Manheim’s car and truck auctions improve for buyers and sellers with high-tech changes


Grace Huang, Cox Automotive?s president of inventory solutions, and Joey Hughes, general manager of the Manheim, Pa., auction, at a town hall. The company?s changes have rolled out at one auction site after another and are scheduled to culminate Aug. 6 with the Puerto Rico auction.

Long lines at the counter. Different ways of doing business at each auction site. Reams of complex paperwork.

A three-year, $400 million high-tech makeover of Manheim’s auction operations eliminated many such frustrations that buyers and sellers used to experience.

“Clients are really embracing the changes,” said Grace Huang, president of inventory solutions at Manheim’s parent, Cox Automotive, as seen, for example, by the number of buyers who settle transactions and pay online, rather than standing in line post-sale. “We’re telling our people: ‘Just because you don’t see them at the counter anymore doesn’t mean they aren’t having a great experience.’ ”

As Automotive News reported in 2014 when Manheim began its Designing the Future project, the overhaul was intended to let employees spend more time handling customers’ specific needs, rather than shuffling paperwork. Manheim’s goal was to deliver a better customer experience and to better position its business for the future by re-engineering every process and replacing old technology.

Barnard: Procedures are standardized.

Standardized

The project also sought to standardize procedures across all 78 of Manheim’s U.S. auction sites.

“We were operating 78 little businesses,” said Janet Barnard, who as then-COO of Manheim North America launched the project.

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“If you walked into one site, you’d have to transact [your business] that way for that location,” and a different way at a different location, said Barnard, now chief people officer for Cox Automotive. “Now, it doesn’t matter which site you walk into, you can do it all. You can do business as one Manheim, not location by location.”

Or, as she recalls hearing from a consultant brought in to aid the transition: “Most companies that we help are going from an old standard to a new standard. In this case, we went from no standard to a new standard for the first time.”

Throughout the process, Manheim’s litmus test was, does this change make things easier for clients? Indeed, when the company set up a website to explain the changes to customers it named the site simplemanheim.com.

One of the first changes addressed setting up an auction sale.

Imagine a lane that will run 25 vehicles apiece from three consignors. Before, a Manheim employee slotted each car and truck in order, assigning each a number from one to 75. But if the first company in line called to say it now planned to offer 30 vehicles, the employee had to manually renumber vehicles 26 and up individually.

Automating that task was the first tool created as part of the effort. Now, the numbered list appears on a computer screen that lets users drag and drop changes in the order of sales, making it easy to insert newcomers anywhere on the list. It reduced the task of setting up an auction sale to two hours from two days previously.

The tool was created in six weeks “by our developer sitting in the cubicle next to employees performing the task,” Barnard said. “He created a prototype and showed it to the people doing the job to get their input along the way.”

Sold!

After Manheim’s $400 million overhaul, auction buyers can:

  • View and pay consolidated invoices from anywhere via manheim.com
  • Order post-sale services online
  • Use electronic payments or a line of credit to buy vehicles, services
  • See changes post to their Manheim account in real time
  • View and print invoices, bills of sale from manheim.com
  • Review their purchases across all U.S. auctions in one consolidated account
  • Follow the same procedures at any U.S. Manheim auction site

Manheim managed the entire project using that side-by-side approach. It enlisted corporate and field staff to craft new procedures, which were then tested repeatedly at auctions before implementation. It also identified key personnel at each site to champion the changes, establishing what came to be known as Timeshare University.

As Manheim began rolling out initial changes, first at its New Orleans auction then at one in Mississippi, it realized “we have to build some muscle memory within the network,” said Doug Keim, senior vice president of client experience. “We gathered 400 subject-matter experts from the field,” and via ongoing training every couple of weeks on the latest changes, made them the trainers in the field.

“You have to have people equipped,” he said, with both “emotional maturity and literacy with the system” to “put their arms around people” who are stressed by change.

What changed?

What changes do Manheim clients see?

Mostly, Huang said, “it’s what’s not there.”

They still buy and sell vehicles, in the lane, online or via simulcast — which enables a buyer in lane 2 to bid on a car there and a truck in lane 5 at the same time — just as they used to. They may notice, though, that the auction’s controlled chaos is quieter.

There are no more printers or five-part forms in the lane. “All the paper is gone,” Huang said, with those forms instead handled on smartphones or other devices. A key milestone in every auction’s transformation was bundling printers onto pallets and shipping them away.

During bidding, buyers now can get real- time access to lines of credit. That avoids, said Keim, what used to happen: “Oh, I didn’t realize I had exceeded my line of credit. I can’t buy this car.”

But most of the changes affect what happens before and after the bidding.

Before the auction, buyers can register online, get their gate passes and set up their preferences and notifications electronically. Sellers can drop off vehicle titles at any Manheim location.

Afterward, checkout is dramatically different, with no more standing in line.

“They used to get the paper form, go to the counter, and pay by check or whatever,” Huang said. Now, arranging payment and floorplanning, as well as ordering a post-sale inspection and transportation can all be done online. Some buyers skip the counter and do everything on their phones while sitting in their cars before heading back to the dealerships, while others return to their offices to tackle those tasks.

Because all data on sales are available immediately online, sellers don’t have to go back to the office to tell their accountants what they sold.

With the changes, about 40 percent of purchases are settled through manheim.com for payments and lines-of-credit access, Huang said. “Clients are saving about 30 minutes each week on sales day,” which translates to 22,000 hours across all Manheim sites.

Manheim’s internal customer-satisfaction scores, measured on a scale of 1 to 100, have climbed “each month,” adding 20 points to an undisclosed record high in May, she said.

After rolling out the changes at one auction after another, Manheim deployed the project in April at its largest auction site: Manheim, Pa. Its Puerto Rico auction, because of delays caused by Hurricane Maria, is slated to be the last to get the changes, on Aug. 6. Barnard visited the Pennsylvania auction the first week of May, two weeks after the launch. “They all said it was a nonevent,” she recalled. It involved “massive change, but by then [it was] well rehearsed and practiced.”

Keim: Employees became trainers.

More changes

More changes are coming. “We’ll add new enhancements and features every two weeks for the next few years,” Keim said.

Manheim has begun using its online tools to better measure work efficiency, tracking metrics such as the number of gate passes issued electronically and the number of clients who use online funds transfers to pay.

It also wants to implement state-of-the-art tracking technology, working with Cox Communications, so that cars can be located on auction marshaling yards down to the parking spot, Huang said. That technology is being tested at the Palm Beach and Orlando auctions in Florida, with hopes it can start being deployed toward year end.

After that, Huang wants to look at processes and software tools used in auctions’ reconditioning shops.

Timeshare University is poised to help with all of that, Barnard said. “We now have 400 change agents.”


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