Franchising is possibly the most successful business model ever invented. The survival rate of franchises is far higher than that of stand-alone businesses. Is it possible that there is a lesson to be learned from the way in which franchises operate that could be applied to small independent businesses to improve their profitability and likelihood of survival? The answer is an emphatic YES. The fundamental principle of good management that franchisers have put to such good use is available to any business owner - it's SYSTEMATISATION.
Think like a franchiser
The key to systematising your business is to think about it as if you were turning it into a franchise. Entrepreneurs who set out to turn their business into a franchisable operation know that the core thing they need to get right is to develop foolproof operating procedures. The franchisor isn't going to be there to watch how each one of their agents prepares and cooks the pizza or washes and grooms the family pet. Central to franchising is the repeatable production of a high quality product or service experience for the customer without the oversight of the franchise manager. The only way a franchisor can guarantee that happens is to train their agents to go through every process in a systematic manner. If it's preparing a sandwich, then everything from the way to cut the bread to how and when the condiments are added is dictated and taught from a system developed by the franchiser The success of individual franchise outlets is the best advertisement for the soundness of this approach.
Systematising is the approach you need to take with regard to every aspect of your business if you want it to stand as solid as a franchise. Start by focusing on one particular aspect of your business and think through the entire process so it can be handled efficiently and consistently by everyone who has to perform it.
Systematise the right things
Any process can be systematised but the place to start is with those that deliver value to the customer and to your business. A telephone enquiry from a prospect, properly handled, can result in an impressed customer and an order. So systematising telephone calls would involve providing employees with a script that required the phone to be answered without delay, described how to introduce oneself, how to handle likely enquires, how to take an order and get all the relevant information first time, how to deal with transfers to another person and how to ring off courteously. Systematising a towing pick-up would cover not just the mechanics of a safe hook-up but how to treat the customer so that they are happy with the way their vehicle is being treated (no greasy hand prints on it, provide a business card with contact details and so on).
After you have thought each process through in this way, write it down. Then work through any problems or exceptions that you can think of and write down a plan to deal with these situations as well.
First things first
Systematising may seem like a daunting job but not every process needs to be done at once. The key processes for your business are those that touch on product quality and customer service standards. Get those right first. Back office routines that don't directly touch on these such as handling payroll, bookkeeping and marketing can be considered later.
Some processes can be systematised simply by buying a training package, for instance, telephone technique. Others can be systematised by creating templates, standardised forms and checklists so all team members go about a task in a consistent way. And some processes, such as payroll, may be better off being outsourced to ensure they are done in a systematic manner.
Write it down
Systematised processes don't stay that way for long unless they are documented. Set up a simple operations manual which details the tasks that make up each of the key operations or procedures of your business. The objective is to write your manual as if it were going to be used by a 'franchisee'. It should explain an operation in sufficient detail that an employee could follow it unaided and get the right result.
Franchises are successful for a very simple reason - each one has identified a set of customer winning practices and developed operational methods for consistently replicating them. Any business prepared to exert the necessary discipline can benefit from systematisation in exactly the same way as franchisers do. The payoff won't only be in terms of profit. Systematising a business allows it to run without requiring your constant intervention or always answering employees' questions about how things work. It can improve your peace of mind as well as your bank balance.