The Best Way to Pay Technicians

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On this week’s episode of the Weekly Tune-Up, CBT’s Jim Fitzpatrick talks to fixed-ops expert, and regular CBT contributor, John Fairchild of Fairchild Automotive Solutions. Jim talks to John about what he and many others think is the best way to pay technicians.

 

VIDEO TRANSCRIPTION:

Jim F.: Hi everyone. Thanks so much for joining me. Jim Fitzpatrick with CBT News. Today we’re going to talk to John Fairchild on the Weekly Tune Up. Thanks for tuning in. John, welcome to CBT News.

John Fairchild: Thanks for having me.

Jim F.: Yeah, sure.

John Fairchild: Glad to be here.

Jim F.: Sure. Let’s talk a little bit about the best way to pay technicians. We talked about how to keep them, and obviously that kind of goes hand in hand, but if it was Fairchild Automotive Group, you had a bunch of dealerships, what’s the best way to pay them? What would you do to?

John Fairchild: Well, I think that there are some controversial solutions out there that I’ve seen and I do see a lot of dealers this day talking about going away from a flat rate.

Jim F.: Right.

John Fairchild: Okay. I personally think that you’re driven type A techs in the right scenario with the right benefits package are really driven towards that flat rate. Those techs are going to be best served at that flat rate cause they can beat the heck out of it, and that’s where they’re going to make the best money.

Jim F.: Right.

John Fairchild: They’re not scared of downtime or anything else cause they know what their capabilities are.

Jim F.: Sure.

John Fairchild: But I do think you have a whole array of different technicians within a group of techs that are not that top apex predator type of shark.

Jim F.: Yeah.

John Fairchild: But the people that are in the middle, and certainly the people that we’re developing that we have to have a system that is flexible enough that’s not going to toss them out on their ear if they miss their quota one week, two weeks and not as cruel as being on straight flat rate for a C or B level guy.

Jim F.: Right.

John Fairchild: Okay, cause that can be a huge unknown for that person. Typically, let’s face it, people in that type of pay range or in that demographic maybe live in their existence paycheck to paycheck.

Jim F.: Yeah.

John Fairchild: That’s a lot of pressure.

Jim F.: Right.

John Fairchild: Okay. The quality that that person is going to receive out of their job, they may not be wanting to be there longterm. Particularly, these days you can get a job that’s not as strenuous, that you don’t have to invest $50,000 in tools. They don’t have to continually be doing school work to stay abreast of everything that can get right in that dollar range. We want to be careful that we got these people that we’re incubating into those apex predators that we’re taking care of them to the degree that we’re not overpaying them for an over guarantee, but they’ve got a safety net.

Jim F.: Right, right.

John Fairchild: Okay. I do believe in pay plans that do offer a safety net, certainly for a period of time or till a period or a level of performance is achieved.

Jim F.: Should you give technicians the choice of a few different pay plans in the same house?

John Fairchild: I think you can as long as they’re basically all apples to apples pay plans. You sure can. I don’t know about a few, but I think that you should have a couple of options that can be viable. Again, your top performance are always going to fare better off of straight commission. There’s just no way around it.

John Fairchild: Now, you could have some type of eccentric technician that is a top performer that’s really just not comfortable with that. I think that the key is that we’ve got to make accommodations to folks to keep them solid and to keep them performing with our dealership for years and years. Let’s face it, if they’re an asset to the dealership, let’s figure out how to keep them.

Jim F.: Yeah, yeah. Sure.

John Fairchild: If they’re not, then that’s a different story.

Jim F.: Right, right.

John Fairchild: But yeah, I think-

Jim F.: Switching gears again.

John Fairchild: Yeah.

Jim F.: Service management and accountability. How do we as dealers-

John Fairchild: I think that is the $24 question, $24,000 question here, Jim. That’s what it’s all about. It’s all about execution. More and more I find myself, I feel like training means practice.

Jim F.: Yeah.

John Fairchild: Okay. Are we doing it every day? When you see a top level athlete, whatever sport it is, train, what are they doing? They’re doing it over and over, over and over until it becomes habitual.

Jim F.: That’s right.

John Fairchild: Anymore of what I aim to do is to teach people what the methods are and make sure that there’s no ambiguity about it and make sure everybody knows what they’re supposed to do. But from that point, it’s really in the management and leadership’s hands to make sure they do.

Jim F.: That’s right.

John Fairchild: And make sure they hold people accountable, but we can do that in some ways. I’m glad this came up because this is so fundamental to everything I do, is there are some ways that we can do that with folks without it being drudgery, without it being just strict discipline, my way, the highway kind of things, and really they are focused incentives, focused pay plans. Now, I’m not talking about ultra convoluted, multifaceted pay plans that take a PhD in pay plan-ism to-

Jim F.: That works reverse.

John Fairchild: It works in reverse because you got to be able to say to a service advisor particularly, hey, how do you get paid?

Jim F.: That’s right.

John Fairchild: They should be able to-

Jim F.: In 30 seconds or less tell you exactly-

John Fairchild: They should be able to tell you that.

Jim F.: That’s right.

John Fairchild: I think that all of these things really make for a better dealership in the long run.

Jim F.: Yeah, that’s for sure, but accountability is at the top of the list.

John Fairchild: Yeah. No. Some of the other ways that accountability can be measured and really done in right way is grading. One thing I always have my managers do is to send a grade in every week of whatever that topic is that we’re trained in that month. We might be training, we’ve talked about, walk-arounds earlier, but where we might be training an active delivery process or we might be training an additional service request process, but during that, how do we know they’re doing it? Okay.

John Fairchild: I always set up a role play or an observation or sometimes you can get the straight metrics from numbers that there is a grade assigned and then we got to make it very visible.

Jim F.: Yeah.

John Fairchild: Okay. In some of the doodle groups I’ve worked with, actually what we put together was each manager is required to give a weekly grade on their service advisor. Let’s just say it’s a walk around process.

Jim F.: Okay.

John Fairchild: Okay. Every week they submit that to me, and what I do is I post it online to their own private website that I’ve created on my website. It’s a page on my website. Everybody’s got access to it. You can see you never want to be at the bottom of the list.

Jim F.: No.

John Fairchild: Right?

Jim F.: Yeah, yeah. It’s like the motivator board in the showroom.

John Fairchild: It’s exactly what it is. Also, we assign prizes. We maybe have some incentives geared towards the top one of the week, top one of the month, the most improvement, the guy you never thought would be that good or whatever it is.

John Fairchild: Accountability doesn’t have to be drudgery, but it does have to be active and you’ve got to really keep in front of people’s faces or else if you just set it and forget it, it’s going to be forgotten.

Jim F.: Yeah. Oh, for sure.

John Fairchild: It’s going to be forgotten.

Jim F.: Yep. Yep. John Fairchild, retail automotive trainer and president of Fairchild Automotive Solutions.

John Fairchild: Yes.

Jim F.: And that’s the key is that you have the solutions.

John Fairchild: Yes, sir.

Jim F.: For the dealers that are out there listening to us have this discussion today, man, give John a call if you want to take your 2020 net profit to the nth degree, right?

John Fairchild: Please do. I’m here for you. I only want dealers that are really committed to change, Jim.

Jim F.: And your real world. I mean, I know that I’ve been in the business and talking to you over the years. These are real, real,-

John Fairchild: I’m a real guy.

Jim F.: Real life solutions. You are, yeah. Well, thank you so much for joining us.

John Fairchild: No, thank you. I appreciate the time to be in the studio and it’s always a pleasure.

Jim F.: Yeah, it’s great having you.

John Fairchild: Thank you.

Jim F.: Thanks.

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