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Overcoming Resistance to Change in a Lean Environment

With change comes resistance and pushback. But here are some ways, when implementing lean, to get everyone to trust that what you’re
doing is a better way.

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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.

At the core of lean is change that improves things not just for the customer but for all parties involved in a business transaction. That means that it creates better things for you and your employees, vendors and business partners.

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But with change comes resistance. In many cases, the very people you’re trying to create a better situation for can become the biggest detractors of the improvement.

Pushing Back Pushback

A frequently asked question from those in the midst of implementing change is, “How do you deal with pushback when trying to make changes that involve these outside parties?” It’s an interesting question, so I ask them, “Where’s the pushback?” The common answers are: “It starts with my own staff, who are expressing lots of concern about a new way and how it’s going to affect them.” Or, “It’s the customers, because what if they become concerned about us trying something unfamiliar? They’ll ask, ‘Is this right?’ or, ‘No one’s ever done it this way before.’” Or, “It’s also our vendors, who may say, ‘You want me to do what?’ or, ‘We don’t do it that way.’” Or, “It’s the insurers and their reps, who will commonly say, ‘It doesn’t work like that,’ or, ‘I tell you how we work, not the other way around.’”

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The shop owner who’s concerned about all this pushback needs to figure out what’s causing it. From my experience, I can tell you that technicians are concerned about pay. But as long as they believe in you, they’re generally supportive. The reason vendors might be concerned is because no one has ever asked them to do things much differently. In most cases, a conversation with those in charge of their bottom lines or those with an eye toward the customer will result in you being able to do what you need.

Maybe those are oversimplified responses; each concern could be a long discussion. But for us, the majority of concerns around supporting change comes from the customer, and most shops struggle with this. So for now, let’s look specifically at the customer.

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A Common Thread
Most in the lean community would look at the concern about customers and say, “What do you mean your customer is concerned with the change? The entire objective of lean it to better serve the customer, so if you’re having trouble with them buying into your change, then you’re working in the wrong place, dummy!”

But we’re in the collision repair industry, and as we all know, few other industries have lost so much connection with the customer. Many would say we’re nothing more than a commodity forced to serve two masters who have diametrically opposed needs. Those of us who believe that our only customer is the vehicle owner fight the backlash and bad-mouthing influence of insurers. Those of us who believe the insurer is the only customer fight the vehicle owner influence and our industry colleagues, ultimately working toward mutual destruction. And those of us who believe both the insurer and vehicle owner are our customers either succumb to the impossible pressure of pleasing both sides or…they find the common thread.

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If you mapped out everything both of these customers want, you would find that it comes down to the same thing: quality, service and price. They all want good, quality work and excellent service. Also, they don’t want to get ripped off or overpay for what they’re getting.

Quality, service and price are translated into many different things for both sides but, peeled back, the commonalities really do live here. So if what we’re trying to deliver is so common, where’s the trouble? Why doesn’t it feel like all of us are looking for the same thing?

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Take quality, for example. To the vehicle owner, that might translate to OEM parts. To the insurer, that might translate to any kind of part, as long as it looks and functions fine. These two translations seem dissimilar, but dig deeper and you might find that there is something common here: the customer’s sense of confidence in the repair.

As far as good service goes, the vehicle owner might think that translates to receiving a rental car to drive during repairs. To the insurer, it might translate to a timely estimate upload and parts at the shop before drop-off. These two translations don’t appear to be the same thing, but upon further analysis, we find that the one commonality is that both parties are after an easier experience.

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With price, shop owners want what’s fair for their effort. To insurers, that’s more like a cheaper price for their efforts. Both sides here have an argument over which one better serves the customer. For us, fair price protects the customer’s investment because the job will be done “right” – sort of pay now or pay later. Cheap price for insurers means keeping rates down for policyholders. It’s the same thing for them, really – if we pay more now, you’ll pay later in the form of rate increases. Clearly, we’ve got some gaps here in thinking, and the trick is to discover how we can start to close them.

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So, thinking about all that, the question then becomes, “Isn’t there a solution where all parties can win?” Can we do quality repairs at an affordable price with high levels of customer service, while at the same time create a better outcome for our business, employees, community, vendors and business associates (I won’t call them partners just yet)? Lean business models believe that they can do this, and work to do it every day.

Roadblocks

For those organizations struggling with this unique problem of getting all parties to support change, it comes down to this: Those parties must believe that you’re in fact trying to better serve them. Examine the roadblocks:

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There’s incredible mistrust on both sides and all levels. I don’t need to go into all the details here because we all know what they are, but we have a history that’s hard to erase. The insurers feel like the big target with deep pockets that everyone’s trying to get into, including their own employees and customers. We feel like the fall guy, getting abused because we’re too small to win the fight.

The decision-makers aren’t in your shops. With the amount of cash and power at their disposal, your local guys are much like bank tellers or foot soldiers. Their culture says, “You will do it this way…no exceptions.” The problem is that we have little access to the real decision-makers who, if they would sit and listen to the concepts or changes we’re proposing, would support the new ideas. But even then, when we finally got an audience, changes would be slow to come because of their massive size and would be greatly compromised by the time we saw them. Often, these decision-makers can see that it’s a better way, but they can’t do anything about it.

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Many drivers are nervous about even reporting a claim, let alone going against the grain. Although most people in conversation might feel differently, when they’re up against these massive organizations, they’ll concede to their requests. Let’s face it, insurers have done a good job of scaring consumers with insurance fraud marketing programs and threats to cancel policies. We stand little chance of having consumers do something that they believe is not the way they were told to do it.

Most drivers are completely unaware of how things work. We’re a once-every-seven-year need. Every day, we still see customers come in and ask for an estimate because they think they need three. We can’t get along long enough with our colleagues to put together a large-scale marketing program to educate consumers. Most customers only have the memories of the last time they needed us, or just stories from friends and family. For these folks, believing in your better way is impossible because there’s no reference point.

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Many drivers are leery about body shops. No secret here. Many of our forefathers didn’t do us any favors (no disrespect to those longtime organizations that have done it right – thank you to them). But many consumers have a less than professional picture of the body shop in their heads, so you’re starting with almost no faith from the customer.

Truth vs. Perception

If we’re going to change for the better, we must overcome these roadblocks. So how do we do this?

First, you’ll need to separate truth from perception. To do that, you’ll have to figure out how much of your concerns about change are in your mind. Often, you’ll find that the change you fear is there only because you’ve always done things a certain way. Let’s face it, you wouldn’t have done it that way for so many years if you didn’t believe it was right. Now you’re going against your own beliefs, which isn’t easy. The key to doing this is having a combination of trust, which may come from experiencing the change or testing it out first.

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If you’re going to make a change you believe is for the better, then surely you’ve done some math or mapped the new way first. You must have faith that your thinking is correct based on your upfront work. In a lean organization, you would never make a change without going through this process first.

Next, test the new way. Whatever the change is you would like to try, test it on someone. See what kind of feedback you get. In many cases, you’ll find that everyone is actually comfortable with the new way.  Again, separate perception from reality first, then move forward with confidence. Believe it yourself.

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Step Up
There’s one easy way to overcome the mistrust: Step up! What is the source of the mistrust? It’s almost always about the money: “You’re trying to take me,” the other party thinks. So just step up.

For example, maybe your change is to not waste time writing estimates anymore (you can read more about this in Out with Estimating from the October 2008 BodyShop Business). The concern from the insurer or even the self-pay customer is that it’s going to take longer to fix the car because you don’t have an estimate to order parts and that ordering and receiving parts first makes the job go faster. Since the repair will take longer, there will be more rental cost. The truth is that, mathematically, this outdated process only extends the cycle time of the repair because if you don’t have all the parts, you can’t deliver the job. The estimate doesn’t get all the parts and only delays finding the hidden damage. The delayed exposure of hidden damage plus the additional wait time for parts equals longer cycle time.

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Regardless, the fear is longer cycle time. So take that fear away and commit to paying any additional rental, no questions asked. This is called getting at the root of the mistrust and stepping up. If you’ve done your homework, you’ll realize that there is no cost to your change. If there is, then it’s a change that doesn’t serve the customer.

Post Your Results

So how do you overcome the fact that the decision-makers aren’t located in your shop? Clearly, there are many insurers that are not going to let you do things outside of your agreement no matter how good they appear. Fine. The trick, then, is to find the one that will. Or maybe it’s only for those that you don’t have an agreement with, where you’re not obligated to an insurer on a field claim to do anything a certain way.

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Next, make the results others are getting thanks to your new way very visible. Compare and post your performance results where everyone can see them. If you do that, you’ll be asked very quickly, “How come it’s so much better when you do it for them?” Once you reveal the answer, in most cases, you’ll find that the others will ask for the same benefits. At the end of the day, if you can improve your performance for any percentage of your business, you’re by default getting better results.

How Does It Work?

In nearly every case, if you can explain your new way in simple terms that make sense as a win for all, you’ll find that your vehicle-owner customers will be completely comfortable with what you’re doing. But the key here is confidence. You’ll need to spend time training your own staff on how to explain the new way. Customers can always sense fear, and if they don’t see confidence, they’re not going to be okay with what you’re telling them.

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A big part of this is experience. Your staff has to watch the new way happen before they believe it’s possible to do. Often, you’ll have more success with those who have little experience in the business. They don’t know the “always-done-it-this-way” stuff, so it’s not a problem for them to do it differently. But if this new way doesn’t properly serve the customer, it’s not going to work.

When it comes to overcoming the “don’t-know-how-it-works” customer, the ball is completely in your court. It’s simply about educating him or her. The key is in “setting the expectation.”

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Many of us don’t set the expectation; rather, we let customers tell us how they want it done. In almost every case where you’re not clear up front, things turn out poorly. Understanding how they would like it is critical to building a business that better serves the customer, but the truth is that we can’t always meet these requirements…at least not today.

You have to be able to walk customers through the process, explaining in detail what you’ve built to make their experience better. At the same time, you need to address their concerns and show them how you can come close to what they’ve requested or at least tell them why you can’t. But the key is to set the expectation for the experience so that before they leave, they know what to expect and they’re comfortable. Sometimes, you can’t meet their expectations. Maybe no one can, but at least you give yourself an opportunity to maybe opt out of doing their work before you get involved in a losing proposition. We’ve all attempted a repair that in hindsight we know we never should have attempted,  but in this case you have the chance to avoid that repair. Set the expectation and educate.

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Performance Rules

When it’s all said and done, performance eliminates all concerns. When you take the time to build better ways, using facts and targeting the customer, you’ll ultimately deliver true value for all. But those of us changing our businesses to better serve the customer (for the sake of all parties) must execute those changes with confidence. Have a plan, think it through and go forward. Use these tips to work through the changes. You’ll only truly know if you’re on the right track by doing.

Contributing editor John Sweigart is a principal partner in The Body Shop @ (www.theodyshop-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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