Tom Schwartz Featured

7:00pm EDT February 28, 2007

For years, Tom Schwartz had a policy: When someone bought a new BMW from his dealership, The BMW Store made the event special by detailing the car and adding accessories before delivering it a few days later. But then some employees posed a question. ‘What if,’ they asked, ‘someone is excited and wants the car today?’ The owner and president responded by changing his staffing around so that if a customer wants the car immediately, the dealership can customize and deliver it the day it’s purchased. It’s just one example of how Schwartz listens and responds to his employees and is a big part of the reason his 130-employee BMW Store had revenue of $92 million last year. Smart Business spoke with Schwartz about how he shares his passion, and the importance of listening to your employees and taking risks.

Show employees your passion. One of the biggest problems I see in small businesses is that there are way too many managers and not enough leadership. I barely even manage anymore; I simply lead and give them an example.

When we first started, I was a service manager and when that department closed down for the day, I’d go and manage the new car department with just one salesman. I was in it, and if you cut me open I’d probably bleed BMW blue. I showed them that I was willing to put the time in and that I would be able to keep pushing.

There were times when I would come in at 5 in the morning and not leave until well after midnight. People saw that and believed in me because I had a vision.

People believed I would make this work, and it was kind of like, ‘We’re going to go work for Tom.’ Thirty years ago, I opened up a little repair shop, and two fellows who worked with me at another dealership quit to work for me.

Why would they do that? I didn’t have any benefits, money or anything else. But it worked, and that was a leap of faith. And you can’t just do that on charisma and chutzpah. You have to walk your talk and you have to deliver. You have to make sure people see that you are really doing everything you can to make it happen.

Evolve with your people. A lot of times, people come in and they really know where they want to go and how they want to get there, and that can be a problem.

Say it’s a new manager, and that person comes from another store, or even another industry, and that person has an idea that he wants to do it this way. Well, you don’t want to crush that person because his way has worked for him. We all kind of hang on to what got us where we are today.

At the same time, by nurturing him and really trying to see what he does and how he does things and comparing that to how we do things, we find some common ground, and it’s going to work better. So it’s a question of, we do it this way, we’ve always done it this way, but I’m open to ideas that you’ve got to make anything better as long as we can keep these key areas from being compromised.

We live our processes, and everyone knows how important they are, but we want them to be breathing things and to keep evolving. There’s a synergy that you get by compromising the way you do certain things as long as you keep your focus intact.

Stay focused, and the people will follow. Good people find you. I’m not proud enough to say that we’re the best organization on the planet or anything, but we have an operation that really resonates with people — we’re well-thought-of in Cincinnati, and that’s because we’ve never strayed from our calling.

What happens is, when you really focus on one thing and you’re really good at it — and you want to be great at it — then the people find you. We don’t put an ad in the newspaper; we just focus on what we do well, and people are drawn to that.

The level of attitude and drive and competence in our group is phenomenal. I guess for us, it’s sort of when the student is ready, the teacher appears.

Let employees help you take the risk. I look at something like our Mini Cooper dealership. I went and talked to some of our guys that were really gung-ho on it, and they told me they really thought it was just the cat’s pajamas and they just wanted it like there was no tomorrow.

So I went home and thought about it for about a half an hour and came right back in and submitted our application. You have to listen, listen, listen and listen.

The people that really developed into being truly great managers and even better leaders are the ones that listen to the troops about the big moves. You have to listen to your own gut and conscience, but it’s the people that listen and really openly seek the input of other people that are the most successful.

I look at risk like eating properly. If you’re not taking risks, you’re going to die. And they can’t just be calculated risks that are small potatoes. You have to keep that edge.

As you get older and a little more established, it’s very easy to get away from that edge to where you’re more secure — but then you’re not living your life.

Listen to ideas from the outside. When somebody comes in from another place, one of the things we do is make sure they understand our philosophy, and once we’ve kind of saturated them with what we do around here by showing them our systems for a couple of weeks, then we’re in a position to say, ‘OK, what’s working for you, what’s not working for you, and what can we do to facilitate you better?’

It’s good to get ideas from other people in the business. We really encourage our people to speak out and we’re willing to listen to ideas.

If somebody doesn’t change a lot when they’re successful then they mess up. You know, if you always do what you always did then you’ll always get what you always got. So, it’s important to be constantly changing and be constantly open to new ideas. Never compromise your principles, but everything else is open to discussion.

HOW TO REACH: The BMW Store, (800) 651-5569 or www.bmwstore.com