Let’s Talk Values

Values—fundamental beliefs that have the power to drive behavior. Guiding principles that define how a company and its people should operate

In our work, we’ve found company values show up in one of two ways—by default or by design. That’s why we were curious to talk with a leader who has intentionally designed a values-based culture.

Aaron Montgomery was a perfect fit. He’s the Chief Operating Officer of CarLotz, and he knows values aren’t just a mantra to live by. They're a competitive advantage.

In the latest episode of The New Frontier podcast, Grant Millsaps talks with Aaron about the defining moments that have shaped Aaron’s values, how CarLotz brings its organizational beliefs to life, and how to lead and encourage teams to live into their values.

We’ve shared a few highlights from their conversation below.

Grant: We're here today to talk about values. We reached out to you because we admire you as a leader in the company and the culture that you're building. Tell us a little bit, before we dive deep into values, when you think about building a culture at CarLotz, what have you really worked on in your organization to make sure that's at the center of what you're doing while you're also serving your customers?

Aaron: At CarLotz, the interesting thing to keep in mind is that CarLotz is an auto dealer. We're car salesmen. When I say that word, it's just so loaded. When you think about what does it mean to be a car dealer or a car salesman, the first five or 10 images that come to mind are all negative. The stereotype is well-earned, I believe. You've got a long history of bad behavior. You've got a lot of misaligned incentives. It's a tough business to be in. So when you talk about living a value or aspiring to a value that brings you above that common stereotype, in our business that's not just a nice to have thing, it's mandatory, it's a requirement to be successful in a space where people assume the worst.

So when we talk about living our values, it's looking at the status quo in dealerships in our case, and saying, "We don't want that." So what does that mean? That means you've got to be more focused on caring about people. That means you have to be more focused on building relationships and not just transactions. That means you have to genuinely care about what's in your customer's best interests and not just what's in your own best interest.

So for us, it's not just the thing that we're saying, "We live by these values." It's not just a mantra, but it really is ultimately, the competitive advantage of the company, to be able to say that, "We're a car dealer and we compete in this space and we know what you think when you hear used car salesman, but we are absolutely 100% not that, and we work hard at being not that every single day."

Grant: So what are some of those values that drive that differentiation from your competition?

Aaron: When we started up the business, we thought about—assuming that not everybody that's in this business is just a bad person, which seems like a reasonable assumption to start with—what would cause the bad experiences that we're reading about and hearing about and that we'd experienced ourselves? We said there must be some core things that are just happening, that create all this other downstream effect and one of those we said, was the fact that there's no transparency in this space. You don't know what a dealership paid for their car, you don't know what a good deal looks like, you don't know what your neighbor paid for the same car the day before.

There's no transparency and that's encouraged. The more information I can hide from you, the more I can control you. There's not a ton of integrity. You assume that the ad that you read is false. You assume that the commercial has fine print. You assume that the contract is written in such a way to bait you into making a bad decision. You don't trust the information that you see. You assume that there's no integrity.You assume that there's no service.

The idea is, it's a transaction. I'm here to sell you a car and you know that, so no matter how friendly I am, no matter how warmly I receive you, no matter if I remember your kid's names and give them a lollipop, whatever, you know that I'm doing that because I have to sell you a car, so I'm focused on a transaction. Then lastly, it's just not fun. If you think about it, it's the second largest purchase that most people are going to make. If you've ever bought a home for example, it's fun. Like, the closing, you go and open a bottle of champagne, it's fun. It's a nice thing to do.

With a car, by the time you actually get the keys, you're so worn down from the process, you're so beaten down, it's almost like it's a consolation prize for having survived something. So we said if we can flip all those things on their side and if we focused on transparency, if we focused on integrity, if we focused on serving people and not selling people, and we drive towards making the process fun, that's what we do. Basically, where they zig, we zag. We decided that that was the core for that. Ultimately, made up the core of our values, is those four ideas. That gives us a good compass to make sure that we're driving away towards what we think the traditional dealers are doing, or haven't done well.

Grant: You are your own unique person that values certain things in life. You've got an origin story, you cut your teeth on a lot as well, selling cars, went to school, learned a lot, gained different experiences, here you are doing this new work. How do your values connect to the values at CarLotz in your day to day work?

Aaron: Very directly because these values were born from those experiences. As you mentioned, I started selling cars when I was a kid. I started when I was 17 years old. I had the good fortune of working for a very successful dealer who was willing to give me to give me an opportunity to learn the ropes and I enjoyed it. I liked working with the customers, I liked trying out the new cars, I enjoyed working with my team, but there were aspects of it that I just could never get comfortable with. The idea of telling somebody one thing when I know that my incentive is to do another thing, or giving information that I knew wouldn't paint the entire story.

The way that we treated each other, it's like we're all buddies when we're at lunch, but the next customer that walks through the door, I'd step over my own mother because that's another commission to that possibility. The way that we interacted, the idea that a manager's job wasn't necessarily to develop you, but to use you to get to the next sale.

Again, these weren't bad people. It was just a bad system, and I felt like if I could take all the things that I enjoy in this business—and lots of things that I liked, I liked the buildings, the space, the cars and everything else that I'd mentioned, it would have to not have the other things that I didn't like because these weren't just annoyances.

These were things that made it hard to sleep at night. Made it hard to enjoy going to work. So you think about what work is for anybody, and that's not peculiar to car dealerships, you think about anybody's work life, you've got to be able to be in a place where you work and the things that you do and the people that you're with are harmonious with what you believe. That's what I found then. I said, "Man, I like everything about this business except ______. How can I find harmony in that?" Then, as I worked through that job and many others, that became more or less the marching orders for me.

I said, I’ve got to find opportunities where I can be fully aligned, or else I can't do it. I won't be able to live with myself. As we hire people even now, and not to bring it all back to CarLotz, but I hear that said more often from people who've been in the business, that are thirsty for a change. They say to me, "I like this business. I like cars. I like selling. I like all this stuff but I don't like this. It's so great to be in a place where other people feel the same way." Which makes me believe that that had always been the case for a lot of people. They're only now finding an oasis away from the traditional dealer model.

Grant: I know you hire a lot of folks from dealerships and from the business. You also hire talent from unique and different spaces. How do you feel like you all are able to impress upon them the importance of living out the CarLotz values and this idea of alignment, that you want them to be in alignment, that makes this place a place that they can feel whole?

Aaron: I honestly think, in our case, it hasn't been so much a matter of, "Hey, you need to live our values," so much as, "These are our values. Isn't that refreshing?" Them saying, "Yes." I want that. I wish that all my work could have been that. This is great, to go to a place where I'm respected and I'm expected to respect other people, and where I can be honest, and that's the expectation. I'm not supposed to be pushy and I'm not supposed to be self-focused and all these other things. It's refreshing to them.

So I look at the recruiting challenge and the staff-development challenge less as a, "How do I spread the propaganda of what our values are and make you believe them?" And more, "How do I find other people who already believe what we believe and bring them into the fold?" Obviously, there are technical things that we need to teach you. You don't come out of the box knowing how to sell a car. You don't come out of the box knowing what CarLotz is, but as far as the values, most of those things are forged long before, from the people's personal experiences, their upbringings, their parents, whatever. We've found, more often than not, that when people come in that already believe what we believe, there's no sell. It only reinforces what we've already believed to be true. For them, it's a great retreat from everything else that's out there.

So I've found it to be more of a selection process than a training process. Obviously, we want to reinforce it. We want to make sure that we all agree on the common ground, but how do I find more people that already believe what we believe?

Grant: This idea of "living your values" is one of those things that is not readily or easily defined. For you, at work and in life, what does "living your values" mean for Aaron Montgomery?

Aaron: You asked earlier, where does this stuff come from? An idea like that, it's a pretty heady idea because even if you live your values, what's the scale? Is it 1 to 10? Is it you give yourself an A or a B? So what does it mean? In my mind, the person I think about that most epitomized this idea is my grandfather. He passed away some years ago, but if you asked anyone in the world, be it the people that worked with him, his family, people that he met on the bus, what was this dude about, you'd get the exact same story, 100% integrity in his interactions with every single person.

You'd hear some version of, he was very gracious, he was down to help anybody, he liked to teach, and he's very disciplined. No matter who you asked, he just espoused that to everyone. He lived it. That was his whole deal. The things that you could see and the things you couldn't see. I'd see this man on Sundays, I'd go off to church, he always had to have his suit finely pressed. The night before, he's shining his shoes, ironing the tie. Just things that you wouldn't believe because that was who he was, and that's what other people expected, and that's what he was going to deliver.

For me, if you take him and call that a 10 out of 10, that's the idea. I want to be seen as somebody who's consistent. Not somebody who's telling you about values because I want some plugs on a podcast, not somebody who's doing it because my team expects me to say that stuff because, "Yes, he's the boss, that's what he's supposed to say." That if you saw me anywhere, you're like, "That's Aaron. For good or bad, this is what he values, so this is what you're going to see." I think that's a good thing. I think that if everyone was able to maintain that state or aspire towards that state, it's probably easier to relate one to the other.

It's probably easier to have frank conversations with one another. It's probably easier to mold around the edges where you need to. So I think about that. To me the idea is, if there's something that I value, then that's what I want to epitomize in every action. Actually, the things that I lose sleep over, honestly, when we have to make a decision, maybe it's disciplinary, maybe it's anything related to the business, the thing that makes me lose sleep is what have I done in the last 10 times I've seen this? Am I being consistent in this? I've said I value this, openness, being fair, justice, whatever thing I value, am I showing this in this case?

If I can't get the harmony, I have to stop and, "How many more times with this one, guys? Because I'm not quite there yet." That's how much it means to me. So I think that being more or less a swing thought for my life, certainly given the model of my grandfather, has helped. Also, knowing when you don't have that peace, "I don't feel like I'm living my values now, so it's time to take a breather and see how I can get back to that point."

Listen to the full podcast.

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