The Must-Do's

Close Relationships

Understand Your Franchisees

 Select The Right People

Invest in good franchisee selection systems. Selecting the right people is fundamental to the success of any franchise system. If you choose the wrong people they will not only under-perform, but will take up a disproportionate amount of your resources in trying to raise them to an acceptable level. Far better to recruit the right people in the first place and to train them properly.

The four vital principles of good franchisee selection are:

1. Work out a proper selection system then follow it. Use checklists to ensure that important information is not accidentally missed during the selection process.

2. Develop specific and measurable selection criteria. Create a profile of your ideal franchisee and a rating system whereby candidates can be assessed against this profile. Use professional selection tools such as behavioural interviewing and profiling to assist you in understanding the strengths and weaknesses of potential franchisees.

3. Gather good quality information about your existing franchisees which can be used to determine their learning and development needs as well as provide a further basis on which to evaluate new candidates.

4. Link selection, induction and performance management to ensure that franchisees receive the training and support they really need to bring out the best in them. Each franchisees' needs will be slightly different.

Manage Change

Change is inevitable in a growing business - in fact, if you don't change, you can't grow, so you must tirelessly seek worthwhile improvements and opportunities which will help your business prosper and your franchisees succeed.

But change creates conflict. In a franchise, you're dealing with a large number of disparate personalities, each of whom is used to making their own decisions. So the franchisor has to be careful to innovate and manage change intelligently.

There are actually two types of change: the change that we choose, and the changes that chooses us. Most of the time, franchisors are the ones who choose the change, while the franchisee experiences the powerless feeling of BOHICA - which stands for 'Bend Over, Here It Comes Again'.

People resist change for several reasons:

Loss - they fear losing identity, power or status.

Habit - they are locked into certain paradigms of thinking

Cynicism - not every change in the past will have worked. Past mistakes make people less inclined to make new ones.

Insecurity - they fear the change will lead to failure in some sense.

Tiredness - they are burned out and cannot raise the energy required to change.

Personality - some people are more adaptable than others.

Because change is so important to every company's future, a franchisor needs to have a way to handle the process of introducing changes so that the need for change is understood and the majority of franchisees buy into the solution, while the rest at least accept it. A good way of doing this is to identify the needs of key people. Before instituting any change, work out

• Who are the stakeholders affected by the change?
• What are their needs?
• What are their concerns?
• How can we get them involved in a positive way?

Be Honest

Be firm, fair and friendly in all your dealings. There are two great myths about the franchisor/franchisee relationship. The first is that franchisees are customers. They are not - the relationship is much more complex than that. After all, a customer can walk away if he or she is not happy. The second myth is that franchisees are the franchisor's friends. They are not, because the relationship is based upon unequal power - but it can be a friendly relationship.

Franchisors need to be leaders. Research shows that the most important thing people want from leaders is honesty. More than anything else, franchisees need to know that their franchisor will tell them the truth and take them in the right direction. This 'believability' factor is built up through the franchisor's acting with integrity, demonstrating reliability, proving his or her competence, and showing concern.

Consult

There are three styles of decision-making which are often used in franchising: Directive; Participative; and Consultative.

Directive The franchisor tells the franchisees what they are to do. This approach is efficient, but does not involve the franchisees. It therefore generates low commitment levels from them.

Participative The franchisor canvasses the opinion of franchisees on every subject, seeking consensus before progressing. This requires a high level of involvement from franchisees and generates high commitment levels - providing they all agree. However, it is very inefficient and often ineffective.

Consultative The franchisor uses consultative decision making to build commitment and trust by setting out the problem or opportunity to franchisees and seeking their input. This approach gains moderate commitment and is often effective, but can be time-consuming. In most cases, however, it is the best option.

The rules of using consultation effectively are as follows.

Prior to making your decision, agree on the ground rules that just because you are consulting franchisees does not necessarily mean that your ultimate decision will be one they all agree with. Your job is still to be leader. However, you should listen to the views of franchisees without comment and practise 'active listening' - take notes of their key points and questions and reflect these back to them.

During decision-making, evaluate the assumptions and recommendations made by franchisees and look for commonalities with your own views. Try to link your views when expressed to specific franchisee input.

Once you have made your decision, present it to franchisees by pointing out commonalities with their input. Focus on commonalities, not differences, and point out specific contributions and links.

At Napier, we had three volunteers playing the roles of franchisors addressing a group of franchisees in each of these styles. It was interesting to note how many of the franchisors present greeted the 'Directive' mode with approval!

Clear Roles

Although every franchisor needs the enthusiastic participation and feedback from franchisees on ideas, opportunities, what works and what doesn't, and so on, it is vital that both parties maintain the focus on their specific role in the business.

The franchisee's role can be defined as: