Issues In Depth
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Offer younger employees assignments outside their normal sphere to keep them challenged. Here, a part sales representative sells a part to a walk-in customer at Mascot Truck Parts. (Photo by Jim Park)
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1/20/2010
The Graying of the Aftermarket
By Diana Britton, Managing Editor
While distributors aren't exactly going on hiring sprees these days, there is a major issue within the industry that is being overshadowed by the current economic situation. Although it's on the back burner for now, a small number of young people in the industry are taking notice. "It didn't make as much sense until someone brought it up, and I looked around me," says Matt Heller, the 30-year-old director of CSP Global, Detroit.
The issue is "the graying in the aftermarket," a term used by Chuck Udell, senior partner at Essential Action Design Group, Leawood, Kan., to describe the fact that the majority of the aftermarket industry consists of those in their 50s and 60s. Many of these aftermarket professionals are coming up on retirement, and distributors will need to act quickly to replace this dwindling workforce.
"There needs to be that next generation trained and ready to take over as older employees retire or move on and leave critical positions open," says Adam Kretz, 25, production manager, drivetrain products, for ArvinMeritor.
"I think it is very important to get younger people into the industry, because with natural attrition, the company is going to lose more and more experienced employees who hold all the knowledge," says Jessica Sendelbach, a 24-year-old sales analyst at ArvinMeritor.
Generation Y, those born starting in the mid '80s, are just coming out of college and are poised to enter the workforce. This generation, a larger group even than the baby boomers, is a huge, technologically advanced labor force that is set to change the shape of the U.S.'s labor, according to Kenneth Gronbach, author of "The Age Curve: How to Profit from the Coming Demographic Storm." And there are Generation X workers out there, those born from the late '60s through the early '80s. While this is a smaller generation, they share many of the same characteristics as their younger counterparts.
Good timing
Now might be the best time to take advantage of young workers, given the state of the economy. Generation Y is experiencing 20 percent unemployment rate at entry level, and this presents employers with the opportunity to hire the best and the brightest people in almost 20 years, Gronbach says.
The short attention spans typical of these young people, which some may see as a drawback, actually means this generation is built to drive efficiency and expedite things in the workplace, Gronbach says. This generation won't worry about benefits, and won't bring their dogs to work, he says. They're looking for a stable place to put their skills to good use.
"I know things are difficult in today's economy and that all companies are having a hard time and that we all need to work together to get through it, but I am just very thankful to still have my job," ArvinMeritor's Sendelbach says.
This situation presents an interesting opportunity for distributors to position themselves for the future upturn. "The best times for the U.S. in terms of our economy and GDP are ahead, not behind us," Gronbach says. "Plan now."
The changing aftermarket
ArvinMeritor's Kretz points out that the industry has seen major change in the last 10 to 15 years, "and needs a new way to operate if it hopes to survive. Bringing in young fresh talent with new ideas and new ways of looking at things is a great way to help push through the tough times and emerge a stronger redefined company for the future."
One of the things that needs to change is adapting to the concept of competing on a global scale. The aftermarket industry is becoming more global each day. While the auto industry has been global for many years, the commercial truck aftermarket is just starting to expand worldwide, says CSP's Heller.
This is one place where Generation Y may be a big asset. According to Gronbach, China, for example, won't have the labor force in position when the economy bounces back. The county's One Child Policy Act, which has been in place for the last 30 years, has prevented about 400 million births. He says that when the manufacturing industry comes back in the next three to 10 years, the U.S. will be the industrialized nation that can manufacture and consume.
In addition, the aftermarket industry is implementing new technologies, new computers and moving toward Web-based systems, something the new generation is very familiar with. "They speak cyber as a first language," Gronbach says.
These are the types of changes that excite the younger generation, as they have the ability to bring new ideas to the table. "That's where the younger generation is going to be interested," Heller says.
Central Screw Products, Heller's company, is an example of the changing face of the industry. The company went global in 2008 with the launch of CSP Global, the company's China presence. Heller says that the skills involved at CSP have helped prompt the company to hire younger people. Those skills include communication, travel, technology and going to other countries with a fresh outlook. "I think it's important to drive change," he says. "We've had the opportunity to break that mold."
Kretz notes that the pace of the automotive sector is one thing that attracted him to it. "Things change so rapidly from day to day it keeps it exciting," says Kretz. "New challenges are presented on a daily basis - ones that force you to think about how you do things in a whole new light."
'It's an image problem'
But getting young people into the mix is not as easy as it sounds. Misconceptions about the industry being dirty and old-world have been keeping people out. When people think aftermarket, they think of a greasy mechanic with a toolbox, ripping people off.
"It isn't the most glamorous work out there," ArvinMeritor's Sendelbach admits.
"Outsiders might think a distributor is a 'dirty' business, but that couldn't be farther from the truth," says Brandon Allen, a 22-year-old, second-term marketing co-op at ArvinMeritor, which offers students the opportunity to alternate between study and work through its co-op program. "It's a viable, growing business - just look at the real behind-the-scenes part of the business - [that] can be very exciting and promising to a young person."
When Heller graduated from the University of Michigan, he remembers the majority of his colleagues going into law or business, not truck parts. The aftermarket is "not viewed as the sexy place to go to work," he says.
The image problem also stems from the public's lack of knowledge and understanding about what goes on in the industry. When people see a truck on the road, they don't think about where it was made or where the parts came from, Heller says.
"It is not really something that kids grow up saying they want to get into, but once you get into it, you really can't see yourself working with anything else," Sendelbach says.
The aftermarket industry is not taught in schools or even encouraged by school counselors. Steve Hoellein, president of Felt Auto Parts in Ogden, Utah, is very involved in the schools and tries to educate counselors. During a recent talk he gave to counselors, the counselors could not tell him one thing about automotive programs offered in the state of Utah.
The schools are definitely a good place to start changing that image. Essential Action Design Group's Udell also makes presentations to schools about how the industry has all the same aspects as other perceived "good jobs." Jobs in the industry are challenging, have good earning potential, provide stable employment, require in-demand skills and hone skills that are portable.
Another way to address the image issue is through branding. Gronbach suggests distributors hire a professional marketing company to help beef up their brand. "The bad image comes from themselves. If the barn needs painting, paint it."
The case for the next generation
The image problem goes both ways. Younger people don't have a good image of the aftermarket - and hiring companies have a perception of Generation Y workers as having a bad work ethic. Because this generation values a work/life balance, the thinking goes, they work only from nine to five, and they don't take work home.
"That's not all a bad thing," Udell says.
Just because these younger workers have different work habits doesn't automatically mean they're bad. CSP's Heller says it's a matter of getting things done faster, with an emphasis on getting things done, rather than hours put in. "Results is what really matters now," he adds.
Hiring younger people does offer benefits, including fresh ideas and a much more technologically savvy skill set.
Some of the advantages of this workforce have already been mentioned, including the economic benefits involved in getting ahead of the curve, the ease of finding the best and the brightest in this economy, as well as their advanced skills in using computers and handling technology.
"You could almost look at it as revamping the company, by bringing in younger people with fresh ideas and completely different perspectives on things," ArvinMeritor's Sendelbach says. "When people have been here for so long, they get a feeling of 'this is how we have always done it,' while younger people can come in and say 'well what if you did it like this?' I feel to get a balance of both minds would benefit the company, especially during these tough economic times. New software is coming out that is faster and more efficient, and younger people are learning how to use these in college."
Bringing in younger workers also presents employers with a unique opportunity to capture the wealth of knowledge of experienced employees looking to retire. "There is a huge amount of knowledge in this industry," Heller says. He cautions that there is a ticking clock to get people into the industry and pass that knowledge on from the older generation. It's an opportunity for these new people to spend time with those that have been in the industry for 30 years, and apply that wisdom to their future careers. "We could lose it."
Roping 'em in
Once the obstacle of image has been removed, the next step is figuring out how to attract younger workers to your company. You have to put yourself in the young person's shoes to accomplish this. What do young people really want out of a workplace?
They want to be a part of something exciting, dynamic and changing. These are all aspects that are readily available as the industry continues to evolve into a more global, high-tech operation. They want to be challenged, get involved, and feel like they are contributing to something greater.
"The opportunity to move up and accelerate in my career is a big factor for me," Sendelbach says.
Kretz's advice: "Two major things that you need to retain young talent: continually challenge them and compensate them accordingly. By continually challenging them, whether through new assignments or tougher goals, you push individuals that might otherwise become bored in role and look to a new company to bring them new challenges.
"Allow younger individuals to more rapidly learn and be put into positions to create real change within the organization. Offer them assignments outside the title they hired in at. If they have an engineering background, give them some sales or marketing assignments."
According to Udell, research has shown that people in their 20s want tech-savvy jobs, with a flat hierarchy. They want a meaningful job, one that makes every day matter. Udell says it falls on the managers to capture their enthusiasm and listen to their ideas. "Engagement is really critical," he says.
Companies can also get involved at the school level, by taking part in career nights or sponsoring heavy-duty scholarships. "They [aftermarket companies] need to have a partnership with the schools," says Felt Auto Parts' Hoellein.
Hoellein helps organize MotorFest in Utah every year, an event that gives junior high and high school students exposure to the industry. He has been honored for his efforts raising funds for the Global Automotive Aftermarket Symposium scholarship, and has sponsored several students applying for the funds. He meets with career counselors and parents to educate them and bring awareness to the industry. In Utah, he assembled the Automotive Aftermarket Advisory Council, a group of local aftermarket businesses that work to get the industry's name out there.
At Felt Auto Parts, Hoellein employs about 30 percent students from secondary schools, who get school credit in exchange for the experience. "There isn't a school out there that wouldn't welcome industry," he says.
Distributors could take a page from a supplier's book and develop some sort of internship or co-op program, such as ArvinMeritor offers.
"I think the co-op is a great program for a company in this industry, because you get to give a person the experience they need to further their career with the company while being able to be cost-efficient for the company during their training," says Sendelbach, who got hired through ArvinMeritor's co-op program. "Trying to keep your co-ops to stay upon graduation I believe is also huge."
However you manage to get the attention of young people, this is one issue that should not be ignored, especially in the midst of a recession. If left untouched, the industry could be in real trouble down the road.
From the August/September 2009 issue of Heavy Duty Aftermarket Journal.
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