Unified Pay Plans

[hilinebdcguy]

I have heard that we are moving to a "unified pay plan" and I am not sure as to how this will pan out. Our BDC is one group with 4 brands from 4 separate dealerships. I have one person on my team who has been with one dealership over 15 years and the salary is very generous.

I feel like a one pay plan for the BDC may not be in the best interest of all parties.

In a nutshell, my pay now will not be determined by my GM who knows me, hired me, and who is well aware of my ability and skills to someone who barely knows me and did not hire me or does not know my skill and background.

I came to the dealership already underpaid but I accepted the position because my former boss recruit me to get this new BDC going and now we are moving into a unified BDC with a whole new program. From my understanding, the idea is to cut base salary and have better bonus. For me, I rather have a comfortable base because bonus fluctuates which alters my lifestyle.

What do you guys think?

 

[joe.webb]

Hello Christian,
I can imagine what you're going through. I believe most on this forum feels that everyone should be rewarded on their own merits. Personally, I believe pay plans should be structured initially based on skill level, alongside anticipated goals, or it should be performance-based.

Understand why your dealership is unifying the BDC's pay plan, though. Most likely they feel a level playing field will increase morale between the BD Agents. They probably believe it allows everyone to be tracked on an individual level with the same baseline, thereby determining the ROI of the team and individual as well, provided they still track individual metrics.

If you are looking to change the unified pay plan, the only solution may be to ask to be placed on a solely performance-focused pay plan (as they're likely trying to trim the fixed costs of differing salaries.) Or, they need to recognize that, provided the 15 year veteran of automotive outperforms the 1 year veteran, there should be a longevity stair-step structure to reward employee retention.

 

[Jerry Thibeau]

Sounds like socialism to me. Print this story out and put it on the decisions makers desk. Write at the top, "is this what you are hoping for with your unified pay plan?"

Story:

An economics professor at a local college made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Obama’s socialism worked and that no one would be poor and no one would be rich, a great equalizer.


The professor then said, “OK, we will have an experiment in this class on Obama’s plan”. All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A…. (substituting grades for dollars – something closer to home and more readily understood by all).


After the first test, the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. As the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too so they studied little.


The second test average was a D! No one was happy. When the 3rd test rolled around, the average was an F. As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.


To their great surprise, ALL FAILED and the professor told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed.
It could not be any simpler than that.


There are five morals to this story:


1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.
3. The government cannot give to anybody anything that the government does not first take from somebody else.
4. You cannot multiply wealth by dividing it!
5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

 

[ddavis]

I was reading about Ronald Reagan. When he was an actor, the top tax rate was well over 70%. He was in demand but he would go on vacation before he hit the high tax rate. He knew, first hand, that the tax lowered productivity.

 

[Jeff Kershner]

Sounds like socialism to me. Print this story out and put it on the decisions makers desk. Write at the top, "is this what you are hoping for with your unified pay plan?"

Story:

An economics professor at a local college made a statement that he had never failed a single student before, but had recently failed an entire class. That class had insisted that Obama’s socialism worked and that no one would be poor and no one would be rich, a great equalizer.

The professor then said, “OK, we will have an experiment in this class on Obama’s plan”. All grades will be averaged and everyone will receive the same grade so no one will fail and no one will receive an A…. (substituting grades for dollars – something closer to home and more readily understood by all).

After the first test, the grades were averaged and everyone got a B. The students who studied hard were upset and the students who studied little were happy. As the second test rolled around, the students who studied little had studied even less and the ones who studied hard decided they wanted a free ride too so they studied little.

The second test average was a D! No one was happy. When the 3rd test rolled around, the average was an F. As the tests proceeded, the scores never increased as bickering, blame and name-calling all resulted in hard feelings and no one would study for the benefit of anyone else.

To their great surprise, ALL FAILED and the professor told them that socialism would also ultimately fail because when the reward is great, the effort to succeed is great, but when government takes all the reward away, no one will try or want to succeed.
It could not be any simpler than that.

There are five morals to this story:

1. You cannot legislate the poor into prosperity by legislating the wealthy out of prosperity.

2. What one person receives without working for, another person must work for without receiving.
3. The government cannot give to anybody anything that the government does not first take from somebody else.
4. You cannot multiply wealth by dividing it!
5. When half of the people get the idea that they do not have to work because the other half is going to take care of them, and when the other half gets the idea that it does no good to work because somebody else is going to get what they work for, that is the beginning of the end of any nation.

Good stuff Jerry.

Might not be a bad idea to print his shared story and place it on the desk of whoever came up with this idea.

I believe Joe has it nailed and I would consider asking to go on a performance based pay plan.


I've seen dealers have a unified bonus structure to help make sure customers who responded on someone's day off were answered and employees weren't fighting against one another over who the customer or sale belongs to.

Here is a thread that you may find beneficial to read http://forum.dealerrefresh.com/f5/do-you-have-bdc-622.html - it doesn't refer to unified pay plans BUT it provides some excellent conversation around the BDC and pay plans.