F&I and Showroom, February 2014

AFIP The magazines compliance expert says theres no such thing as a random act The decision matrix below will help keep dealership employees from breaking the law By Dave Robertson T here isnt an F I practitioner who wakes up in the morning and says I think Ill go to work and willfully and knowingly break the law Yet by the days close of business there are deals transacted across the country that will have been moused So how do you ensure you arent the guilty party Folks what were talking about here is the decisions made by the person you see in the mirror every morning the one with a working knowledge of the laws and enough common sense to determine when an act crosses the line Unfortunately knowing right from wrong isnt good enough these days Whats needed is accountability And thats the approach my organization took with the rate matrix sheet youll see on the next page It is based on the belief that while random events occur theres no such thing as a random human act See unless you arent in full command of your faculties you are for the most part aware before during and after the action you took no matter how random the situation is And that awareness creates accountability In your personal morality play youre the only actor on stage The Triggering Event A triggering event launches the decision matrix Its any situation in need of resolution that requires weighing ethical or regulatory factors in order to reach a decision For example you might discover that you overlooked a form that requires the customers signature during the consummation process Or maybe youre working a deal that will only get funded if the customer has an additional 10000 in annual income 40 F I and Showroom February 2014 Solution Roster When an event triggers the decision matrix list the various possible methods for rectifying the situation Lets consider the missing signature situation I previously described There are several options from which to choose You could arrange to secure the customers signature submit the form sans the required signature or you could forge the customers name As for the income shortfall your solution roster might include two options Submit the deal as posted or adjust the customers income fi gures to meet the fi nance sources requirement Its not right but it is an option Weighing Options Next you must weigh the options against two standards The fi rst is the personal accountability test Who is accountable for my decision The further a decision moves from its legal or ethical center the stronger the attempt by the decision maker to make another person or event complicit in the fi nal decision The extenuating factors will then somehow justify it If that customer wasnt in such a hurry I would have remembered to get that form signed one could reason If my manager didnt set unrealistic production goals I wouldnt need to fi nesse the income fi gures on that deal That is not to say that the presence of such factors shouldnt be considered during the evaluation process but they cannot be used to justify an unethical or illegal decision If the dealer habitually sets unrealistic performance expectations that might become a triggering event in itself Then the decision you have to make becomes Do I want to work for an employer who requires me to break the law or compromise my personal integrity in order to keep my job The second standard is the longrun ramifi cation test How will the decision I make today infl uence future decisions or my personal integrity over the long run An illegal or unethical act that goes undetected is known as a perpetuating event Once set in motion it is nearly impossible to stop If fi nessing the income on one deal helped me hit my numbers this month it just might work next month as well you may reason And if Im having a really bad month I may need to mouse fi ve or six deals The open questions then become At what point will I get caught How many dealers will hire me before my reputation forces me out of the industry And how much time will I need to spend lying to myself so I can look at myself in the mirror each morning The decision matrix is more intricate than space allows for a thorough description Hopefully this simplifi ed model and examples provide a practical template for evaluating job related decisions When youre weighing decision options remember that the standards personal accountability and long run ramifi cations will point you to the right decision Decisions derived via the matrix on the following two pages may be diffi cult to make but they will serve you well David Robertson is executive director of the Association of Finance and Insurance Professionals Email him at david robertson@ bobit com Mousing the Deal