Hold People Accountable

by: Stephan King, CPA

My last article, Budgets and Forecasts, stressed the need for dealerships to set performance expectations. They are the marching orders. Armed with these tools, you motivate and reward results. Dealers learn to “expect what they inspect.”

A highly recommended book by Jim Collins, Good to Great, is an analytical review of what changes a good company into a great company, and includes the observation that disciplined people and quality leadership are important characteristics of great companies.

Collins’ research finds that “those who build great organizations make sure they have the right people on the bus, the wrong people off the bus, and the right people in the key seats before they figure out where to drive the bus. They always think first about ‘who’ and then about ‘what’.”

Who is the right person on the bus? Remember when you had doubts, but your organization hired anyway. What was the outcome? Why did the organization hire anyway, and what did you learn from the situation? Get the right people on the bus, and then communicate. As a rule of thumb, communication of expectations is the single biggest key to success.

INITIAL ACTION
First, dealers must communicate financial and/or performance expectations. Remember, most successful dealers get “buy-in” from their team. Everyone is committed and appropriately motivated to meet the company goals. The expectations are attainable and measurable.

There should be a clear understanding of the rewards associated with meeting or exceeding the agreed-upon expectations. Likewise, a failure to meet expectations should have consequences. However, there should be a built-in opportunity to rebound. If you have the right people in the wrong seat on the bus, put them in a position to succeed. Don’t be afraid to change their seat.

ONGOING MEASURES
Successful dealers use regular management and department meetings to track and evaluate results. The meetings allow the sharing of ideas. The tracking and monitoring of results is a standard agenda item. It also allows the best performers to rise to the top.

In addition, formal evaluations of performance are key. Employee evaluations are a way to formally summarize and communicate performance. They allow you to reestablish or re-communicate financial and/or performance expectations, negotiate areas of improvement, and reconfirm your commitment to their success.

• Do you hold people accountable or do you routinely accept mediocrity?
• Do you try to get the right people on the bus? If not, why not start so that your good dealership today becomes a great dealership tomorrow.

Continue reading RV Executive Today for the next article in the series on Secrets to Dealership Financial Success.

Stephan King is a certified public accountant and partner of Moss Adams LLP. Moss Adams serves over 400 dealerships nationwide, providing creative solutions to clients’ complex issues. For more information contact them at (800) 905-4010 or visit their website at www.mossadams.com.