Unlock the secret to seamless integration in the auto industry with our special guest Mets Kramer, who joins us on a journey to decode the complex relationship between systems providers and dealerships. As we navigate the murky waters of dealer management systems, Mets brings his dual expertise in dealership operations and software development to the forefront, illustrating the critical role of a 'translator' in harmonizing the language of technology with the daily rhythms of car sales. Our riveting conversation reveals the hidden intricacies of software implementation and the undeniable value of marrying tech fluency with operational savvy.
Prepare to be captivated as we unravel the transformation of dealer software development, now veering towards insular company-driven models, shifting away from its collaborative roots. Discover how modern programming languages and frameworks promise to cut costs and timelines, revolutionizing the way the auto industry approaches innovation. But that's not all—we also venture into the broader implications of dealership consolidation, the competitive market landscape, and the awe-inspiring potential of AI and avatars in customer experience and education.
The episode culminates with a forward-looking gaze into the crystal ball of automotive inventory management. We dissect the industry's pivot to electric vehicles and direct-to-consumer models, spotlighting Ford's bold new direction. Our dialogue pivots to the urgent need for advanced CRM and opportunity management tools, positioning dealerships to thrive in an evolving marketplace that rewards proactivity and a customer-centric sales strategy. Tune in to explore how these trends are sculpting the future of inventory, sales opportunities, and competitive dynamics.
Visit us at LearningWithoutScars.org for more training solutions for Equipment Dealerships - Construction, Mining, Agriculture, Cranes, Trucks and Trailers.
We provide comprehensive online learning programs for employees starting with an individualized skills assessment to a personalized employee development program designed for their skill level.
Unlock the secret to seamless integration in the auto industry with our special guest Mets Kramer, who joins us on a journey to decode the complex relationship between systems providers and dealerships. As we navigate the murky waters of dealer management systems, Mets brings his dual expertise in dealership operations and software development to the forefront, illustrating the critical role of a 'translator' in harmonizing the language of technology with the daily rhythms of car sales. Our riveting conversation reveals the hidden intricacies of software implementation and the undeniable value of marrying tech fluency with operational savvy.
Prepare to be captivated as we unravel the transformation of dealer software development, now veering towards insular company-driven models, shifting away from its collaborative roots. Discover how modern programming languages and frameworks promise to cut costs and timelines, revolutionizing the way the auto industry approaches innovation. But that's not all—we also venture into the broader implications of dealership consolidation, the competitive market landscape, and the awe-inspiring potential of AI and avatars in customer experience and education.
The episode culminates with a forward-looking gaze into the crystal ball of automotive inventory management. We dissect the industry's pivot to electric vehicles and direct-to-consumer models, spotlighting Ford's bold new direction. Our dialogue pivots to the urgent need for advanced CRM and opportunity management tools, positioning dealerships to thrive in an evolving marketplace that rewards proactivity and a customer-centric sales strategy. Tune in to explore how these trends are sculpting the future of inventory, sales opportunities, and competitive dynamics.
Visit us at LearningWithoutScars.org for more training solutions for Equipment Dealerships - Construction, Mining, Agriculture, Cranes, Trucks and Trailers.
We provide comprehensive online learning programs for employees starting with an individualized skills assessment to a personalized employee development program designed for their skill level.
Aloha and welcome to another candid conversation. Today we're joined by Metz Kramer and we're going to take on an interesting subject. As many of you know, I've been around for a long time in this business and seen a lot of changes, and the one that I'd like to entertain with Metz today is the fact that systems providers no longer seem to know the business. They're selling software, they're selling hardware, but they don't know the dealership business. They don't know the market that the people are working in. And I'd just like to get Metz feeling, because he comes from the same background as I do. He's from the dealership world. But hi there, metz. First of all, welcome and glad you're with us. What do you think of that introduction? Am I making any sense?
Speaker 2:Makes perfect sense. The software world is full of people who, unlike you, I didn't get the opportunity to start in the business. I started in program with the cat dealer and that became a shop supervisor's job really pretty quick, and other opportunities came from that as we moved through. So I spent the first 20 years of my career really running various departments of dealerships. So I was lucky too. After leaving the cat world I worked for Terrex. There, met numerous smaller dealers, so I got the smaller dealer perspective. Even in the cat world people know what they do but they don't know the whole business. And then after that I went to Lieber, which is sort of in the middle, and so you get very different perspectives, very different focuses.
Speaker 1:So yeah, yeah, and I started in the Barts department, went into the service department and then what was interesting with me is that I was called on a Friday afternoon about 4.30 and told to meet the boss up in the data processing manager's office on Monday morning and I said, okay, what's that all about? He said, well, that's your new job. And what he did was he was a bush pilot, he was a master mechanic, he was a really dirty fingernails guy. He fired me half a dozen times. I love the man, but he recognized that we had data processing who were really good systems people. It was called data processing in those days, not information technology.
Speaker 1:And we had operating people who are really good at the operations, but nobody could translate it. So he said okay, ron, you're going to go up there and be the translator. And the data processing people, the technical people, they're all really good at their job. They want to do a great job, but nobody really spent the time to educate them on what the hell a repair order looked like or what a parts order looked like and what you had to do. And they're smart enough. Once they know what it is, it's easy. Why doesn't the? Okay? So let's come backwards a little bit. We've got Microsoft. We've got M4. We've got SAP, we've got Oracle, we've got JD Edwards. Those are the bigger dogs in the fight. We've got DIS. We've got E-emphasis, that is purchase CDK. Dis is owned by a company called Constellation up in Canada, and most of those businesses are systems people. I don't see very many operational people anymore.
Speaker 2:Yeah, absolutely.
Speaker 1:Even in the install teams. Yep yeah.
Speaker 2:Yeah, I saw some people. So when I started at Tormont and I was a shop supervisor, we were still using a clipboard for scheduling.
Speaker 1:Yeah.
Speaker 2:And for like what was in the yard. And they came down from the IT department one day and said we want to make a scheduler, online scheduler and I said, oh, that'd be awesome, I'd love to help on that. And that's how I got involved in this whole. Software business was as a supervisor. I worked on this project to develop a scheduler and there's where I also became like what you said the go between the translator that explained to the software people what is we are trying to do so they could build it and at the same time, very few people would leave. That I'm fairly rare and that I left the actual dealership operations. We had people in the software team that learned a lot. But you have to be intentional about training people and taking that time and investing that time. And even then you know it wasn't until I'd spent time at multiple other places and got involved in other software developments or ran my own software developments at other dealers that you really start to get a strong understanding of how operations relates to software.
Speaker 1:Yeah.
Speaker 2:Even if you just did a cat deal, you have one model for how it works.
Speaker 1:Yeah, yeah, exactly right. And it's rather intriguing if you look at the major manufacturers. You know Caterpillar used to have DVS, dvsi. They're no longer in the software business because they recognize the dilemma. John Deere still got JDIS, they call it now or some other name. Volvo has their own little package. Kamatsu tried to do it with a thing called Discus. Case is involved with a smaller manufacturer. But it's really interesting, at least to me. It took me a long time to figure out. My consulting business, which I started in 1980, succeeded, I believe, in part because dealers didn't know how to use their systems.
Speaker 2:Yeah, that's it. Every system has a lot of fields that no one knows how to use. You know, and on the other side you don't even appreciate some of the functionality that you can use if you don't have it, so you don't even know to ask for it. You know, I was lucky starting a cat and when we started developing our own software for dealers. You know, something like a work order is super complex in a sense, and it's really just a bucket for parts and labor, sure, but you come across so many different scenarios of work orders and the reason the work order is happening and who the customers are, both internal and external, and once you understand that, oh, you could have a system that would let you deal with that complex situation in one work order. You know most dealers have to open multiple work orders on the same machine if they have multiple internal and external customers to charge, right, you know, yep, so sometimes you don't know what you don't know.
Speaker 1:Yeah, well, that's the old question you know. But I guess Dick Cheney's thinking you know, we don't know what we don't know, so we don't know what we have to do. And one of the things I did software development with PFW before ADP bought them once a year with God by the name of Ross Atkinson, who works with us today, and we would just go through things as to you know what needed to be changed in the system. But one of the things that Ross founded that made really hard was we need a tool as a software company that tells us what percentage of our system our customers actually use.
Speaker 2:Yeah.
Speaker 1:And it struck me at the time because when I was at the dealership I did a review of every document we used to find out how many of them were still used. The shock was almost half of them were no longer of any value. We still had them on the shelf. It's kind of like dead inventory, right.
Speaker 2:It's kind of like service manuals on the shelf. They're sold in the 80s and people still have their 90s AD service manual on the shelf.
Speaker 1:We had remember, when we moved from paper numerical parts records to microfish, that NPR catapult. It was three to four feet long on the top of the desk. I put the microfish viewers up there and we had three different magnifications because we had different manufacturers. It was crazy. The guys at the counter didn't want to give up their NPRs.
Speaker 2:One weekend.
Speaker 1:I went in and I took them up all their desks, I put them in the dumpster. They come in Monday morning and they where did it go? I said I don't know.
Speaker 2:They were stuck. There's a really good equivalent to that and I run across that on a regular basis and that's dealer people who are trained by the software they've been using. Yes, I had this awesome debate with a good friend of mine at a dealer who kept asking for reverse POs.
Speaker 1:Which is.
Speaker 2:Well, it was a way to return parts to a vendor or to get parts off a work order. The way that software was implemented you just did a reverse PO. I'm not doing reverse POs. We'll do parts returns and we'll do parts return to inventory and parts return to vendors and we'll do vendor return documents and we'll do confirmation that you actually got the parts that you say you take off the work order. Before they come off the work order, they're trained that way.
Speaker 2:I've seen it especially coming out of dealers trying to run on rental systems because they tend to go to a rental system when they're rental dealer even though they have other dealer operations. They're trained by what the software does. It's hard for them to think like, how should we really do it? That's been one of the fun parts is to say we want to structure this in a way that we understand the business could run. We're not going to prevent ourselves from running properly by structuring the data in a way that will stop it. One of the most common things that I come across is the same part number from two different dealers, a lot of independent, multiple places and they can choose which dealer they buy the part from. They have to set up variations with a suffix of this is the dealer that we buy this one from and this is the dealer we buy that from. It's an oversight in this structure and how you could run the system. You could get used to it. It causes all kind of inventory control issues and whatnot.
Speaker 1:You make an interesting point that the people use the system the way the software people tell them the years that we train them to use it, and the software people don't know how to do the job that they're trying to put the solution to. Alex Schuchler is the founder or the guy who started Smart Equip, and I call it paper to glass. A lot of systems did is they took the form. They just put it on the computer screen and it was a map and instead of writing it by pen or pencil, you type in, and that's kind of baloney, isn't?
Speaker 2:it. It's not really rethinking what you're trying to do.
Speaker 1:It's not process driven, it's not Kaizen driven. That's the other thing. When we look at systems and you look at dealerships, I wonder how much the people that are doing the job actually have as input to the company as to how the job should be done. I don't think they're asked very often. I think they're told what to do and that's just a repetition of what we've been doing for 20, 30, 50, 100 years, instead of asking them how can we make this better.
Speaker 2:To make it better, you need to understand both sides. You need to understand how the system could work, what it could do, how it's structured and then also what the business needs might are and what they might be in order for improvement. If you don't know both sides, then it's really hard both to teach people better ways but also to upgrade any system or create a system that will support a dealer's needs.
Speaker 1:Years past there used to be dealer meetings once a year, once every two years, and they'd get all of the dealer users together with the software code. In a lot of cases, the software became a product of improvements that the dealer suggested. I don't know that there's that much of that going on anymore. This is our product, this is our package and we're done.
Speaker 2:You have.
Speaker 1:Here you come and you're bringing a new software product into the dealer network. How the hell did you put it together?
Speaker 2:Structurally how everything fits together. That's experienced and having practiced it in other places or seen it structured in other places. That was where I was lucky. You realize why something works and why it doesn't. The nice thing is we're not doing it from on top of another platform, we're just building it from scratch. I think that's one of the challenges. You said that dealer software used to be developed by a collection of dealers who got together and gave feedback At some point. If you can't rearchitect or you can't change that, or the person who wrote the pieces that are really core functionalities if that guy retired, then you might lose all ability to understand that code. Then you end up with the option to take a whole bunch of software, people and modern software. It has an 80% failure rate or something.
Speaker 2:I did some consulting through COVID for an auto manufacturer and started talking to them about the platform they would need for their new car. It was a new electric car company. The expectations of what it would cost and how many people it would take to build the functionality they needed was astronomical, because it follows a current approach to software development that requires scrum masters and front end and middleware and back end developers who all do their little pieces. The cost to do something becomes astronomical. It's assumed that it has to be expensive. It's assumed that implementing new software has to take a year and cost upwards of $200,000. Once you have those assumptions in place, it's hard for people to reconsider those. My biggest challenge is getting people to reconsider.
Speaker 1:It's funny. I worked with a guy by the name of Ian Sharp back in the 70s who had a company called IP Sharp Associates and he used a programming language called APL, which stood for a programming language which was invented by a man by the name of Ken Iverson. Ken Iverson was hired by IBM and locked up such that he couldn't be used anywhere else and they used APL. It's an array. It's a completely different approach to programming. It's very mathematical. Ian hired Ken's sons and he created Sharp APL. We built a part system in less than a month Early operational, interactive. Here we go. It's like you say, if you don't have blinders, from where we came and you come in brand new with expectations and a statement of need and you had somebody on the other side that didn't know what he couldn't do. Like, young people are smart enough that they don't know what they can't do yet and they go yep.
Speaker 2:My first project was at the CAD dealership, which was like a from scratch was the contract management platform for managing maintenance contracts, service scheduling, review of all work orders and assigning them to buckets of where we thought money was going to be spent, and condition monitoring stuff. We started that project. We did a lot of scoping and planning and doing some designs. Then the developer went away for like three months. I didn't see him for three months. Then he came back and showed me what he built.
Speaker 2:The first basic functionality that was ASPNET front end. Now we build and react with existing frameworks and existing theming and stuff that we just plugged in. You could build the same thing in a couple of days, because that's how fast software is. When we say, hey, we want to build this new function, I have to start a warranty function. Now we do warranty work orders and I got to have an interface for warranty. With the new software we can do that in a couple of weeks and get the basics up and running. That changes people's perspective as well. If they think something is going to be complex to do, they don't even ask when you can say yeah, we can do that, it will take you two days and it will work.
Speaker 1:We started with assembler is how we used to program machines, and then COBOL and Fortran and all these other PL1, et cetera. Today you can almost do it in English language. It's really amazing. I was talking to a learning management software company a couple of weeks ago called Moodle. I think I mentioned this to the earlier. He said that artificial intelligence is so good. Today they could put a picture of me up on the screen and have four of me there. One of them is me. The other three would be AI generations of me. We could have a conversation. They could respond to my questions or I could respond. He said I'll bet you 100 bucks you can't figure out which one is you. I couldn't. I said to him that's magic, it really is. We're doing all of our classes using artificial intelligence today with avatar. It's phenomenal what you can do now, along with all of the other things that we've been rather retrograde on, in part because we make a lot of money, but also in part there's not that many dealers anymore.
Speaker 1:Canada's got two caterpillar dealers, one John Deere dealer, essentially one Kamatsu dealer and basically now one Volvo dealer. Versus what was it? When I started? There were 10 caterpillar dealers. Now there's two. There used to be 50 in the US caterpillar saying they want 15. But that smaller number. One of the byproducts of that is that the dealers have bigger revenue streams because there's less competition. It's still good, but at the same time their market share has dropped by 50% over the last 40 years.
Speaker 2:You said that a bunch of times.
Speaker 1:Or for service, and they don't know. So I don't know how we get the dealer principle, the people that own the dealerships, interested enough to say well, wait a second, we can make more money by being more efficient, which means maybe we can invest more in customer service and inventory. Blah, blah, blah. Whatever it is, I don't see that happening.
Speaker 2:I had a dealer come up to me at AED last week I had my first little booth there and he came up and said why should I switch from my existing system? Because your system is 40 years old. It doesn't integrate, it doesn't have APIs, it prevents you from moving your business forward and doing other things from offering good e-commerce integrations and changing your business model, accessing your data more easily for better analysis or for more automation in understanding what's happening in the data when you see things happening. That's why I mean, yes, our system will do a part sale very similarly, but that isn't what's going to move you forward. If you want to keep doing what you've always been doing, then Well, e-commerce is a perfect example.
Speaker 1:It's been available since the early 80s and yet I don't think there's a dealership that I've run across anywhere in the world that has more than 10% of their parts business on an e-commerce platform, and I find that rather remarkable. Here comes Amazon. They're selling it on their parts online. Now, why the heck have we not got there? Is it just that we're fat, dumb and happy, or is it something else? It's remarkable, isn't it? The other thing that comes along is silly things, that's technicians ordering parts from their bay. We've had electronic catalogs for a long time. We've had shopping carts for a long time. Why does the mechanic have to walk to the parts department today?
Speaker 2:I don't know. And that guy, I love their phones.
Speaker 1:I'm surprised we can't find them right.
Speaker 2:Yeah, we Techs love their phones. One of the things I've learned is that techs have actually been one of the easiest groups to take on new tech. I think there's an internal camaraderie that they'll just teach each other. Like, hey, how do you do this, how do you do a parts wreck? And then so they love their phones, so give them a phone app, list their parts that they need, take a picture of what they're working on for the parts guys we have a better reference and then send that in. Keep working, so that's.
Speaker 2:But there again, you have to understand what the tech is doing. What are the challenges he's going to face. Do we always know the part number, will he sometimes not? How do you support both the fact that he has a catalog and knows exactly what he needs, but may have some questions, so it doesn't limit him. So it's the only spot in our platform where a tech can just put in any part number. It doesn't have to exist in the parts master because it may not exist there yet. So let him put in the part number, let him add a picture of this thing.
Speaker 1:Well, again, I think the evolution has been predicated on what the limitations of the hardware were. In the old days disk drives were really expensive. So to put the full parts catalog up of a manufacturer that had maybe 300,000, 400,000 records and you only stocked 40,000, you chose to have only on there 40,000. But that meant that if you had a non-stock part that was on an order from a customer, which happened probably 10% of the time or 90% of the time, you had to go to two places. That's okay, it's just work, yeah.
Speaker 2:Well, this is one of the things that I've learned is that the decision makers don't really see what's happening and the people who are spending their days sitting in front of screens are fairly quiet and they don't say, oh, this could be better or this would save me half my day, they just get their job done. They're primarily interested in just getting their job done, whether they're tech or admins or service writers or whatever. And that's a really important disconnect. If you haven't lived in that space and your software provider is only getting feedback from the people at the top who are not hearing anything, then you're missing out on it. And I was the first department at Tormant to have dual monitors and when I asked for it I got a lot of pushback. I wanted to for myself. I'd had them at a previous place and they're like no. And Mike was like I'll buy you a really big TV. And he did. He bought me a huge TV so I could try and get more on one screen. I like no.
Speaker 2:I eventually got it and, sure enough, all these admins sitting and talking paper to glass. It's like imagine your desk was only eight and a half by 11 big and you could never put two pieces of paper side by side. That's how we were forcing people to work and when the team I had was a bit of a showpiece, we finally got two monitors. Now it's common and it created a flood at Tormant. Skids of monitors were coming in every day because now everyone understood how valuable it was to have multiple monitors and be able to put two things up beside each other and work like this. And it took that long. Because it's like oh, it's like $300 per person extra. Why does an admin in most companies run a crappy old desktop, but the VP, who only does email and goes to meetings, has a $4,000 laptop and that's the commonplace. Buy your admins the best hardware and as many screens as they can learn to use, because it will make them faster.
Speaker 1:Yeah, yeah, it's remarkable. I don't know if you've seen it, I'm sure you have. Back in the 90s there was a slide show presented, a PowerPoint presented put forward, that showed a computer coming out of a pen and the pen spread into pieces. One piece of it was the memory, one piece of it was the projector, and you projected onto a wall and you projected the keyboard down onto the desktop and you interfered with the desktop by your finger on a letter and that's how the computer operated.
Speaker 1:Now I haven't seen one in operation yet, but I've seen desktops. That are computers as opposed to having any keyboard. An associate of mine, a friend of mine Jim McGrath's name he had, I think it was 13 patents pending he controlled the cursor with his eyeball. Ooh, I like that. Imagine that. And I've been using voice recognition for 35 years only because I can't type where the damn? I still can't. Now we've got the phone having to text it, my fingers are too damn big for the keyboard. Caroline, my daughter keeps telling me, dad, you have to slow down on the text because it looks terrible what you're putting out there. You know, maybe you're right. We've got a disconnect. The people that are doing the job aren't communicating with the bosses that make the determination of what's needed, and the boss has an understanding or expectation or perception of what the job is, and that's not what the job is anymore.
Speaker 2:No, and this is the thing like we. I remember doing a project. That was where Formon did an e-commerce platform and worked with customers and one of the customers they put the invoice approval online so that all the people could authorize payment and then it was downloaded into the ERP system of the customer and it saves like four man years. Basically, you know that's a big benefit and if you're running old software or you're not having your people talk to someone who understands their business to try and improve things, those are the kind of like savings you leave on the table.
Speaker 2:Like we've talked about this before, our business is a world of hidden losses. We don't account for lost time very well, or lost troubleshooting time or misplaced parts. We don't really quantify it. Nor do we look at how much time are we spending on payables and all the invoices that we're getting from all over the place, from vendors at rare times and stuff, and the work orders that didn't get closed on time because it took long to get an invoice and now the customer won't pay it.
Speaker 2:These are massive amounts of money. I mean we always look at the top of the business what's my gross margins? But when we bleed it away in these vax scales and if your software can't help you improve that, if you can't patch into a payables platform because there's great, great payables platforms out there that will scan everything and auto generate all their bills and then put them into your accounting, as long as you have modern accounting. But there's huge savings there. Like, yeah, hate to put people out of work, better reassign them, but if you can save two man years, what's that really worth? That's a quarter million dollars, even for your true cost of admins.
Speaker 1:Yeah, and it's easier. This is gonna be a real tongue in cheek, but it's easier to reduce two bodies and save the money and increase the profit that way than it is to invest in technology that gives you the saving that's equal to those reduced two bodies. But keep the two bodies on the payroll and let's apply it to customer service. God save me. I might be able to call a customer back when the part comes in.
Speaker 2:Yeah, one of my favorite things is purchasing. You know the number of dealers that I see who let the people run around and buy the parts wherever they want or other supplies wherever they want, and they don't think about the processing cost of payables and the problems it causes them and it's failing to recover them on work orders or not being able to build their work orders fast enough so that they get paid at a higher percentage.
Speaker 1:Well, you know, stay there for a second. One of the biggest complaints I've heard over my whole career is customers don't understand their service invoices. And if you look at the service invoice, I agree with them they're terrible. So what we've done is we take a work order. We've got this header that we've had since the beginning of time. Then now we've got smart. We segmented the work order so we got a bunch of things that we're gonna do. So I'm gonna rebuild an engine, but I'm gonna do it in 40 segments, which all of a sudden takes my document to be five pages long.
Speaker 1:It's really strange, and somehow that's okay. Yes, it slows my mind. And then, you know, I wonder if the dealers get up into a helicopter with me and ask themselves how come so many of their customers have their own mechanics and how come a guy like Alex Kraft, who's got heave, is being successful when he's created an Uber for technicians. The customer says he needs this repair or that maintenance and the technicians bid on it. It's amazing. If we don't wake up pretty soon, I think we're gonna be in a different place. Now let's go further forward and look at the automotive industry, where electric vehicles have come in and Ford has put out at the beginning of last year a new contract for electrical vehicles that says the dealer will not have any inventory of a car on their site. All cars will be shipped directly from a manufacturer.
Speaker 2:Yep.
Speaker 1:Is that the future?
Speaker 2:I think it's already happening in some places. I agree, and that creates like a really interesting problem and opportunity in that if you're not using information systems to understand your sales opportunities, you're really just selling from inventory or selling the order. You may have a harder time than ever getting inventory if your manufacturer is going to prevent you from owning inventory. And so this is where CRM and opportunity management and analyzing your customer fleets and stuff would be hugely powerful, because then you can justify to your OEM why do I need 47 of that model wheel loader in my yard? Well, because here's my backup data.
Speaker 1:So the change in buying patterns and the data analytics. Most people don't know that. Most dealers haven't got that kind of data, don't have that kind of reporting, and so there's one aspect of it. The other aspect is we use traditional methodologies to go to the market salesman pounding the dirt, and we've got a completely different world out there today with the Gen Zs and Gen Xs and whatever the younger people are called anymore. Social media is where they're doing a lot of activity.
Speaker 2:They are Like we talked offline. Then there's a I know of a particular dealer where the best sales rep is working in the social media marketing department sold more units than any other sales rep and the data's there Like it's. I struggle to think that anyone doesn't have the data.
Speaker 1:The data's there.
Speaker 2:It's about learning, wanting to use it, deciding that there is value. It's pretty easy to like just get in the truck or go see some people that you know and have dealt with for years. It's harder to sit down in front of the data and really think through what's happening. So I think we're just tempted to keep doing what we're doing, because why do the hard thing? But there are people that are starting to do that, people who make sure that every lead gets followed up on when it's all digital and stuff, versus working their traditional way, and they're picking up a lot of deals.
Speaker 1:You know it's kind of strange. At Hewitt in 1969, it might have been 1970, we were the first head of the dealer to put product support salesmen in the field, and we've talked about that in the past. The qualification that Kat was looking for is somebody that had good handwriting. So I used the keys. You know that we'd give the guy the keys to the truck, we'd give him a customer list and we'd point to the door and say go sell. And then in my, when I was in college, I did door to door sales of encyclopedias. I also did telemarketing and night selling, newspaper subscriptions and those sales models, for all intents and purposes, are still in effect when the world today.
Speaker 1:If we've learned something from the internet and Amazon, it's that people wanna buy when they wanna buy, not when we wanna sell to them.
Speaker 1:Yep, and it might be two in the morning, it might be noon, don't know, but they're gonna choose the time. So the trick in selling the old nonsense of contact, content, conclusion and, in the content, arousing interest in a sales call now we have to create interest in whatever media we can get, whether it's Facebook or Twitter or LinkedIn or WhatsApp or all of these different things. That's catchy enough that the buyer sees it, pays attention to it. So there's the first problem. And then we have a device available that they can get to without us even being present. They can check our inventory, they can check our price, they can see what's out there, they can do the research, they can get the features and benefits without us at all and, even worse, with shopping carts, we should have a facility whereby they can buy it, whether it's a $10 million machine or a 10 cent O-ring. And I don't think the dealer network, the distribution channel and heavy equipment, industrial equipment, light equipment I don't think you get it yet.
Speaker 2:I saw there was a digital dealer out there that came from a non-traditional starting point not industry people and they started selling aggregate crushing, screening equipment. And what's interesting is we've talked about people selling small equipment for, say, 50,000, maybe they're pushing towards 100,000. But that industry was happy to buy equipment sight unseen off of a brochure or a website for half a million to three quarters Because to some degree those customers are used to not being able to get their hands on it. So if you've got that happening on one side, with people who are just buy it off a brochure already, and you've got a lot of people who are happy to buy small equipment, then I don't think the problem is anymore that people are afraid to buy a $300,000 wheel loader off of a webpage.
Speaker 1:It's about enabling it.
Speaker 1:Yeah, the other thing that that kind of highlights, matt, is that a lot of times you're able to return it. Don't like it, send it back, sure. And you know Nordstroms. There's a famous story in customer service about Nordstroms, the department store in Seattle. Customer came in and returned a pair of tires, set of tires, and they took it back, they gave them a credit. They never sold a tire in the company in their life. Yeah, you know the customers. You know we talk about Ian Charlson when he was his kind of Navy in their service, talking about moments of truth, the interaction between the employee and the customer, and that's important. But today, the interactions between a system and the buyer's eyes and ears, and how we present ourselves on the website, in branding, in emails, in every presence that we have on social media, that becomes important. And I don't see people out there who have we got in a dealer, Anybody that you've run across yet that has a chief change officer.
Speaker 2:Chief change officer. No, I haven't heard that one yet.
Speaker 1:It's long overdue. We've had Kaisen since 1980. We've had continuous quality improvement since 1980. We came afat at this period. Anybody that's still doing continuous improvement.
Speaker 2:Under that label.
Speaker 1:Or whatever label you want to have. You know I haven't heard it Right and you know you bring up the example of guy. He's got an executive position with one dealership, he's recruited and he goes to another dealership and he brings his knowledge and his skills and he goes into a new organization and he hasn't got a clue how to apply it Because he doesn't know how the business actually runs.
Speaker 2:No, you learn how to live in the ecosystem of the dealership you're used to, and this is particularly what happens in large dealers. You know, the large dealer has momentum and there's a lot of culture. A lot of things just get understood and how to deal with them. I went through this when I went to a much smaller organization that didn't have some of the advantages of, you know, high volumes of parts moving to make logistics easier and a long history of dealing with warranty and large populations and stuff. And at the really reshift, my thinking and okay, so what? Why did we do it that way? How would that work differently here, considering, you know, the I don't have the same inputs, I don't have the same volumes, or the people don't understand it.
Speaker 2:I mean, I had this great old VP in my first job when I was a shop supervisor and he was like he was magic at dealing with customers who had machines fail, you know, and he just knew how to handle them.
Speaker 2:He got the machine fixed, he got things moving again and then they sorted it out, and even that it was an example of if you don't have that in your culture, if you don't have people like that, then it doesn't just happen and so you know, we can know the language, but you have to really understand what's happening.
Speaker 2:And that kind of brings us back to you know, our starting point of having people in your organization that understands business but also understand technology and information, so that you have a bridge in the organization that can say look, you know, you're running, I see you running around talking to all these people. But I ran some numbers, you know, and here's like 27 customers with a larger fleet than the people that you're talking to. That you haven't seen. You know, and we looked at it and said that you know, between them they have 50 machines that really should have been replaced this year. So you know, but you need to have someone who can talk to them. We're definitely a big industry for paying your dues and, you know, earning respect, so you've got to be able to talk to people about what they do knowledgeably. But that's an investment I think dealers have to make in developing people that can bridge that gap, or finding them and then training them on the industry side.
Speaker 1:Yeah, you bring up an interesting point. The jar talking to talk, everybody seems to be able to get there earning your respect. Steve Clay, one of the interesting things of his data analytics not really surprising, but the further the customer job site is from the dealer location, the lower the retention rate. And that goes back to multi-location distribution theory. And if you look at the dealerships, they're big and we operate one shift. Why don't we have small, or maybe none, and operate out of a truck? And your comment about the culture and the employee being able to solve a problem without asking for permission is important. And Jay Lucas from Jordan Sipter, the owner of it biggest recruiting business in our industry. We put up a blog of his on Tuesday. The Delusion of Culture. Culture is something that you have to work at keeping and the culture isn't something you can mandate. The culture is a product of how the people in the business feel about the business. If they feel good about it, they'll go the extra mile.
Speaker 1:If they don't man, like my granddaughter, says we've got my generation, she's 22. We've got a whole bunch of people that we call quiet quitting. They go to work. They just get enough done so that they can get their paycheck and not get fired and go home.
Speaker 2:You can always tell if there's a traffic jam at the front door at quitting time. If people slowly trickle out, then it's probably a sign of a good culture. If it's bad, they all log jam in the front door on their way home.
Speaker 1:It's really strange. The other thing that I used to do a lot of is go to whenever I was in a dealer location Second or third day. I'd come in a little bit later and I'd drive by every shop to see how many field trucks were still there. There shouldn't have been one. Of course, everybody opens the door so you can see who's working and who isn't. It's really revealing. It's really old fashioned stuff, isn't it, mitz? It's being people first.
Speaker 2:Yeah, we do have to be people first, but it's how we empower people and it's how we inform people. Those people are just doing their job. I find that most people, like those admins who just try to get their stuff done, so they don't put up their hands saying I could do this better if you got me this or if we changed that Most people are just trying to do it. It's putting information in front of people that they can evaluate, that allows them to make change. If you hide that or if you don't spend the time on putting that information together and putting it out in front of people, then they won't make the change.
Speaker 2:One of my mentors along the way, as the CIO, had a very strong idea of where he wanted the dealership to go and what areas were important to focus on. He used the tools at his disposal to say look, I think people should be focused on this. I'm going to invest in putting a tool in place and put it in front of them and say look, now you can see what's going on. I find a lot of places are, unfortunately, the opposite. They're using information systems or reprimand, like measurement, to find fault, measurement to drive performance, but they're not using it to drive knowledge so that people will take action. They take action out of fear. I don't hit my number and then I get in trouble. I better figure out how to just hit the number, then they're just going to hit the number.
Speaker 1:You're right, we've got to be people first. There's a starting point the businesses have to provide to the employees the tools, the technology and the training that they need. Then we've got to be able to put the data not raw but translated into information in front of them, such that there's something of interest for every customer in every document or department every day. That, if you call me whatever it is you're calling me for I'm going to look after. But before we hang up I'm going to say something like Mitch, it just came to my attention that the filters for that DM300 you've got.
Speaker 1:You never buy your own filter from us. You haven't bought one yet. Do you mind asking where you get it? The last time that I saw you in my shop was expiration of your warranty. Do you mind helping me with who's doing the repair and maintenance of your machine now that the warranty's over? Or that operator has been. He's famous for about half the day he doesn't have any RPM on the engine. He's idling. We've got the tools now. We've got the data now. We could have that little snap up on the screen. Whenever I'm talking to whatever the customer is something personal.
Speaker 2:Yeah, Instead we burn that time asking whether or not the customer will fill out a survey when we're done Correct and see if I can get five stars.
Speaker 1:Yeah.
Speaker 2:Which is often most people don't do it. It's really poor feedback. It brings no value to the customer. And so you're right, better to show that customer that you've got some information about him, that you can be a benefit. I always said that about sales reps You've got to show up with something of value, some useful information about and understand the customer's business, so that when you show up, they're always like oh hey, ron's here, ron's always got something useful. I have time for Ron.
Speaker 2:And that same idea using information to put it in front of people. The kind of joke version of that is that we all put birthdays in CRMs so that I can give you an automated happy birthday or call you to say happy birthday and your birthday. Okay, it's relevant. It's the starting point of the right idea, but there's so much more you could put in front of salespeople to help drive them. We don't do metrics on our dashboards. We do indicators and exceptions. We flag the things that we crush out of the data and put it on the dashboard for the sales rep. That are actionable items. This guy you haven't talked to in this long and this machine is coming off of its finance lease. That's the kind of stuff that drives value for the people using it too.
Speaker 1:Yeah, big time. And the other side of that is, with XML I can track the cursor on the screen, so I know what you looked at, how long you looked at it and all the rest of that stuff. And then you bring up an interesting point All of those birthday reminders. It's really helpful, but then the software business came up with a bunch of different. You choose what the birthday message is that you want to send to the guy. And I've got about 7,500 on LinkedIn and 5,000 on Facebook and on Mugawa, and not once when I send a birthday greeting do I use their canned words. Not once I've refused to, because I see them all the time and it ticks me off.
Speaker 2:My birthday was last week and I made it a point to go back and answer everyone who said happy birthday from the automated slick.
Speaker 1:And, by the way, it was a significant birthday, wasn't it?
Speaker 2:It was.
Speaker 1:So you're half way there now At that. I'm going to wrap this up, Mets. We had a power event in the middle of this podcast that caused us to do it over a couple of days, but the information that Mets is bringing to us and the thinking and perceptions with his new business visibility software for everybody that's on a brand new platform. Everybody who's listening to this and is interested should get in touch with them. He's got an awful lot of background. He's got the chops, he's got the scars that I talk about all the time of knowledge, because he's done almost everything there is out there. So thank you, Mets, for being here, Appreciate it, and thank you everybody for listening. I hope you'll join us at another candidate conversation in the near future, Mahalo.