Insights into Business Succession Planning for Dealerships

Every dealership group needs to address succession planning, not only for their dealer’s role, but for other key roles.  The dealer is the body of the car and the other key roles in the dealership are the wheels that keep the car moving.  No wheels, no movement.  

Are your dealers prepared with a trained professional ready to step in or step up if their F&I Manager quits and moves on to “greener pastures” or if their Controller is involved in an accident and won’t return for 90-120 days?   

For example, when a dealership’s service director quits, other employees may not have realized all the work the director was actually performing. This creates a struggle to simply complete routine and daily tasks.  The service director was probably wearing many hats and finishing others’ projects. 

Succession planning takes time and requires a conscious commitment to prepare for the future and  potentially worse-case scenarios.  But this planning  enables the business to continue to survive and provides stability for employees. 

Cross Training

Cross training is similar to succession planning but is geared more toward the axles that keep the wheels rolling – technicians, countermen, billers, payroll, etc.  Again, no axles, no movement.  These may not be the highest paid positions, but one or two extended absences, vacations planned at the same time, or terminations, and efficiency plummets.    

For example, in my last dealership group, we had two employees who performed our payroll and human resource roles for a dealership group of about 350 employees.   Neither knew much about the other’s duties.  They could do the bare minimum for the other desk if absolutely needed, but not very competently.  

Shortly after I started with the group, our HR clerk went to the doctor, was diagnosed with cancer, and sadly passed away a short time later. While we dealt with the loss of a co-worker, we also found ourselves short-handed. As a result, we found ourselves struggling with some of the administrative duties for a while. We later moved one of our existing team members into the HR role. She had only been with our company for about six months and even though she was fairly inexperienced, she was a real go-getter.  She worked quickly, asked for more work, and turned a real mess-of-a-desk into a shining example of what could be accomplished with hard work.  

Fast forward two years.  Sufficient time has passed and now we need to cross train our payroll and HR clerks but we were meeting resistance. Both worked there when our last HR clerk died unexpectedly.  They knew what a difficult time that we went through.  

Our payroll clerk had been with the dealership for many, many years, and worried that she was being pushed out of her role by teaching someone else her desk even though our HR clerk had no desire to do the daily payroll functions.  Knowing how important it was to have them understand each other’s job responsibilities, I walked in one day and told them, “As of tomorrow, both of you will sit at the other’s desk and will perform whatever tasks were normally completed at that desk.”  I told them they could provide guidance to each other, but could not do their old jobs.  I intended for it to be a 90-day swap but after 3 weeks, cross training was complete and they happily swapped back.

Six months later, our payroll clerk had medical issues that took her out of work for four months.  She returned to work later, but in a different role and was only able to work part-time due to medical issues.   Cross-training made it possible to work through a difficult time and to enable everyone to get paid timely without missing a check.  Being prepared also helped us through the transition again to a new clerk in that office.  

No one wants to put their employer, co-workers, clients, customers, managers, or partners in a bind, but by not preparing for the unexpected, it can happen.  Plan for success and encourage your clients to plan for their own success as well.  

Laurie Holt