Opinion: What Is Your Organizational Chart Saying?

A picture of magazine columnist Valerie Ziebron

We happened upon the organizational chart’s power by accident. A dealer had scheduled a call to discuss growing pains. Before the call, the dealership emailed us a copy of its organizational chart.

VRZ has done hundreds of similar calls but having that chart before us was pure genius. The call was productive, and we covered so much ground quickly. I felt as if I already spent a day visiting the dealership.

At a glance, your organizational chart allows you to see everyone in the dealership: names, positions, who reports to whom, the length of each person’s tenure, who is family and much more beyond the basics.

Viewing the chart objectively, many dealerships reached an epiphany that helped them in numerous ways. One page can help pinpoint why:

  • You are struggling with turnover in certain positions.
  • Customer experience is compromise.
  • Drama and conflict are happening internally.
  • Some areas are not as profitable as they should be.
  • Management’s time and effort is being overtaxed in certain areas.
  • Some positions are destined for failure no matter who you hire.

Since that call, I now request an organizational chart before working with a dealership. Unfortunately, not many dealerships maintain one. Often, they send an employee roster with job titles, but the roster does not really show you, or your team, the true chain of command.

If the team is unclear about the organizational structure, confusion and potential conflict will likely ensue.

So, let’s start by defining exactly what an organizational chart is and what it should look like. As we do, remember seasonal dealerships might have a chart that looks much different in January than in July. It is a living document, updated every time you make an adjustment in staffing or job positions.

Every team member should be clearly represented on your chart by name, position, who they report to and who reports to them to prevent confusion among employees.

To make your chart look professional, online programs are available to help. Usually, I start by simply sketching out a chart by hand.

When you start laying out or looking closely at your chart, you might start seeing why things are not going as smoothly as you would like. Some common issues we learned to identify as red flags include:

Everyone reports to
the big cheese.

Dealers or GMs might have too many people reporting directly to them, people who need the boss to intervene to get daily work done. You never will have enough hours in the day to do everything well. You have to choose, and some person or department will get the short end of the stick. In the end, you will wear yourself down and not be very effective. This happens mostly with Type-A leaders and dealerships that experienced fast growth.

Ratio of managers
to workers.

Look at your number of managers versus employees. Some stores have so many “managers,” yet no true leadership for workers to follow. Others have few managers and many workers, who are trying to get a minute with a manager to answer a question or make a call.

When dealerships specifically request help with their shops, one frequent problem we see is the sales department has a clear and effective chart, but the service and parts departments do not. The service and parts department charts look like a bowl of spaghetti, with the chain of command confusing everyone. Sometimes people are given the “manager” title, but their daily tasks are so consuming, they have no time for true management tasks. This happens often with service advisors or service managers who are consumed with advisor duties.

“Managers” who are not in charge of departments or people.

If you have a title that suggests you are in charge, yet you are not specifically overseeing a department or people, chances are good you will frustrate everyone and not have much accountability. We most often see these titles given to children of the dealers’ ownership or employees who were inherited from a previous owner. This practice is not fair to the team nor to the children, as it sets them up for failure.

Workers who have multiple bosses.

When you are taking direction from more than one person, you likely will not make everyone happy. This is incredibly frustrating and unfair to the person doing the work. This situation happens most frequently with lot attendants, forklift drivers, detailers and technicians. Sometimes the chart clearly lists the dealership’s hierarchy. Other times, people are not honoring the chart and going around the chain of command. For example, the GM is not consulting the service manager or advisor first. Rather, the GM is pulling a tech or lot worker off a job to do something else.

Organizational charts are not one-size-fits-all or even something you can pick up in “small,” “medium” or “large” to perfectly fit your store. Every dealership looks different. Often, dealers with multiple locations are surprised to see how each store is unique from the chart’s perspective.

Sometimes, identifying that a dealer needs a service advisor and a service manager to handle lots of techs is easy. Adding staff is not always the answer when work is being performed inefficiently. Maybe the wrong people are in certain positions. Maybe their job descriptions or processes are unsuitable.

To help answer these questions and more, consider combining your dealership’s organizational chart with a professional financial review. VRZ consultant Carrie Stacey said: “A balanced organization with clear lines of authority results in an efficient and effective organization, which translates directly to a healthy bottom line. When a dealership is struggling financially, it often comes back to processes that need improving, and this jumps off the page when the people, lines of communication and authority, and the roles are laid out in an org chart.”

Dealers often say, “We are understaffed.” However, the financial statements show a clear picture of whether your payroll spending in each department is within range and how well the department is performing.

What is your organizational chart telling you? Take a fresh look to see if it is helping or hurting your team’s work toward the dealership’s common goals.

Valerie Ziebron is a leading industry expert and top-rated speaker.  She has delivered thousands of presentations for dealers and their OEM partners to help dealerships ‘flip the switch’ from reactive to proactive business practices.

She started VRZ Consulting in 1989 and has worked with hundreds of clients, big and small, to increase customer loyalty and profitability along with job enjoyment.

313.506.8069   |   vrzconsulting.com

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