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Why does motor retail have such a problem with management?

Piers Trenear-Thomas

The automotive retail sector needs a more rational approach to management.

AM ran a story in its talent pages recently entitled ‘Should automotive retailers try to tempt high street managers?’ One of the conclusions was that it was difficult for middle managers to make the transition because of the different level of complexity and specialist knowledge involved in running a business with the diversity of “new, used, service, parts and bodyshop to manage”.

This does rather underline the problem. The function of those middle managers should be to facilitate problem-solving. The job of the team leaders reporting to them is to understand the ‘specialist knowledge’ and to receive assistance in defining, proposing and implementing improvement experiments to better apply that knowledge. If the middle managers try to understand it, they are second-guessing those with better knowledge of the detail than they have. Wasteful effort.

The barrier to improving the management structure is the idea that everyone should know a bit of everything, that you move up the chain by imposing that knowledge more aggressively and the badge of seniority is that you have more answers than the person below you.

A more rational approach is to accept that the person who knows most about the work is the person who does it.

Then that the person who does the work needs a team leader who understands the work, but also the wider context of how it all fits together.

Then that the team leader needs someone who understands how to solve problems to coach and assist in smoothing out the issues running through that wider context.

Then, finally, that all people are operating in a rational environment where the direction of travel is clear and consistent and one that everyone can buy into, which is the job of board members/senior management.

Car retailing does not look like that. Managers have been rewarded and promoted, since time immemorial, for being successful at shooting from the hip, putting out fires, cracking the whip and being sparing with the carrots. All the way up to board level. Wasteful.

Groups have been searching for more effectiveness in a variety of ways. It would seem, however, that most have been focusing on cost, rather than on changing the structure.


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