Grant Forsdick

SELLING a car can be a long and involved process, one that involves several of us humans who are all prone to making the odd mistake. Time spent rectifying errors means less time spent focussing on the customer and the next sale.

How to eliminate errors and increase customer focus is a question that continually faces car dealers. According to management consultant Grant Forsdick of Level 5 Lean, the answer is to simplify business processes as much as possible to eliminate mistakes and allow people to focus on their actual job.

“Our approach includes a combination of ‘coaching’ the leadership team to think and act lean,” Mr Forsdick told GoAutoNews Premium, “and building capabilities from the shop floor through practical training to also think and act lean in executing daily tasks.

“This philosophy combined with a customer centric value set, underpins our business philosophy and has resulted in new ideas and concepts being adopted quickly by businesses.”

Mr Forsdick’s process involves the practical application of what he calls the five principles of lean thinking:

• Specifying value from the customer’s point of view;
• Rigorous, objective measurement of value streams and eliminating as many non-value creating steps as possible;
• Ensuring the remaining value-adding steps are sequenced to flow smoothly towards the customer;
• Paced at the pull rate at which the customer demands; and,
• Always seeking to continue the cycle of improvement.

Christopher Randall

One dealership where this method has been put into practice is North Shore BMW (NSBMW) in Sydney. They ran a cut down version of the Level 5 Lean seminar in one day rather than two, as they couldn’t afford to have the sales team off the floor for two days.

The NSBMW team determined that there were 15 separate processes involved in them selling a car, and they pretty soon figured out that could be reduced to 10.

“It’s changed the way we run our business,” said Christopher Randall, owner and Dealer Principal of NSBMW. “Where it’s helped us most is allowing us to be a lot more customer focussed by eliminating errors in the business.”

According to John Randall, Christopher’s father and part of the board of management at NSBMW, prior to Lean management being introduced, the sales team were making up to 100 paperwork errors on any given day. That has now been reduced substantially and many days there are no errors at all.

“The process also seems to generate a good work culture, encouraging people to get on and work things out rather than more traditional finger pointing exercises,” said John Randall.

BMW North Shore Source: Google

“I put it down to the fact that people aren’t making mistakes, so there’s no need for playing the blame game. It comes down to simplification or processes and making fewer mistakes.

“The error reduction has other benefits too. In terms of productivity I’d rather that sales team were ringing the next customer than still sorting out paperwork before delivering a car to an existing one.”

Lean management also works in the service department where the NSBMW team were able to achieve a 25 per cent increase in the number of services performed each day.

To give another example of where the business improved Christopher Randall cited the deal process, or more specifically the email that would usually come from the company accountant about the 15th or 16th of each month asking where all the paperwork was. That would lead to the closing off the accounts on the 20th of the month.

BMW North Shore Source: Google

“Once we had put our new simpler process in place we were able to close off accounts on the fifth of each month, an improvement of 15 days” he said.

Mr Randall described the task of instituting Lean management philosophy as, “worthwhile but not easy”.

“Implementing this involves looking over people’s shoulders and pointing out where they are going wrong, it can be hard for some not to get defensive.

“It’s changed the way we run the business with more emphasis on quality and efficiency rather than just hitting a number. Making target is still important but so is investing time in honing the process along the way to make meeting budget a sustainable thing.

BMW North Shore Source: Google

“It allows people to focus on what they are meant to be doing.

“It’s a business philosophy, a different way of looking at a company. Once you understand the concept you can look at any process and say, ‘how can we make that lean, how do we make it more efficient?’

“The easy part is identifying the problems, the most difficult part is changing the culture and get other people to understand what you are trying to do.”

Christopher Randall said it took about 12 months for the Lean philosophy to really sink in, and was adamant that its introduction must be driven from the top of the business.

By Daniel Cotterill