Will Chrysler dealers regret getting their way?

Other blogs
Related Topics

DETROIT -- Chrysler Group may make automobiles, but right now, it’s selling its dealers rope by the yard.

Chrysler’s decision to abandon the traditional punishment-reward cycle for monitoring how its dealers treat their customers in favor of a more collaborative approach has drawn many kudos in online comments posted this week on autonews.com. Many of the comments seemed to come from envious General Motors’ dealers, who urged the General to follow Chrysler’s lead and trust dealers to do what’s right in their own stores.

Chrysler dealers -- who had grown frustrated with the rigid, checklist-like nature of the former Dealer Standards program -- had requested that the company begin treating them as adults.

And in large measure, dealers themselves created Chrysler’s new sink-or-swim Customer Experience Initiative. Though they argued that the initiative should come with some financial incentives for dealers who met objectives, only a few will ignore the program because there’s no money attached.

But Chrysler’s bold move to abandon the rewards and penalties of its Dealer Standards program could eventually become a case in which dealers regret getting what they asked for.

What happens when the flood of consumer input coming in from the factory’s surveys and mystery shopper program -- which will now identify the individual employee the customer interacted with -- reports that the dealer principal’s son or daughter is the reason behind his sales department’s bad rep?

Or imagine what would happen if a few holdout Chrysler dealers chose to ignore their customer satisfaction scores altogether?

If dealers thumb their nose at the factory, the logic behind Chrysler’s new initiative would argue that those dealerships either wouldn’t stay in business or would be bought by others. That would be a very cheap way for Chrysler to reduce its dealer body further.

But I can’t be the only person to consider a scenario in which frustrated Chrysler executives would share their dealers’ customer satisfaction surveys publicly -- a type of factory-sponsored Angie’s List that would reward well-performing dealers and decimate those who failed to play ball.

Don’t get me wrong; what Chrysler has chosen to do with its Dealer Standards Program/Customer Experience Initiative is a much-needed step toward improving the performance of its dealer body. Smart dealers will grab the opportunity to improve their service and, ultimately, their profits.

For others, it’s appropriate to remember what Benjamin Franklin said at the signing of the Declaration of Independence.

“We must all hang together,” Franklin said, “or assuredly we shall all hang separately.” 

You can reach Larry P. Vellequette at lvellequette@crain.com.

Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

Or submit an online comment below. (Terms and Conditions)




Rocket Fuel