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Sales Training

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Sales Training

  1. 1. June 28, 2005. Call in at 12:55 p.m. Eastern Time Mark Dixon Bünger Claire Schooley Principal Analyst Senior Analyst Forrester Research ForrTel: eLearning For Auto Retail Success
  2. 2. Theme Fast, efficient learning is good for business
  3. 3. Agenda <ul><li>Drivers for learning online or with mixed media </li></ul><ul><li>Costs of using non-traditional learning approaches </li></ul><ul><li>Technology required and benefits </li></ul><ul><li>Case Studies: AutoNation, Toyota, and Volvo Construction Equipment </li></ul><ul><li>Business case development </li></ul><ul><li>Some vendors in the eLearning space </li></ul>
  4. 4. Auto retail needs to get smarter every day . . . <ul><li>New products </li></ul><ul><li>New promotions </li></ul><ul><li>Sales techniques </li></ul><ul><li>Legal and regulatory requirements </li></ul><ul><li>Customer service </li></ul><ul><li>Maintenance, diagnostics, and warranty </li></ul>
  5. 5. . . . for thousands of current and new employees <ul><li>Auto dealerships employ 1,129,600 employees* </li></ul><ul><li>Turnover averages 92% annually, highest in sales† </li></ul><ul><li>Tech retirements increasing; 12,000-35,000 new mechanics needed annually (of 820k total)‡ </li></ul>* Source: NADA Data 2005 † Source: CNW 2001 ‡ Sources: Automotive Youth Educational Systems (AYES), Association for Career and Technical Education (ACTE), Bureau of Labor Statistics
  6. 6. There is a need for more learning <ul><li>Tom Purves, CEO of BMW of North America, </li></ul><ul><li>said dealers are clamoring for &quot;more training than we can actually provide .” </li></ul><ul><li>“ Ford Motor Credit Co. will reassign about 75 salespeople to train dealership finance and insurance managers . . . Captive finance customers are 20% more likely to buy another Ford; for lease customers, owner loyalty is 32% higher. Of Ford and Lincoln-Mercury retail customers, 59% signed up for vehicle loans with Ford Motor Credit.” </li></ul>Source: Automotive News , February 07, 2005
  7. 7. So how do you do it? <ul><li>Determine whether it’s a training problem </li></ul><ul><li>Build the business case on hard savings </li></ul><ul><li>Determine the need for an LMS </li></ul><ul><li>Evaluate proposals and make your choice </li></ul>
  8. 8. Determine whether it’s a training problem <ul><li>Why is the employee not performing? </li></ul>Willing Able Allowed Aware = motivation problem  change compensation = skills problem  train! = policy problem  change rules = information problem  change communication
  9. 9. Tools for learning Very scalable Not scalable Very scalable Scalable Not scalable Scalability Continual content updates Additional wages High upfront cost of applications, infrastructure, content Expensive to develop; can’t update easily Materials, duplication, travel, instructor, per diem, location costs Costs Self-reporting Database LMS, LCMS, authoring tools, learning objects, competency mgmt. skill gaps, analytics Checklist Database Database, LMS Tracking PDA Review material just-in-time On-the-job learning Shadow and work with others Self-paced eLearning; simulations Work independently; interact with online content Videos Watch in viewing room Books , Classroom manuals, instruction workbooks Read on own Attend class, discussions Material
  10. 10. Three delivery methods in a blended environment Instructor-led training Virtual classroom Self-paced training
  11. 11. Determine the need for an LMS <ul><li>Number of learners </li></ul><ul><li>Number of learning experiences </li></ul><ul><li>Dispersed learner locations </li></ul><ul><li>Record maintenance </li></ul><ul><li>Certification </li></ul><ul><li>Customer learning </li></ul>
  12. 12. Basic LMS Functionality From: Managing Learning: An Essential Component To Business Success, September 2004
  13. 13. Common components of an eLearning integrated suite From: Managing Learning: An Essential Component To Business Success, September 2004
  14. 14. Learning… Where it comes from and where it’s going Classroom On-the-job Computer-based training Integrated learning and work Point A Point B Point C
  15. 15. AutoNation (Case study)
  16. 16. Case Study: AutoNation “Knowledge Central” <ul><li>“ How are you going to train 28,000 people to perform standardized processes? . . . and there are thousands of new people every year.” </li></ul><ul><li>In the past </li></ul><ul><li>Text-based, video, and classroom training </li></ul><ul><li>16-20 booklets (one for each process) as well as VHS videotapes. “A 6,000-page manual written by some marketing guy that nobody’s going to read.” </li></ul>
  17. 17. Now <ul><li>Created series of online courses covering wide range of standard operating processes </li></ul><ul><ul><li>CRM tools </li></ul></ul><ul><ul><li>Inventory management </li></ul></ul><ul><ul><li>. . . even “How to answer the phone” </li></ul></ul><ul><li>Launched with six modules in Q2; goal is 15 modules (60-90 minutes each) in 2005 </li></ul><ul><li>All employees, including legacy, will be retrained </li></ul>
  18. 18. The high points <ul><li>Vendors: Sparrow Interactive and ADP </li></ul><ul><ul><li>“ (ADP) have some pretty slick stuff. They developed an interactive module for their custom inventory management tool. They trained our people and they LOVED it.” </li></ul></ul><ul><li>Training distributed via Citrix-based DealerCentral (AN portal); available to users via tab called Knowledge Central. Training available at any time, at users’ fingertips </li></ul><ul><li>The business case: KISS </li></ul><ul><ul><li>“ It used to be $100k per online module hour; now it’s $45k. We keep it simple; not like an OEM that might spend $1 million to include a bunch of video.” </li></ul></ul>
  19. 19. Volvo Construction Equipment (Case Study)
  20. 20. Case study — Volvo Construction Equipment <ul><li>A worldwide provider of large construction equipment with 8,000 employees in the US </li></ul><ul><li>Frequent changes in product and service strategy </li></ul><ul><li>High turnover in sales staff in North America </li></ul><ul><li>Needs fast training because of expanded product </li></ul><ul><li>Traditional instructor training too erratic, time-intensive, and costly </li></ul>
  21. 21. Original model of sales training Front-line sales staff VCE product specialists VCE district manager VCF finance specialists Regional and dealer product specialists Dealer sales manager Dealer finance specialists Training on all products, processes, and support Train the trainer Etc.
  22. 22. New system installed <ul><li>QuickTrack — 33 course sales-training modules linked with hands-on training </li></ul><ul><li>Filled a learning vacuum for sales personnel and managers </li></ul><ul><li>Cultural issues addressed with one-on-one help </li></ul><ul><li>Development cost $500,000 over two years </li></ul><ul><li>District managers can focus on other areas of need </li></ul>
  23. 23. eLearning structure: Dealership personnel Front-line sales staff VCE product specialists VCE district manager VCF finance specialists Regional and dealer product specialists Dealer sales manager Dealer finance specialists Etc. QuickTrack basics
  24. 24. Market share growth percentage Market share growth percentage (YR 2003 vs. YR 2002) Branch salespeople split into three categories — no training, Web training, and Web and hands-on training 101 110 131 Not trained Web only Web and hands-on
  25. 25. Toyota (Case study)
  26. 26. Case study: Toyota Dealer Simulations 4. Action plan 2. “Discovery Session” 3. Feedback 1. Dealer simulation
  27. 27. Dealership simulation: Parts and service department <ul><li>Service revenue is currently dependent on warranty </li></ul><ul><ul><li>But warranty work is declining as vehicle quality is improving </li></ul></ul><ul><li>Customer-pay work is declining </li></ul><ul><ul><li>Independent repair shops are a threat to customer-pay </li></ul></ul><ul><li>Capacity is constrained </li></ul><ul><ul><li>Improve shop productivity and technician efficiency </li></ul></ul><ul><ul><li>Brick and mortar investment in more service stalls </li></ul></ul>
  28. 28. Parts and service (cont.) <ul><li>Parts: Potentially higher margin business </li></ul><ul><li>Inventory management: Low inventory turns </li></ul><ul><ul><li>Same day fill rate vs. obsolescence expense </li></ul></ul><ul><li>Low accessory sales </li></ul><ul><li>Retail and wholesale parts sold </li></ul>
  29. 32. Developing a business case <ul><li>Must show that eLearning will be worth the investment </li></ul><ul><li>Look for a learning situation that lends itself to learning online </li></ul><ul><li>Establish measurable outcomes </li></ul>
  30. 33. Developing a succinct business case <ul><li>What is important is not what is spent, but what the organization gets in return </li></ul>We want THIS number “ We are doing to make better, as measured by , which is worth $
  31. 34. Developing a succinct business case (cont.) We are implementing an eLearning training program to increase effectiveness of sales staff training , as measured by increased sales performance , which is worth $900,000 .
  32. 35. Vendors <ul><li>Learning management system (LMS) vendors </li></ul><ul><ul><li>SumTotal, Saba, Pathlore, Plateau Systems, WBT Systems, GeoLearning </li></ul></ul><ul><li>Virtual classroom and rapid eLearning vendors </li></ul><ul><ul><li>Macromedia Breeze, WebEx, Brainshark </li></ul></ul><ul><li>Dealer training specialists </li></ul><ul><ul><li>ADP, Reynolds and Reynolds </li></ul></ul>
  33. 36. Recommendations <ul><li>Determine what part of the performance problem is truly a training issue </li></ul><ul><li>Establish an eLearning program for consistent, fast distribution of informal and formal learning to distributed learners </li></ul><ul><li>Prepare the learning culture for the online learning experience . . . it can make or break the program </li></ul><ul><li>Track employee learning through a learning management system </li></ul><ul><li>Use authoring tools consistent with the nature of the content (and keep it simple) </li></ul><ul><li>Integrate learning with everyday work — don’t make it something dealer employees must “go away” to do </li></ul><ul><li>Mix training, practice, and simulation online </li></ul><ul><li>Use eLearning to prepare employees for real-world simulations and OTJ practice </li></ul><ul><li>Let eLearning outcomes drive OTJ to-dos/actions </li></ul><ul><li>Measure performance improvement in operational and dollar terms </li></ul>
  34. 37. Selected bibliography <ul><li>March 29, 2005, Tech Choices “Learning Simulations: From Simple Tools To Custom Solutions” </li></ul><ul><li>March 29, 2005, Trends “Simulations: An Emerging Technology For Building Employee Skills” </li></ul><ul><li>January 12, 2005, Best Practices “Driving eLearning Through The Dealer Portal” </li></ul>
  35. 38. Thank you Mark Dixon Bünger [email_address] Claire Schooley [email_address] www.forrester.com Entire contents © 2005 Forrester Research, Inc. All rights reserved.

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