What makes people do what they do? More importantly, from a business perspective, what makes people do what we want them to do to advance the objectives of the business?

Herb Mast is Leadership Coach and Employee Engagement Specialist. Learn how he can assist you in implementing the principles and concepts presented here.

Have you noticed that  when the going gets tough most car dealers focus on speed and reducing expenses. Let me be clear, I am not against speed nor reducing expenses–both have their rightful place in achieving results. My concern is when dealers get so caught up in speed and reducing expenses that they forget about the ultimate results they are trying to achieve.

When results are not occurring quickly it seems many managers turn their focus on efficiency instead of effectiveness. This is when it becomes obvious who the real leaders are. Leaders keep the ultimate destination clear in their minds as they consider and implement the most effective path to get THERE.

The moral of the story of the tortoise and hare is not that slow is better. Rather, it is that doing the right things at the best pace possible with consistency delivers better results over time. If that means desired results seem slow in coming that is better than wrong results achieved quickly. Once right results can be achieved consistently effort can be invested in speed (i.e. efficiency), but not at the expense of effectiveness. Without effectiveness efficiency is irrelevant.

This principle applies as much to parachute manufacturers as it does to automobile manufacturers and dealers.

By Herb Mast, published March 8, 2018

I recently read a quote from an unknown source that said, “don’t cling to a mistake just because you spent a lot of time making it.” Great advice! The mistake is in the past and is sunk, so move on. Great leaders get-it and don’t sink their future by holding on to what doesn’t work.

The best leaders are more vested in the outcome than they are in the methods. They can let go of methods that don’t work and redirect resources to methods that will.

Imagine where our industry would be if we did not learn from the past nor try new things. The good news is that great leaders avail themselves of the best possible information and adjust their course as necessary. To this end science has been shaping the automobile industry ever since the invention of the first wheel in 3500 BC.

Most of the scientific discoveries have been product related and leaders have used it to transform the automobile into the marvel we have today. For some reason, however, science relating to human behavior, and what creates customer and employee engagement, continues to be largely ignored.

Since customer engagement translates into retention and employee engagement translates into productivity how a dealer responds to the science has huge implications for the growth, profitability, and sustainability of the dealership.

Research shows that the best dealers achieve 50% better customer retention and double the employee productivity of average stores. Why then don’t more dealers adjust their course when faced with this reality?

I believe the answer is found in one or more of the following paradigms:

1. A belief that the car business is more art than science. The same was true of baseball until the concept we now know as Moneyball was proven to produce better results than talent alone.
2. The manner in which this industry attracts strong personalities who often see control as strength and vulnerability as weakness. These are people who say they don’t have time for, or see value in, the ‘soft stuff’. But as you will read below, it is actually the soft stuff that makes the bigger difference.
3. A view that the current model is not broken, so why fix it. This mindset is also reinforced [inaccurately] by the amount of money an average dealer can make even when using an inferior model. All you have to do is look at the wake of consumer distrust and employee turnover to know that something isn’t right.
4. Not being aware of a better approach or how to implement it.

My objective with this article is to spark a conversation that will inspire a paradigm shift for many dealers, if not for the whole industry.

Current State of Affairs

Major advances in science and technology over the past 20 years, especially as it relates to the Internet and ease of access to information, has resulted in significantly greater competition, forcing most Dealers to rethink their strategies and approaches.

Gone are the days when you could simply advertise a deal to drive sales—every Dealer is offering low prices and people can now shop the Nation within minutes. Gone are the days when you could boast superior quality—every Manufacturer has excellent quality and extensive warranties to shore up their offering. So what sets you apart? What causes people to choose your store and ‘be back’? What causes people to keep coming back for additional purchases? What causes people to refer family and friends? Further, what causes employees to be more engaged allowing you to build an outstanding and remarkable brand? Answers to these questions are found in neuroscience, the study of the brain, and are available at no cost to those with an open mind (pun intended) and a willingness to try a different way.

While the “car deal” remains a thing of art—no two deals are ultimately the same—science shows that there is a better way to deal with customers than the current “up-selling” approach. Neuroscience has revealed that “up-selling” connects only with part of a buyer’s brain, the part that only influences 25% of behaviors and decisions. An approach I call “up-caring”, on the other hand, connects with a different part of the brain, which happens to influence 75% of behaviors and decisions. Read that last sentence again and let it sink in. In effect, the science is suggesting that our current methods are only 25% effective and that there are better methods that would be three times more effective.

Dealers That Get-it

Those dealers who represent the top 10% of the industry get it. They may not have labeled their methods as “Up-Care”, because it is a term that I have coined, but their practices reflect an “Up-Care” model.

If the top 10% get it, why don’t so many others? I believe it has to do with the second perspective above. It is a control thing. So much of the road to the sale has to do with controlling the process and most managers are not willing to surrender control to the customer. I’m not suggesting we need to discard the road to the sale, but I am suggesting that elements of it need to be tweaked.

If the Internet has taught us anything it is that consumers will take control regardless of whether we are willing to give it. And consumers will continue to take more control and those dealers unwilling to surrender it will be become increasingly irrelevant.

As I understand it a Dealer’s goal should be to sell more units, generate more gross, and increase retention. The reality is that those dealers that provide the best customer experience also have the highest profits and retain the most customers. It’s time for automotive leaders to humbly let go of an antiquated model [up-selling] and embrace the future [up-caring].

The Science of the Brain

Human behavior research shows that only 25% of human behavior and decision making is driven by the rational brain (Neocortex), while 75% is driven by the emotional brain (Limbic). This means that emotional factors are three times more effective in driving behaviors and decisions than rational ones.

The rational brain is logical and analytical and connects with things like: price, quality, time, features, etc.—if it can be measured it is rational. Our ability to speak is also made possible by the rational brain and we can easily speak about rational things like sports and the various plays in yesterday’s game. The rational brain functions well with black/white, yes/no, on/off, and more absolute constructs.

The emotional brain, however, processes all kinds of subtle information and generates feelings, but does not have the ability to speak. Instead, this is where our gut feel comes from. This also explains why it is so difficult to put our feelings into words. The emotional brain is not black/white, but gray scale.  It does not provide answers in absolute terms, but more on a sliding scale (1-10).

For example, somebody might ask, “did you buy a new car?” Our typical response, generated by the rational brain, especially for people we don’t know very well is a simple “yes” or “no.” If that same person were to ask about our car buying experience they would not ask, “did you have an experience.” Rather, they would want to know our feelings and ask, “How was your experience?” Two very different questions appealing to different parts of our brain. Again, and especially with people we do not know very well, the rational brain provides generic answers, like, “it was ok,” which don’t really provide much insight. If we are in a trust position with the individual, or if the experience produced strong feelings the answers will be more like: “it was good,” or “it was great,” or “I loved it!” You can see the increase in the amount of emotion being expressed, which provides much greater insight into how the person is actually feeling.

A good way to discern the difference between something rational and something emotional is by adjusting the structure of the question. If a question can be answered with a yes or no response the subject is probably rational. Closed ended questions tend to get a rational response and don’t reveal much insight. On the other hand, open-ended questions require more detail and usually provide insights into how a person feels. I have found great value in asking questions which involve the person answering with a number between 0-10. For example, “how would you rate your experience on a scale of 0-10 where 10 is outstanding.” The number given in response provides some of the best insights into how they feel and provides context for a follow-up question, which may be structured, like, “What one thing could have been done differently to increase your answer from a 7 to an 8?”

We tend to be more open with people we trust and have a relationship with and closed with people we don’t know or don’t trust. A good indicator as to whether somebody trusts you is whether they answer questions in a closed and rational manner [suggesting low trust], or open and with emotion [suggesting higher trust].

The Emotional Brain Builds Greater Trust

The first thing to understand is that trust is actually made up of two components: Rational trust, which is built with competency (having the ability to do something) and reliability (actually doing the things we say we will do); and emotional trust, which is built with authenticity (being real) and care (putting another person’s best interests ahead of ours).

We all have relationships with people who we [emotionally] trust who are total screw-ups. We give them grace and make allowances because we have a relationship with them. On the flipside, nobody wants to deal with a liar and cheat regardless of how much they know. And to do business we need more than rational trust so that people will divulge their true feelings and not just be “nice.” This is also true for leadership and teamwork. People need more than just rational trust to engage with each other and to follow another’s lead.

This does not mean that we can disregard the rational elements while turning all of our attention to the emotional side. Incompetence and unreliability have a way of destroying even the best of relationships.

The key to building relationships is to be real, care and serve. Simple elements that demonstrate this, are: calling a person by name, following through on commitments, showing courtesy and respect, telling the truth, etc. The good news is that none of these elements adds expense or reduces gross. Rather these elements actually lead to higher gross, greater retention, and better productivity. The catch is that living this way requires humility and selflessness.

Applying the Science for Greater Effectiveness

Obviously, we have only scratched the surface with this article. Many more materials are available if you desire further insights. To help you start benefiting from the science, here are three simple approaches you can adopt immediately:

1. Up-care versus up-sell.

If you knew that somebody would be your customer for life and that they would purchase all of their vehicles from you, and bring them only to you for service, would you still feel a need to sell them? In other words, if you could eliminate the fear of losing their business would you, or could you, change your approach?

Instead of trying to get all you can out of them each time, fearing they might not come back again, why not just focus on authentically fulfilling their desires and needs. Provide them with what they want or need, not what you want. This is what Up-care is all about—being authentic and caring about their best interests. The interaction becomes “others-focused” and is structured from a win-win perspective.

In contrast up-sell is typically “us-focused” and a rational approach, which rarely produces as good a result, especially in the long term.

I realize that this is easier said than done and will require adjustments in process. Whatever you do, however, don’t try to fake it until you make it, because that would not be authentic. Just be real and look after the needs of the customer. It is all about focusing on the feeling instead of the transaction. And, when that happens the transaction is more likely to take place.

2. More gas, less brake.

With all the insights provided by neuroscience around the benefits of a positive working environment it’s surprising how many Dealers and managers still use power, pressure, coercion, manipulation, micro-management, negativity, and yelling to get their people to perform. As a case in point, and it is sadly humorous, I visited with a Sales Manager recently who was wearing a boot on his foot. I asked what happened and he told me how he kicked a table in a sales meeting while trying to make a point and broke a couple bones in his foot.

The science shows that sustained high performance requires a positive environment. Research shows that the highest performance happens when there are five times as many “atta-boys” than “what-were-you-thinkings.”

Positivity is like pressing on the accelerator, while negativity is like applying the brake. Scientifically positivity has been shown to produce “performance enhancing chemicals” (dopamine, oxytocin, serotonins, and endorphins), while negativity produces a hormone (cortisol), which shuts down the brain. Imagine trying to win a race with one foot on the brake.

So, the advice is simple. Reduce negativity and increase positivity to increase engagement and effectiveness.

3. Connect the dots.

Neuroscience has revealed that the brain needs three things to function properly: oxygen, glucose, and connectedness. In other words, eating and breathing is not enough for people to perform at their best. They need to be connected with each other (teamwork) and they need to be connected to the ultimate purpose behind their efforts (vision).

There are many ways to build connectedness, but one of the quickest and easiest is the least understood of the tools we have at our disposal—meetings! Yes, meetings. Not the kinds of meetings we hate to attend, but the kind of meetings that are collaborative, engaging, and which keep people aligned and accountable. A good meeting cadence not only cascades necessary information quickly and effectively, but helps to keep a team focused, headed in the right direction, free of distractions, and with the kind of motivation and support required to sustain high performance.

To take your store to the next level, try tweaking your processes to align with the science. That is what the Top 10% stores have done and look where it got them!

Herb Mast is Leadership Coach and Employee Engagement Specialist. Learn how he can assist you in implementing the principles and concepts presented here.

According to Google, alignment is defined in a couple ways: arrangement in a straight line and/or a position of agreement or alliance.

When it comes to any group, whether it be sports, politics, or business having everybody working together, headed in the same direction,  and “singing from the same song book” often, if not usually, makes the difference between winning and losing or success and failure. It is one of the main reasons why one team performs better than another!

Keeping everybody aligned in philosophies, behaviors, and values is a constant challenge, and requires constant effort, especially in a growing organization where the pace is fast and new people are introduced into the mix. Add to that the unavoidable “potholes” of life.

You would think that the automobile industry understands alignment better than anybody else where a misalignment causes excess wear on tires, results in lower fuel economy, and can be a nuisance, let alone a potential safety issue.

Since wheel misalignments don’t fix themselves, are not always easy to detect, and not everybody is trained to properly fix them, it is important to get trained experts [Technicians] involved. A trained technician can assess the situation and apply the appropriate ‘fix’. Not fixing-it-right-the-first-time in this area can actually make the situation worse.

The same is true when it comes to people and teams, who inevitably hit relational and operational potholes. Unfortunately, it seems, by their actions, that most automotive owners, dealers, and/or general managers try to deal with alignment issues themselves or hope they will just go away [rectify themselves] – neither approach produces the best result and, as with wheel alignments, can often make things worse.

According to research, people misalignment within automobile dealership teams is costing the dealership hundreds of thousands a year in preventable, fixable, and unnecessary expense, reduced productivity, and lower customer retention.

Don’t trip over dollars to save nickels. Consult an expert, get your situation assessed, and ensure your team is well aligned. It will be your best investment of the year…guaranteed!

Herb Mast is Leadership Coach and Employee Engagement Specialist. He would love to assist you in implementing the principles and concepts presented here. 

Click here to schedule a free no-obligation introductory consultation.

By Herb Mast

In her book Multipliers, Liz Wiseman, shares research which suggests that the American worker is generally only 40-70% productive. She details a number of traits that are prevalent among certain leaders that allow them to get up to 50% more productivity from their staff—while increasing a sense of satisfaction and fulfillment. She refers to those leaders as Multipliers, because they have the effect of making everyone around them smarter and more productive. This is contrasted with a very different type of leader, actually more of a manager, whom she refers to as a Diminisher, because their approach has the effect of reducing the effectiveness of the people that report to them.

Pick up the book to dig deeper into the disciplines that distinguish Multipliers from Diminishers. I will no doubt present some of those disciplines in a future article, but at this time I want to rather give insight behind what causes people to willingly give more of themselves in one situation and less of themselves in another. Not surprisingly the secret is associated with motivation, but not necessarily in the manner you think.

Dave’s Story

First, let me demonstrate the concept with a story. I often tell clients about an unemployed individual, I will call Dave, who approached the General Manager of a dealership in search of work. The General Manager, being busy, reacted without too much thought, and told Dave that he did not have anything for him to do. Not to be deterred Dave shared how he has a family, has been out of work for a while, and would be willing to do any job, large or small, just to put food on the table. In a moment of compassion the General Manager had an idea that would not only get Dave out of his office, but give him a chance to earn a few dollars.

The General Manager explained how he had a pile of old tires behind the service department that could be moved from where they had gathered for the past few months. The pile was large and the General Manager explained that it should amount to a days work. All he had to do was move the pile of tires to a specified location at the back of the lot.

Dave gladly accepted and went right to work. Within two hours Dave was back in the General Manager’s office looking for more work. The General Manager was surprised how quickly Dave completed the job and thanked him for his effort. Not having any other work for him, yet knowing his need, the General Manager suggested that he would pay Dave the same amount to move the tires back to the original location behind the service department. Dave hesitated for a moment, clarified that he had heard correctly, and went back to work, but with a little less vigor. This time it was three hours before he was back in the General Manager’s office looking for more work. This cycle repeated a third time with the project taking even longer to complete.

The General Manager was fascinated by what he was observing and wondered why Dave was slowing down. Was it possible that Dave was simply getting progressively more tired, or could there be more to it. Driven by his curiosity the General Manager posted a question on the healthyDEALER.com blog, which provides all kinds of free leadership insights and teamwork perspectives for Automobile Dealers, and got the following explanation:

Three Levels of Human Effort

There are three levels of human effort stimulated by three forms of motivation, as follows:

• Survival Effort is motivated by self-preservation and is only evident when a threat to our survival is present. In modern American society survival is not something most of us think about or face on a daily basis. We just don’t encounter many true threats to our survival like people in third world countries might, or the kinds people many centuries ago did on a regular basis. Hence, it is rare in our society that we tap into this kind of effort.
• Mandatory Effort is motivated by a sense of obligation (like paying back a debt or getting a paycheck), an appetite for more of a good thing (like money or pleasure), or pain avoidance (like being yelled at by a boss or getting fired). We refer to these types of external, or extrinsic, motivators as the proverbial “carrot and stick”. Extrinsic factors provide an external impetus to exert more or less effort. There may be short spikes in our productivity when the extrinsic factor is first introduced, but the effect is usually short lived and the individual eventually settles back into their regular routine. In fact, after exerting more mandatory effort, as a result of an increase in external factors, like at month end in the car business, or during a sales contest, we might even go into recovery mode after the external motivator is removed, and lower our output for a period of time. Mandatory effort was very prevalent during the industrial revolution when most people had very little and the progression of materialism was rapid. Over the long term, however, especially in our current environment, external motivators only drive us to a 40-70% productivity level on average. In a negative environment, where staff feels disengaged, or as a result of cortisol (look for a future article on cortisol as it is one of the least understood side-effects of the diminishing boss) produced in response to negativity and stress, most people will put in just enough effort (40-50%) to avoid getting fired. In a more favorable environment people may put in more effort (50-70%), but only that which they feel obligated to contribute.
• Discretionary Effort is what allows for peak performance. Motivated by internal, or intrinsic, factors such as autonomy, mastery, and purpose, people will put in up to 50% more effort on their own and feel better in the process. Intrinsic means that which comes from within – things that we ultimately do for ourselves. Autonomy is the desire to direct our own efforts – the brain likes control and comes alive when it has the chance to call the shots. Mastery is our desire to achieve, compete, and become the best—pride is closely linked to this. Purpose is our desire to be a part of something bigger than ourselves—people will work harder and longer for a cause than they will for external rewards, like money. The challenge, especially for managers, is that discretionary effort must be volunteered. It cannot be coerced or forced. But when it is volunteered the exertion of additional effort actually results in a feeling of satisfaction and fulfillment—which serves to motivate even more effort.

Let’s apply this to the story of Dave and the Tires. Initially Dave was motivated by survival. He was willing to do just about anything to feed his family. Once his basic needs were met his motivation reduced to “mandatory” levels. During the first third of the project he exerted a combination of survival and discretionary effort. That is why he did the job so quickly. Once he earned enough to feed his family his survival need was met. Further, when Dave learned that there wasn’t a real purpose behind moving the tires his sense of purpose was eroded. Hence, the project was taking longer because the survival and discretionary elements were dissipating and he was increasingly relying on mandatory effort.

In reality all of us contribute or withhold effort depending on the type of motivation we experience—extrinsic, intrinsic, or a combination of both. You will notice it at work, at home, in sports, or any other place where productivity or effort can be measured.

The challenge in most workplaces is that a management approach, which peaks at about 70% effort, tends to be the default mode of most bosses. Why? I believe it is because most bosses just don’t know different.

The best leaders, on the other hand, whether knowingly or intuitively, inspire and cast vision. They create environments of self-direction and encouragement to do and be your best. As a result their people continuously offer up discretionary effort resulting in up to 50% greater productivity.

In his book, Drive, Dan Pink goes into greater detail about the importance of intrinsic motivation in the modern workplace. Watch the following YouTube® video for an overview of the progression of motivation.

Take-Aways

• Develop more of a leadership approach. Take time to inspire and cast vision. Explain not only what needs to be done, but why it is important or necessary. Explaining ‘why’ helps people buy-in and gain a sense of purpose.
• Don’t micromanage. Rather give room for people to figure out how to get the job done on their own while coordinating the timing and details with others. Self-direction [autonomy] provides a sense of control, causing the brain to become more active.
• Don’t impose targets. Rather, collaborate and get buy-in on targets and goals. People do more of what they want to do than what they have to. Ask your people what they think they can accomplish if they give it their best and get them to commit to a target. Then provide support, accountability, and development to help them become their very best—not for you, but for them. This will release a feeling of mastery.

Final Thought

A paycheck is like rent for people’s hands and feet, but their hearts and minds must be volunteered. Treat your people like you would volunteers—cast vision, seek buy-in, give room to do some things “their way”—and they will happily do more for you and the organization.

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Herb Mast is President of COHESION, inc. and is passionate about inspiring Car Dealers to achieve greater growth and business sustainability.  Everything he does as an Executive Coach, Consultant, Author,  Keynote Speaker, and Workshop Presenter is focused on “filling gaps and connecting dots” of automotive leaders and managers to increase their effectiveness in the areas of leadership, teamwork, employee and customer care, and organizational health. Additional insights and practical solutions are available on Herb’s blog at www.HealthyDEALER.com. © Herb Mast 2016