The Ultimate Guide to Franchisee Training
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1 The Ultimate Guide to Franchisee Training
2 CONTENTS 1 It s a Good Time to Be in the Franchise Industry 2 Training Is Critical to the Long-Term Success of a Franchisee Operation 3 But We Already Provide Training! : Why Your Existing Franchisee Learning Program Is Isn t Enough 5 Three Elements to a Successful Franchisee Training Program 8 Getting Started 9 About Cornerstone OnDemand
3 It s a Good Time to Be in the Franchise Industry According to International Franchise Association, franchises in the United States in 2017 will once again outpace the overall economy. In fact, the sector is expected to grow by a whopping $36 billion. And a 1.6% increase in establishments will provide more than seven million jobs, a 3.3% uptick from Yet despite this good news, not every franchisor experiences long-term success. In a 12-year study of 157 franchise organizations, business and economics professor Scott Shane discovered that only 25% of franchisors survived during that period. 2 While the study was published in 1998, the statistics are similar today, if not worse. What then separates the successful 25% from the three-fourths who don t make it? Creating a franchise organization with staying power, one able to withstand economic fluctuations and fickle customer demand, requires more than a beloved product, diehard customers, or even clever marketing. The real key to creating a successful organization is ensuring a consistent, high-quality customer experience every time and that begins and ends with your franchisees. The real key to creating a successful organization is ensuring a consistent, high-quality customer experience every time and that begins and ends with your franchisees. As brand ambassadors with skin in the game, franchisees are invested not just in their own success but that of your organization, as well. Yet though they ve put cash on the line, purchasing a working stake in your business, franchisees don t operate in a vacuum. While they bring the motivation, passion, and drive, your organization must nurture and sustain that drive with resources and training. 1
4 Training Is Critical to the Long-Term Success of a Franchisee Operation The best franchisors are huge advocates of training and invest heavily in it. 3 Mark Siebert, author of Franchise Your Business, and CEO of the ifranchise Group While undercapitalization is ranked first as the reason for franchise organization failure, a close second is a lack of training and support. 4 But the case for franchisee training doesn t end there. In fact, how and when a business develops its franchisees matters. After all, every franchisor provides some training. But what separates the successful from the ho-hum is learning opportunities that expand beyond the initial operational training. A successful franchise isn t the result of sprinting to the finish line but running a marathon. The rewards come, not immediately with a sudden magical buyout or IPO, but with consistent effort over long periods of time. Thus, training must also be treated as a similarly consistent effort that takes place over time. The rewards come, not immediately with a sudden magical buyout or IPO, but with consistent effort over long periods of time. Thus, training must also be treated as a similarly consistent effort that takes place over time. Training doesn t just help create a successful franchise and a skilled, engaged franchisee. It also helps attract the right franchisees in the first place. Franchise organizations that provide robust, comprehensive, ongoing training are a beacon for committed, motivated candidates. The kind of franchisee organizations want will expect to have access to training that helps them succeed. 2
5 Research shows organizations also reap measurable business benefits from expanding training for franchisees and other external employees. In a survey conducted by Brandon Hall Group in 2017, organizations that facilitated extended enterprise learning reported significant changes: 53 % met or exceeded corporate objectives 67 % reduced training cost 61 % increased sales 59 % reduced training travel time 29 % reduced turnover 5
6 But We Already Provide Training! : Why Your Existing Franchisee Learning Program Isn t Enough Continuous employee training is crucial to creating the modern, agile business. Organizations that implement comprehensive internal employee training programs see reduced turnover, higher profits, and more. Yet it s not just internal employees who benefit from continuous training; franchisees do, as well. Both internal and external employees also thrive on blended approaches, as well as development that enables learning on the job while also providing on-demand, bite-sized lessons. Yet as external employees, franchisees have additional learning needs. A franchisee occupies a unique space within an organization: independent yet reliant, a solo operator who is also tangentially part of a tribe. Thus, learning and development must provide franchisees with the opportunity to engage in structured learning, while simultaneously respecting the semi-independence and self-direction of the franchisee. Separated by psychical and psychological distance from peers who often also play the role of competitor, franchisees still need opportunities for collaborative learning and connection. It s a tall order, further complicated by numerous other factors, e.g., the investment levels of different franchisees, numbers of franchises someone owns, types of franchisee experience (business background, food service experience, etc.), and legal constraints. In fact, these factors give training franchisees more in common with a technology company training its customers or an insurance agency training its agents than with internal employee development. All three face the common challenge of needing to train a wide variety of learners operating at different levels of independence, while remaining external to the organization. 4
7 Three Elements to a Successful Franchisee Training Program Extended, continuous training for franchisees is critical to ensuring franchise consistency, quality, and long-term financial success. Yet the training needed is more complex than an initial operations course or yearly conference. How then can organizations create the right kind of training for franchisees? By integrating the three key elements that all successful franchisee training programs share: Learning is continuous and structured to build skills and capacity over time. Learning is just-in-time, asynchronous, and on-demand. Learning is aligned with the franchisee s goals and the organization s
8 1 LEARNING IS CONTINUOUS AND STRUCTURED TO BUILD SKILLS AND CAPACITY OVER TIME. Successful franchisee training starts with basic operational skills and builds on those skills over time. In fact, in a profitable franchise operation, training never ends. As franchisees gain experience, training responds in kind. Successful franchisee training starts with basic operational skills and builds on those skills over time. In fact, in a profitable franchise operation, training never ends. For organizations, this requires planning with the end in mind, forethought as to how to best facilitate a logical skills progression. For example, after basic operational skills, franchisees can begin learning soft skills, such as enhanced communication, leadership, and conflict resolution. After both hard and soft skills are gained, franchisees may then be offered opportunities tailored to their own goals and talents, such as business analysis, expanded ownership, or advanced sales and marketing. 2 AT THE RIGHT TIME, VIA THE RIGHT CHANNEL After initial training, franchisees will still need on-the-job instruction, as questions and challenges will arise as a franchisee adjusts to the realities of a new business. Providing resources to answer these questions via training that is delivered at the right time is key to maintaining momentum during the initial and vulnerable months of a new franchise. Delivering knowledge as franchisees need it reduces frustration, sustains engagement, and improves retention. Providing resources to answer these questions via training that is delivered at the right time is key to maintaining momentum during the initial and vulnerable months of a new franchise. Training also needs to be delivered with the right channel. Everyone learns differently; offering franchisees a variety of learning opportunities accommodates multiple learning needs. For example, training can be provided within the context of a task to provide reinforcement for that task or via gamification to stimulate interest and engagement. 6
9 Training that is provided within the context of work is ideally supported with asynchronous learning. When training is available on a franchisee s own schedule, anytime and anywhere, franchisees are better able to find that crucial work-life balance and manage the stress of business ownership. When learning is bite-sized and on-demand, learning is also better retained over time. 3 ALIGNED WITH THE FRANCHISEE S TALENTS AND CAREER GOALS, AS WELL AS THE ORGANIZATION S. A franchisee that has mastered both operational and soft skills is a tremendous asset. Keeping that franchisee for life, beyond the initial contract, can yield tremendous financial and marketplace benefits. While extended training functions to keep the franchisee engaged, ensuring the franchisee s goals align with the organization s nurtures loyalty and career longevity. Each franchisee has different talents and career aspirations. Your franchise organization, while a generalized path for success, can also provide tailored opportunities for the achievement of individual franchisee goals. A franchisee that has mastered both operational and soft skills is a tremendous asset. Keeping that franchisee for life, beyond the initial contract, can yield tremendous financial and marketplace benefits. In fact, research by the Brandon Hall Group showed that organizations can recoup some costs of an extended enterprise technology platform by charging for certain content. At this phase of training offering franchisees customized learning aligned with aspirations the franchisor organization can also realize a more monetary ROI. Motivated franchisees are often willing to pay for development that aligns with individual goals. In fact, research by the Brandon Hall Group showed that organizations can recoup some costs of an extended enterprise technology platform by charging for certain content. Thirty-percent of respondents in the 2017 Extended Enterprise Learning study stated they were able to cover more than 50% of their annual learning management system (LMS) costs via extended learning revenues. 6 7
10 Getting Started Knowing extended learning opportunities are beneficial to both franchisees and organizations is one thing. Taking action to create a successful learning program is another. The first step? Use this questionnaire to assess the effectiveness of your current training program. Learning that is tailored to the lifecycle of the franchisee requires planning ahead What short-term and long-term performance goals have been established for franchisees? Does current learning drive franchisees toward these goals in a logical, linear progression? What other opportunities do franchisees have in the organization, such as expanded ownership or leadership, and does training support those paths? Designing, managing, and updating curriculum takes tremendous resources. While operational training is specific to each franchise, training on soft skills is more universal. Has your organization considered using pre-packaged curriculum for soft skill development, nd if not, what are the barriers to doing so, e.g., leadership resistance, budget, lack of technology that integrates ready training? Creating and managing a successful continuous learning program for extended employees requires not just planning but a platform. What technology are you using now to deliver on-demand, just-in-time, and collaborative learning opportunities? Is this technology seamless and integrated for delivery and reporting and analytics purposes? Is your current learning management system capable of delivering bite-sized lessons in the moment of need? Could your organization benefit from a holistic system that integrates a variety of extended learning methods including peer-to-peer communication and collaboration opportunities as well as real-time analytical capabilities? Training offsite is expensive airfare, meal, and hotel costs; material fees; instructors; etc. And the time franchisees spend away from the business to learn is even costlier By reducing expensive, one-shot onsite training and delivering ongoing learning opportunities to your franchisees offsite via videos, forums, collaborative lessons, gamified lessons, and more how much money could you save? Can you not only deliver engaging training but track and report on employee completion of that training? Knowing who engaged with what content and when (from taking a quiz to watching a YouTube video) is crucial to managing development plans, performance improvement, and even succession planning. If learning were available as needed, i.e., just in time, how would that affect franchisee productivity and profit? 8
11 About Cornerstone OnDemand Cornerstone OnDemand (NASDAQ: CSOD) is pioneering solutions to help organizations realize the potential of the modern workforce. As a global leader in cloud-based learning and human capital management software, Cornerstone is designed to enable a lifetime of learning and development that is fundamental to the growth of employees and organizations. From recruitment, onboarding, training and collaboration, to performance management, compensation, succession planning, people administration and analytics, Cornerstone is there at every phase of the employee lifecycle. The company s solutions are used by nearly 3,000 clients worldwide, spanning more than 31 million users across 191 countries and 43 languages Brandon Hall Group/Cornerstone OnDemand. Extended Enterprise Learning: A Profit Driver for Leading Organizations. June Page Brandon Hall Group/Cornerstone OnDemand. Extended Enterprise Learning: A Profit Driver for Leading Organizations. June Page 8. Cornerstone OnDemand is the global talent management software provider that is pioneering solutions to help organizations realize the potential of a modern workforce. csod.com 2017 Cornerstone OnDemand moreinfo@csod.com CSOD Stay connected: 9
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