James Womack thinks you should Toyota-fy your auto dealership. And, he promises, you'll make more money doing it.
More important, if you don't do it, the guy across the street will, he warns. And then -- well, you're toast.
Womack has a way of upsetting people in the auto industry. He is not a consultant. He has no clients. He is a theorist -- with nothing to sell. A bearded, blunt-speaking author and former Massachusetts Institute of Technology professor who doesn't particularly like cars, Womack has been tweaking the U.S. industry's mind for three decades.
Toyota knows how to build cars better than the rest of the industry, he said throughout the 1980s. (The auto industry accused him of being a Toyota cheerleader, then later agreed with him tacitly.)
The U.S. industry's efforts to become more efficient are going nowhere, he has said for the past several years. (The auto industry has accused him of being mean to the Big 3, then pulled up their chairs to listen better.)
His latest message, contained in his book Lean Solutions, is certain to irritate people again.
Says Womack: American auto dealers are inefficient and wasteful. Their inefficiency is hurting their business. Fixing the problem will take a fundamentally different approach to operating a store. And worse, most dealers probably will never be willing to change, never understand the point, and so will spiral into a less and less competitive situation.
The perfect solution, according to the Cambridge, Mass., efficiency guru: Take the factory-operating ideas of Toyota Motor Corp. and apply them to the dealership. Run the service shop and repair shops like Toyota plants. Run the dealership like a Toyota distribution center. Sell cars and trucks as though they were perfectly crafted metal parts moving smoothly through a supply network where no one receives anything he doesn't want.
Toyota does this in the factory by endlessly identifying and eradicating wasteful activity. It achieves this by eliminating unneeded inventory and using a systematic method of understanding what's really causing problems. It corrects them as soon as they are known, instead of putting them off to deal with later.
How would all this work at a dealership?
Here's one scenario: A customer pulls into the service department needing a new headlight bulb. Instead of filling out paperwork and putting the car into a service bay to wait all day, the service writer fetches a bulb and installs it himself, sending a happy customer away in a matter of minutes.