In the hyper-competitive auto sales industry, every car manufacturer is looking to cut costs, stay within budget and trim anywhere and everywhere possible. For many companies, this can mean slashing the learning and development budget to the bare essentials. At DaimlerChrysler, however, the executive team has recognized the value and ROI of the DaimlerChrysler Academy (DCA), led by Director Patrick Kittle, all the while making sure the academy isn’t simply “training for training’s sake.”
Kittle said DCA is responsible for providing voluntary training to 100,000 employees within 3,800 dealerships nationwide. The academy focuses on sales, parts and service training for these dealership employees.
“It’s not part of the overall learning and development organization,” Kittle said. “We have a separate DaimlerChrysler University that is involved with internal personnel training. The DaimlerChrysler Academy actually falls under the sales arm of the organization and is responsible for our sales, product, service and parts management, as well as technical training and the field training for district managers.”
Rather than offering a series of unrelated courses, DCA operates a certification program for sales, parts and service employees. Through these certification programs, employees can obtain their certifications within a year or two.
“An individual — let’s use a sales consultant or a sales manager for example — can get certified in a year,” Kittle said. “There are approximately seven courses that they have to take, as well as some product information. Our service and parts curriculum is a little bit unique. I believe there are 12 courses for the service and parts managers, and because we thought that would be too much to take at any one particular point in time, we ask them to take three classes per year. It’s kind of like a college curriculum. They build upon themselves, and once you’re done, you’re done. And we really only ask you to come back one opportunity a year, so we have an opportunity to share and also put some of our better performers together and put together some performance classes where we do a lot of best practice sharing.”
DCA offers both e-learning and live courses. However, Kittle said, because sales training relies so much on presentation skills, some of the training focuses heavily on live classes and role-playing.
“It’s kind of the Carnegie approach because if you can get up in front of 30 of your peers and try to sell these guys and gals on a particular feature benefit, that’s kind of unnerving to do because everyone out there is a critic,” Kittle said. “But the more often you do it, the more confident you get. The more confident you get, the more comfortable you are. The more comfortable you are, the more fun you start to have, and the thing starts to build upon itself.”
‘Five Star’ Standards
Of the 100,000 DaimlerChrysler dealership employees in the United States, about half are involved with training through the DCA, Kittle said. That’s because DCA courses and certification are voluntary for dealerships — they’re an investment dealerships make in their employees. The dealerships are responsible for paying for certifications and courses their employees obtain through the DCA.
“Training is not forced by some statute in their agreement — it’s voluntary,” Kittle said. “But it is a requirement for dealers that want to achieve Five Star.”
Five Star is a program DaimlerChrysler created to highlight the high-level dealerships across the country. Mike Manley, Chrysler Group vice president of sales strategy and dealer operations, said Five Star is a level of performance and standards that the best dealerships reach and maintain. It covers operational performance, training, customer handling, customer satisfaction and performance in the marketplace.
“Dealers effectively go through a Five Star certification process that says, ‘We meet all of those standards. We do the right amount of training. We have the right processes in place. We take care of our customers. We listen to what our customers want, and we adapt our business to provide that,’ and they are awarded Five Star status,” Manley said. “And part of getting to Five Star status is they must have been through Patrick and the team’s certification process.”
Because participating in the DCA is voluntary, Kittle said his philosophy for the organization is to make training a valuable investment for the dealers.
“The vision of our organization is: We want to be the go-to place when a dealer has a performance problem,” Kittle said. “We want to be able to have the content, the people and the processes in place, so if a dealer’s got a department that’s running suboptimally, he or she doesn’t have to look anywhere else other than DaimlerChrysler Academy. And I know I will be successful when my senior vice president of sales is getting phone calls complaining that we can’t get into their dealerships fast enough.”
Executive-Level Buy In
Helping the DCA meet its objective is a positive reception DaimlerChrysler’s executives have toward learning and development. Manley said DaimlerChrysler executives are pleased with the way the DCA has developed since its inception in 1999, and they’re particularly pleased with the direction the academy is heading.
Part of that positive reception comes from the executive level’s understanding of the vast complexity of the automobile industry.
“In context, the product that we sell and service and maintain is hugely complex,” Manley said. “It’s not like going to buy a tube of toothpaste, for example. It continually changes as we bring more product out, and our dealers operate in one of the most competitive markets of any industry. So we know that outside of some fairly basic fundamentals such as product and pricing, the key differentiator in terms of us being able to achieve our overall objective is the way that the dealers perform.
“In other words, they can be a key differentiator for us in that hugely competitive market, so we’re very conscious that collectively with our dealers, we want to make sure they are best-equipped to maximize the opportunity in the marketplace. So training plays, from a corporate perspective, a huge and vital role for us because of the impact they can have in us bringing our products and services to market.”
To ensure the learning and development department is on track, Manley and Kittle work together to assess competency gaps within the dealerships and develop appropriate courses to address them.
“What Patrick and I will do very regularly is look at the performance of our dealerships in the marketplace, and we will determine, based on the performance in various areas, whether or not additional intervention is required,” Manley said. “And then the actual design of the course or curriculum will be done by Patrick and his team, and part of that design is absolutely understanding the business model for it. They will come and talk to me about the business model, the resources they need to do it, how they’re going to deploy it, the results I can expect from it, the results our dealers can expect from it and very importantly, the results our customers can expect from it. And if that business case makes sense, then we agree to go forward.”
Manley said the organization has to take this standard business approach to ensure training meets the needs of the dealers and employees.
“From my perspective, even though we have a very complex product, the last thing that I would want to happen or allow to happen is training for training’s sake,” Manley said. “I believe that training is a very, very important part of the business model. But like other elements of the business model, it needs to have a tangible impact on our performance, on our dealers’ performance, and that’s why the business case and the business case-based training organization is very important.”
The executive level also can see the positive results of training through the DCA’s measurement of impact. Across the board, dealerships with trained and certified employees out-performed their noncertified counterparts, Kittle said.
“Turnover of nontrained personnel is more than double the number of trained personnel across all divisions,” Kittle said. “Turnover among nontrained consultants is more than three and a half times greater than among certified consultants. It seems that the certification programs that we have in our present model have taken us to a higher level than our old model had. We used to have a bronze, silver and gold approach to certification, in which the bronze was kind of basic product information. And then when you got to silver, there was some of the practical, hands-on, live application added. So what we’ve done for the past couple years is actually combine those two levels of certification into one program.
“So if you’re looking at it from a sales consultant perspective, the average certified sales consultant sells about 73 to 75 cars per year. The noncertified consultants sell about 35 cars per year. Do the math based on average gross profit per car, multiply that by 10 sales consultants over the course of a year and you’re talking a pretty big number. The ROI can be in excess of 1,000 percent.”Filed under: Measurement, Technology