The Real Way to Improve your Dealership’s Culture

dealership culture

There is money to be made writing books about management. Just skim the shelves at your local bookstore and you will see tons of advice that promises to make you a better leader, a more efficient manager, and a highly effective team builder.  

The problem is, when looking to learn something useful, how can you discern the helpful advice from the fluff? To evaluate each new idea or theory it would be helpful to have a basis for comparison.

The History of Management Science Tells the Tale

This is where knowing the history of your profession can be helpful. When it comes to leading people, knowing what has been established as fact and what is merely unproven theory can save you a lot of time and effort.

Other professions have been studied for hundreds of years, and some even longer than that, but the body of knowledge called management science is extremely young.  Until shortly before the twentieth century most people lived in small villages and on farms, or if they lived in big cities, they worked for small companies. Every employer managed their people according to what they thought was best.

The industrial revolution changed all that. Progress in laws, economics and finance made it possible to form huge companies that traded over vast geographic areas. Now, aside from military operations and governments, which have never been known as models of efficiency, for-profit organizations found themselves under pressure to manage large numbers of people more effectively. That led to the establishment of your job as a recognized profession, management.

The Basics Never Change, Give Your People What They Need to Do a Good Job

Since factories were among the first big employers, they commissioned some of the first formal management studies, which were typically done by mathematicians. Sometimes what they observed in the workplace went so far against common sense that it boggles the mind to this day.

I remember reading one of those ancient studies about the efficiency of factory men who shoveled coal into furnaces. It seems that the company required each man to bring his own shovel; the penny-pinching employer did not provide them. So every man simply brought whatever type of shovel he had on hand, no matter how unsuited it was for shoveling coal into furnaces. It took a formal study to get managers to realize that it was far more economical (and productive) to provide the tools their people needed to do their jobs as best as possible.   

With respect to life in that factory, imagine how bad morale must have been working under managers that were so removed and so disinterested in the day to day work of their staff.  

The same concept holds true for managers today, but hopefully it is not as blatantly apparent: a problem (or an opportunity) that is obvious to your staff might go unnoticed by you for a long time. Just be open to that concept, and you might start hearing some great ideas coming from your staff.

Humans Don’t Respond to Rewards Like Animals Do

When it comes to ‘proof’ that financial incentives are a good way to motivate employees, you’ve no doubt heard about a famous person named Pavlov who ran behavioral experiments on dogs in the early 20th century. Usually misunderstood and frequently misapplied, the popular interpretation of Pavlov’s work says that he taught dogs to perform (ring a bell) to earn a reward (food). The next logical step, then, is to believe that humans (employees) will likewise respond positively to rewards, and negatively to punishments.

That is not exactly what Pavlov was trying to prove, and certainly not with humans. But the ‘reward or punish’ and ‘the carrot or the stick’ frame of mind was the prevalent belief in American management up to the 1960s. If you rephrase that belief, it said that employees were naturally lazy, and that’s how managers viewed them. Therefore, management had to promise employees a reward to get them to work. Now then, if you constantly tell your staff that you believe they are lazy, how will they act? Insulted, then distant and then unresponsive, all things we label as a poor ‘attitude.’

The underlying problem with using financial incentives to ‘motivate’ people is this. Human beings resent being bribed to work and threatened with punishments if they don’t perform well. It makes them feel lack of respect coming from their managers. The more managers harp on financial incentives the more distant and unresponsive their people become. And that erodes the corporate culture. What’s a better alternative?

People Like Attention from Their Managers

Let’s throw this next idea right out on the table. If you want your people to perform better, you have to pay better attention to them. The more interest you take in them the better they will perform.

That phenomenon is so well established that it has its own name. It is called The Hawthorne Effect. Google it. It comes from a study of factory workers employed by General Electric decades ago. Keep in mind that back then many factory workers were paid by piece work, a type of commission similar to the way salespeople and dealership technicians are paid today. The financial incentives were the primary tools management used to ‘motivate’ people to produce more.

The study was supposed to prove that adding more light to employees’ work areas would increase their productivity, which would seem to make sense in a factory setting. But the study yielded something else, a gold mine of insight to human behavior. It showed that the employees they were studying responded better to something else. What they liked, what they prized most of all, was the attention from managers they were getting by being studied. The more their managers showed an interest in them the better they performed, even when the lights were dimmed low and they had less light to work with.

As for using that idea to improve your corporate culture, this is the thing. You have to be there with your people. There is no substitute, there are no gimmicks.  

Human Beings are Born Motivated; Don’t Squash It

Towards the middle of the 20th century, another famous person you’ve probably heard of named Maslow did work that contradicted the popular misinterpretations of Pavlov’s studies. Maslow found that humans are born with certain motivations that will drive them to seek success on their own. Typically, we see Maslow’s work called a hierarchy of needs (motivations), and it is depicted as a pyramid. Sound familiar? You could divide the various innate motivations into three groups.

First, every person you hire has an inner drive to survive. That means they want to earn enough money to buy food, clothing, shelter and to provide their family the basic needs of life. If they didn’t want to do that they would have not applied for the job you gave them.

So, when you see salespeople not earning enough to provide the basics, it’s not because they are lazy. It’s because they haven’t learned how to survive in sales. Don’t promise financial incentives as a ‘motivation’ for them to figure it out on their own. Teach them. Would it really hurt to admit that the people you hired are motivated enough to survive, but are just uneducated and unskilled at their job?  

Second, in addition to earning enough to survive physically, people want to be accepted where they spend their time, at work. A sense of community. They are motivated to seek that. But constantly comparing workers to each other, and establishing a rank order of the most valuable to the least valuable, is a sure-fire way to extinguish that motivation inside them. That is what demotivates children in school, being assigned grades and constantly being ranked as better or worse than each other. So, if you are trying to improve the corporate culture in your dealership (who wouldn’t, because a good culture can help drive productivity), maybe it wouldn’t hurt to shift the focus a little, away from getting people to compete against each other and to instead get them to compete against themselves. Leadership.

Third, in addition to being well fed and feeling accepted where they work, people naturally want to feel like their work really matters to somebody. Look at the inverse. Who would not like to work for a company that is respected in the community, and that makes him feel like his contributions really matter?


A healthy corporate culture can help drive productivity upwards. It certainly can’t hurt. When evaluating new ideas to try, it is helps to look at what has already been established in the field of management.

  • Give your people what they need to do their jobs well. Be open to suggestions and ideas from them as well.
  • Realize that your staff wants your attention, your presence, and will respond favorably to it.
  • Recognize that some unavoidable aspects of dealership life are counter-productive and hurt your staff’s inner motivation. Rely less on financial incentives and on comparing them to each other, and more on teaching, coaching and on your own leadership skills.