By Katrina Vo posted August 19, 2021

In the early 90s, the US military came up with an acronym known as VUCA, referring to situations characterised by Volatility, Uncertainty, Complexity and Ambiguity.

Today, more than ever before, franchisor leaders are facing the challenge of leading their networks in a VUCA world. Just a few of the many complex questions leaders are coming to grips with include:

  • What should we do with our face to face meetings and conventions?
  • How do we best support franchisees in the face of unpredictable lockdowns?
  • What is our position on the vaccination of people associated with our brand?
  • Where do we draw the line in providing financial support to franchisees?
  • How do we help our franchisees to keep their teams engaged and motivated?

In this Positive Franchising Update we provide some tips on leading in a VUCA world. You'll also learn about:

  • Solving some of the common paradoxes in franchising.
  • A franchising fact on how franchisees and franchisors are coping with COVID.
  • Upcoming professional development workshops for franchisor teams.

BEST PRACTICE: How to create certainty in VUCA times

For these best practice tips, we’ve drawn from the work of two pioneering leadership researchers, Barry Posner and Jim Kouzes. Their book, The Leadership Challenge, has sold over two million copies and their leadership model, The Five Practices of Exemplary Leadership has been studied in more than 350 doctoral dissertations and academic research projects. Here's our take on what franchisor and franchisee leaders can do in this environment.

The Five Practices of Exemplary Leadership

#1. Model the way. In the face of uncertainty, our brains do not work effectively. For instance, we find it more difficult to deal with complex problems and processes. So simplify messages and keep goals short-term and immediate. Also, modify and clarify processes to make things easy for people who may be working under difficult circumstances.

#2. Inspire a vision. When there’s a lot of complexity and ambiguity, people can get lost and confused. Help them to rise above the cloud of chaos to see the bigger picture. Remind them of why your business exists and the positive impact it has on the world. If possible, link current initiatives back to your mission and vision.

#3. Challenge the process. This involves consciously looking for opportunities to innovate, experiment and take risks. You might invite newer people to challenge existing processes, and explore how to do things differently. Leaders need to encourage people to play the 'devil's advocate', stay open to contrary views, and control the urge to close down discussions in meetings.

#4: Enable others to act. It is common for relationships to get strained during change and uncertainty, as people tend to get reactive and defensive. Leaders need to consciously generate a culture of mutual respect and deescalate situations by using a calm tone, encourage empathy, and assume good intentions from others. 

#5. Encourage the heart. Recognise the contributions and commitment of your people. One area in our Franchisee Satisfaction Surveys that is often rated low is appreciation. So actively recognise the efforts and accomplishments of franchisees and staff, no matter how small. Many of your people are doing amazing work, so make them feel like heroes.

FRANCHISING FACT: Encouraging data on how franchisees are coping with COVID

As part of our ongoing research using the ACE Franchisee Satisfaction Survey, we have been asking franchisees how they have been coping with the stress of COVID, and how helpful their franchisors have been. Results from 2,744 franchisee surveys indicate the following:

Stress: While 32% of franchisees feel they are coping well, 47% are slightly stressed but functioning okay, and 22% feel that COVID related stress is making them significantly less productive and anxious.

Planning: 63% of franchisees say they have a sound or comprehensive plan to adapt to the ongoing impact of COVID, with 27% having a basic plan, and only 10% not having a plan.

Survival: 72% of franchisees are fairly or very confident their business will survive and remain financially viable.

Support. 85% of franchisees say the support from their franchisor in responding to the challenges of COVID has been somewhat to extremely effective. Only 15% of franchisees rated their franchisor support as not very effective.

These findings are very encouraging compared to what we have gleaned from the non-franchised small business community. It appears that most franchisors are stepping up to the challenge of guiding and supporting their franchisees through these difficult times.


FRI has a range of professional development programs to upskill your team. These include:

  • Franchisor Excellence Masterclasses for senior executives responsibile for creating strategy or leading division teams.
  • Culture of Franchising Workshops for supprt office staff who interact with franchisees as part of their work.
  • Field Manager Bootcamps for field managers who support franchisees to improve their businesses.

Click here for details.

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