Of course, any dealership that stays even today is a winner. In 1993 nearly 10% of all U.S. car dealerships lost money, according to the National Automobile Dealers Association (NADA). For the most part, Childress has kept after-tax margins above 2%, compared with NADA pretax averages of 1.0% to 1.6% from 1989 to 1993. Not long ago Childress had no Lexus, no Acura, no Infiniti to contend with. Now there are 95 new-car dealerships in metropolitan Phoenix -- five are Buick outlets -- and new dealers move in each year.
Inside the dealership you begin to get a sense that there's something, well, different about this place. You realize you haven't heard a brash voice or a swear word or the imperative tense -- anything tense, for that matter -- all day. Childress folks address one another amicably: "Nice job!" they say, "Why don't we . . . " and "I'd suggest . . . " and "Sorry!" As in service boss Tom Anderson's apologizing -- not deferring, just being respectful -- to Mark, a lot attendant, when telling him he'd have to hustle that morning because a new lot attendant was going to be in a training session.
Maybe niceness is in the water here. Rusty Childress believes that helping people realize their full potential is just as important as pumping up profits. Or perhaps it's a function of the values of the courtly founder, George Ray Childress -- "Mr. C" as he's affectionately known -- Rusty's father. In earlier days, Childress found itself dubbed "The Country Club" by other dealerships for its relaxed ways and low-pressure approach to sales.
But workforce harmony didn't cut it in 1987 when calamity hit in the form of a computer system that the company belatedly found out was a development model. Soon, long lines at the service driveway and the cashier's office were sending CSIs into free fall. The senior Childress and then general manager Jerry Hughes had no answers. Hughes called in Childress's son -- at the time, head of marketing -- and asked for his help. The energetic twenty-something who'd once wanted to become a geologist so he could play on top of volcanoes now had something just as hot to handle. The challenge came with a new title -- owner-relations manager. And it came with tacit permission to change the entire organization.
You have to understand something about Rusty Childress. For being such a regular-looking guy and for all the Tom Peters slogans he uses, he's quite the hotdogger. The back of his business card tells all: hometown, Tucson; education, Northern Arizona University (B.S. Geology/B.S. Earth Science) and NADA Dealer Academy; interests, Harley-Davidson, Mardi Gras, the beach, and so on -- kayaking, Swedish massage, speaking on total quality management. One wall of his office is all photos of himself running big white water in his kayak. Overhauling his father's company was "The Next Big Adventure" -- white-water rapids for the workweek.
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Rusty had worked his way up and knew the dealership well. The idea of fixing the organization -- not the computer -- held powerful appeal. It was risky. But he knew that to manage risk, you use information. He began signing up for courses and seminars. ("Back then, if you spent $39 on a seminar, you really had to sell it.") A Tom Peters session led him to the Ritz-Carlton hotel chain, and soon Childress was interrogating hoteliers about customer-service excellence and total quality management. (At Childress Buick/Kia, the terms are used interchangeably much more than consultants would care for.) And he was getting himself one learning opportunity after another. There's another line on that telltale business card: under organizations are Rotary, NADA, Arizona Automobile Dealers Association, Arizona Quality Alliance, American Society for Training and Development, and American Society for Quality Control. And that's only about half the list.
Soon Childress was "getting pretty smart" about employee involvement, communication, benchmarking, and total quality. "So I had to do some training, had to write it down." The result is Creating Service Excellence, 158 ring-bound pages of an employee manual that's very different from most. There's no information about sick leave here: the subtitle is "Employee Manual for Quality Customer Care." In four sections Childress communicates about communication: Active listening skills and interpersonal communication make up two sections. The one on listening tells how little listening training is done and describes how to develop a desire to listen and how to determine a person's intent or purpose. New recruits have to read the book as they go through "Childress College" -- the company's seven-week orientation, in which employees spend one day a week in a different department -- and then sign a pledge at the end that says they know who their internal customers are, too.
In June 1991, about the time he was distributing the manual, Childress "borrowed" the Ritz-Carlton's company-credo idea. With help from employees, he crafted a mission statement that appeared in every office and on every employee's business card. He also began to mobilize employee teams all over the company to spotlight themes as sublime as quality and as earthy as housekeeping.
The same month -- a little over a year after he'd been promoted to vice-president and dealer -- Childress resurrected Squeaks and Rattles, a monthly newsletter that had appeared briefly in the 1970s. This time around, birthday gossip was joined by stories that communicate about communicating: one and a half pages of a recent six-page issue list "attaboys" and news from "Take 5" meetings, another device for letting ideas bubble up. (Childress picks five workers at random and asks how they would improve the dealership.)
Just over a year later Childress borrowed the idea of a president's letter from a local community college and launched Dealer Direct, a weekly E-mail newsletter received by every employee with a computer. Every Monday morning, he would crank out a breezy bulletin that might contain data on Buick's nationwide sales or an appeal for workers to sign up for a team, and there was always a folksy inspirational aphorism that would do Reader's Digest proud. Then managers would meet with employees for doughnuts and dialogue.
But something still wasn't right. To the workforce, Childress Buick/Kia was no Information Central. In 1991 Rusty Childress had begun polling employees; by late 1992 the results were revealing that all was not milk and honey. "What would you like to see more of?" asked one Employee Satisfaction Index questionnaire. "More things like this. At least you are trying to find out what is really going on around here" was one reply. Childress ran another survey to test the "coefficient of company culture" with questions like these: "Do employees receive the information they need to understand organizational changes?" Grade: C plus. "Are employees told about day-to-day events?" Grade: B minus. "Do employees receive information about major changes in a timely way?" Grade: B.
