Bridging Strategy and Execution in Franchising

By Michael Seid, Managing Director, MSA Worldwide

Execution Pollution with Strategic Plans

“We spent a week off-site to formulate our strategic plan, and six months later, nobody’s using it!”

Whether you spent a week away with your franchise management team, or several sessions at the office to crank out a plan, you’re not alone if you’ve discovered that “working the plan” is more challenging than getting it on paper.

The sources of execution pollution – that grey fog that blurs the results in the horizon – are many. How a franchise system’s strategic plan is created, and how management communication and decision making are structured, are often significant parts of the problem.

Most franchise organizations commit to regular weekly or monthly meetings of top managers, and assume this creates the necessary alignment among functions to execute the strategic plan. These meetings do not, however, ensure that the right information is being communicated across departments to support effective execution.

If managers are not required to share their function’s objectives, strategies, and progress on their projects in a standard written format (that their colleagues are required to review), it’s likely they will only communicate what is top-of-mind for them. Each manager uses their own discretion about who else needs to know “their” critical information. This often leaves important communication to hallway catch-up sessions.

The Costs to Franchise Systems of Incomplete Communications

The unintended outcome of this type of communication can be that interdependencies, obstacles, or conflicts between functions, that should have surfaced in a management meeting, may not become apparent until it’s too late. For example, that inventory won’t support the expectations set by sales and marketing; or that training can’t provide timely instructions for the new equipment being installed at franchisee and corporate units. These are costly failures in execution that are preventable.

Start with a Clearly Written Strategic Plan

Revisit the process of developing and implementing the strategic plan for your franchise system. Start with how the consolidated plan is articulated:

• The plan you present to your bankers or investment groups is not the same plan that should inform your organization.
• The wording of your working plan should be crisp and to the point so that anyone in your company can read it and get it. I am not suggesting using only 3-letter words, but rather a plan that brings discipline to the wordsmithing process: think “less is more.”
• Go for one page (yes, it can be done) for articulating your company’s vision, mission, measurable objectives, strategies, and key projects.
• Bullet points are fine and, in fact, are a must in describing objectives, strategies and projects.

Create a Strategic Plan for Each Functional Unit

In addition to your overall approach to writing your strategic plan, carefully consider strategic plan implementation. After you have upper-level management agreement about the consolidated plan, require each functional head to create their own one-page plan for their unit. These plans will then be presented to peers at management meetings specifically scheduled to focus on alignment.

All of your franchise system’s functional leaders should be present at these alignment meetings, to engage in dialogue about possible interdependencies, obstacles, or conflicts. For example:

• If inventory can’t be ramped up for an impending marketing campaign, the alignment meeting is when to develop “Plan B” – not after the crisis has hit.
• If marketing cannot produce an ad campaign for a new product roll-out because of competing projects, several people in the alignment meeting may have input into what projects take priority, and how to integrate schedules.

Gaining alignment on the objectives, key strategies, and projects across functions is essential for execution.

Once all the strategic plans have been aligned, a major source of execution pollution has been lifted. Managers should share the consolidated plan, as well as their unit’s plan, with each of their teams. There may be substantive input at the department level that will continue to refine that function’s plan, for the benefit of the entire franchise system.

Franchisee Input to your Strategic Plan

Once things solidify, certain aspects of the plan can be communicated to your franchisees.

• In a mature franchise organization where an elected Franchisee Advisory Board is in place, give them a preview of the consolidated plan before presenting it to the franchisee body as a whole.
• In some organizations, where the franchisee advisory board keeps close tabs on marketing activities (since franchisees often contribute to a marketing fund), consider sharing the plan from the marketing department in greater detail. Remember the capital “A” in Advisory Board.

Franchisees can certainly provide advice and input for your strategic plan, but you as the franchisor are ultimately responsible for setting franchise system strategy, and for ensuring that the entire system moves in the right direction.

Update and Communicate Your Strategic Plan

The key word is “update.” Maintain rigorous updating and continued cross-communication between departments about their plans. Utilize collaborative software so that all managers can view one another’s strategic plans. For an elegant and efficient one-page emphasis, check out the One Page Planning System at www.onepagebusinessplan.com.

Simple documentation, in plain language, fosters alignment and provides a working tool that keeps the important things on everyone’s radar. Regular weekly or monthly manager update meetings become effective, because each manager is now bringing their updated one-page plan to share with others. This ensures that the projects fueled by employee time and company resources are actually the ones that tie to your company’s strategic plan for your franchise system. And it provides a valuable communication tool for everyone – from your Board of Directors to your franchisee community – by providing a yardstick for measuring the value (or lack of it) of current and potential projects.