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Learning Without Scars

Learning Without Scars

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    Learning Without Scars
    S2 E41•October 19, 2022•56 min

    Mike Pentz and Mets Kramer and I continue our conversation about branding, addressing the challenges of getting this done.

    Send us Fan Mail (https://www.buzzsprout.com/1721145/fan_mail/new) Transferring any business from transactional to aspirational is tough. Changing a culture is very difficult. Our conversations meander all over the subject. You will get many ideas and hear about how to embed a brand in a business.  Visit us at LearningWithoutScars.org (https://www.LearningWithoutScars.org) for more training solutions for Equipment Dealerships - Construction, Mining, Agriculture, Cranes, Trucks and Trailers. We provide comprehensive online learning programs for employees starting with an individualized skills assessment to a personalized employee development program designed for their skill level.

    Transcript

    0:01

    Good day. And how's everybody today across the network and the internet and all of this exciting stuff that we've got? This is another candid conversation. We're picking up our discussions that we had with Mike Pence about a month or so ago with Metz Kramer. Last time we were together, guys, we kind of defined what branding is. And we left a jumping off point where, yeah, that's cool, but how do you implement it? And so that's, I'm going to put that into Mike's court to start with. But it's the world that we're going into is selling services, not things. And that is much more dependent on people. and getting the hearts and minds of the people. So your brand can be, you know, this wonderful colors and logos and fancy stuff. But that's, I don't believe that's what it's about. Is it Mike?

    1:22

    No, no, I agree. It's, it's, we kind of hit on it a little bit last time where we started talking about brand. Brand tends to be this nebulous thing where it's like, oh, I do branding. I have a logo. I have a website. Those are things that exemplify your brand, but that's not what identity is in the first place. And so one of the things we talked about it kind of universally in the last episode, in this episode, I was thinking you just kind of have to start chipping away at it. And it's how you view yourself and it's how your customers view you. And so what are kind of the next steps to do that? I think, did I give the example last time of the rain sensor guy?

    2:06

    Yeah, but repeated.

    2:07

    Okay. So the rain sensor guy, there's a guy who makes water table sensors in northern Colorado. And he came in and said, hey, I need some help with branding and marketing. And we said, okay, tell me what you do. Tell me about your business. And he said, well, I create sensors that go into different liquids. And he got very, very technical right off the bat. And he said, okay, that's a great first step. And I'll kind of outline. these questions on how we can apply them to our own businesses. But to start with the story, he was saying, okay, yeah, I do this, but you know, how do I get more public awareness? I said, well, that's great. How do you use these, these sensors? Well, we use them in water tables. Okay. What kind of water tables? Well, we actually use them in the aquifer. We work with the government and fracking companies to make sure that the water table and the aquifers stay safe. And it's like, okay, that's vastly different idea there.

    3:04

    saying that we make sensors that identify and protect the Aqua table or the check water purity versus I make these sensors in this little void that becomes highly technical, right? It becomes inspirational and aspirational. And suddenly it's like, okay, that clicks. That's a really neat company. I can get behind that. I can get excited about that, even though I don't know any of the technical stuff anymore. Now, suddenly that's like, this is a really cool company that people need to hear about because they're doing everything they can to keep our drinking water safe. And that's kind of the tie that marketers make and that you make in branding that as you define that identity, that will lead you to something much more compelling than I make these technical sensors that are 12 nanometers and you can insert them using aluminum or whatever, right?

    4:02

    Yeah, we have a professor from McGill who has put together 10 one-hour lectures on marketing. And what you say is exactly right. The theory of marketing, people's perception of what marketing is, and the reality of marketing are two different things. Right. You know, it's important to know the theory, understand all of that. It's important to know how equipment works. The customer doesn't care how the equipment works as long as it works and it gets the hole for him or it digs the trench for him or whatever the heck he's trying to do with it. And I don't know that people in a company target a restaurant, a dealership, an aquifer water sensor. I don't think they get it that way. I think they look at it as a job. They get paid for it. And that doesn't do any branding, does it?

    5:01

    No. It's, it becomes transactional one. And when it comes to managing our own businesses, when we don't take an aspirational or an inspirational view of our own business, what happens is things become just this transactional we're talking about. A good example of that is a lot of small businesses say, well, I have to have four blog posts, or I have to have 10 tweets a day or whatever it might be. And it's like, that's great. I always tell people that tactics. without intention is worthless because you can be doing those things.

    5:38

    That's a wonderful line. I'm going to use that, Mike. Tactics without intention.

    5:44

    Because you see people who will just throw stuff up there, but if you're not creating something. When I worked at Fitch, right? We talked about last week, I worked at this company, Fitch. We designed different products and we would tell our case studies and the case studies would be, we helped design this plastic. It got very technical and it got very transactional. It's like, here's what we did, dah, dah, dah, dah. Rather than saying, we helped design the Apple iPhone to create a new experience in the way that you interact with your digital devices or whatever. we miss the boat on connecting those things. And the reality is, is any real marketing company, their whole focus and their whole pitch to other customers and to their clients should be that we help you tell your story better because that's what you are. You're a storyteller.

    6:33

    And being able to try to connect those dots, I kind of came up with like three questions that I always like to ask. And I've done this with my business. I've done this with lots of other businesses. Is first establish, what do you do? Be able to articulate in a sentence or two. It's kind of like the elevator pitch, right? So I buy and sell asshole paving equipment. Cool. That's one. What do you do? Two, how is that used? What do customers do with that? That's great. Well, customers can call me and I can help them find equipment they're looking for or help them get rid of stuff or I can help give them trade values on things. So that's kind of like the second question. And the third question is what impact does that have? Well. It completely changes the game when they can confidently manage their fleet by knowing what a real value is, what a real wholesale number and retail value is.

    7:22

    And they can find the right machine and not be bogged down by being forced into a machine. And suddenly that third thing that what impact does it have by leading those questions along? That allows me to start saying, OK, I don't just buy and sell asphalt equipment. I'm I'm a resource to them. A dealership would look at that and say, your job isn't just to sell a piece of equipment to a customer. Your job is to be the support team for that customer. Right. It's you're in the service business. You know, that that changes the mindset for being in an equipment sales business into a service business.

    7:58

    But that also changes that also changes the foundation of what a dealership perceives itself to be.

    8:06

    Right.

    8:07

    What it's obligated to do.

    8:09

    Well, and it becomes nasty, doesn't it? The manufacturer, the OEM, expects you to sell machines. They measure your performance. They get your market share, and it's down to the 15th decimal place. And if you aren't pulling your weight, we have to have a chat about it. Yeah. That has nothing to do with branding for the dealership.

    8:32

    Yeah.

    8:34

    Sales goals.

    8:35

    No. That's a tactic. That's one of the worst things.

    8:38

    Yeah, that's a tactic without intention. Actually, the intention is good for the OEM, but it's not good for the dealer. You know, think about what you did early in your career, Matt, working within the dealership, trying to create a brand for a thing, a maintenance program or a service operation or to create some rallying point around which those employees could come.

    9:06

    But I think that's one of those great things. How many dealerships have as a motto or a tagline, quality equipment, quality used equipment, quality rental equipment? This is their whole tagline. And if that is your focus, if that is your brand, then it leaves you really short. If you suddenly change your brand to be, you know, keep my customers running, then you're suddenly obligated to have more than just quality equipment. You're obligated to figure out how you're going to keep your customer running,

    9:46

    you know, changes how you talk about it too. Yeah.

    9:50

    Now I have to have service. Now I have to have PM. Now I have to have parts in stock because I can't say my brand is I keep my customers running, you know, so you can see how short.

    10:01

    Let me flip that a little bit. The people that are touching the customers are the ones that have to live the brand. Right. But we haven't communicated to them what that brand intent is. It's still sell a machine, rent an hour. It's a thing always. And the employee has got to get to the point that he or she is absolutely convinced. that the customer gets the best value from that transaction, Mike, that you're talking about, because it's all transactions. But the transaction has to have a bigger meaning, like what Steve Jobs was able to do with Apple. Why are people spending $1,000 on a phone every couple of years? I mean, what is this nonsense?

    10:57

    The chip's not any different. It's just another camera that has one more megapixel.

    11:02

    Precisely. Precisely. But you got to have it, right?

    11:05

    But it's an experience.

    11:07

    Well, see, that's the whole deal, isn't it? And so while they were on the experience, here comes Samsung and wiped them off the map. Right. So this branding is really, it's a moving target, isn't it?

    11:23

    It's a culture thing. It's more than a lot of times traditionally, especially when you had like the Mad Men era and you had advertising, it's like, let's create a cool jingle, let's create a hook, and let's get something that creates an experience within 30 seconds. And then we had this move of mass market convenience and manufacturing. And now it's the old adage, biblical adage, like there's nothing new under the sun, right? And so we have things that are the same. So it differentiates products because right now, if you get a Google phone, if you get a Samsung phone, if you get an Apple phone, each of the ecosystems will have the similar features, if not 99% parity of features. across the board. What's different is what the experience is going to be, who your family is going to use, word of mouth. And so suddenly it becomes an experiential thing.

    12:18

    And so it's a cultural mindset to where if you can get everybody to buy in, it also changes the way we manage though, because you're talking about those frontline employees. The most important employee is the mechanic that's interacting with the customer. It's the sales guy that's stopping by their place. You have to understand that that mindset shift as you figure out what your brand is, as you try to embrace this culture, if that's what you aspire to. Some people, again, will just want to say, sweet, I just want to sell the equipment and you want to move that. That's totally fine. It's if you're trying to build beyond that and you're trying to really have market penetration, market penetration comes from creating that experience. And you have to learn how to incentivize those people and prepare them the most way. or in the best way so that they're equipped to do these things.

    13:08

    And that starts with that aspirational brand aspect because all these things that we just talked about, those questions that we're getting into, once you say, what impact do I have? Then you have to get other people on board with it. And that is how you do that before you even get to a single tweet, blog, or tactic. Yeah.

    13:26

    Fill in all the blanks that actually lets you deliver on your aspiration.

    13:32

    Well, for what you're doing, Metz, The understanding that people have about the things you do is the first obstacle, isn't it? People don't really understand software, nor should they.

    13:53

    If you look at it from that perspective, then yes, because you look at it by itself. You look at it from the perspective of this thing I have to have. But if you were to look at it from the end of an aspiration of a brand, of an experience you want your customer to have, then it's really just that thing that helps you deliver on your aspiration. If you say you're the dealer that keeps your customer moving and working, then filling in all the blanks back from that statement to what I need to have. Suddenly software isn't just this thing I have to have and it's an IT thing and my IT person is going to deal with it. But you actually know how to approach all the shortcomings, issues and requirements of that software. It's no longer, oh, will it satisfy my accounting needs? It's like, will it let me deliver on my aspiration of who I want to be to my customers? The brand I've chosen.

    14:58

    I think it's even more fundamental. I was talking with a guy earlier today up in Canada. Other part of Canada, right? Actually, he's in Alberta, so I have a better affinity to that Mets than the Eastern guys. But he's been involved in installing a software package across the country. And he becomes a firefighter, doesn't he? He enables bad behavior because he goes in, he shows people how to do it, he trains them how to do it. If they have a problem, they call them and he solves the problem. Yeah. And I said, you know, that's terrific. Is that what you want to do for the rest of your life? Yeah. And the answer is no. But business seems to get ourselves stuck in the trap that that guy's good at the job. Leave him there. Don't touch him. When the reality, and that's why I use software as an example, it doesn't matter what the software does and how it does it. It's the result that you see from it. It doesn't matter what the machine does.

    16:01

    and how many horsepower and what torque and all the rest of this stuff, it's the result that the customer's trying to get out of that machine. And if we don't change how we sell that machine to services, we're going to be dead in the water, I believe.

    16:19

    Yeah, it's perfectly analogous. And I think we often, whether it's software companies like you spoke to or dealerships, you know, you can become completely reactive and you and I have talked about this reactive nature of our industry and how we breed reactivity. But, you know, if you don't stop to ask your customer what they're really trying to accomplish, when I work with dealers on their information systems, it's not just like, well, what tools do you need? What tools do you think you need? It's like, what are you trying to accomplish? And let's make sure that the platform will support it. It's how I ended up doing this is because, you know, to do what a lot of people really want requires a continuous platform that or set of platforms that integrate. But a dealer is no different. If you're constantly just sending machines out.

    17:15

    to a customer to service and repair stuff, and you're not analyzing that and realizing that you're constantly just running out fighting fires for that customer, you don't stop and walk out to that customer and say, look, we looked at your service work. I mean, we're doing nothing but fighting fires and fixing things that should never have been broken. But it's because you don't have, because no one sat down and talked to you about that maintenance program that you, you know, you said you didn't want, but now we can show you why that's what you really need. That's what you really, you actually do want it. And that's how we come to the party to really support you in what you're trying to do, which is dig dirt, not make phone calls and call service out.

    17:54

    So go further down the road that Mike was taking us. Let's just use excavators for a moment, because I think this is true with almost every piece of capital equipment, from a washer in your home to a lawnmower. The differentiation on the product anymore is almost non-existent. So if we're trying to sell features and benefits, that horse left the stable years ago. So now I've got points of light for George the Father Bush in salesmen touching the marketplace. Congratulations, they're out knocking on doors and selling to the same people they've always sold to. They don't sell to new customers. They don't displace competitive equipment. They just continue to get what we've always got. And we reward them nicely. That horse has also left the stable.

    18:51

    Well, their metric is and their compensation is on machine sales. Yes. It's not on productivity. Take a sales rep and make him responsible for like board feet of wood. Yeah,

    19:06

    right. But you tell them why we sell. Like if you go to the culture, in effect, we're flipping the company upside down. The salesman who's out in the field selling machines to customers. That's not the most important person in the company. Never has been, but that person has got a hero badge on his chest. That's got to change. That technician at three in the afternoon who's out there getting the machine back to work, or there's a story that I wrote about a while back with specialization and everything, a doctor. has unbelievable skills, but here's this guy, and he has a medical event, and he's rushed to the hospital, and he's in danger of losing his life, and there's only one doctor that can solve this problem. He's out at his country place having a nice long weekend with his wife, and he's the only one in the country that can satisfy the deal. They call. He says, yes, I'll come in. He gets in his Rolls Royce and starts driving.

    20:16

    About an hour into the two-hour trip, the car fails. He has to get on the blower, call a mechanic. Mechanic comes out, diagnoses the problem, fixes the problem. The doctor gets in the car, goes forward, does the operation and saves the man's life. So the guy whose life was saved, who does he think? The doctor or the technician?

    20:40

    Right? Well,

    20:44

    it's true. You almost need to send out like, think of yourself as a customer, right? And I'll get to it in a second. But I think what's interesting about Mets and I is our pitch to our customers is essentially the same thing, but from a different angle. We're there to support you in what we're good at. Right. And it's interesting to think about. What would a dealership look like if with the sales guy, they also send the technician say, hey, I'm here. I know you didn't sign for the extra warranty, but if you need anything, you pick up the phone. I'll be here to help you. You tell me what you need. I want you to see my face. And they just do some sort of check-in like that. And they're incentivized to do so. And suddenly a customer will go, hey, well, this other guy just had some sales guy show up, sell me this thing. And now I can't get a hold of him when my machines broke down. And this other guy's saying, hey, I'm ready to go.

    21:40

    If you need any, if there's any. We've noticed over the last year, you have these particular parts that keep wearing out. So we're going to stock a couple extra for you. Suddenly, that technician is doing marketing and doing sales and doing all these other valuable things. It kind of flips. It also goes to line with the cultural trend now, where especially coming from Colorado, trade jobs are... on the rise because they're making a great living. Nobody's doing them and everybody's lost the knowledge to be able to do it themselves. And so, you know, electricians and, and apprentice plumbers are making 80, $90,000 as an apprentice.

    22:18

    It's like, this is Mike Rowe and dirty jobs. It's what the whole world is. That, that cannot be outsourced.

    22:27

    A hundred percent. We've lost, we've lost some of that, some of that edge. And so. When we're developing brands and we start talking about brands, having a clear picture of your business, where you want to go, who you are, how you're impacting people. That's like the first concrete step. And I'd even encourage people to take the time and actually write it down. Because from that, then you can say, okay, what words or phrases stand out to me? What colors represent this? What does that? That will impact all the tactics down the road, but you don't have any meaning. unless you've taken the time to actually sit and mull it over for a bit or ask your customer. Best thing to do is ask your customer, what do I mean to you? What do you want me to mean to you?

    23:09

    The interesting thing, Mike, is, you know, just use the telephone as an example. And Mets, you've seen this. If we got on a plane, the three of us, and we went to visit 100 dealers and we went to their parts department, to the people at the counter and on the phone and asked one question. Who here has had training on how to use the telephone as a customer service tool? Right. The answer is zero, right? And that's shameful. And again, that's a cultural issue as well. This is a big deal. This is a very hard transformation. And it's not just our industry. It's across all industries in America and around the world, for that matter, that I've worked in. People need to have a feeling of worth, of value. I do worthwhile work. What do you do? I sell parts. What's that mean? You know, now we start. I think you guys, the last time we might've walked through my three questions. What do you do? Almost everybody can tell us that. How do you do it?

    24:17

    Well, most can tell us how to do that. Not everybody. And then the magic question is, why do you do that? And I don't allow them to say, because I get paid for it. No, no, no. That's not the reason you do it. Why do you do it? And companies, Mike, that's exactly what you're saying. On your questions. Yeah. You know, but I don't think we get it. I don't think that message is penetrated into the leadership's heads in many businesses. That water sensor guy, he's selling technical. He's not selling what the thing does.

    24:55

    It's good to recognize where people come from, right? Like we all know, like, you've got a big background in parts. I started in service. We kind of know that people kind of set a mindset early on in their careers and you can tell them apart all the way through. And who tends to end up running the dealers? Sales guys. And so focus is sales.

    25:20

    And we're not always the most equipped to do so. That's the sad part.

    25:25

    It's just that we've been taught to take initiative. Yeah, but it's a perception. You know, next week I've got something in lifelong learning that's talking about this exact thing. You know, becoming successful. What is that? And then you start talking to 100 people in a dealership. You're going to get a different answer from the folks in the office, from the folks in the field, pulling wrenches, working computers, selling. What is being successful for the business? What is successful? It's not ROE. You know, it's what's the legacy that you're leaving. We've got many that are two and three generations businesses, and that's really difficult in this country to do. But some of them are just wonderful on how they continue, and they have an obligation to their employees that's real. It's not like Intel is laying all kinds of people off after getting $4.5 billion from the government to keep jobs running.

    26:27

    You know, all of the cynicism that comes around. So I'm asking those questions, Mr. Customer, what would you like me to do that I'm not doing? Right. Be an interesting series of answers and different answers. And internally. Oh, yeah. And asking that internally, right?

    26:46

    Sure. Like how many business owners will take the time to go to the janitor and say, look. What you do is important. What you are doing is valuable. You literally make things better that we can work here and do our jobs. And we appreciate you and we trust you. And building up some sort of mentorship type thing to say, hey, you know, parts and service guy, I know that this is tough for you. I know that talking is not your thing, but what you're doing really makes a difference. And this is part of the grease on the wheels. And you are just, how many people take the time to do that aside from? hey, here's this great monetary thing. You know, it's like I always tell people, you know, I always joke that I'm the porcelain cleaner because I just do whatever needs to be done. And the people that work for me, it's like, no, no, no, you guys, you guys are more important than I am as far as I'm concerned.

    27:36

    And when I talk to the customers, my whole pitch to the customers is always, look, I need to do whatever I can because I want my kids to work with your kids. And as you start to build that mentality and then apply it to the customers and apply it to when you interact with employees, that's the cultural change that really we're talking about. That's where brand identity becomes really, really strong because it's a cultural lifestyle. It's not just words on a page or a logo or a picture. It actually means something.

    28:04

    Yeah, we put a new blogger up last night in Lifelong Learning. Her name is Carrie Bogdan. And one of the most powerful, well, there's many things, but in her paper, he said, I learn when I'm teaching. Well, of course you do. But how do you do that? Because I'm listening to what my students are asking me. And we do that in teaching. We do that with grade school kids. But then we get out into the business world and we stop doing that. We teach people how to do a job. We tell them to do it more and more and more, get better at it, faster at it, so I can do with less people. And the big dilemma in America today is that we're so driven by productivity and headcounts that we have too much is done by too few people on too many subjects. We have absolutely no coverage whatsoever, no depth whatsoever in athletics and all of those things. We talked about soccer. You've got a practice squad.

    29:04

    You know, in every athletic event, you've got people that are standing in to, if there's a failure, if there's an injury or whatever, we don't have any of that backup in a dealership. Right. You know, we're short technicians, Max. That's where you started. Isn't it wonderful? How many two-shift shops have you got around North America selling equipment? Not very many. No. And then the answer is

    29:29

    going back from

    29:31

    a service manager is, well, I can't hire any more mechanics because I haven't got any more space. And that's the same thing, Mike. It's brand new.

    29:42

    Yeah, I view it as everything kind of ties together.

    29:46

    I agree with that.

    29:47

    To articulate it and being able to correctly define, I like to say story just because that's what I used. But it's like when you figure out what your story is. That impacts not just how you market, not just how you create a logo, not just how you build a website, tweet, et cetera, tactically, but it makes you figure out your intentions. It requires you to understand your intentions before you do things. And I think that that can dramatically change the trajectory of a business.

    30:20

    So go back there for a second to thinking about what you're going to do before you do it. That's novel. Now I think about that. The moment I pick it up, I process the order. A machine arrives in my bay. I go have a walk around and have a look. It's the same stuff over and over and over again. I get up in the morning, I put my feet on the floor, and I get dressed the same way. Whoa. We're creatures of habit, and the habit's a hard thing to break.

    30:51

    This is like the... A lot of these problems that we struggle with and the coverage is one of them, you know, having backups if someone's on vacation or sick, you know, a lot of these things are have come this way because we're really driven by one thing, which we think is the most important. And, you know, be honest for some people to put it up on their signboard. You know, our brand is we try and make as much money possible. by squeezing everything as hard as we can. That's a real brand in a lot of dealerships that I've known.

    31:30

    It's not just dealerships, it's everything.

    31:33

    I get it, I get it, but try

    31:35

    and stay on topic.

    31:37

    But it lends itself, I think, to kind of like this one road and this one, why do we keep running into these limitations? Why are we short technicians? Because... We don't make it an attractive job. We don't bring kids in early enough. When we do get apprentices, we don't invest in them. We make them do jobs that they're not prepared to do so they get frustrated and quit because we're trying to get productivity out of them. Otherwise, we can't justify having them in shops. And now we're short technicians. We're not willing to bring technicians and apprentices in and say, for the next two years, you're just going to shadow buddy over here. But he's going to teach you for two years and you won't be put out. in the cold by yourself, around on a limb, trying to do a job you're not qualified to do yet. It's going to cost us two years of investment in you to make you a good technician and to make you feel like you're competent at this job.

    32:29

    We don't do that. We're scared to spend the money. I've sat in the meetings. We can't, oh no, you can't have too much training time. That costs money. And so we put ourselves in this conundrum. We want profit. We don't want to invest. And now we don't have technicians.

    32:48

    The concept is upside down, though, isn't it? Mike, profit is the motivator. That's how everything distills itself down, our headcount, our facilities, et cetera. It's all driven by how much we're going to get back. But over my work life of 50 years, market share in parts and service has gone down by 50%. Equipment market shares haven't really changed. Caterpillar, John Deere. Komatsu, Volvo, JCB case, but take the top 10 in the typical construction work, not the specifics that you were talking about, Mike, but nothing has changed. The market share that they have on equipment is static. And there's two in every market that dominate. Three and four goes away. And I don't care who the two are. It could be cat and deer. It could be cat and Komatsu. It could be deer and Komatsu. It doesn't matter. Volvo is not there, which is a shame. And parts and service, meanwhile, has dropped by 50%.

    33:55

    The thing that makes the money, keeps the door open, has dropped by 50%. Because we're not selling it as a brand, Mike. Not everybody believes this stuff. Sell a machine, congratulations. Next. We'll try and find a salesman six months after you bought a machine from. Where is he? He's gone. Gone to the next one.

    34:18

    Right. And because of economies of scale, customers don't have any other choice. That's where there's opportunity. That's one of the things when I talk to guys like BOMAG and stuff like that, that it's like you guys have an opportunity here to change this stuff through service and then to catch up with those type of things. That's how Ingersoll, Rand and Blanox made their name before everything went to pot. It was service. Because the market leaders say, well, look, we'll just keep pushing machines. We'll just keep pushing machines. And guess what? With government contracting and the way that we do bidding and stuff over here, it's like, well, I'll just add an end to the bid and we'll just go. And it's just kind of stuck in this loop. All it takes is one company to come in and say, no, no, no, I'm going to be service first. And they'll skyrocket.

    35:08

    And isn't that, to some degree, that's how Liebherr has made their place in the market? They're in so many market segments, but they're in the top three to five in every single segment they're in, aren't they?

    35:21

    They're in the industries that they know. Actually, my experience has been that by being customer focused and knowledgeable in particular segments like material handling, that's why they're, you know,70,80 percent market share, because, you know. You send a guy in who actually understands what the customer's trying to accomplish, can show them how to do it better. And suddenly the discussion about the machine is minuscule. I mean, we often get in our own way thinking that the machine we're selling them is, you know, the biggest piece of their cost. The price is super important. When you can show a customer that... how they really do something. I remember this doing grade control at the cat dealership when Trimble came around.

    36:16

    When you can show a customer that your machine's $100,000 more, can save them a ton of time and actually make them more money because you bring someone on site that knows the business and can show them exactly how to do it, the $100,000 is nothing. But the salesman will complain that, oh, the machine's too expensive. But it doesn't make any difference. We did like foundation equipment, put a guy on that machine that knows the foundation equipment business, that knows how to get everything done and have him show the machine and push out real productivity. And no one sits around and argues about the price anymore.

    36:55

    How do we get that into the hearts and minds of all of the dealerships? It's investment. I'm constantly struggling with this.

    37:04

    I had to fight for that guy. I had to keep fighting to have a guy who on the books didn't make any sense, you know, at 200 grand a year, but he saved money in warranty and he sold machines. And he, you know, it's, we have to think like bigger. We have to think not about nickels and dimes and think about dollars.

    37:27

    That's where that inspirational, aspirational stuff comes in.

    37:31

    I agree with you, Mike. I really do.

    37:32

    You can't force people to think that way. And it's okay if you don't. If that's not natural to you, it's like square peg, round hole. Like, I don't need to tell a story. I just want to do this. That's okay. But for those people who are searching and trying to do something more and trying to engage and pulling their heads, how do I gain more market percentage? How do I do this? When you sit back and then you actually examine yourself or the people trying to figure out, tie it into branding, right? I want to do a new logo. I want to do this. I want to figure out who I am. Take it to the next level. This is the time to start thinking about these things and think about what you do well, think about what you can do better, all the things we've been discussing today. And you have to start there with coming to a conclusion about what direction that you want to take. And then that direction, then you can create your tactics.

    38:18

    But a lot of people don't take the time to step back and say, it's no different than, like, did I tell the story about my grandfather? My grandfather, he ran a Blahnox Case Dynapack dealership for 40 years. He started out as a mechanic, didn't have a high school degree. And he started in central Pennsylvania, moved over to Pittsburgh and basically started like he was a mechanic. He was trained as a mechanic. That's what he was good at. And they said, hey, there's a sales rule. I want you to open this up and start this in Western PA. I said, OK. And he started it up and he had that mechanics knowledge. And his whole focus was his whole mentality. And this is for asphalt paving, right? His whole idea was never lose a load of asphalt. That's what he said all the time to his customers. I want you to never lose a load of asphalt. And he backed it up.

    39:08

    And for 38 years or so, he had 98% market share in Pennsylvania on the Blonox parts because no one could outsell him. And he could get whatever price he wanted, et cetera, et cetera, because his whole thing was you're buying a reputation. You're buying me. You're buying my word. And I'm going to keep a million dollars. parts sitting at the dealership for you because you will not lose load of asphalt if I can help it. And that's drastically different than let's push the machines. But Blahnox sold more pavers. I mean,98% market share is absolutely unheard of.

    39:43

    But take that example, Mike. Why did not Blahnox celebrate your grandfather and use him as a model for everybody to see this is what it looks like when it's right? This is how to do this work. They had the opportunity to do it, but they didn't do it, did they?

    40:02

    No. And when Ingersoll Rand bought them, it turned into we have to maximize margins and profits. They stopped looking at the long haul. They started looking at how can I get dividends today for my shareholders as opposed to how can I make sure that my business lasts for the next 100 years?

    40:20

    Somebody is going to write a case study about Ingersoll Rand and Melrose.

    40:24

    Right.

    40:25

    Because they just stripped everything of value out of that company. And now they're on their lips and don't know what the heck to do.

    40:33

    No, and even when they're giving product away, they can't, like Volvo can't do anything about it.

    40:39

    It's really a shame. But then Mets, the dilemma is people are protecting the status quo. Yes. People are comfortable with how they are doing things.

    40:52

    People's intentions, like you know this too, people's. There's the aspirational, inspirational stuff we talk about. There's, you know, like you said, the questions you ask and the last one they're not allowed to say because I get paid. When we work with people, we have to acknowledge and understand that people have like a hidden primary intrinsic reason for doing what they do. If you ignore it, if you think that people at work are all altruistically working for the good of the company, it's not true. And it's not that it's dark or that it's negative. It's just, we just have to understand like what's really driving people primarily. And how does that play into all the other things that we want them to do? Right. Like the sale we talk about, the sales rep is their favorite whipping boy. You know, primarily he's trying to make commissions. Right. That's his primary goal.

    41:49

    His primary job is to work and sell machines to make commissions and everything that you build around that. that you also want this person to do, you have to figure out how that plays into the other things. You know, I have it with administrators a lot. They're like the quietest group of people. And I sit and I talk to them a lot because their primary goal really is just to get stuff done. Like, why do you do it this way? Like, this doesn't make any sense. Yeah, I know. Like I just need to get it done. Nobody really listens to me. My real job, my real goal is just to make sure that I get through all my work so I can feel good about the fact that I got through it, even if I'm doing it in a less efficient way, you know. And so you have to challenge that and accept that first when you start to work with them on the next step. Like, OK, I understand that you're just trying to get through all this paper.

    42:42

    And so trying to do something new and different is going to be hard because it may slow you down for the first little while. or you may have to rethink it. And that's not really your primary intent. I think everyone around the business is the same. And if the problem is, I think at the top level, their primary goal is good numbers on the quarter, you know, and that makes it hard to think ahead. It makes it hard to say, I'm going to put two guys on the shop floor that are fully played apprentices that they're not going to make me money, going to cost me money, but my long-term goal will result in a better shop. in a more profitable service organization. I'll bring my numbers up from 50% to 65% market share and service because I'm actually building something.

    43:26

    It's an amazing truth, an amazing reality. One of the things I'm hopeful about is that the under 40 generations, and they call them Alpha, Gen X, Gen Z, the younger millennials, whichever way you want to look at it, they have a different view of the planet. You know, my generation, the boomers, we were taught to be obedient. Just do what you're told. Don't worry about it. It'll be okay. Take your time getting a job because you're going to be there the rest of your life.

    43:59

    I see that work for you.

    44:01

    Pardon?

    44:01

    I see that work for you.

    44:03

    Yeah. I've had the same boss for the last 40 years, but it isn't outside the family. But it really is. Again, I'm talking to this guy this morning. They've got over 100 stores. And they have training centers. They train technicians. I said, oh, that's terrific. Do you have an assessment to determine how much they know after they've finished their training? I said, no. I said, well, how do you know they learned anything? We don't. I said, well, isn't that kind of silly? You're spending money and you don't know what the heck you're getting? Come on, boys. He says, don't ask those questions because I've known him for 30 years and he knows the kind of idiot I am. But we've got some fundamental flaws, Mike. Businesses that you touch, this aspirational thing, how do you get the hearts and minds of the employees to really care versus I need money to get through the month?

    45:04

    Owners and upper management have to care. It can't be just one guy siloed caring, right? You have to give a damn about it. It'd be no different than if I, it's really, it's really, really easy for us to say, look, you should care about this, Matt. You don't understand, man. You should care about this. Okay. I'm going to go hit up the links and we'll catch you later. Right? Like it's really easy for us to say things and not actually live it. Part of that, you know, like I always view things as the best leaders are servants and, and. we're getting into leadership beyond branding and stuff like that with this discussion. But the point being is, is that if you want to, if you, if you want someone, if you want one of your employees to believe something, then you better live it and you better believe it yourself. Right. Because otherwise, otherwise it's very, very, it's no different than you talking about your gentleman with training, right?

    45:59

    You want him, you want these people to be trained and you want them to understand, but unless he takes the time to go through it and see what they're actually learning. So it's kind of meaningless. It's like, look, this guy's sitting on his laurels, taking his bag, and he's not doing his stuff. When I came on board with my dad, my dad made me go to paving school, to two paving schools. And he was like, no, no, no, you got to learn from the bottom and you have to earn your stripes. And it's like, okay, that mentality can be applied to me as a business owner, regardless. If I'm going to put someone else through this, I better know exactly what they're doing and how to get through it too. Because if I can do that and bring them alongside me. suddenly that creates a much more compelling interaction and a compelling experience that they'll learn something, they'll embrace the things that I embrace.

    46:42

    Otherwise, you're just disconnected from them and going to say, here's your paycheck, right?

    46:48

    It's interesting that you bring that kind of thing out. Matt, have you been noticing recently that the major consulting companies are starting to be challenged as cookie cutters? They haven't got anything new. They haven't had anything new for years. It's true. That's why they have businesses. That's why they say things like synergy. Yeah, but there's a beautiful expression. The true leader is invisible because the employees are doing the job and they don't even know that they're there because the leader's done such a wonderful job of transference, training, passing responsibility, accepting and giving rewards and praise. I mean, we don't do, you know, one of the old customer service films I use, years ago was a guy standing up, has anybody been in here that's been thanked too much? You know, and everybody said, well, geez, you know. So I make a point now of my granddaughters and my wife even, you know.

    47:52

    Or when we were talking with Stephanie, just say yes. What's the customer want? Yep, I can do that. And go figure out a way to do it. That's what your granddad did, isn't it, Mike?

    48:09

    Yeah, exactly. Exactly. My dad can tell you a story about a machine going down at midnight at the airport, the Pittsburgh airport, when they were paving 30 foot wide. And he got a phone call and said, hey, this needs fixed. So he said, all right, boy, let's go. And so they went over there and he was president of that group or whatever. And he's out there in his suit, throws his tie over or tucks it in and he starts pulling off solenoids. He gets them up and running and he has a new machine to him and they had 10 or 15 trucks of asphalt that needed unloaded and he got it done. And it's like how many guys, how many presidents, vice presidents, upper management now in any dealership that you know would take the time to do that? Not that my grandfather is like the best thing ever, but it's like St. Francis of Asai would say, in all things, I'll paraphrase, in all things preach and when necessary use words, right? Let your actions. speak for yourself.

    49:06

    Well, you know, how do you want to be remembered? You know, it's a, it's, it's an interesting dilemma.

    49:14

    I think that's really, really interesting. I can just segue this a little bit because we talk about branding and we talk about, and I know that people like you, Mike, and we know a lot of people like it. And you have people like your father and others that we know who started the business. Right. And have like this hidden brand. Right. It's it's they they sold used equipment and they sold good used equipment. But that wasn't really what made them successful because there's lots of used equipment out there. Right. Most of it pretty good. And so there was some hidden brand that they had. And I always one of my favorite areas is like the transition. Right. The the succession planning. Like how do you take. a business, a dealership and hand it over to the next generation. When one, it has, you know, this hidden brand, like what was the true brand of the person that grew it? You know, it could have been someone who said no to nothing, right?

    50:17

    They just said yes. And that's what helped them grow. It could have been because they were out on Sunday night at midnight in their suit fixing something. You know, these are hidden brand aspects. And then when you get the next generation in, They have their own ideas and things that are passionate to them. But if you can identify either this hidden brand or really go through the idea of what is our brand? What has made us to this point? And what do I need to transfer to the next generation? It's both a valuable branding exercise because you have to boil it out so that you can transfer it to the next generation. And you're more likely to transfer a successful dealership. into the next generation because you were able to distill the brand and, and communicated and the next generation continued it on. Cause if the next generation just, you know, Oh, well we're about making money.

    51:13

    Cause I got racehorses now because that's how I grew up with racehorses. You know, that's, that could be the end.

    51:20

    Yeah. The hidden brand you talk about, Matt, so I think is the individual brand of the person that took over the brand of the company. The company became the person. The person became the company. And we just need to multiply the number of people that that applies to. Like what Mike is saying, we've got to go through those questions, get people to think about it, contemplate it. Because, you know, they're not – we have – look at how difficult Mike Rowe is. The tough job that Mike's having to deal with and communicating to the world that dirty jobs are good jobs, boys and girls. that you're $250,000, like my grandson's just going through applications for universities. He said, Bobby, this is expensive. It's $40,000, $50,000, $60,000 a year. I said, well, get your grades up, babe.

    52:10

    Have you considered the trades?

    52:13

    Yeah, but the other part of life, and I think the reason that this is going to become, we're ahead of this curve, and I think it's going to become more significant because the younger generations, They have so many things that they're interested in. They have so many more options than we ever dreamt of. They don't need to be doing what we're having them do. They don't want to do what we want them to do in order for them to stay. And if we're not showing them opportunities to grow, to increase their knowledge, they're out of here. My opinion. I think we're seeing that already.

    52:50

    I think that's why you don't have many people that are my age getting into the business or younger, right? You know, it's like your mid 30s and your 20 year olds in your mid 30s. Like there aren't many of us.

    53:04

    The trick is, Mike, what are they going to do in those 20s and 30s? What do they want to do? I don't think they know yet.

    53:12

    No, no, that's it. That's a loaded question. So, so it's so that's a that's a big, big question. But I think ultimately, again, if. If you have business owners that are engaged in wanting to, this is something that we deal with. And granted, it's my dad and I, but I deal with it because my dad's such a big personality and he's kind of a stalwart of the industry and he's the ultimate sales guy. And I'm not, I'm different than him. So how do I change the, how do like my big struggle and what I've worked on the last 10 years is how do I change the perception from being Mark Pence and to being Calvin group? And that's a big thing that you have to deal with. But part of doing that and having that mindset change means that my dad and I have an easier time getting other people who work for us to buy into it. When we do that, it's a whole lot easier to say, here's what we're doing. Here's what we're living.

    54:07

    Here's how we're going through it and bring people on to walk alongside us and that we can mentor and be mentored by. That attitude is a whole lot different than I need a sales guy to get me some more numbers in this area. Again, I want this to be, I'm looking, you have to look long-term is really what it boils down to.

    54:26

    So I'm going to use that as a segue to the next one with you guys. Look, what do we have to offer to the younger generations and how do we get them to come to realize that? Because we desperately need to have skills and talented people in this industry for this to keep on going. I think this has been a nice transition. The first defining the brand, now talking about the difficulty of implementing the plan, changing the culture, making it aspirational, not transactional. And I will thank you eternally, Mike, for the tactics without intention comment, because too often we're, that's what we're exactly what we're doing.

    55:05

    I see.

    55:06

    I think we covered pretty good ground today. You

    55:08

    always.

    55:11

    Well, it's true, isn't it? We wander all over the darn place.

    55:15

    That's what you get when you get. Two ADD guys and a Canadian.

    55:20

    When you get an old guy that's involved, that's really unbelievable. Thanks very much. I appreciate it. I appreciate you guys. Thanks very much for your time today. And I'd like to thank the audience for tuning in to another Candid Conversation with us and look forward to having you with us at another one in the near future. Mahalo. Thank you for listening to our podcast. We appreciate your support. Should you have any thoughts or comments, please don't hesitate to contact us at www. learningwithoutscars. com. The time is now. Mahalo!

    Mike Pentz and Mets Kramer and I continue our conversation about branding, addressing the challenges of getting this done.

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