Puente Hills Toyota, as one of the best-managed dealership with many awards for excellent performance in the country, was found some issues in management process. PHT used performance-based incentives in its result control process. It involved the rewarding individuals for generating good results.
The advantages under this control were greater employee commitment and motivation. Employees had the higher the performance, the larger amount of bonuses they would have. Additionally, the employees helped company to earn a perfect profit. While the disadvantages under this control were that the control did not have constraints for employees’ actions. So there were two problems faced by PHT. The first one was sales personnel were not effective at keeping in touch with potential customers. The other one was the high value of CSI led to employees “coached” customers to complete the questionnaire. However, CSI was a considerable measurement of employees’ performance. The authenticity of CSI is quite significant. Both problems appeared because of the incentive plan. Employees wanted to save time for more customers so there was come situations they used to save time, like cutting corners, or ignored some. Besides, the employees ignored the importance of teamwork.
Although the management process of PHT existed some issues, those problems were also appeared in all other dealerships in the industry. If the incentive plans changed, it may cause a big amount of turnover or reduce the motivations of employees. All those changes may result in losing of profit for the company. Teamwork is a help way for employees to improve efficiency and productivity. Some of team members can focus on selling and some of them can focus on keeping in touch with customer. Finally they can get the split of the bonuses under the whole