then let it go so you can experiment with hit-or-miss projects the next month. Good dealers spend time at the end of each project or month to evaluate what went right and what went wrong, and why. Look at the measurements of the project. What do they teach you? What did you learn from the management style of your sales manager? What would you change the next time you have to accomplish this task? Was the budget right for the task? Did your team have the right tools? Are there any external factors that skewed the results, like weather or cost overruns that you need to account for in the future? The answers to these strategic questions will provide more data and more key learnings to include in the next assignment's plan.
If you strive for peak performance on all your projects and assignments, then employ these strategic management principles with your leadership team starting today. You'll appreciate the measurable results.
Clark Vitulli is a Harley-Davidson dealer in St. Augustine, Fla. Contact him via email@example.com.