12 August 2022
The following six trends have emerged from our research listening to senior franchisor leaders. We hope these stimulate constructive discussions within your franchisor team. BEST PRACTICE LEADERSHIP CASE STUDY Background In 2020, Darin Harris took charge of Jack in the Box, an iconic brand with over 2,000 stores. While the network had been embroiled in conflict, Darin systematically implemented best practice strategies to rebuild trust with franchisees, revitalise the Support Office culture, and generate record growth for the franchisor and franchisees. Darin recently discussed his first 18 months as CEO with a group of FRI clients. The session was facilitated by FRI’s Founder, Greg Nathan. Here are some excerpts. (Editor's Note: The full transcript has now also been made available here.) Getting off on the right foot Greg Nathan: I know you made a point of meeting franchisees face to face when you first arrived at Jack in the Box. What did you typically say to someone who's meeting you for the first time, and who would probably be somewhat cynical? Darin Haris: The first thing I did was to reach out to 20 influential franchisees. I said "I want to get to know you. We've got plenty of years in front of us to talk about the business, but let’s first start with you telling me how you got started in this business. Tell me who you are. Tell me about your family. Then let me tell you about my situation, and let's get to know each other and start to build a relationship."I wanted them to understand that we've got years to talk about the business. But right now, we need to get the relationship right, and get to know each other as people. Because when we do have the inevitable challenges, just like in a marriage, we need to have the right foundation in place so we can say “Look, I don't agree with your view, but I respect it.” So my first priority was to create that kind of transparent, open dialogue. Greg: Did you find most people were open to that conversation? Darin: Absolutely. There was an immediate transition in the conversation to “Oh, my gosh, let me tell you. I was a cook at a Jack in the Box, and now I own 200 restaurants. And let me tell you my story.” So really getting a chance to hear their story and who they were as people is where it all started. This also helped us to start resetting the culture. Greg: What other strategies did to use? Darin: We collected a lot of data from guest segmentation work, from our franchisees, and from employee surveys which enabled us to look at our business and peel back the layers to see the good, the bad and the ugly. And then to ask “What do we have to change? What is coming at us from the industry? Where do we need to compete? And how can we differentiate?"And we definitely didn't try to do this in a silo. We communicated frequently that franchisees are partners in strategy. And I can't just write a strategy without having good data points. So we also used the Franchise Relationship Institute survey and workshops, and we used our franchisee Leadership Advisory Council. From a Relay to a 3-Legged Race Greg: What other shifts did you try to bring to everyone's mindset? Darin: We stopped treating the franchise relationship as if it was a relay race where we would just say "Take the baton, don't look back, don't ask questions, just run to the finish line and do what you are told to do.”We changed to a mindset of us being in a three-legged race where we are tied together. So we're at the starting line together, we have both got a leg in this, and we're going to fall down a few times, and we're going to get back up, and we're going to finish to win. This started through the Leadership Advisory Council, and with data that enabled us to create a strategy together. I used a balanced scorecard approach and communicated to franchisees over and over to engage them. We asked, “Is there anything in the strategy that you disagree with, that are not the right priorities?” This doesn't mean I'm going to agree with you, but I definitely want the ability for you to have feedback and input into where you think the business needs to go. Greg: How did you best communicate your strategies? Darin: We instituted what I call 'seven times seven ways'. This is a realization that we need to communicate something seven times in seven ways before it's really integrated. This can involve mailouts, emails, texts, and discussions with the Leadership Advisory Council and franchise business consultants. We also have regular monthly communication through what we call hot topic webinars. So messages are cascaded into the organization in seven ways. A big thanks to Darin Harris for his openness in this session. We will continue to bring you best practice tips and strategies this year through our workshops and this Positive Franchising Update. If you are not on our mailing list you can subscribe here. |
| 5 FRANCHISING FACTS TO HELP YOU FACE INTO 2022 Our friends at Franchise Business Review in the USA, Michelle Rowan and Eric Stites, recently shared in a webinar a number of fascinating research insights from their latest surveys on franchisors, franchisees and support office staff. Here are a few pertinent takeouts. Franchisee satisfaction ratings are at an all-time high. Franchisee satisfaction in the USA is strong, up 3% on the previous year. We have noticed a similar trend in Australia indicating that, during the pandemic, franchisees have appreciated the benefits of being part of a franchise network. For instance, 86% of franchisees said they enjoyed being part of the franchise network. Employee-related issues pose the biggest challenge and risk. Franchisors rated a number of challenges limiting the growth of their networks. In order, these were employee recruitment and retention, increased labour costs, franchisee recruitment, supply chain issues, and government pandemic regulations. Franchisors are focused on franchisee performance. The highest strategic priorities for franchisors were, in order, supporting franchisee performance, expanding the number of franchise units, ensuring a great customer experience, maintaining healthy franchise relationships, and helping with employee recruitment & development. Franchisor team tenure at an all-time low and getting worse. There has been a huge drop in the tenure of franchisor staff, with over two-thirds having less than three years experience. Compare this with franchisee tenure which is the reverse! This means the culture and corporate history of your brand will increasingly lay with your franchisees. Another statistic worthy of reflection is two-thirds of Gen Z staff (under 25) plan to leave their job within two years. Lowest rated areas of franchisee satisfaction. These relate to ineffective marketing and promotions, problems with technology, not consulting franchisees with important decisions, and a lack of innovation. The effectiveness of FACs was also identified as needing attention. We have found similar trends in our work with Australian brands. Thanks again Eric and Michelle from FBR for your generosity in sharing your research insights. We suggest these are worth discussing with your teams. You may also want to start planning now for their professional development, which is one of the best ways to boost retention and engagement. Read on. |
 INVEST IN YOUR TEAM & REAP THE BENEFITS We have events to suit all members of your franchisor team We understand that franchisor teams have different learning needs depending on their role. So, rather than taking a one size fits all approach, our professional development programs are tailored to the needs of the following groups: Senior Executives responsible for leading divisional teams can register for the strategic Franchisor Excellence Masterclass. Support Office Staff who interact with franchisees as part of their work can participate in the highly informative Culture of Franchising Workshop. Field Managers who support franchisees to improve their businesses can get down to practicalities in the Field Manager Bootcamps. Franchisees can also receive inspiration and practical tips to help them run a better business by engaging in our sessions for Franchisee Conferences and Meetings. Check out our Events and register for the programs of your choice below. MORE INFORMATION |
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