Tuck The Octopus

Managing, owning, and running a dealership can feel like trying to tuck an octopus into bed at night while the tentacles keep flopping out! 

My close friend, Ryan Sodikoff, Dealer and General Manager at Steven Toyota Kia Nissan in Harrisonburg, Virginia, says,

“There are three ways to do things: the right way, the wrong way, and the way it’s always been done.”

He’s right, and these things have been octopi-ing my thoughts. We all know “how it’s always been done” because that is how you are conducting your business right now.

Please consider continuous improvement activities. Topics should include thinking about which potential problems could put you out of business.

In addition to sales, it’s the dealer or GMs’ octopation to consider how you might lose money at the dealership. Has this ever been a consideration or focus? Are your business practices and procedures “the way it’s always been done?” Does that help safeguard the dealership? That’s not necessarily the best way, though. There might be better ways, and you may not be aware of it. 

We all know and agree an ounce of prevention is worth a pound of cure. Yet, (to continue the analogy) often dealers’ medicine cabinets are empty.

So what do you do about it?

You start a process to identify potential problems and discuss them before they become “heat issues.” These questions are the basis and focus of a governance, risk, and compliance program (GRC). So let’s break it down even further.

Do you have Safety Committee?

A Safety Committee addresses potential physical concerns.

Three (3) examples:

• Do you have an outside company perform service lift inspections once a year to catch any safety issues before a technician gets hurt?

• If you live in an area that gets snow, do you have someone who spreads salt when it ices or snows to prevent slips and falls?

• Are there extension cords laying around to “temporarily” solve an electrical problem? (These short-term solutions tend to become “permanent,” right?)

A dealership employee was recently killed because of an electrical issue, which is tragic in so many ways. But, perhaps, it could have been prevented through awareness and training.

Consider these folks as members of the Safety Committee: General Manager, Fixed Ops Director, Service Manager, Parts Manager, Lot Porter, Sales Manager, Controller, or CFO. (Remember, many hands make light work, though at least eight is preferable) It’s important to have someone like the porter on the Committee because they see everything which happens at the store. Ask them. You’ll be surprised at what they tell you.

Beyond a Safety Committee, consider a compliance program.

I am often asked, “How do we start a compliance program?”

• It’s simple. You begin by creating your first written policy about what should happen at the dealership. Then you train the employees on that topic.
• Next, employees should sign important acknowledgments of the training, which should be filed in their employee folders, whether electronic or paper.
• Then, someone at the store must check behind everyone on this policy, and voila! You’ve begun.

It doesn’t have to be complicated. However, it does have to be verifiable and documented. Each month, you add one more policy while maintaining the ones you already manage. 

And that’s how you start an ink-credible compliance program. 

The “Next level” and the next “pattern interrupt” is to layer in the governance and risk components. Governance ensures the compliance work is reported to upper management for their review. Then, they decide what changes to make, if any. Risk management begins when you start asking, “What if.” In playing out these scenarios, do you have a company procedure to handle the problem? Do you have one person with the responsibility and authority to solve problems?

You do have to ink positively here. (Chortle, chortle, snort.)

The risk side of the equation is the final layer to consider. If you have a problem, do you have both a procedure as well as insurance that would cover how you will handle and extinguish the peril? 

For example, did you know that most crime policies exclude coverage for your employees if you know they had previously committed an economic or theft crime?

(You know octopuses can’t commit crimes, right? They don’t have a bad bone in their bodies after all.) 

Shouldn’t you arm yourself by making these management choices? (I’m almost done with the octopus humor.) So get kraken on compliance! Tuck in those tentacles and put your compliance worries to bed once and for all! You’ll be glad you did!

(Thanks for enduring the eight (8) octopus jokes…you knew there had to be eight, right?)