6 Tires, No Plan : The Impossible Journey of the Most Inspirational Leader That (Almost) Nobody Knows (9781608322589)

by Rosenbaum, Michael

  Halle relies on his team to pump up sales volumes, control labor costs and increase the total value of each transaction. The balance among the three is sensitive.

  Discount Tire sells tires and wheels but doesn’t offer oil changes, alignments or general automotive services. By focusing on a limited number of services, the company can reduce customer wait times and build satisfaction. Training expense is reduced, inventory management is simplified, work scheduling is more predictable and units per man-hour can be maximized. By servicing customers faster, the stores can serve more customers per day with the same number of employees and work bays, which leverages the fixed investment in each store.

  Increasing the value of each transaction is a more sensitive issue, because each store manager benefits from higher profits but suffers when customers feel pressured or oversold. Employees are trained to explain the various product features to customers and let them make the decision, rather than steering the customer to the most expensive products. The goal is to be the trusted expert for the customer.

  “The opposite of a trusted expert in our measurement is a pushy salesman,” CFO Christian Roe explains, “and we don’t want pushy salesmen driving our customers away.”

  Employees are encouraged to sell warranty certificates that provide replacement tires in cases not covered by manufacturers’ warranties. The certificates are highly profitable to Discount Tire, but they also build customer satisfaction by resolving problems quickly and in the customer’s favor.

  “For many years in the industry, the only warranties that the tire industry had were workmanship and material failures,” Halle remembers. “There were no road hazards. You could get a brand new tire, run over a beer bottle tomorrow and destroy it. Good luck. That’s how it was. During that period of time, you would come in and buy a new tire, and next week you’d destroy it. And you’d come into my office, into our store, and I’d feel so bad about that, so what can I do for you? It’s a lot of money. It’s big money for people, and I’m trying to build a business. So, I start by saying I’m sorry about that, there’s no warranty for road hazards like that, but I’ll do something for you. And I would do something. I would give you half off or do something, whatever would help the situation. During that period of time—and this is back in Arizona in the early 1970s—I started this warranty program, this certificate program that we have, which has been extremely successful for our company and for all of our customers. People buy that, and then have this failure, and they come in, and here are two new tires. Good-bye and thank you.”

  The process of tire sales is relatively straightforward, but Discount Tire’s approach includes extra steps to instill confidence and loyalty in the customer. The process includes a review of each step of the sale, the product features and costs, what the customer bought and, finally, a thank-you that the team has labeled the “benediction.” Making sure to thank the customers and ask them to come back is common sense, at the least, but it’s often missed in retail stores.

  Sir Tom Farmer, who built the Kwik-Fit chain of automotive stores in Europe and became a friend of Halle’s in the 1980s, says Discount Tire’s success begins with an understanding of the customer. For the tire buyer, spending hundreds of dollars on new tires is not a joyous shopping experience.

  “Nobody gets up in the morning and says, ‘What a beautiful day. I think I’ll go buy four tires.’ They get up and say, ‘I have to buy new tires.’ It’s like going to the dentist,” Farmer says.

  Because customers tend to view tire buying as a necessary evil, it’s not too difficult to exceed their expectations. When Halle started changing snow tires at no charge, the lines extended around the block. Customers responded, as well, when he offered to repair flat tires at no charge and provided free tire inspections. While many financial analysts might consider such freebies unaffordable, Halle found the free services to be highly profitable, especially when the value of referrals is considered.

  For the cost of a free tire repair—usually less than $30—Discount Tire can acquire a lifelong customer. While the company might invest $50 to $100 in giving away a tire or two to a cash-strapped driver, that person will come back as a paying customer when he or she is back on firmer financial footing. Along the same lines, Halle never, ever wants his people to lose a customer because a competitor is offering the same tire for a few bucks less.

  “We need the customer. The customer doesn’t need us,” CFO Christian Roe says. “So if you lose a customer over price, you have to buy them back later. It’s better to give them the price to get them to stay in the first place.”

  Discount Tire measures customer satisfaction with a net promoter index, which nets out the difference between customers who would recommend the company and those who would pan it. Only scores of 9 or 10 on a 10-point scale count as positives, and anything below 7 is a negative. Most companies average 5 to 10 percent, according to one study, and a net promoter index over 50 percent is considered solid. Discount Tire consistently scores at the 80 percent level.

  When a customer is dissatisfied, the store manager must address the issue personally. At 6:00 p.m. each night, every store manager receives an e-mail with the names of unhappy customers who need to be contacted within twenty-four hours.

  Ultimately, the managers will convert many of the unhappy customers into lifelong patrons simply by making a personal connection and offering to solve their problems. This is not rocket science or the stuff of MBA dissertations, but it is highly effective.

  “A tire is a commodity,” Roe notes. “You can get one elsewhere. The differentiator is the people. By having people with great attitudes, you make the difference for Discount Tire. We hire people with the right personality and the right attitude. We can always teach them how to change tires.”

  People do business with people they like. Hire, motivate and reward the people that others will like and, no matter what the product, the probability of success rises sharply. It’s an impossible way to run a business, but Bruce Halle, like the bumblebee, has found a way to make it fly.

  WOODSTOCK FOR TIRE JOCKEYS

  Tim Higel pulls up to the opening in the fence that separates the Lakeland Village Resort from the Lakeshore Lodge and Spa on the southern shore of Lake Tahoe. The trip has brought Bruce Halle all of three hundred feet from his rustic cabin on the beach, and Halle might have needed less time to walk the same distance, but Higel won’t let the boss walk when he can ride.

  Halle is pumped as he alights from the white Chevy Tahoe and strides past the sign that informs of the private party ahead. He stops for a moment to scan the banners that drape the three stories of the Lakeshore Lodge, heralding the fifty years since he rented an old plumbing supply store, built a countertop and started his chain of eight hundred tire stores. Walking past the catering trucks, his pace quickens, and he actually skips the last thirty feet to the registration tables lined with backpacks for the incoming throng.

  Halle is the host of this party, but also the guest of honor. The Tahoe trip is the coveted prize for thousands of employees who will compete to move more tires, sell more warranties, shorten wait times and bump up their Customer Delight scores for a chance to spend a few days with Bruce on the California-Nevada border. Each of the twenty-three regions in the Discount Tire Company network is allocated slots for the party, and each regional management team decides which contests to run and how to pass out the rewards.

  The corporate office doesn’t set the rules for Tahoe, because the corporate office doesn’t run the show. Unlike most corporate retreats, it’s the workers and not the suits who are the honored guests. And the ticket to entry is earned in the store, where the customers make the ultimate decisions about success.

  Some of the “Discount Tire Warriors,” as Assistant HR Vice President Staci Adams refers to them, will make the trip three, five or six times as they work their way up from the assistant manager ranks. Halle is always happy to see the familiar faces, of course, but he’s most excited for the first
-timers. “If you’re a guy twenty-three or twenty-four years old, and you’re working in a store, and you win a trip like this to Tahoe, it’s really cool,” he explains, sounding more like one of the twenty-three-year-olds than the captain of industry he’s become. To Halle’s mind, first-timers should make up the majority of every Tahoe party, even as the most consistent warriors battle for return appearances. “It doesn’t do any good to have one guy come there five or six times, and then have people who never get there at all,” he argues.

  Halle worries about those twenty-three-year-old tire jockeys, and cheers for them to earn the journey to Tahoe. In the Discount Tire network, a trip to Tahoe is a sign of both your recent achievement and your manager’s confidence that you’re going places in this company.

  Halle greets a few of the corporate staffers working the event, then hustles to the cantina set up for afternoon snacks. Anticipating a few hundred carnivores, Men Wielding Fire is offering burritos the size of NBA sneakers, and Halle devours one, observing that his wife wouldn’t quite endorse this dining option.

  His afternoon repast is interrupted by well-wishers who ask him to pose for cell-phone photos, then shake his hand. Marvin Martinez, a senior assistant manager from Encinitas, California, hustles up to thank him for the $1,000 check Halle sent when Martinez got married the prior year. Halle asks about the wedding and how things are working out for Martinez and his wife.

  For the next hour, Halle will burn up all the calories from the burrito as he works his way through the crowd, thanking each person for making the company great and smiling for one more picture.

  He moves through a display of old advertisements and photos, mostly from the 1960s, and reappears at the back of the lodge, where the swimming pool is adorned with life-size cutouts of Bruce in various items of beachwear. He doesn’t look exactly like Sean Connery in Dr. No, but he does appear to be having fun.

  As tire store conferees line up for poolside massages, Jason Henderson, an assistant vice president from the Los Angeles region, challenges Halle to take a photo with him under an LA Lakers banner, but the diehard Phoenix Suns fan declines with a laugh.

  Halle’s son and company president Bruce Jr. shows him the stage the team has set up for evening programs, designed to mimic the first Discount Tire store at 2266 Stadium Boulevard in Ann Arbor, Michigan. Halle notes that the mock-up looks somewhat better than the first store.

  The sun is bright and the lake is a glorious blue as hundreds of warriors gather on the beach for the kickoff of Discount Tire’s fiftieth anniversary celebration at Tahoe. An airboat zips across the water and makes it only partially up the shore as the Marine Corps Hymn plays and Staff Sergeant Bruce Thomas Halle storms the beachhead. The old Marine clambers up the steps to the stage, pulls a cord to light up the “OPEN” sign on the door, and the party is officially begun.

  As he will do dozens or hundreds of times over the next sixty hours, Halle credits the employees for making the company great, for making him proud, and for making each other successful. Gratitude rolls downhill at Discount Tire, with everyone dependent on the success of individual stores, and Halle wants everyone to know the rolling begins with him.

  Dinner is early, as the interregional volleyball tournament begins at 6:00 p.m. and most teams are hoping for an upset over perennial winner San Diego. Bob Seger’s “Old Time Rock and Roll” blares across the beach as eight regions square off for V-ball glory. Halle stops to watch as San Antonio takes on a team from the corporate office. He doesn’t have high hopes for his desk jockeys, but they prove victorious in the end.

  By 9:00 p.m., the sun has set behind the mountains as the wind whips the flags of the United States and the states where Discount Tire operates, along with the banners of the company’s brands. Swarms of insects flock to the spotlights that illuminate the epic battle between PacWest and New Mexico, while dozens of tire jockeys wait for their turn to talk with Bruce Halle.

  Bruce Halle and Bill Sweatt, the former Goodyear executive who is now a consultant and friend to Halle, are chatting under a neon sign for Big Kahuna’s beachfront bar. There is no bar—the sign is a remnant of a prior Tahoe celebration—but the staging is apt. One after another, leaders from San Diego, Nevada, Indiana, Ohio and PacWest regions bring their up-and-comers to meet the Big Kahuna.

  The conversation is almost always the same. The new guys, and most of the older ones, thank Halle for the opportunity he’s given them to work at the company and to come to Tahoe. Halle, in turn, tells them he is the one who is grateful, because the people in the stores are the lifeblood of the business.

  Halle and former son-in-law Stuart Wimer, a store manager in Encinitas, California, head to the bar, where a mob from San Antonio appears for thanks and photos. Apart from the dinner break, Halle has been on his feet for more than six hours, and the night is about to get longer as the awards ceremony begins.

  CEO Tom Englert, President Bruce Halle Jr., COO Steve Fournier and other corporate execs welcome the partiers and introduce Halle, the giver-in-chief. The crowd chants, “Bruce, Bruce, Bruce,” but Halle repeats his mantra: “I’m so proud of you for what you’ve accomplished. You all came here and you thank me, but you did all the work.”

  Halle and the executive team fire up the crowd with a mock debate about the number of prizes to be awarded that night. The prize in question is a five-day trip to Hawaii or the Caribbean for the employee and spouse. Even better, days off for a prize trip don’t count against vacation time. By the end of Tahoe 2010, Discount Tire will have passed out 153 such awards, with a total value north of half a million dollars.

  After the first night’s stash of thirty-five prizes has been awarded, Halle and his son work their way down the beach toward the snack tent, but the elder Halle is waylaid as guys from Discount Tire Direct and the Nevada region indoctrinate him in the finer points of beer pong. He watches for fifteen minutes, until the business expert has figured it all out.

  “If I was a beer distributor, I’d go broke,” he concludes. “Nobody ends up drinking any beer.”

  Halle plops two slices of pizza on a plate before joining Bill Sweatt, who is rooming with Halle this week. Halle grabs some food for Sweatt and sits for the first time since dinner, roughly five hours ago. It’s 11:35 p.m. Halle and Sweatt talk about life for a few minutes before Bruce Jr. sits down and makes plans for a tennis game the next morning. At 11:50, the octogenarian and his friend pick up some oatmeal cookies for the road and call it a night.

  Monday and Tuesday at Tahoe bring a steady stream of golf, tennis, bicycle, boat and parasailing excursions, along with massages by the pool. For two hundred guys who work in tire stores all week, the perks are a major motivational tool.

  The biggest motivator, though, is Bruce Halle. He’s the tire jockey who made it big, who remembers his roots and keeps the doors open for the next generation. One by one, the men in the Discount Tire T-shirts will describe what they see when they look up the corporate ladder, and what they see is themselves. From store managers to assistant regional vice presidents, regional VPs and corporate operations executives, it’s a parade of people who started their careers busting tires and, at the top, tire-buster Bruce Halle.

  The Tahoe trippers describe Halle as a role model, both for the path of his own life and the path he’s opened for them. He’s “Mr. Halle,” the icon on a pedestal, but they feel comfortable calling him Bruce and, occasionally, slapping him on the back at the bar. The balance is challenging, and most business leaders fail to achieve it. Halle is more a father figure than a boss to many of these people, even though he is clearly the boss.

  By Tuesday night, sharp winds from the west are turning the flags into billboards as Houston squares off against San Diego in the volleyball finals. Bruce Halle is standing next to the stands in a pair of shorts and sandals, a white baseball cap and a Discount Tire pullover—one of the items of clothing in the backpacks every attendee received. Employees sitting in the stands offer him a seat, but he declines.


  Halle is alone here, both the center of the event and somehow outside of it. It’s one of the contradictions in life that the leader of twelve thousand employees is most engaged when talking to one at a time. In a crowd, he appears more comfortable as an observer than as a participant.

  He stands five feet from the bleachers, watching San Diego take an early lead with an 18-12 win, smiling as he observes others having fun. Cigar smoke wafts across the beach as Houston ties it up with an 18-8 comeback, and it looks like San Diego, home of beach volleyball, might fall from its throne. In the end, though, San Diego reclaims its crown with an 18-14 win, and it’s time for Bruce Halle to hand out some trips.

  The awards ceremony is particularly festive as Michael Zuieback, Halle’s stepson and executive vice president of corporate strategy, introduces the drivers of Discount Tire’s two race cars: drift car racer Daijiro Yoshihara and NASCAR driver Brad Keselowski. Keselowski was NASCAR’s top Nationwide Series driver in 2010, despite running out of fuel in one of his races. Zuieback awards him a spare gas can as the crowd roars its approval. The Dallas region team takes a golf trophy, and San Diego receives its volleyball prize, again, but the big question is how many trips the company will give away this night.

  Tony Doca, 2009 manager of the year in the Arizona region, is in the crowd, eyeing Assistant Manager Frank Alvarez. Doca has won three trips at Tahoe, but Alvarez, who no longer works with Doca, is here for the first time. Doca decides to follow the Bruce Halle model because “I’ve been blessed to work for the Bruce Halle family for thirty years and it was time to give back, pay it forward.” So when Doca wins his fourth trip, he runs up to the stage and gives his certificate to Alvarez. Alvarez wins a trip a few minutes later and pays it forward to Raul Olivas, who then wins a trip that he hands off to Andy Cazares, “It was really the spirit of Discount Tire,” Doca says.