Grow Market Lead
Leadership
guru
Leadership
by Example
Earning the confidence
of franchisees
By Don Fox
L
eadership is a fundamental
ingredient for the success of
a franchise concept. When
franchisees invest in a brand,
they are casting a vote of confidence
in the leadership team. After all, if the
franchisees don’t believe in the leadership team, why would they put their financial resources at risk with the brand?
So, what might a franchisee be looking
for in terms of brand leadership?
The franchisee’s first impression
may be of the leadership styles of the
CEO and executive team. Is there any
one right or best leadership style? The
short answer is “no.” Every leader, in
some form or fashion, blazes their own
trail. But at the root of great leadership must be the belief that before you
can lead others, you must lead yourself,
and hold yourself accountable for your
own actions and decisions. Leadership
by example is a critical trait within a
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franchise system.
Franchisees also look at the executive team’s track record. They evaluate the way the brand is managed, as it
affects their operation of the business.
But more important, they are looking
for brand leadership. The distinction
between management and leadership
is significant. Great management is
functional in nature, while great leadership is inspirational and drives the
people within the brand to achieve at
a level higher than they might do on
their own.
Great leaders restore calm and reason when the team is under pressure
and duress. Great leaders create an
environment where team members
have mutual respect for one another
and put the success of the team ahead
of their own interests. Great leaders inspire people to act because of a sense of
purpose, not out of fear of retribution.
The qualities a leader needs to instill
this sort of drive and motivation are
far different than the recipe for a successful manager, and your franchisees
will certainly look for these points of
differentiation.
Prospective franchisees will look at
your track record of critical decisions.
Existing franchisees will judge you on
the basis of their direct experience under
your leadership, and their commitment
to the business will be directly shaped
by that experience.
As the leader of a brand, you must
not dismiss this dynamic. You should
be thoughtful and reflective, do your
due diligence, and consult with others as part of your decision-making
process. But there will be times where
expediency is of greater consequence,
and it is at these moments great leaders really shine.
General Patton once said it best,
and I will paraphrase: A plan that is
80 percent right, executed at the right
time, is better than a plan that is 100
percent right executed too late. In
business, this translates into the old
saying “paralysis by analysis.” There
are times in many walks of life where
leaders must seize the moment. But
never forget that it should always be
a calculated risk. A bold plan without
contingencies risks crossing the bound-
ary toward recklessness.
I have faced moments like this in my
own business career. In 2008, Firehouse
Subs was faced with the challenge of
declining comparable sales. In the absence of a plan that would lift sales, I
allowed the franchisees to stop sending
in their 2 percent advertising fee. Instead, I told them to keep their money.
In the absence of a winning advertising
campaign, I would empower them to
market their business locally.
But before I had ever made that decision, I thought through the contingency plans. If the franchisees failed to
lift sales through their own local store
marketing efforts, I would have to be
prepared to step back in with a solution.
Empowering the franchisees didn’t
work. But within six months, we were
well on our way to selecting a new agency. I later announced to our franchisees
that I would not only start collecting
the marketing fee again, I would also
ask them for an additional 2 percent
that would enable us to purchase sufficient media. We demonstrated leadership by testing the program in our
25 company restaurants, a classic case
of leading by example.
The franchisees placed their trust in
the leadership of the company. Since
that strategy has been implemented,
we have enjoyed more than 2 years of
comparable store sales growth, reached
an all-time high average unit sales volume, and have grown our system by
more than 130 restaurants. This is the
result of leadership at a critical time in
a company’s history.
Without effective leadership, and
without the accompanying confidence of
your franchise community, your brand
will never reach its full potential. n
Don Fox is CEO of Firehouse of America.
Under his leadership, the brand has grown
to more than 475 restaurants in 28 states
and one U.S. territory. He sits on various
boards in the restaurant community and is
a respect Y