On this episode Josh speaks with Jeff Morrill, author of the book "Profit Wise: How to Make More Money in Business by Doing the Right Thing". The talk about how hiring the right person for the job is one of the most important things.

Jeff Morrill co-founded Planet Subaru and businesses in retail, telecommunications, real estate, and insurance. In 2021, TCK Publishing will release his book Profit Wise: How to Make More Money in Business by Doing the Right Thing. He is donating all his royalties. Using the secrets shared in the book, his companies generate over $100,000,000 in annual revenue and win many awards for customer care, environmental stewardship, and team satisfaction. Jeff’s achievements in building ethical and flourishing companies have been featured in USA Today, Automotive News, and Entrepreneur Magazine.

In today's episode you will learn about:

  • What’s the most important thing to get great success and have a great team?
  • What are the personal characteristics that the right person needs to have?
  • Should you have some sort of an apprentice system?
  • What’s the problem you’re solving?

Transcript

Narrator:        Welcome to Cracking the Cash Flow Code where you'll learn what it takes to create enough cash to fill the four buckets of profit. You'll learn what it takes to have enough cash for a great lifestyle, have enough cash for when emergency strikes, fully fund a growth program, and fund your retirement program. When you do this, you will have a sale‑ready company that will allow you to keep or sell your business. This allows you to do what you want with your business, when you want, in the way you want. In Cracking the Cash Flow Code, we focus on the four areas of business that let you take your successful business and make it economically and personally sustainable. Your host, Josh Patrick, is going to help us through finding great thought leaders as well as providing insights he's learned through his 40 years of owning, running, planning, and thinking about what it takes to make a successful business sustainable and allow you to be free of cash flow worries.

Josh:                Hey, how are you today? This is Josh Patrick and you're at Cracking the Cash Flow Code.

Our guest today is Jeff Morrill. Jeff is an interesting guy. First time I've had a car dealer on our podcast in six years. One of the businesses he owns, he has a Subaru dealership and a Chrysler Jeep dealership, I think. And he's just written a new book. It’s called Profit Wise How to Make More Money in Business by Doing the Right Thing. That's kind of a really cool title.

I know he's got some really interesting things to talk about so, instead of me wasting your time and talking about myself, let's bring Jeff on.

Hey, Jeff, how are you today?

Jeff:                 Very good. Thank you. I'm really excited to be with you today.

Josh:                Yeah, I'm glad you're here. This is going to be a fun conversation. We could talk about the in’s and out’s of the car business because it's kind of an interesting business. And most people don't realize how you guys make money today. But, instead of doing that, let's start off with one of the two or three most important things you're ever going to need to do as a business owner and that is hiring the right person. In fact, I'm reading Jim Collins’ newest book right now and he, once again, after saying “you’ve got to be values‑lead,” says the next important thing is to get the right person in the right seat. So, let's start our conversation there.

When you think about hiring the right people, what's the most important thing or how do you go about doing it to get great success and have a great team?

Jeff:                 I've made a lot of mistakes over the years and it took me a long time to figure it out, but I think that the heart of what I was doing wrong was thinking that I, alone, could detect a person's qualities during the interview process. And so, over time, our process which is relatively simple and straightforward, but it does involve multiple people. So, in a nutshell, I describe it in the book, so I won't go into too much detail here, but just to rattle it off, I think it's important to start by being the right company.

Josh:                What do you mean by being the right company?

Jeff:                 In terms of making sure that your policies, your like personnel policies are friendly, your schedules are reasonable, to try to attract really good people to a company that's not functioning well or doesn't have a healthy culture, doesn't take good care of its team members, you're going to have a really hard time doing that because a lot of those applicants will figure it out during the interview process, or the ones that don't figure it out will figure it out once they've been on your team for a little bit of time, and then they'll quit. So that's, I think, a really important place to start. And that's, of course, a very complicated, comprehensive thing so it's not easily fixed. But, in terms of things that you can correct quickly, or adjust quickly, the first thing we do is just to make sure, before we run an ad, that we know exactly the kind of person that we're looking for, not only in terms of the skills that a job requires but we also need to have a discussion for a new position, anyway, where we haven't thought about these things before, we have to decide “What are the personal characteristics that this person needs to have?” And once we've identified those, then we can prepare a good recruiting ad.

Josh:                So, when you say the personal characteristics, are you talking about the values they bring to the table or something else?

Jeff:                 Sure and skills. So, let's talk about values first. One of the things that's really important to us, as a company, is that we see many stakeholders having a role in the success of our company. So, we want people who believe that taking care of the environment, while we're conducting business, is important. We want people who believe that building a healthy community is important.

And just a couple of for instances there. So, if we get those things identified, and then find people who share those values, then they're going to have a much greater likelihood of succeeding with us because they understand the environment that they're coming into and they know the kind of people that they're going to be working with.

Josh:                So, I'm going to assume that these values will be the same for anybody that you hire, period, for whatever job you have.

Jeff:                 Yeah, I think so. I mean, it's sort of the top level. We're looking for a person with a lot of integrity, a lot of concern for how their actions impact other people. We're looking for conscientiousness, especially as it relates to making sure that they don't let their co‑workers, their families, or their customers, or their supervisors down.

Yeah, pretty much. I mean, they manifest differently in different positions. Like, as a mechanic, you know, what we call a technician now, we don't really need someone who's particularly conscientious with their interpersonal communication because, generally, they're more focused on hand‑eye coordination and making sure that there's, you know, a technical application to their skills.

Josh:                Your technicians, would they still need to believe that environmental safety and good to the environment is an important part of their belief system or do you not care about it for those folks?

Jeff:                 I'd say, universally, regardless of the position, we're looking for those things. And that isn't to say that we need everybody to have a Greenpeace sticker on their car when they come for an interview. I don't mean to suggest that because some of the values that we have get expressed in different ways, depending on the personalities.

So, we're just looking for people that appreciate that pro‑social approach that we have in business and want to be a part of something like that. And we're looking for people that means something to them, because we want to hire till retire. You know, we want to bring people on and retain them. We're very successful with keeping our turnover low. And there are so many benefits to the business.

If someone is just coming to us, because we're paying a little bit more than their last employer, the likelihood that we're going to be able to keep that person over the long term is much less than if we have a commonality among how we see the world.

Josh:                Yeah, I find that too many businesses are not values‑led.In fact, if you would ask the owner, what are the values of your business? They go, “Huh? What are you talking about?” My experience is, if you have four or five core values with good clarifying statements, then you're going to attract the right people to your company and you'll know who shouldn't join your company which is probably even more important about attracting the right one because then you stay away from what I call the brilliant jerk which is somebody who is highly, highly competent at their job but is just a terrible values mismatch for the company.

Jeff:                 And we've accidentally hired a few of those. I think most business owners are familiar with the type. It's a good term. I like it.

Josh:                I can tell you any business that has over 10 people and has been around for 20 years or more has hired at least one brilliant jerk, if not several. I think it took me 10 or 15 years to figure out why that was such a bad thing to have in a company.

So, are there anything else that you do around hiring that you would say is interesting, or different, or leads to your success?

Jeff:                 Yeah. Crucially, we're in an industry that's male dominated and other industries are populated by team members that typically come more from some groups than others. And one of the ways we've had a lot of success attracting women to the business and allowing us to tap into that half of the population and all that talent that we were previously missing, is to make sure that our recruiting ads are very clear in their invitation to traditionally underrepresented groups, that we're looking for people in groups like that, for example, in this particular case, women. And we've had a track record of success inviting them into an industry where they've not been previously represented in large numbers, but that they'll find other people like them, other women, in this case, who have succeeded and, you know, will find a culture that they enjoy being a part of, even though it's not an industry that's associated with being particularly welcoming to those groups.

Josh:                That might be an understatement.

Jeff:                 Yeah.

It's funny, we have-- our service manager is a woman. And we have, currently, six women technicians which is more than any other car dealership of any brand or size in the country. And the way she describes female technicians is unicorns. They're that rare. And what we found is we have to grow our own. So, we invite them to apply. And we've had success, you know, with those recruiting ads, getting people to think about coming to work for us. And then, of course, once they come and interview, they see that it's a culture that would be, you know, something that they'd want to be a part of.

Josh:                So you have some sort of an apprentice system?

Jeff:                 We do. And that's important too because, if you're inviting people who have not traditionally been participating in your industry, then they don't have the experience. Most of them do. It's very rare to find someone, for example, a woman technician, because there just aren't any. So, we have to grow our own. And so, we've developed-- it's a basic thing. This is not like we had to build a university from scratch, but we have a set of processes and a few team members that are devoted to growing people who are joining the business and don't have the skills but are eager and very capable of acquiring those skills.

Josh:                So, would you often take a service writer and promote them to being a technician or learning how to be a technician?

Jeff:                 We wouldn't be averse to that. I don't think we've ever done it that way. Generally, I mean, think about there's two different skill sets there. And, typically, the people that are interested in the hand‑eye, mechanical, technical aspects of the business aren’t the same people that are interested in that day‑to‑day interaction with a lot of people and have the ability to put up with, you know, the occasional grumpy customer or the rude thing that someone says.

Josh:                That would make sense.

So, after hiring, then what do you put on your list of how to make more money in business by doing the right thing? What else do you have in your menu?

Jeff:                 I mean, philosophically-- I guess, I alluded to it earlier, but one of the things that I think is important for business owners to understand, and this is more conceptual rather than technical which I have plenty of technical advice in the book, but conceptually I think it's very important that we understand that profits can be generated in larger quantities sometimes by focusing less on profits. And what I mean by that is that, for example, a lot of business owners are reluctant to give raises to people even who deserve them because they think, “Well, the business can't afford it.” But they don't understand that if you don't give a raise to someone who has earned it, they'll eventually figure it out and they'll either insist that you give them a much larger raise than then you would’ve otherwise needed to keep them or they'll just quit.

Josh:                Yeah. I find they just quit. My first mentor had a great saying, “You pay peanuts, you get monkeys”--

Jeff:                 Yeah. Right.

Josh:                --which, essentially, is true. I mean, by paying a fair wage, it doesn't guarantee you’re getting a good person--

Jeff:                 Right.

Josh:                --but by not paying a fair wage guarantees you're not going to get a good person.

Jeff:                 Sure enough.

Another thing I'd like to share is just one of the things I think we've succeeded with and I'm very proud of is that we've used projects of the dealership to connect with our customers outside of traditional marketing channels like, in other words--

Josh:                Can you explain what you mean by that?

Jeff:                 Sure. I'll give you an example. So, one of our salespeople heard about a golf course that was using goats to do landscaping at the golf course. And the salesperson said, “Well, why don't we use goats to do our landscape?” We have a huge facility. It’s 11 acres so we have a lot of grass. It's not like a typical dealership in any way that you would expect. There's a lot of trees and a lot of grass. There's a lot of poison ivy. Just a lot of maintenance to do. It's kind of an interesting place.

But, anyway, so we've used-- in the fall, we bring in goats and they do our fall cleanups for us. And it's a lot of fun for the customers. It's a lot of fun for our team members because we get to feed ‘em. You know, we take care of ‘em for the for the week or the two weeks that they're with us doing their work within the fencing that gets put up. And when we share these things with the community, it's a way to communicate with our customers, prospective customers, that we're the kind of place you'd want to do business without having to run an ad in the newspaper that says, “Come buy a car from us.”

Josh:                It sounds like your business-- and we talked a little bit about the dogs you have running around your dealership and you get more noticed for that than anything else. It sounds like your dealership is very, very different than the typical car buying experience that most of us have had in our lives.

Jeff:                 Yes. That was by design from the very beginning. And when we opened the dealership, we wanted to provide an alternative for people. And we thought that there was a real competitive advantage in doing that, too. That we could market ourselves, position ourselves as, as an alternative to an experience they didn't like. That we could solve a problem that a lot of customers have and that problem is they don't like buying cars. So, if we could find a way to make that experience more enjoyable then--

Josh:                I think people like buying cars. They don't like the experience of buying cars.

Jeff:                 Yeah. Yeah, they like driving off the lot in the car.

Josh:                Yeah. They like driving off the lot with the car but they don't like the process. You know, the thing that always annoyed me was the game that the salesperson played with the sales manager about going back and forth with prices. And I used to demand the sales manager came over and talk to me or I walk out the door. I didn't want to play that game.

Jeff:                 Yeah, right?

And for the longest time, we we're essentially one price. And, routinely, people ask me why dealerships continue to do the negotiation. And one of the reasons, I think, is that there's a culture outside the walls of the dealership that still expects that a little bit.

And we do run into people who, when they come in and the price that we advertise, you know, on our website is the price and we explain that to someone, they're like, well-- they don't know what to do because all the cars they bought, traditionally, they've gotten an additional discount on. Even though the price is a great price, as it sits, they want more and we lose customers. So, it's a challenge for us. And it's one of the reasons why we don't advertise that we're one price. We talk about a lot of things, but we don't talk about that because we're still working within a culture that's bigger than just our stores.

Josh:                So, did you guys become a Subaru dealership because it's Subaru or because it was the dealership that was available and you could buy?

Jeff:                 The latter.

Josh:                Okay.

Jeff:                 In 1998, my brother and I had-- we were in our 20’s. I guess, my brother may have just turned 30. We don't come from any wealth of any kind, inherited or otherwise, so we wanted this. We knew that this was a business - an industry that we wanted to buy into, but we couldn't afford stores that at the time had greater popularity. What has happened, of course since 1998, is that Subaru went from being just a tiny little niche car to-- in your state, for instance, in Vermont, it's the number one selling vehicle. Number one. I mean, ahead of Toyota, and Ford, and Honda. It's number three in New England. It might be number nine in the United States but it's a serious player now. And we benefited from the growth of the brand, for sure.

Josh:                Yeah. Subaru in Vermont. The rise in Subaru was in the exact proportion of the decline of Saab.

Jeff:                 Oh, yeah.

Josh:                Saab used to be the number one selling car in Burlington. And when Saab cratered, the folks with real money went over to Audi and everybody else went to Subaru.

Jeff:                 Well, I remember-- it's funny. I mean, I've been around long enough. I remember trading a lot of Saab’s back in the day. You know, it was definitely a lot of overlap with the customer to be sure.

Josh:                Yeah. It's really interesting how cars come and go.

So, what else do you have in your cookbook that you'd like to bring out?

Jeff:                 As it relates to sales, you know, what people think about the experience in a car dealership as being a very adversarial kind of thing. And I encourage business owners, whether in our industry or any other industry, to think about sales and customer service as solving problems for customers. And just to give an example, I hate to keep-- I don't want to devote the entire podcast to an exercise and what goes on in the showroom floor of a typical dealership, but I think in the typical dealership, there's a lot of pressure applied to try to obtain some result that benefits the salesperson. And, conceptually, we look at selling-- and I encourage business owners, in any industry, to look at what do you have to do to remove obstacles from the customer buying the car? So, in other words, we're not trying to sell them something. We're trying to create a situation where there is no friction for the customer to actually buy the car. So, it's like, instead of us being the agent of selling, it's the customer being the agent of buying.

Josh:                You know, that's a really important thing. I'm a huge fan of Donald Miller's StoryBrand. And StoryBrand essentially uses the hero's journey which is Campbell's thing, you know, for mythology. And one of the questions that he asked is, “What's the problem you're solving?” One of my nasty habits I have, when I connect with somebody on LinkedIn, is I generally look at their website and then see if they're talking about themselves or the customers and if there's anything on the website about the problems they solve, and not the stuff they do. It's rare that a business ever, ever, ever talks about the problems you solve. And, frankly, your customers don't care about the stuff you do. They only care about, “Can you solve my problem? And do you understand it? And do you have any empathy about it?”

Jeff:                 Yep. Right.

I think it's a good point. I mean, it's interesting you mentioned websites too, that it seems like a lot of businesses-- I think there's a lot of opportunity and we've tried to find this opportunity on ours, but there's still more opportunity for us, is to figure out a way to make sure that the businesses are communicating why they should do business with them instead of the competition. And when you visit most dealer's websites or any other business’ website, you have to go looking for what makes that business special. And I think it's just one of those things that it's the business owners or the people responsible for those things that the company just aren’t looking at their own materials to discover that.

Josh:                Well, I think a lot of businesses are scared they're going to drive off a customer. And one of my stupid little sayings I have, ”When you try to be everything to everybody, you're nobody to everybody.” So, you’ve got to pick a lane on what you're going to do and how you're going to present to the world, and those who like you will buy, and more people won't buy but that's okay because you'll still have plenty of customers.

Jeff:                 Yeah, sure enough. That reminds me of Harvard professor Michael Porter says, “Strategy is what you don't do.” And I think that applies to a marketing context.

Josh:                Yeah, there's a lot of that.

Jeff:                 Yeah.

Josh:                Hey, Jeff, unfortunately, we have reached the end of our time that we can spend together. I'm going to bet that people listening to this podcast, and even watching this on YouTube or Facebook, would like to find out more about you and where they can get more information. So, how would they go about doing that?

Jeff:                 Please visit jeffmorrill.com and there'll be-- you know, if they're uncertain, they can buy the book there or learn more about what we're doing with the book. My last name is M‑O‑R‑R‑I‑L‑L. Just got to jeffmorill.com. Or, if that's too hard to remember, profit wise book. If you Google that, you'll find our website.

Josh:                That sounds great.

And I have two things I would like you to do. The first is really, really important. We’ve been doing this podcast for almost six years. We're getting really close to episode 300 now. Not sure what we'll do when we reach there but we should do something, probably. But what I would like you to do is go, wherever you're listening to this podcast, that’s probably iTunes or Spotify, and please leave an honest rating review. It's really important for you to do that.

And the second thing I’d like to do is I developed this thing years, and years, and years ago, it was kind of a joke when I first did it, but I have found that people kind of like it. It’s called the Periodic Table of Business Elements. And what it is, is a whole bunch of strategies that you can use in your business to make yourself better. They’re actually more tactics and strategies, but they're things that you might use to make your business go from being successful to economically sustainable. It's really easy for you to find, just go to www.stage2planning.com/periodic. That's www.stage2planning.com/periodic.

This is Josh Patrick. You're with Jeff Morrill. We're at Cracking the Cash Flow Code. Thanks a lot for stopping by. I hope to see you back here really soon.

Narrator:        You've been listening to Cracking the Cash Flow Code where we ask the question, “What would it take for your business to still be around 100 years from now?”

If you've liked what you've heard and want more information, please contact Josh Patrick at 802-846-1264 extension 102, or visit us on our website at www.sustainablebusiness.co, or you can send Josh an email at jpatrick@stage2solution.com.

Thanks for listening and we hope to see you at Cracking the Cash Flow Code in the near future.

Topics: blue collar business, sustainable business podcast, Sustainable Business, Hiring, how to hire right person, jeff morrill, ding the right thing, profit wise

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