Heavy truck OEMs have approached the management of their field forces in the past year with a number of different new strategies, but in the end they’ve all come down to maximizing the amount of time the field reps spend on parts and service issues. All OEMs agree that current initiatives are driven by current economics of the industry … not pushes for overall increased or improved service levels. However, there is a silver lining as a few OEMs have come up with innovative ways to increase field organization cost effectiveness.
Most of these efforts are based on one fundamental idea: parts and service field reps are experts in parts and service. While they may be great at expediting parts or explaining promotions, there are other ways to communicate these non-technical issues to dealers. If OEMs can rationalize their field and reduce the time they spend on “non-technical issues”, they can deliver more parts and service expertise to dealers. Here’s some of what’s happening along these lines.
Non-Technical Support Hotline
The first gem in the latest changes to the way the field operates is one OEM’s support hotline that is available for dealers to contact directly. The hotline can handle all questions of a non-technical nature, such as parts expediting, billing, or warranty policies. Beyond that, some people on this hotline specialize in certain topics, which make them an even better resource to dealers than their parts and service field reps. Another advantage, from a corporate perspective, is that no one on the team is assigned to a dealer – they remain internally focused.
Learning and Leveraging IT Systems
One litmus test for computer programming is that if you ever find yourself copy-pasting something, there is an opportunity to automate the process. When evaluating their field force, OEMs applied this kind of thinking to realize that that their field reps were spending the first 15 or 20 minutes at each of their dealers explaining the basics of new initiatives or promotions. In other words, copy-pasting. So how did they “automate” this process and save their field 20 minutes talking about discounts and return policies? They now hold town-hall style conference calls and webinars to disseminate information about the programs that roll out on national or regional levels. While the time required to prepare this kind of meeting well exceeds 20 minutes, the number of dealers reached more than makes up for it.
Historically, multi-brand truck OEMs had unique field reps for each brand. In recent years, OEMs have moved from having a field force for each brand to a single field force for all brands. This trend started before the economic downturn, but has accelerated since. Much like the efficiencies gained from multiple brands sharing a DDS delivery network, multi-brand responsibilities eliminate the redundancy associated with two (or more) reps from a single OEM covering the same geographic territory.
Reinventing the Field Rep
Another source of lost time is time spent in cars driving from dealer to dealer. How do you cut the time the field spends traveling? Easy, the big car-guys know about this: “Virtual” parts and service reps that reach their dealers via phone, email, or webinar. Several OEMs are currently employing this strategy, and each of their virtual reps can serve approximately 70-100 dealers apiece. They have no travel costs, and dealers can call when they’re available and have a problem. Also gone are the days when field reps have to sit at a dealer and wait an hour for the service manager to become available.
Dealer reaction to this was neutral to positive – most dealers prefer in-person contact, but recognize the limitations of the current economy. Some rural and low volume dealers even liked this more: they end up with more contact than before, as the opportunity cost of contacting these stores has fallen drastically.
Bottom Line: Where Do We Go From Here? Reinvent the Field Rep – Again
Are there opportunities here to create hybrid field and virtual reps? When budgets loosen as we climb out of the recession, there are real opportunities to preserve some of these cost savings, but also boost service levels. A new hybrid parts or service rep could spend one week per month traveling to dealers and building face-to-face relationships, and spend the remainder of the month operating from a central office. This would keep time efficiency high while working from a central office, but the 12 weeks per year spent on the road could enable relationship-building with dealers to help the remote support be more effective.
The next phase in this evolution needs to also be accompanied by a shift in the way we measure the performance of the field. Currently, most OEMs track just sales or revenue as the metric. But the perverse incentive here is to erode margin in an effort to boost volume. Instead, the sales should be measured on profitability. One OEM is starting to experiment with this, but their efforts are just in their infancy.
We need to get the car-guys and truck-guys together to talk about what works and doesn’t work, and dream about what might work better.