Lessons in Leadership
It was 9 p.m. and nearing the end of a 12-hour day—another in a long line of 12-hour days for Scott Travers. All of his employees at Quality 1 Auto in Temecula, Calif., had gone home hours before.
Travers had spent the entire day “putting out fires,” he says, and was now staring at the paper trail signaling the money his shop was burning through.
They had a steady car count. They generated sales. They had loyal customers.
None of it mattered.
“It was one of those things where we were profitable most of the time, but all I was doing was hoping we had the money in the bank to make payroll and to pay the mortgage and bills and everything,” Travers says. “I was living by the bank account.”
His managerial approach wasn’t working.
By nature, Travers is nonconfrontational. As his shop grew throughout its early years, he struggled more and more as a leader.
—Scott Travers, owner, Quality 1 Auto
“I avoided conflict,” he says. “It’s really that simple. I would do just about anything to not have to deal with certain situations. I was worried about being their buddy.”
Because of that, his employees formed bad habits that never broke. Techs were misdiagnosing cars and blaming it on the parts. Service advisors were failing to sell work and blaming it on bad diagnoses.
Travers’ shop lost $64,000 in 2010, 11 years after it opened. He needed to make drastic changes if he wanted his business to stay open.
A former technician, Travers started Quality 1 as a one-man, one-bay facility in 1999. He worked on cars, handled customers and the service writing, and gradually grew a steady stream of sales.
As the business became larger, he hired another technician, then another, and then moved into a new seven-bay shop across town.
“It was the same as most shops: You just take the next indicated step in front of you,” he says. “You get too busy, so you hire more people. You get too crowded, so you get a bigger shop. You keep expanding, but that doesn’t mean you know what you’re doing and you don’t really understand how to manage any of it.
“All of a sudden I had a service writer, two technicians and a whirlwind of business, and I had no idea where to go with it.”
The smaller a shop is, the easier it is to manage, Travers says.
“When it’s just you, you control all of it. When there’s just another guy, you’re right there with them, so you always have an eye on everything,” he says.
“Then you get the third guy, and you start seeing problems. Then, there’s a fourth guy and even more problems.”
While the business continued to generate healthy sales (it did $658,000 in 2010), it went in and out of profitability. He was seeing regular comebacks with customers, as vehicle issues were going unfixed or unsold.
“I was trying to breed this environment where everyone is happy,” he says. “And it got to a point where they were just shooting from the hip on diagnosis. If they did a brake job, and it was still squeaking like crazy, and it came back, they’d tell me it was a bad part. Instead of telling them it’s their fault and making them do it again at their cost, I’d roll over.”
And Travers worked around the clock to make up for it. He would spend his entire day “putting out fires” his employees started, then spend the evenings poring over the paperwork and finances, trying to make it all add up.
Once his bank account started running out, he realized he needed to do something different.
Travers wasn’t oblivious to his issues as an owner; he knew exactly where he stood as a leader of his business. The issue was trying to figure out what do about it.
The way he saw it, his options were pretty clear.
“You see it a lot with shops as they grow and can’t figure out how to handle the growth,” he says. “They either back up to where they were—drop some techs, make the shop smaller again—or they sell it to someone who’s willing to take it on.
“We were bringing in a lot of sales. I could’ve sold (the shop). I didn’t want to do that, though. I wanted to fix it and make it work. I wanted to keep building it.”
Around the time his shop took a big loss in 2010, Travers decided to get some outside help and hired a business coach.
“I knew my mindset was wrong. I knew there were issues (in the shop), but I didn’t know how to fix them,” he says. “Like any owner that starts out as a tech, you have that mechanical mindset, and that’s the wrong personality to have. I was constantly trying to put out fires instead of preventing them from happening. I needed someone to take an objective look.”
With a coach’s help, Travers began putting together an operational manual for the shop, an all-encompassing document of every procedure for every operation in his business, from requesting days off to answering the phone to verifying a diagnosis.
The point to it, Travers says, is to show every employee exactly what’s expected in every situation in the shop. He has them read it over and sign it. And then, Travers holds them to it.
The process forced Travers to confront difficult issues in his shop, like a service writer that wasn’t writing much service. Travers gave him a chance to improve, but he didn’t. So he was fired.
The changes didn’t occur overnight, but nearly two years later, there are two ways to look at Travers’ transformation.
The first is the shop’s bottom line. The second is the thick, bound operational manual he keeps on the desk in his office.
In 2011, the shop’s annual revenue rose by nearly $200,000 and it was profitable throughout the year. In 2012, the shop has soared to record levels. After Travers fired his service writer—and hired a much more qualified and motivated one—sales rose 36 percent over the previous year. Through Sept. 1, the shop was on pace for $1.27 million in 2012 with a net profit margin over 20 percent.
How’d it happen? That’s where Travers’ manual comes in. For a year, Travers went through every process in his shop and documented how it should be done. If something new came up, he added it in. Pretty soon, his shop was fully trained and aware of each situation they would face and exactly how to handle it.
For instance, every diagnosis has to be verified twice: before the work is performed and after it was fixed. And if a diagnosis isn’t clear, techs have to give the customer two options: “They tell them that we can’t 100 percent verify it, but based on what we see, we believe it is this. Or, they tell them they need to come back when the situation worsens.”
From the way his service writers answer the phone (they now have an exact script of what to say and even how many rings before they answer) to what type of keys customers need to bring in for making duplicates, Travers now has a procedure in place for everything.
Travers doesn’t feel he’s much better at confrontation; he still doesn’t like it, and he still struggles with it every day. But now he has a way of dealing with it.
“There are some owners that just come out and scream at you, but it’s so far from my personality, I just can’t do it,” he says. “I just go out and say this is how we do it, it’s in writing, you agreed to it and you have to do it.”
Travers also finds himself at the shop a lot less. What used to be 14-, 15- or 16-hour days for Travers are now more like six or seven—with a two-hour lunch break where he goes to the gym.
“When you have procedures in place, you’re building something that can run on its own,” he says. “People know what to do, and I trust them to do it.”
“Everything is about practices and procedures. If you know what makes your business successful, and you know what customers you need, how to handle them, how to handle the work, you’re going to be successful. And you’re not going to be there 16 hours a day putting out fires, because you’ve already made sure they aren’t going to happen.”