Everyone reacts to unexpected new in different ways. One reasonably consistent response to “we’ve hired a consultant” is a combination of fear, anger, and a gut check. Why is my client hiring a consultant? Why do they think we need one? What do they know that I don’t know?
Consultants are just out to get operators and will either squeeze all profits from a deal or award my location to someone else. Consultants only make money by pressing this already-present profit margin further. Sound familiar?
Some of those concerns and emotions are often valid, but they don’t have to be. You may recall the “I’ve got nothing to worry about. We aren’t doing anything wrong,” or my favorite: Bring it on!
This tale is of two recent consulting projects with surprisingly similar (positive) outcomes, but very different paths. Both began with the apprehension described above. One operator embraced the process, and the other rejected it and almost created a self-fulfilling prophecy. By the way, these are similar reactions to when auditors are brought in, but that’s another (and very different) story.
Scenario number one is a high-profile residential valet operation in South Florida. A high-profile technology-focused operator tackled their first valet operation. They did many things right, including hiring people from valet. They are one of the growing groups with their “own” technology, and it’s not designed for valet. It could be (transformation is underway), but perhaps we should have shared that with the client.
The valet is labor-heavy and losing $150,000 per month. The new operator has reduced the auto damage substantially, and the client appreciates that, but it’s old news. They significantly improved over the last operator, but the owner wants to stop or considerably reduce the loss. The owners are trying to find that magical balance between cost and service. This is compounded by two key decision makers: one is focused on the numbers, and the other on service. The operator has been on board for several months and is trying to please both.
The client calls me and says, your firm is highly recommended, we need to see if you can come to South Florida and tell me if this operator is worth what we are spending or not. We are losing more than $150,000 a month.
I arrived and found what is often the case if you look at it objectively and not from a spreadsheet. A strong team is doing what Client One wants them to do. They don’t have much interaction with Client Two. The operator takes great pride in customer service, wants to keep them happy, and does not want them waiting for their nice cars.
Many consultants start with transparency (unless the operator is believed to be stealing, which is rare in 2023). They have been to this “movie” and observed the location. In this case, we found a hard-working group doing what Client One has told them to do. That leads to many downtimes, and the on-site parking operator knows that no one will let the operator adjust staffing because of the abovementioned goal.
We met with the regional manager (who flew in for the three days without being asked to do so).
With the consultant’s arrival, the operator is apprehensive. They have been working hard, reducing substantial auto damage, and exceeding the requested service levels. They listen to our planned approach and take some comfort in knowing our team, who are all former operators. Imagine their joy when the strategy is transparent, and let’s walk through these observations TOGETHER before anything is reported to the client. They engage, and the “partnership” begins.
Client Two has no interaction with the operator. They see numbers and “hear things” about lazy employees with little to do. The operator has asked Client Two (repeatedly and with thorough documentation) for permission to experiment with several ideas to reduce costs without impacting the service level. They share with us that their proprietary has technology gaps but is on their development roadmap (dates and tangible evidence).
Working together on-site in just four days, we form a plan for both client contacts that provides acceptable wait times, balances staff, shares overnight staff, empowers the management team, and adds tech, streamlines the rate schedule and considers staff suggestions that could work.
We located several cars that needed to be added to billing (client communication issues), improving operations by $100,000 per month. The new loss of $50,000 is well worth the value the valet provides. A rate increase is planned for 90 days later.
Together, the client, operator, and consultant delivered a significant win.
Next month, an operator suspicious of the consultant almost created a self-fulfilling prophecy.
