Friday, January 9, 2015

Parts Manager Satisfaction: The Industry Continues To Move The Needle
by Harry Hollenberg

In 2014, Carlisle & Company conducted the 13th annual North American Parts Manager Satisfaction Survey. Supported by 40 automotive brands/OEMs across North America, this industry-syndicated survey solicited responses from over 9,500 parts managers. Response rates continued to hover around 66% for the industry, with 20 unique brand/countries achieving > 90% response rate.

U.S. brands led in terms of Overall Satisfaction, with an average of 55% top-box satisfaction – up four points from last year. Mexican brands showed the biggest gain, jumping from an average top-box satisfaction of 29% in 2013 to 49% in 2014. Finally, Canadian brands stayed constant at an average 41% top-box satisfaction.

Year-over-year increases outweighed decreases on a roughly 3:1 basis, with the biggest improvements exhibited by two Mexican brands – each gaining over 30 points in Overall Satisfaction. In the U.S., the biggest gainers benefited from a “return to normalcy” as they managed to straighten out their supply chain systems.

  This chart looks at 2014 Overall Satisfaction across the individual categories, with the candlesticks representing industry high, low, and average. U.S. brands represent 13 of the best-in-class scores, Mexican brands represent three, while Canadian brands represent the remaining two.

Similar to previous years, Parts Representative, Order Processing Phone Support, and Order Processing Systems have the highest average satisfaction, in the 60%-70% range. Also like previous years, Pricing and Accessories have the lowest average satisfaction, right around the 30%-40% mark.

It is interesting to note that the company with the most “best-in-class” ratings also has the highest satisfaction with Pricing. As discussed in our November 14th blog, we consistently see that parts managers are relatively more satisfied with pricing (relative to the rest of the industry) when they are satisfied with the rest of the areas in which the OEM supports them. Dealerships don’t usually like paying OEM parts prices, but it is easier to accept when they feel the OEM is doing a good job of supporting their needs.

So, what were some of the key process/people/policy changes that the biggest “movers and shakers” made over the last year? Some of these (which were documented in more depth with the participating OEMs) included:
  • Reducing minimum piece prices for allowable parts returns
  • Streamlining communications describing material return process and policies
  • Improving fill levels by leveraging offerings of inventory management system, including conducting simulations and modifying stocking parameters
  • Focusing on back order reduction by intense monitoring (e.g., detailed daily B/O reports), heightened focus on expediting, better planning for inventory needs (especially for accessories and promotional parts), and increased sharing of status (with brands, customer care, etc.)
  • Offering faster order response time to smaller/remote dealers
  • Upgrading speed and reliability of electronic parts catalog system
  • Redesigning order hotline to assure each call/request is closely monitored and dealers are provided frequent updates on progress
  • Most notably, one OEM opened a Canadian PDC, rather than supporting their Canadian dealers out of the U.S. This OEM experienced a 30+ point gain in satisfaction after this decision.
In fact, the industry continues to make dramatic strides across all facets of parts manager satisfaction. As shown on this last chart, OEMs with best-in-class improvements saw gains ranging from 12 to 45 points across the entire spectrum of parts manager support. Clearly, there are still improvement opportunities available, and information gleaned from Carlisle’s surveys will help OEMs focus their limited resources on the right initiatives.

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