Multi-Unit Franchisee Magazine Issue IV, 2015 | Page 65

Counts! Culture BY ERIC STITES Building a Culture of Trust T he difference between a weak and a strong franchise is often the alignment between franchisor and franchisees. Franchise Business Review’s franchisee satisfaction research shows that franchise brands with strong cultures: 1) have extremely high satisfaction and engagement among their franchisees, and 2) outperform their competitors by a factor of 300 to 400 percent. Great company cultures don’t just happen. They are always the direct result of inspiring leadership and constant efforts to grow, learn, and improve. Trust also plays a crucial role: its absence creates a barrier to performance, while its presence, which promotes creativity and teamwork, accelerates it. While many franchise brands pay lip service to building trust with franchisees, few actually do. Before you invest in a multi-unit opportunity, be sure it is trust-worthy by asking the following questions of those who know the most about its culture and leadership: its franchisees. 1. Are realistic expectations set? You don’t want to invest in a franchise that sells “sunshine and rainbows.” It’s important to look for one that sets realistic expectations of what your franchise life will look and feel like. 2. Does the franchisor operate transparently? Franchises with happy and productive franchisees empower them by freely sharing information, which helps them feel like an integral part of the company’s growth and success. Find out if the franchisor communicates openly and honestly, shares corporate and unit-level performance data system-wide, encourages healthy competition, and ensures that best practices are shared. 3. Are franchisees engaged? Does the franchisor regularly seek its franchisees’ opinions and involve them early on about all major decisions? In response to the question, “Senior management involves franchisees in company decisions,” there was nearly a 100 percent increase in how franchises at the top ranked, compared with the lowestranked franchises surveyed (see graph). 4. Do franchisees and corporate share the same vision? Shared values and a common vision drive franchise success. Does corporate listen to its franchisees’ goals and vision and consider them when outlining action plans? 5. Does the franchise question everything and measure constantly? The best brands are obsessed with getting better. They regularly and systematically measure franchisee satisfaction, address critical issues, and are constantly looking for ways to improve results. It is clear from our data that the chances of your succeeding in franchising dramatically increase if you take the time to identify a brand that collaborates with its franchisees to build a strong culture based on trust. Eric Stites is CEO of Franchise Business Review, a national franchisee satisfaction market research firm. Cultural Differences Between Franchises Ranked Cultural Differences between Franchises Ranked Highest and Lowest By Their Franchisees Highest and Lowest by Their Franchisees shows   percentage   of  two  survey most  posi2ve   survey  response   op2ons  (“Agree” ("Agree"  and  "Strongly   Agree")  to  each   Chart shows percentage ofChart   two most positive response options and “Strongly Agree”) to each statement statement  by  franchisees  of  the  top  and  bo>om  25%  of  approximately  350  surveyed  franchise  brands.   by franchisees of the top and bottom 25% of approximately 350 surveyed franchise brands. Top 25% Bottom 25% n TOP 25% n BOTTOM 25% 94% 92% 93% 89% 88% 77% 65% 60% 65% 63% 54% 54% 33% trust my my franchisor. actsacts with I Itrust franchisor. My Myfranchisor franchisor with a high a high levellevel of of honesty integrity. honesty &&integrity. My franchisor a Senior Senior management management Myfranchisor franchisorcares cares My cares about my success. encourages strong bout my encourages aastrong about mysuccess. success. team curture team culture. culture. 36% Senior management management Overall, Overall, II am am satisfied would recomment this Senior satisfied II would recommend involves franchisees this franchise to involves franchisees in with withthis this franchise. franchise. franchise to others. in company decisions. others. company decisions. Source: Franchise Business Review, 2015 Source: Source: Franchise Franchise Business Business Review, Review, 2015 2015 muf4_culture(60-63).indd 63 MULTI-UNIT FRANCHISEE IS S U E IV, 2015  63 10/7/15 12:55 PM