AKRON (Oct. 14, 2002)—Can higher pay motivate technicians to embrace diagnosis? Robert L. O'Connor certainly thinks so.
A former service shop owner, Mr. O'Connor owns R.L. O'Connor and Associates Inc., an automotive consulting and management training company based in Seattle. In addition to traditional training workshops, he is widely known and respected for his company's Bottom-Line Impact Groups, which are built around owner/manager participation.
Mr. O'Connor's bold plan is to make competent technicians the proverbial offer they can't refuse: Pay them double their normal hourly rate for tackling diagnostic jobs. Here's why this concept can and is succeeding at progressive service shops.
First, this entire premise is based on the assumption that your tire dealership or service shop looks and acts professionally enough to charge for diagnostic time. In many previous columns, I've stated that premier service facilities successfully charge for diagnosis because overall they look like they're worth it.
Second, Mr. O'Connor understands that technicians gravitate toward the kind of repair jobs that yield maximum return on minimal effort, relatively speaking. In other words, they prefer the jobs at which they're most efficient. Efficiency is the amount of time the tech actually spends fixing the vehicle vs. the amount of time your dealership charges for it.
If a tech changes a water pump in one hour and you actually collect an hour's labor for the task, the tech is 100-percent efficient on that job.
For example, a technician knows that his boss will pay him X hours of labor to replace a certain water pump. By now, the tech has replaced enough of these water pumps to know how to do the job quicker—with greater efficiency—without sacrificing quality or risking a comeback.
He now knows that he doesn't have to remove this component or that one; he only loosens the bolts and pivots those items out of his way during this water pump job.
Therefore, the tech prefers these water pump jobs because he knows he can literally earn extra money simply by improving his own efficiency at the task: He does the job correctly in 65 minutes instead of 90 minutes.
Third, this same technician resists taking diagnostic work because he can't ratchet up efficiency on it the way he can on the water pump replacement. For instance, a vehicle has an intermittent stalling problem. It takes this tech an hour to pinpoint and correct the cause, which is a loose ground connection.
Traditionally, bosses who do pay for diagnostic time simply give the tech his standard hourly rate. So, this tech is paid one hour of labor to pinpoint and correct a bad ground. Mr. O'Connor explained that on this typical diagnostic task, the tech couldn't leverage up the efficiency the way he can on the water pump replacement. It's simple, straight labor time.
To make matters worse, diagnostic work requires more of everything than the water pump job does: More training, more knowledge and more specialized tools and testers.
Another unpleasant consequence of doing diagnostic work is the fact that your tire dealership or service shop often doesn't make any parts profit simply because no parts were required to fix the vehicle. In this instance, all the job required was cleaning and tightening a connection.
This means that at a time when motorists are clamoring for competent diagnosticians, both service managers and competent technicians often dodge diagnostic work because they perceive it as being bad business, Mr. O'Connor noted.
Can you blame them?
Mr. O'Connor argues that the best overall solution is to caucus with your technicians and learn approximately how much time it takes them to cover all the required fundamentals in the common diagnostic jobs. Naturally, this is a number that will require constant monitoring and updating. Then structure your diagnostic fees to accomplish two goals. First, charge enough to offset the lack of parts income on diagnostic jobs.
Finally, charge enough to pay good techs twice the hourly rate to do diagnostic work. Tune in to my next column where I'll continue this discussion. See you then!