Have you considered if you have the right people in the right place to get the job done next year? Two things to consider in people terms would be sufficiency/over-sufficiency and calibre.
Tough Targets to hit ?
Tough targets to hit ?
Have you considered if you have the right people in the right place to get the job done next year?
Two things to consider in people terms would be sufficiency/over-sufficiency and calibre.
In terms of cost ? the major contributant to cost and which we can influence, is payroll.
Run with too many people and their payroll and benefits cost may overwhelm your ability to perform.
The industry is also littered with KPI?s and all the main manufacturers provide them in number. The key is in separating the vital few from the irrelevant many and on majoring on the lines you can influence ? no point getting hung up on rent or notional rent, as you can?t change it. Some old chestnuts would be units per salesperson (225 for volume), hours per tech (1750 general mechanical inc service work and pdi), prod/non-prod 2:1, parts sales per parts employee (ranges from ?250k factor van sales to ?400k parts wholesale), sales admin 1,000 units per annum new or used unless the new car franchise is especially cumbersome to administer. DP/GP% ball park should be around 50/50 for all departments i.e. the department keeps as net profit half of the gross (after variables) which it generates. Service (with oil sales in and no parts gross profit transfer) should generate around 75% gp on all sales and retain at least 50% of that; Parts generally (with no distortions such as internal transfers) should retain at least 22% gp on all sales (unless they are a large wholesaler, in which case you need to start at buying margin in each sales area and work back), with 10% used to run the department, leaving 12% net retained on sales. Indirect overhead depends on the group ethos, such as computer system, rent versus mortgage etc ? it?s a line by line slog I?m afraid.
Once the cost and kpi piece is understood and any necessary changes planned, you could move to assess the calibre of your team. If a careful assessment of the capability and attitude of each of your team members tells you that you have some good material to work with, then you could break down each of your next years challenges and share them out with your team. The sum of the whole being greater than the sum of the parts ? you?re bound to have heard that before and in this context, properly executed; it really works. The Performance Management process has the capacity to transform business results, however, it can be lengthy and cumbersome to deliver. It all depends on how sincere you are and how determined to install improvement.
Agreeing and Setting objectives ? through the Balanced Scorecard or SMART objectives approach.
The standard format for setting objectives is through the Balanced Scorecard approach. The Balanced Scorecard is a business performance measurement model. It is aimed at aligning behaviours and business objectives. The BSC enables participants at all levels to track financial results while simultaneously monitoring progress in building the human capabilities and acquiring the intangible business assets they need for future growth. This enables the individual and manager to have a better balance to their objectives as it focuses objectives around (say) four key areas that in turn align closely with business objectives. These four areas might be Financial, Customer, Internal Business Process, Learning and Growth,
Progressive stages
Clarify the answers to the questions above and ask what you do on a daily, weekly and monthly basis to support success in each criterion. What actions do you need to take that will support these four perspectives. These are called initiatives. You should question whether anything that falls outside of these four areas is really adding value to the business as a whole. Set clear deadlines for achievement of your initiatives.
Finally
You need to start thinking of milestones ? interim and objective. Naturally, objectives should still be Specific, Measurable, Achievable but stretching, they will be Relevant to the business, suitable for a cascade process and, lastly they must have a Target date or timescales to achieve them.
