Low CSI has Marchionne on the muscle

DETROIT -- Sergio Marchionne says Chrysler Group dealers need to raise customer satisfaction scores. At stake are big quarterly payments the factory makes to its retailers.

The CEO of Chrysler-Fiat said some salespeople weren't making necessary callbacks, following up on leads or treating customers "with the dignity they deserve."

On Jan. 1 Chrysler suspended the awards in its Dealer Standards program, which is designed to improve many aspects of dealer operations. But some dealers say altering behavior of salespeople, now the main responsibility of Chrysler Group dealers, is a challenging task, particularly when sales are rising.

Chrysler is publicly mum about what the ultimate program will look like. The company is "actively engaging its dealers" to negotiate changes to the program, which will remain suspended through at least March, a spokesman said.

Chrysler's Dealer Standards program, introduced in late 2009, awarded as much as $200,000 per quarter to large dealerships that met factory standards for customer service, facilities and management, dealers say.

The group's smallest dealerships could earn $4,500 per quarter.

The program also used mystery shoppers to gauge customer interaction with sales, service and parts employees.

After a stellar year in which Chrysler Group's U.S. sales rose 26 percent, Marchionne says the automaker's front line -- its dealers and their sales staffs -- cannot rest on accomplishments if Chrysler Group is to reach its long-term goals.

"We're not top league. We moved up," Marchionne told Automotive News during the Detroit auto show this month. "But that's not true of the customer interface. We're doing well, [dealers] are doing well, but they're not doing well with the customers."

Marchionne sees no room for complacency if the automaker is to achieve its goal this year of upping its 2011 global sales of 2.0 million by 400,000 vehicles.

"We can do all the Eminems you like, all the commercials, but at the end of the day, this only gets you so far," he said. "The interface is with the guy who sells you the car."

Employee motivation to treat customers properly is the dealer's responsibility. Dealers typically provide bonuses, trips, extra vacation time and other perks when their employees meet certain customer-satisfaction targets.

Chrysler helps dealers motivate their salespeople with contests, bonuses and extra recognitions to reward sales performance outside the Dealer Standards program.

In the most recent Sales Satisfaction Index Study from J.D. Power and Associates, released in December, Chrysler Group's Jeep, Ram and Dodge brands finished in three of the bottom four places among mass-market brands. The Chrysler brand placed ninth of 19 mass-market brands, excluding luxury brands.

The survey measures customers' experiences at dealerships. The J.D. Power study showed the Chrysler Group brands lagged behind most in its salesperson, delivery process and negotiating categories.

David Kelleher, chairman of the Chrysler National Dealer Council and owner of David Dodge-Chrysler-Jeep-Ram in Glen Mills, Pa., says he, too, wants customer interaction to improve in Chrysler dealerships. He says the Dealer Standards program should be rebuilt with input from dealers.

Sales "growth has been rapid, and thank God it has," Kelleher said, "But with that growth, there's a gestation period to build the type of staff to catch up with an expanding business.

"New people and new processes take time. It takes six weeks, at a minimum, for even an experienced new sales representative to train before I'll let them even say 'hello' to a customer."

John Yark, of Yark Automotive Group in Toledo, Ohio, said his dealerships have a stringent sales process "to make sure that even if a customer contacts us and didn't buy a car, they at least leave the encounter with a good taste in their mouth."

His Chrysler-Dodge-Jeep-Ram operation sold 2,656 new vehicles in 2011, up 43 percent from 2010.

Yark predicts that Chrysler Group dealers won't have trouble improving customer satisfaction or motivating their sales forces this year because Chrysler's increased sales and market share "is a hell of an opportunity, when you think of where we were three years ago. It's a second chance."

He said the automaker's revamped product lineup and efforts to improve quality and customer satisfaction "is exactly what needs to happen."

Reid Bigland, Chrysler's head of sales in the United States and Canada, said Chrysler's efforts to improve its customer relations at the dealer level must start with the dealership.

"A lot of it becomes cultural at the dealership level; they either have a culture of customer service or they don't," Bigland said. "And it's the dealer principal that mandates that throughout their dealership."