When the auto finance world seemingly began to collapse last spring, Flagship Credit Acceptance, like most lenders, had to act swiftly to adjust to the changing market conditions and demands on its workplace operations.
Within three days, 97% of the Chadds Ford, Pa.-based lender’s associates had successfully transferred to a work-from-home environment, Chief Executive Bob Hurzeler told Auto Finance News. Currently, the subprime auto financier’s team is at a 98% work-from-home capacity, with a “fluid” return-to-office plan, largely dependent on concerns surrounding team member safety, he said.
“This was not the challenge we expected this year, but it was not insurmountable. As a leader, you become accustomed to rapid change and understand the need for calm responses,” Hurzeler said. “Our collaboration and our existing plans for operational continuity allowed us to respond to a rapidly changing environment.”
Flagship saw success in the latter half of 2020 as the market began to rebound, which Hurzeler credits to his leadership team’s differing approaches to problem solving and the team’s ability to communicate. The lender made headlines recently when it inked a partnership with Pagaya, an AI-powered fintech asset management firm, that will allow Flagship to expand its credit product to other consumers and dealers.
“In this environment, the leadership style impacted how we treated the pandemic, not the other way around. This team responded decisively. We challenged what we knew, and we challenged each other,” Hurzeler said.
And, despite common concerns throughout the industry about communication issues arising from the sudden disconnect wrought by COVID, remote work has improved the way Flagship views and prioritizes its approach to communication, which Hurzeler believes sets the lender up for success this year.
Hurzeler and AFN discussed lessons learned from 2020, best practices for keeping teams connected and harnessing resources to respond to the unknown. What follows is an edited transcript of the conversation.
Auto Finance News: What were some of the challenges the pandemic highlighted for you, and how did Flagship work through them?
Bob Hurzeler: I think that instead of highlighted, we should look to what challenges the pandemic created. You’d think that the largest challenge would be technology and communication, but that wasn’t the case for us.
For us, the largest challenge was uncertainty: What if the market shuts down for an extended period of time? What does the stimulus package look like? Are we doing everything we can to keep everyone safe? Are we timing the markets correctly? In retrospect, we excelled here. If anything was highlighted, it was the importance of our team members, of keeping them safe and supported, both in “normal” and pandemic times.
The pandemic and its resulting challenges have impacted each team member differently. Some faced illness and job loss within their families; others had children home, or were impacted by social unrest. Our IT, HR, Diversity and Inclusion Council, and leadership teams stepped up and worked to ensure all had what they needed, when they needed it.
Externally, we had to respond to the unique needs of our dealer partners. They were
experiencing the same things we were, all while in many cases moving car sales to an entirely or mostly virtual environment. We adjusted our funding process and stepped up our communication in order to provide dealers with as much transparency as possible.
For our customers, our approach has always been to do the right thing. The pandemic heightened that awareness. We immediately evaluated and refined our processes to offer flexibility wherever possible. As is usually the case, doing the right thing for the customer has been what is best for the company, too.
AFN: What tools and technology did Flagship use to ensure success during this time
BH: We had a plan for this type of event well in advance of the pandemic. While it wasn’t specific to the coronavirus, it did allow us to move quickly and with minimal impact to productivity. We had the equipment in place for team members to work remotely, and the tools and support staff in both IT and training and development to do so.
We quickly established protocol for daily departmental meetings, which were and are all on video. The video aspect is key. It connects the teams visually, which creates a more personal experience. We have interdepartmental teams across the country in our Pennsylvania, Arizona and Texas offices who used to only see each other a few times a year. Now they interact face to face throughout their workday.
Cross-departmental collaboration is better than it’s ever been, as meeting with someone from a different department has become as easy as sending an email. Many of our team members have commented that they rarely use their company phones to talk to each other, as almost all intercompany communication takes place over video calls on their computers. It seems counterintuitive, but we actually improved communication by leaving the offices.
AFN: What lessons from this year will you take into leading Flagship next year? And what is your general outlook on the industry in 2021?
BH: I have always valued my team. I can’t say it’s a lesson, but it is a strong reminder of the importance of a great team, and the need to continuously support and listen to each other. Collaboration, community and communication are all important, as is challenging the status quo. You need to be able to debate and question in a respectful way.
For the industry, it’s hard to give a specific prediction as I don’t have a crystal ball. I do know that Flagship is well-positioned, and my 2021 outlook for Flagship is extremely positive. We started 2020 on a high note. Our first quarter was hugely successful, and we are ending the year well, too.
We were recently awarded “The Great Place to Work” designation based on the Trust Index, an anonymous survey of employees across the country. This is a big deal any year at any time; it was even more impressive to me as it came during a pandemic, at a time when we were unable to be together and host company events, sponsor celebratory lunches, or engage in group volunteer initiatives.
Despite this, we still managed to engage our team and positively reinforce our culture to the high level required to earn this designation. We also spent time positioning ourselves for new programs, partners, and increased opportunity. We continue to hire
across many departments as we prepare to increase market share in 2021 and the years to follow. This all drives home the lesson that, regardless of the environment, you always work to improve. We dug deep, and we found a way to succeed.
The 2021 plan is in place and the team is ready. Based on how our team responded to the challenges of 2020, I have full confidence in our ability to execute.
Auto Finance Innovation Summit, the premier event for technology in auto finance, returns March 16-17, 2021, as a virtual experience. The virtual experience will offer the quality networking and education of past events, all through an online platform. To learn more about the 2021 event and register, visit www.AutoFinanceInnovation.com.