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Developing a Lean Body Shop Business Model

Figuring out what problem you’re trying to solve in your shop is the first step toward creating a clear picture of where you want your organization to go.

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Contributing editor John Sweigart is a principal partner in The Body Shop @ (www.thebodyshop-at.com). Along with his business partner, Brad Sullivan, they own and operate collision repair shops inside new car dealerships, as well as consult to the industry. Sweigart has spent 21 years in the collision repair industry and has done everything from being an independent shop owner to a dealership shop manager to a store, regional and, ultimately, national director of operations for Sterling Collision Centers. Both Sweigart and Sullivan have worked closely with former manufacturing executives from Federal-Mogul, Morton Thiokol and Pratt & Whitney in understanding and implementing the principles of the Toyota Production System.

Nearly every conversation I have with those who are starting down the “lean” path begins with a question around some specific and structural concern, i.e., “How do you pay your people?” or, “How do you deal with a field estimate?” My answer is always the same: “What problem are you trying to solve?”

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Truthfully, I can’t think of a more appropriate response, but rarely is it understood. It’s almost as if being lean is the goal, and people just want to know what they should do next. Surprisingly, many self-proclaimed lean gurus would actually answer the question. There’s even people out there right now suggesting that there’s a lean shop model or estimating model that they can show you!      

Destination Unknown?

The vast majority of lean body shops have a serious destination dilemma. But fear not, the vast majority of all lean businesses have this same dilemma. It’s what drives the question, “What problem are you trying to solve?” Like any other destination dilemma, its path can be extremely dangerous, if not deadly. If you’re leading change, then you’re leading people, and if you’re not certain of where you’re leading them, you may just run them right off a cliff.

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I hear many conversations about how expensive and counterproductive a lean transition will be. This is dead wrong. It’s only when the destination isn’t clear that this becomes reality. In other words, it’s when you aren’t developing a lean business model but rather some assembly-line process that you’ll ask these same questions, realize these problems and, by default, have the wrong destination in your sights.
    
What Are You Trying to Do?

Jeffrey Liker, in his series of books on the “Toyota Way,” describes the Toyota business model as a pyramid of 4 Ps: Philosophy at the bottom, Process next, People above that, and at the top, Problem Solving. Most every comment I’ve heard or conversation I’ve had with others has been  around Process, as if it was the foundation of the business model. But what about Philosophy? Isn’t a process’s only purpose to achieve something? How can you talk about a process if you haven’t first discussed its purpose or intended outcome? Again, what problem are you trying to solve?

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So, what are trying to do? What are you trying to build? Do you know? Do your people know? Is your goal to be lean? Frankly, I’m not even sure what that means. I can tell you that when you walk through any real lean organization, you can see a lot of different things that, being so new and uncommon, quickly become “lean things” in the minds of observers, who then think those things must be what lean is. But that’s not only way off the mark, it’s also the reason that so many people get it wrong and struggle so much with lean.

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So I’ll ask again: What is it that you’re trying to do? Are you trying to achieve good cycle time? Great quality? Are you trying to generate more cash? Are these concepts that will move an entire organization? I guess what I’m asking is, are these your values and your beliefs as an organization? Are any of these things powerful enough to move your entire business in a new, unfamiliar and potentially frightening direction? Can your people believe in these values and place their future in your hands knowing that these are the things you say will get them to a better place? Will they follow you through unseen and uncomfortable situations to achieve, say, better cycle time?

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If a company has no principles other than maximizing profit, or its values are understated, workers will limit themselves to the least creative principle in business: pleasing the boss. Pleasing the boss will never take an organization any further than the ability of one man:  the boss. You better hope he or she is a genius who has at least a 200-year lifespan!
    
Define Your Values

What should your organization strive for? What should you believe in or what should you set as your long-term goals? I don’t know…that’s your business. But every successful organization has a clearly defined set of values that guide its every move.

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The organizations that last over the long term have a set of values that the vast majority of their people believe in. For example, how about our nation? It is successful? So far. Long term? Well, it has the longest lasting democracy to date. Values? It has the U.S. Constitution. How about your family or church or any other group? Behind these institutions are also stated values. But remember, history shows that organizations with stated values that aren’t philanthropic may have success but never last.  

Only until you state your values or your philosophy can you begin your lean journey. Now you have goals that the entire organization can support and get behind because they see the personal value in getting there. It’s not about just hitting some number because that kind of success fades quickly. But if you let your organization’s values guide you, you then find direction, and that’s where you’re going. It then becomes simple to understand what you need to accomplish next. These are the things that lean addresses.

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If we all have individual organizational destinations, then conversations around how any process works or should be executed is clearly irrelevant. It’s when people start using one man’s solution to solve another man’s problem that things go sideways. It’s only relevant when we’re trying to solve the same problem.  
    
An Eye Opener

What should be your next step? If you haven’t clearly defined the organization’s values or long-term philosophy, do so immediately. If you haven’t stated them verbally, you’ve probably stated them through your actions, and then your entire organization understands. In many cases, this exercise is a real eye opener and can in itself begin to change your organization. After all, what you believe equals how you behave. This rule even works for those who create the rules.

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Once you state what you believe, it’s a great reminder of what you believe in and how you should behave. It’s a constant little tap on the shoulder when you’re in the heat of the battle and ready to ship that car with a poor headlamp fit or tear that technician up for losing a part. Your stated values will begin to shape and change you and your organization’s behaviors. At the end of the day, this is what we’re trying to do with lean: change our people’s behaviors, for the sake of the customer, to achieve better outcomes for all.

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If you feel like you’re the only one who gives a damn and no one in your organization is buying in to your lean transition, ask yourself, “Have I clearly defined where we’re trying to go?” Do they know that this transition is about them, too? That it’s about all of us? Do they know you care and have them in mind, too? How can you create a successful model of continual improvement when you haven’t told anyone what you’re trying to improve?

You can’t just tell your people you’re trying to improve some number (although that’s what you may be going after right now). You have to explain why that number is important to them and to the future of the entire organization. 

Contributing editor John Sweigart is a principal partner in The Body Shop @ (www.thebodyshop-at.com). Along with his business partner, Brad Sullivan, they own and operate collision repair shops inside new car dealerships, as well as consult to the industry. Sweigart has spent 21 years in the collision repair industry and has done everything from being an independent shop owner to a dealership shop manager to a store, regional and, ultimately, national director of operations for Sterling Collision Centers. Both Sweigart and Sullivan have worked closely with former manufacturing executives from Federal-Mogul, Morton Thiokol and Pratt & Whitney in understanding and implementing the principles of the Toyota Production System. You can e-mail Sweigart at [email protected].

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