When Culture is Out of Alignment

Recently, in a discussion about culture on the IFA’s FranSocial site, the discussion was quite robust and included the following statement… “The challenge becomes determining where things might be out of alignment and methodology to realign.” My response was as follows:

To me, the development and management of culture is much like that of a brand…

It must be planned.
It must be nurtured.
It must be allowed to grow.
It must be invested in.
It must be protected.
It must be promoted.
It must be cherished.
It must be the center of the universe.

I believe it’s fairly easy to determine when and where things are out of alignment in a franchise organization – disgruntled franchisees, frequent franchisor employee turnover… just to name a couple that would be very apparent. Obviously, these are the results of, but not the root of the problem that caused things to move out of alignment. Mostly the problems occur (and fester) due to poor communications and lack of transparency between franchisor and franchisees. Inconsistent messaging adds fuel to the fire. Basically, similar problems to a marriage or other types of relationships that fail.

As for methodology to realign that takes full commitment from all parties to the relationship. However, in a franchise relationship it takes the franchisor to take the bull by the horns and lead the charge. It takes full commitment to open, honest, transparent communications. Even through difficult scenarios. After all, franchisees have made a significant investment and they do need to understand the good, bad and ugly. The precarious issue is, how much is too much? do franchisees need to know everything? Getting back to square one, a benchmark of sorts is critical as emotions running high will dictate more rather than less.

I talk a great deal about positively memorable experiences and I believe it applies to the franchise relationship as well. I won’t get too deep here as I’ve authored an article on the topic in the IFA’s Franchising World magazine. But I will share my thoughts on what I refer to as, “The Emotion Circle”. This circle could be looked at in any transaction or relationship.

Emotion CircleThere are seven key steps within the circle. Think in terms of a clock with the top being the starting point. That’s where the relationship begins. Once something occurs that doesn’t meet expectations the first step is surprise. From there it may escalate to the next steps of disappointment and doubt. Or, it may not escalate but the next “incident” moves the needle along. Sometimes an unaddressed issue moves it. Now, it’s inevitable things happen and expectations aren’t met or even understood. Which is why open, transparent communications are paramount. If the issues are discussed openly and frankly in a respectful way, the needle can be moved back to the 12 o’clock position with no or minimal chance of fueling a fire.

However, if not addressed in a timely and respectful manner the fire burns rapidly and on occasion to the point where it’s out of control. And, just like wildfires in the forest, these fires can jump across roads from house to house and community to community with devastating results. In the case of the Emotion Circle burning out of control, the next steps, often in rapid order include frustration, anger, hostility and remorse (think “buyer’s remorse). The end result is typically broken trust and as we know, trust is the backbone of ANY relationship.

So, in order for there to be realignment, trust must be rebuilt. It’s not easy but it can be done, but it takes a huge commitment.

Thoughts on Developing Corporate Culture

Corporate CultureAccording to author, Kris Dunn in her blog post, Keys to Developing Corporate Culture, “Corporate culture is all about really what you value as a company, what you value in terms of how you serve your customers, how business gets done, and what you value from a performance perspective across your talent base.” Although he concedes that there is no single definition that could be overlaid across all of corporate America, Dunn stresses that, at its core, culture represents the manifestation of the guiding principles that underpin every part of your company.

“Like style,” Dunn says, “you kind of know good culture when you see it.”

Culture is less about “free soda and ping pong tables” and more about performance, Dunn argues. Keeping a fun workplace atmosphere may be part of the image that your company presents, but what culture should actually be built on is an unrelenting focus on factors that “create a DNA map of the type of employee that a company looks for.” Find the characteristics that lead to high-performing team members, and your company becomes stronger and more successful.

Recently, I shared Dunn’s blog on within the Franchise Executives group on LinkedIn and posed the questions, “What are your thoughts on developing corporate culture? Would you be willing to let go of top performers if their management style is detrimental to your culture?” Here’s what various members of the group had to say…

“There is no question that any company is only as strong as their weakest link. Too many leaders wait too long before they let poor performers or those with poor attitudes go. They are afraid of legal repercussions or more commonly, those “difficult conversations.” The biggest error is not clearly knowing and expressing the caliber of work expected from the team, giving the team the tools to be successful, and them holding them to account. Leaders don’t consistently document performance. They wing it. Just because someone is in charge doesn’t mean he or she has the knowledge or training on how to create and implement a company culture that endures and helps the company thrive.” – Nancy Fox

“In our business, not one person can be above the values or culture that we have established.  Most franchises, good ones at least, have that culture built into the fabric of their operations and in everything that they do. It’s one of the reasons that people invest in therm. It is what helps make them successful.  I have had to relieve some top performers before because their method or interpretation of our culture was not in alignment with what was important at the client level and the staff/store level.  It looks on paper like it may be painful to the business, but in each case it was the best decision for the business.  Ours is an owner/investor model so day to day is run by an on site manager so it isn’t always apparent at the 5000 foot view.  To answer the question above, if members of our management teams at the store level is not in alignment with our culture and they are successful, it is generally in spite of themselves and our stores and staff are bigger than any one individual or leader.  Make the move and upgrade.” – Bob Chelberg

“If the answer is no, then you have no culture, and culture doesn’t matter to you. Being a top performer is a part of our culture. Diversity is part of our culture. Acceptance of diversity is part of our culture, but style isn’t culture. If style is part of your culture, maybe your culture is superficial? We used to call that an office full of empty suits. If diversity, acceptance of diversity, and being a top performer aren’t important cornerstones of your culture, you may have a dysfunctional culture. The answer has to be yes. It’s a trick question, Right?” – Steve Davidson

There are many more interesting comments in the LinkedIn discussion that may be accessed HERE.

Franchising: Yesterday, Today & Tomorrow

As I often do on the weekends, I was searching through my personal library seeking out a book or two that might provide me some inspiration for an article or report, and this weekend, I came across a business book that was published back in 1979. The book, “Free Yourself in a Business of Your Own” by Byron Lane, caught my eye for reasons I cannot really explain. Obviously, I’ve had it in my possession for many years, yet, never opened it again since I purchased it for $1.29 at Target. It must have been a clearance book as the cover price was $5.95. Anyway, I can’t even recall seeing it when I routinely search through my library. It’s like it suddenly jumped out front and center and said, “Hey, look here!”

Well, I decided to look through the book because the back cover stated, “This book is about freedom. Freedom from an 8 to 5 regimen. Freedom from dehumanizing democracies. Freedom from job boredom. Freedom from the lock-step culture. Freedom to do your work your way.” Hmmm… not much seems to have changed although lock-step culture is not one I’ve heard of before.

Right away, my thoughts turned to franchising and I began to think about what franchising was like back in 1979. Fortunately, I didn’t have to think very hard, as to my surprise, was a chapter on franchising! It’s placement was to present franchising strictly as an alternative to other forms of business ownership, and in a book with 174 pages, the franchising chapter comprised all of 3 pages. Yes, 3 pages!

Within these pages were a series of bullet points that I found very interesting and it made me wonder how much franchising had actually changed since 1979, and if the changes have improved franchising today. Read the bullet points below and you be the judge.

– While there are no federal laws governing franchising, most states have franchise laws. Get a copy of the law in your state and read it for degree of stringency and coverage. If it is a tough law and a franchising company qualifies to do business in your state, you have one measure of security.

– Don’t believe that acceptance of you by a franchiser means they have evaluated your ability to get the job done. Some franchisers would select a corpse if rigor mortis had not set in and if it clutched in its hand a certified check for the amount of the franchise fee. Do your own introspection and decide if you can handle the franchise.

– Do not deal with profit projections or average profits. Insist on actual financial statements from a cross-section of franchisees. Then, evaluate your expected return on investment.

– Get the financial statement of the parent company and evaluate its ability to provide the services it promises.

– Read the franchise contract. It should be simple, frank, and fair, with complete disclosure, not an instrument of repression. After you think it through with your head, listen to your gut and determine if the contract fits you.

– Finally, and perhaps most important of all, is evaluation of the franchiser’s management team. You should do this from two aspects – their management ability and their humanness. If the management does not measure up to good corporate standards, you will not get the profits you seek. You may turn out okay, but they can bring you down.

Well, it’s no wonder that many individuals had a distaste for franchising. I cringed at some of the statements implying unfairness and deceit, along with an apparent free-wheeling approach to franchising. On the other hand, some of the advice was sound and still applies today.

It’s obvious franchising has changed, and for the better. But, are some of the negatives that’s were stated (or implied) above, still actually cause for concern within franchise organizations today?

I wonder what future generations will think about franchising when they discover some of today’s books and articles on the subject?

Yes, you be the judge…

*By the way, the author is listed as having several advanced degrees in business and psychology, and was a professor at a leading California university. He is also credited with developing several successful companies including a multi-million dollar franchising chain!

Note: originally posted on this site 12/10.


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