DealMaker implements companywide procedural training

In the wake of an investigation by the state attorney general that cost the company $2 million in payments, DealMaker Auto Group has begun an aggressive training campaign to standardize and improve operating procedures at all seven dealerships.

The effort is being pushed by DealMaker's principal, P.J. Simao, who has hired Premier Performance Group LLC, a national training and consulting company that specializes in dealership restructuring, to work with employees over the next year.

DealMaker Auto Group consists of Dodge Chrysler Jeep dealership on Arsenal Street; a Honda dealership on Route 11; a Chevrolet dealership in Theresa; a Nissan dealership in Potsdam; and Ford dealerships in Watertown, Ogdensburg and Clay.

Barry M. Bourgeois of Bourgeois Consulting Group LLC has taken over as day-to-day manager of the dealerships, a role he assumed shortly after the extent of Attorney General Andrew M. Cuomo's investigation last summer became clear.

Mr. Bourgeois was hired in March to streamline operations at the seven locations and work as a manufacturing liaison for the corporation.

"I was brought in with one goal; as facts unfolded and different areas were identified, I then reached out and brought in the Premier Performance Group," Mr. Bourgeois said. "They have a proven track record of taking stores and increasing their profits."

A real estate developer, Mr. Simao had not been involved in the daily operations of the dealerships before the attorney general's investigation.

The need for extensive training within the DealMaker staff also was emphasized by David Grandeau, a nationally recognized expert on ethics and compliance issues whom Mr. Simao hired in the fall to review the DealMaker business practices. Mr. Grandeau recommended a series of corrective actions, including compliance training for employees, Mr. Bourgeois said.

In January, the company agreed to pay more than $2 million in payments, fines and restitution for failing to pay off, in a timely fashion, loans on vehicles taken in as trade-ins. Mr. Cuomo also said the dealership would have to repair the credit reports of consumers who were affected by its delinquent payments and be subject to independent oversight for two years.

According to a release at the time from Mr. Cuomo's office, an investigation determined that DealMaker "systematically" delayed paying off vehicles accepted in trade for new cars throughout 2007. In some cases, payments had not been made for more than two months, damaging customers' credit. The delinquencies affected more than 150 consumers in Northern and Central New York.

Attorneys for DealMaker had acknowledged that the business encountered "internal control" issues that led to the late payoffs.

Scott Lee Reas, executive vice president of Premier Performance, which has headquarters in Barrington, Ill., arrived in February to evaluate the dealerships again. For a week, Mr. Reas visited every store, interviewed every manager and examined balance sheets, sales techniques and service procedures.

"I just found there was really no centralized management structure," Mr. Reas said. "An organization is a lot like a car without good steering and brakes. You can get it to go down the road, but it's a really rough ride."

The lack of a clear chain of command in the dealerships created confusion, Mr. Reas said, for both the staffers and the customers they served.

"If you walk into any good retailer, the stores are laid out very much the same. You have an idea of what kind of reception you will get," he said. "There was none of that on a store-by-store basis. Things were done differently; salesmen were paid differently — there was no set structure to give the level of service that Mr. Simao wanted to give customers."

A need for better core operating procedures was not unusual for a rapidly expanding dealership group, Mr. Reas said. But the consultant was a bit surprised when, after he presented his findings, Mr. Simao immediately hired his company to train all employees from "the general managers to the porters washing cars."

Mr. Reas said such a step is usually reserved for the "largest, publicly held" companies.

Premier Performance tailored a training program for DealMaker, which included the equivalent of 24 days of training for the general managers, spread over a year. The training, to teach staff how to handle all aspects of the business, from new- and used-vehicle sales to asset management, will be done by Mr. Reas and Premier's executive vice president and general manager, George Ewing, at the DealMaker conference center in Watertown.

Although the training has just begun, Mr. Bourgeois said, managers have been responsive and already have implemented changes within the DealMaker dealerships.

"I would measure success with saying that the culture has changed 180 degrees," he said. "Customer satisfaction is the primary target. I can't stress enough how much P.J. wants us to make the experience for the customer the highest quality out there."

Joseph F. Macutek, general manager at DealMaker Dodge Chrysler Jeep, said the six classes he has had so far have helped him understand all aspects of the business, from sales to service and parts. The general managers have been learning techniques for restructuring operations to increase profits, he said.

Descriptions of the duties and responsibilities for each position also have become clearer, Mr. Macutek said, and general managers have assumed more responsibility as a result.

"For myself, having more control over what goes in and out of the store I think will make a big difference," he said. "Everybody wants to move forward and try to learn as much as they can, which is a positive thing."