The Importance of People at Each Step
In February, I attended the International Franchise Association (IFA) conference in Phoenix. One of the most memorable sessions that I attended was the Franchise Relations Summit. Greg Nathan hosted the session along with a group of executives and franchisees. The framework for the session intrigued me: it followed the lifecycle of a franchisee. Greg explained that there are six stages that a franchisee can experience. This got me thinking about the importance of employees at each of these stages:
Investigation
This is the research phase of the journey. You are studying your options to determine whether this is the right path. At the same time, franchisors are evaluating prospective franchisees and setting expectations.
Employee impact: There are no employees at this stage. It is important for the franchisor to communicate about the team needed to succeed. How many people will I need to have on staff? What are their different roles? What resources are available to me?
Initiation
This is the training phase of the journey. You have signed the franchise agreement and paid the franchise fee. Now it’s time to learn the business and connect with the brand.
Employee impact: At this stage, you are starting to make plans to hire people. You need to have people working for you before you open, and they need their own training. The level of training provided on hiring varies by franchise system. At the very least, you will learn about the roles of the team members that you need to hire.
Perspiration
This is the ‘Get to Work’ phase of the journey! You are not in training anymore. This is when the reality of being a business owner hits home. It’s time to grind it out and follow the playbook that you learned.
Employee impact: You have hired your initial team by now, and you are all in this together. This is a likely bare bones team that has gaps you are filling with yourself. Once you have more cash coming into the business, then you can hire more people. You won’t get all the initial hires right. These will be costly mistakes, but valuable ones if you can learn from them. Working in the business is critical right now so that you know how to perform every function at the company. You won’t know who to hire or how to train them without this knowledge.
Consolidation
This is the phase of the journey where the hard work pays off. You are starting to see some success and everything is starting to make sense. You have gotten into your groove and now have more time to work on the business.
Employee impact: Your team helped you make it through the ups and downs of the business launch. Things finally feel somewhat stable. You have been able to hire people to do a lot of the things you did when you started the business. But this can still be a fragile time. It only takes losing one key player or making one bad hire to bring you back to working in to the business.
Maturation
This is the phase where you have figured out the business. You have experienced the ups and downs and survived to talk about it. You may feel like it is a good time to take your foot off the gas a bit and enjoy the perks of being a business owner. This can be a fun time, but it can also be dangerous. Your business may be peaking, which often leads to some kind of decline.
Employee impact: You have the team to run your business, but you still may be missing the people to lead and grow it. Often franchisees at this stage take their foot off the gas and leave the business to run itself. This can be discouraging for your high performers. They don’t want to be part of a sinking ship, and they may jump ship if things don’t change. If you are not careful, this loss of talent is what could lead your company is the wrong direction, fast.
Reformation
This is the phase of the journey where there is a fork in the road. It’s time to either make a striking change to point the business back in the right direction, or it’s time to watch it sink. You must reinvest in your business and set new goals if you want to continue to grow it.
Employee impact: Sometimes you are only one hire away from a Reformation. It could be a manager to help you grow your sales team or something bigger like adding another location. Either way, making the right hires give you the opportunity to take your business to the next level. This might be exactly what you need to stay engaged and excited about your business.
Takeaways for Franchises and Business Leaders
Owning a business is a journey – one that I have had the pleasure to be on for the last 10+ years. One lesson stands out from the rest: You cannot succeed alone. You need to have the right people, processes and tools to grow your business. As a franchisee, you have an advantage over independent businesses. Many of the processes and tools are already provided for you. The biggest question mark is around people. Can you hire and retain the talent that you need to succeed?
First, you need to know where you are and what you need. Here are some questions to consider:
- Which phase of the journey are you in right now?
- What is keeping you from reaching the next phase?
- How would you rate your current team? Who are you missing?
Then you can focus on building and refining the processes you need to build your team of the future. Don’t try to figure this out on your own. There are people inside and outside your organization that can help. Here are some questions to help you get organized:
- What processes do you have in place to recruit and retain top talent?
- What is working and what is not? What do I need to improve?
- What resources are available from your franchisor?
- Are you learning from franchisees who have been in your shoes?
Takeaways for Franchisors
Recruiting and retention are the two biggest growth challenges cited by franchisees. There are three reasons for this:
- Hiring and developing a team is hard for any business. It’s extra challenging for franchisees who have no experience doing it.
- Franchisees rely on playbooks from the franchisor to operate their business. Hiring is the exception, and most franchisees must figure it out on their own.
- Unemployment is currently at 4.1%. It has not been this low since the 1960s. Much of what used to work in recruiting no longer does.
Many franchisors are taking steps to meet these needs despite joint employer fears. They are careful to provide resources and recommendations without direct involvement in hiring. This may seem risky on the surface, but what is the risk of doing nothing? Many franchisors recognize that the bigger risk is doing nothing to support franchisees. Here are my recommendations:
- Make a commitment to do more to help your franchisees with hiring. Spend time speaking with them (or conduct a survey) to learn about their current processes, needs and roadblocks.
- Speak with other franchise executives to learn how they support their franchisees. You can also look on their websites to see what kinds of careers pages they provide for franchisees.
- Download our Franchise Careers Page Best Practices ebook. We researched 68 of the smartest growing franchisors to see how they do it.
Many franchisors who have partnered with us have seen excellent results. Our hiring system has impacted franchisees at every step of the journey. It is a competitive advantage they talk about during the Investigation. It is an integral part of training during Initiation. It has helped new franchisees ramp up staffing during Perspiration. It has added revenue-producing team members and managers during Consolidation. It has helped push long-time franchisees through Maturation into a focus on Reformation.
