Wednesday, July 15, 2009

Building the Dealership Talent Pipeline

INTRODUCTION

Contract furniture dealerships face many talent management challenges, but conversations with several dealership leaders and principals indicate that the greatest talent management concerns center on the various stages of building the dealership talent pipeline. Although individual dealerships might differ in the priorities they place on each talent pipeline concern, all agree that four talent pipeline processes are critical for dealership success and sustainability. Those talent pipeline processes are:

I-Selecting the strongest entry level talent who will stay and grow

II-Developing individual contributors into supervisors and managers

III-Powering sales people to optimize their contribution to revenue

IV-Preparing leadership and dealer principal succession

Let’s look at each of these critical talent pipeline processes and explore the systems and activities that would optimize its effectiveness. Many of these systems and activities until fairly recently were available only to organizations much larger than the typical dealership. Now with online communications, scalable talent management architectures and expert system databases, even the smallest dealership can afford to access these talent pipeline resources.


THE CRITICAL TALENT PIPELINE PROCESSES

Selecting the strongest entry level talent who will stay and grow

Sourcing and selecting entry level talent may be the single most important talent pipeline process for a dealership, since the depth of entry level talent sets very real boundaries on the dealership’s capabilities to deliver, innovate and grow. The sourcing and selecting process is best supported by implementing an integrated approach that includes hiring management automation, job-relevant assessments, and job-specific interview protocols.

Hiring management automation drives employment applications through an artificial intelligence guided web-based screening and qualification process. No paper is created and no effort is required on the part of the dealership’s human resource function until the process identifies a qualified candidate. Qualified candidates, then, can be routed by the software through job relevant assessments and, if appropriate, scheduled for an interview appointment with human resources and/or the hiring manager. This automation improves candidate quality while eliminating tedious hours of reading through stacks of resumes and then trying to connect with applicants who seem promising on paper.

Job relevant assessments also are web based and can be made available to an applicant either un-proctored at their own email address or proctored at a computer in the dealership. Typically these assessments include a measure of work style and one or more tests of critical thinking and/or job specific skills. If the dealership or a group to which it belongs has invested in building a model of a particular job, the applicant can be matched directly to that model. If no job-specific model exists, the applicant can be compared to appropriate population norms. Either way, the assessment process enables the applicant to demonstrate their suitability and capability to succeed in the available job.

Job specific interviews are much more likely to predict individual job performance than are the informal, unstructured interviews typically used by smaller organizations. In an integrated approach to selection the job specific interview is divided between the automated delivery of the artificial intelligence driven hiring management system and the live in person interview conducted by the human resources and/or hiring manager interviewer. Focus groups with people who have been in the dealership long enough to observe the success or failure of several people who have held a specific job uncover the biodata and behavioral elements that predict these performance outcomes. Then questions are written to assess the extent to which a job applicant displays the elements that contribute to success. An applicant’s response to each question is scored, and these scores tallied to provide an objective measure of likely success on the job.

Developing individual contributors into supervisors and managers

The leap from individual contributor to effective supervisor or manager is much greater than most people estimate it to be. Not surprisingly, therefore, many highly successful individual contributors need help in making this transition to their first role with responsibility for others. This transition process is best supported by implementing an integrated approach that includes early identification of supervisory and management potential, a menu of relevant internal and external training resources, and a structured coaching and mentoring program.

Early identification of supervisory and management potential can be made from a combination of behavioral observations, performance evaluations, and standardized assessment of readiness for supervisory and management roles. Data from these three sources are combined to highlight an individual’s already evolved supervisory and managerial strengths and also their needs for further development prior to taking on this additional level of responsibility. Feedback of this information with the individual should result in the co-creation of a realistic plan for career transition to a targeted supervisory or management position. The career transition plan should identify developmental resources and set target dates for the several recommended activities to be completed, assuring that the individual’s efforts remain focused.

The menu of relevant internal and external training resources is designed to meet the most frequent development needs of individuals making the transition from individual contributor to supervisor or manager. This menu might include books, films, online training, classroom training, vendor or association-sponsored programs, consultant facilitated programs, job rotations or project assignments, as well as formal course work from a college or university. An individual’s choices from this menu should be guided by their career transition plan and completed by the plan’s target dates. Many dealerships offer tuition reimbursement or a career development budget to individuals who elect to work toward a degree and/or relevant professional certification on their own time.

Structured coaching and mentoring often is necessary to provide individualized transition support beyond that available from training experiences. Larger dealerships are more likely to have a mentoring program in which senior executives are trained to offer long term guidance to one or more junior people who are in various stages of career evolution and/or transition. Organizations of any size may invite professional coaches to offer their expertise in working with individuals who are moving through these career stages. The personal connection with a mentor or coach greatly increases the likelihood that an individual will meet agreed upon career development goals.

Powering sales people to optimize their contribution to revenue

Powering sales people to optimize their contribution to revenue is essential to dealership survival, success and growth. Sales person turnover is extremely expensive and disruptive, making the retention and optimization of sales people truly critical to the dealership. This optimization process is best supported by implementing an integrated approach that includes detailed delineation of selling roles and strategies, assessment and training to increase sales potential, and rational compensation models keyed to the demand characteristics of each of the identified selling roles and strategies.

Detailed delineation of selling roles and strategies is essential in providing sales people with clear expectations for their behavior, performance, and revenue objectives. Most dealership have more than a single selling role, and these roles may not always be formally defined. Typically some distinction is made between sales roles focused on new business development, current client penetration, or client management. A more formal process of job definition that includes task identification, selling strategy rationale, and performance evaluation metrics greatly increases the likelihood that a sales person will understand and deliver to the expectations of their particular selling role.

Assessment and training to increase sales potential provide an avenue for continually improving sales person effectiveness. Assessment of individual sales people can identify their competency at each point in the business to business selling cycle and also uncover the underlying behavioral attributes that may be supporting a competency or holding back its development. Sales training, then, can be tailored to the needs of each individual rather than simply spending the money to send everyone through the same packaged sales training experience. And the return on a training investment can be measured by both changes in sales assessment scores and actual improvement in critical sales outcomes.

Rational sales compensation models deliver desired sales results while balancing the financial needs of individual sales people and the dealership. Appropriate models also are the key to retaining and motivating the best performers. These models work best when they are tailored to the demand characteristics of a particular selling role and/or strategy and also to competitive job pricing in the particular job market. Sales role definition, preferred selling strategy, and market compensation benchmarks therefore must be clarified before a rational compensation model can be put in place. It’s not unusual for a dealership with several different defined sales roles to have a different compensation model in place for each of these roles. And plans also need to be made for the sales person who transitions from one selling role to another.

Preparing leadership and dealer principal succession

Preparing leadership and dealer principal succession is the big elephant in the room that few dealers want to address until it’s almost too late to do what’s best for the dealership and its stakeholders. Completely unexpected transition needs brought about by death, disability, or unexpected departure of a leader or dealer principal inevitably create a crisis mentality throughout the dealership that highlights the need for a proactive approach to succession. Preparing leadership and dealer principal succession is best supported by implementing an integrated approach that includes career assessment and development activities, a key person internal vs. external succession strategy, and an “all facets” engagement with the dealer principal.

Career assessment and development activities that support succession planning are an extension of the processes used to identify and develop front line supervisory and management talent. The succession planning activities take a longer term view and are designed to identify individuals with high potential for leadership success and guide them through a series of formal learning and business experiences that will prepare them for increasing responsibility in the dealership. Mentoring and/or coaching relationships are essential in growing people toward the top roles in the organization. And active involvement in industry associations and dealer councils provides additional valuable perspectives on what a leader should be doing to power the dealership forward.

Key person succession strategies inevitably come down to an assessment of the talent available within the dealership and the talent that will need to be brought in from the outside. Although there are many strong arguments in favor of “growing your own”, a completely home grown leadership team may perpetuate an insular view of dealership direction. Bringing on board carefully assessed and selected outside leaders can invigorate the leadership team and bring new energy to drive dealership strategies and growth.

An “all facets” engagement with the dealer principal should be in place several years before that individual expects to transition out of their leadership role and/or give up ownership. Typically dealer principals involve their financial and legal advisors in discussions about their transition but pay little attention to the behavioral impact of the transition on the dealership, themselves and their families. An “all facets” engagement should include a psychologist or organizational consultant as a member of the transition trusted advisor team. Transition preparation activities should include ongoing psychologist facilitated discussions with the dealer principal and the successors to this role. Interventions also may be needed to help other stakeholders within the dealership handle the change of leadership and/or ownership with resilience rather than anxiety. And finally the dealer principal may need guidance in accepting their own changed role and understanding its impact on their self image and emotions.

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