lessons learned - canadian franchise association · lessons learned •very long effort but...
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Lessons Learned:
Continuous Franchise Performance Improvement
Introduction
Jason Kealey, Eng.
(CEO FranchiseBlast)
Developed a platform that
empowers franchisors to better
manage their systems.
Introduction
Pino Di Ioia, MBA (CEO,
BeaverTails) & Kathy Slotsve
(Operations Director)
Inherited a system lacking
structure and introduced
sweeping changes
over the last 5 years.
Our thoughts on how to:
1) Improve franchise compliance
2) Engage franchisees via benchmarking
3) Help franchisees increase profits
BeaverTails: Context & Goals
We bought a brand that was just turning 30...
We wanted to ensure it would be
prosperous for another 30 years!
Key Strategy
Additional growth required US expansion,
having exhausted Canadian locations.
This would further complicate distance and
sense of connectedness with our stores
Prerequisites to Growth
#1: CONSISTENCY
We need to standardize and automate our processes
(sharing Excel files was no longer sufficient)
Prerequisites to Growth
#2: KNOWLEDGE
We need to make data-driven decisions
(we were flying blind)
Prerequisites to Growth
#3: EVOLVE
We need to gradually change our company culture
(it’s not going to happen overnight)
How to Address these Weaknesses?
Analyze
Improve
Do
Continuous Franchise Improvement
Case Study
At BeaverTails we first set out
to make our policies more
clearly known.
COMMUNICATE
Case Study
Next step: Measure all
decisions throughout 2016
MEASURE
Case Study
In 2017, we’ll benchmark every
outlet to the best practices as
measured throughout 2016
BENCHMARK
• Audits
• Customer Satisfaction
• P&Ls
• Back-of-House
Management
• Communication
Initiatives: 5 Focus Areas
Initiatives Aligned to Key Objectives
1) Improve franchise compliance
2) Engage franchisees via benchmarking
3) Help franchisees increase profits
Case Study #1:
AUDITS
GOAL:
Improve standardization
AUDITS: CHALLENGES
Lack of brand consistency
• Non-standard operational procedures
• Franchisees historically given free reign
• Wide geographic distribution
AUDITS: CHALLENGES
AUDITS: FIRST ITERATION
• Hire Field Support Coaches
• Perform field visits
• Preliminary paper audit
Catch up with industry standards
AUDITS: LIMITATIONS
• Paper reports hard to keep track of
• Follow up actions fall through the cracks
• Unable to pinpoint system-wide weaknesses/trends
AUDITS: SECOND ITERATION
• Field audits app
• Increased expectations from Coaches
• Concerted effort with legal&marketing
AUDITS: LESSONS LEARNED
• Systemizing evaluations is a prerequisite
• Easily accessible history improves effectiveness
• Generated actionable insights guide initiatives
AUDITS: EXAMPLE
AUDITS: EXAMPLE
Case Study #2:
CUSTOMER SATISFACTION
GOAL:
Leverage customer feedback to
improve store performance
CUSTOMER SATISFACTION:
CHALLENGES
CUSTOMER SATISFACTION:
CHALLENGES
Lack of consistent, actionable feedback
• Client feedback inconsistent and sparse
• Impossible to track in an effective way
• Lack of franchisee involvement
CUSTOMER SATISFACTION:
FIRST ITERATION
Initiate feedback internally
• Secret Shopper program
• Emailed feedback ([email protected])
CUSTOMER SATISFACTION:
LIMITATIONS
• Lack of feedback volume
• Follow up actions fall through the cracks
• Unable to pinpoint system-wide weaknesses/trends
CUSTOMER SATISFACTION:
SECOND ITERATION
• Customer Satisfaction App
• Online review management software
CUSTOMER SATISFACTION:
LESSONS LEARNED
• Make it easy & visible for clients
• Go where your clients are already posting
• Make sure your feedback analysis is balanced
CUSTOMER SATISFACTION:
EXAMPLE
Case Study #3:
P&Ls
GOAL:
Improve unit-level economics
P&Ls: CHALLENGES
No visibility into P&L statements
• No centralized POS system (impossible for us)
• Very rough supplier purchase reports
• Unable to identify franchisee fraud
P&Ls: FIRST ITERATION
• Simple purchase database
• Find purchasing anomalies
• Request/obtain P&Ls
Gather Baseline Info Manually
P&Ls: LIMITATIONS
• Supplier’s data hard to compare month-to-month
• Lots of overhead for Coaches to obtain info
• Manually creating store SWOT is time-consuming
P&Ls: SECOND ITERATION
• Automate self-reporting of simplified P&Ls
• Automate benchmarking of KPIs
• Automatically share this information back
• Coaches leverage benchmarks to make an impact
P&Ls: LESSONS LEARNED
• Narrow focus on a few key performance metrics
• Make it as easy as possible for the franchisees
• Develop action plans for each type of weakness
• Share information back to increase engagement
P&Ls: EXAMPLE
Case Study #4:
BACK OF HOUSE MANAGEMENT
GOAL:
Streamline operations &
facilitate collaboration
BoH: CHALLENGES
Lack of coordination & communication
• No systemized tracking available
• Departments lacked coordination on key projects
• Hard to track employee involvement
BoH: FIRST ITERATION
• Manually create
employee scorecards
• Manually track
project advancement
Determine Employee & Department Priorities
BoH: LIMITATIONS
• Inconsistent tracking
• System unable to keep up with real-time updates
• Lack of coordination between departments
BoH: SECOND ITERATION
• Project management App
• Online creation of Action Plans
• Online management of assigned tasks
BoH: LESSONS LEARNED
• Value in systemizing repeated projects
• Can identify root causes of project delays
• Everyone knows what’s expected of them
• High-level insights on project evolution
BoH: EXAMPLE
Case Study #4:
COMMUNICATION
GOAL:
Engage franchisees
COMMUNICATION:
CHALLENGES
Franchisees overly autonomous & unresponsive
• No forums for inter-communication
• Front-line staff are unreachable
COMMUNICATION:
CHALLENGES
COMMUNICATION:
FIRST ITERATION
• Newsletters/Annual Virtual Conference
• Revamped training materials & videos
• Mobile app to push news to front-line staff
Initiate Communication
COMMUNICATION:
LIMITATIONS
• Chain culture slow to evolve
• Training materials not proactively consumed
• Franchisees don’t proactively help roll-out of app
• Staff requiring initiatives to participate
COMMUNICATION:
SECOND ITERATION
ONGOING: Still researching best ways to weave in
training & engagement in day-to-day operations
Facebook at Work: allows secure
communications with franchisees and
staff where they are already active
COMMUNICATION:
LESSONS LEARNED
• Very long effort but persistence pays off
• Proactively find repeatable successes
• Share these to increase the value of engagement
• Communicate expectations and payoffs to system
Conclusions
Achievements (Development)
• Opening 3x the amount of
stores/year than previously
• Double-digit store count
increases
Conclusions
Achievements (Sales)
• Double-digit sales
increases/year
• Gains are increasing
year-over-year 2008-20092010-2012
2013-2015
Conclusions
Achievements (Sales)
• Roughly 20% increase in same-store sales at
existing locations
• New stores out-perform existing locations
Conclusions
Align your efforts with your key objectives
Conclusions
Keep it simple
Conclusions
Make data-driven decisions
Conclusions
Advance continuously – don’t be afraid of failure