One of the great dilemmas in any small- to medium-sized dealership is attracting and keeping qualified individuals. Talented and driven people are a rare commodity in the automotive business. Therefore, developing existing staff becomes essential. One of the most challenging and demanding positions is F&I manager.
The demand for motivated individuals far outweighs the pool of talent. This brings the dilemma full circle. How do you discover talent within the existing body of employees? Perhaps the better question is, with so much at stake, why risk a potential legal disaster by anointing just anyone for the position of an F&I professional? How does a dealership maintain compliance while generating revenue in a legal, ethical manner?
The F&I professional’s duties are to bring both parties together in a legally binding contract in a mutually beneficial manner. This becomes a weighty responsibility that makes integrity of purpose and the conscientious execution of duties essential. Dealership sales operations depend greatly upon the production of profit that results from having effective F&I managers. Dealership operators frequently avoid unnecessary litigation by educating and enforcing strict rules of compliance.
The dealership’s finance office is responsible for staying up to date on regulatory information and compliance issues and for ensuring local, state and federal laws are followed. In fulfilling their duties, F&I professionals must serve both the dealership and customers. An ethical finance professional attempts to serve the customer’s best interests while contributing to the dealership’s profitability.
The dealership needs to establish rigorous guidelines so it can find, develop and keep qualified individuals. Here are five elements to serve as strategies:
1. Hire the Right Individuals
Finding the right individual to fill the role of F&I professional requires looking for very specific personality traits. The list of characteristics can be endless. However, these characteristics are paramount: ability to translate the value proposition of intangible products, charismatic connector, acute attention to detail, highly disciplined, organized, multi-tasker, customer-focused, persistent, tenacious, avid goal-setter, enthusiastic, passionate, responsible and highly ethical.
To make sure an individual fits the outline of the position, the dealer should make every potential employee complete an online personality and business reasoning intelligence evaluation. There are multiple websites and vendors that provide detailed personality tests that help the employer align the potential employee with the available position.
The F&I professional should undergo an extensive training program. The program should at a minimum cover legal compliance, proper document disclosure, menu presentation, presentation skills and closing skills.
Every F&I professional should have to complete the rigorous training program from the Association of Finance and Insurance Professionals (AFIP). The AFIP certification includes multiple training resources that outline local, state and federal laws as well as ethical standards. Once an F&I professional completes the training, he or she must take and pass a comprehensive test. The grades are centered on comprehension of the materials, and there is a pass or fail structure.
As the demands on the F&I office increase, employees’ training should be updated regularly. At the very minimum, an F&I manager should attend a week-long training seminar once per year. To hone skills, the F&I professional should take part in every sales training meeting performed weekly by the sales management team.
3. Set Performance Standards
Establishing minimum performance guidelines is essential for creating a win-win atmosphere. A detailed job description should highlight very specific requirements of the position. Here are a few of the standards that should be outlined:
• Gross revenue production
• Detailed plan of how the F&I professional will protect the dealer
• Deal completion and compliance requirements
• Per-unit dollar performance
• Product penetration expectations
• Finance reserve expectations
• What the specific measurement standards will be and how they will be utilized in the decision-making process.
Motivation is a very complicated issue. The debate will run on about whose responsible for creating motivation and how? Reinforcing the specific behavior that the dealer wants creates an environment where the employee understands what’s expected. The guesswork and unknowns are eliminated. Recognition, most of the time, carries more value than handing out a monetary reward.
5. Conduct Formal Reviews
Holding formal reviews annually is essential for setting clear expectations. These critical discussions allow for constructive criticism on job performance issues as well as reinforce the positive growth of that individual. Regular performance reviews should be done throughout the year to let the employee know what they’re doing well and where improvements are needed. A business intelligence (BI) metric performance sheet should be produced weekly so that the F&I professional can track his/her performance. The spreadsheet should have all the key performance measurements highlighted for at-a-glance review.
The F&I professional is the very core of the sales department’s processes. The F&I professional is a highly-compensated, hybrid salesperson. These five strategies will guide the dealership and the F&I professional so that the results are congruent with the dealer’s goals.