Canadian Small Business Women

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Don’t Sell To Every Franchisee Who Can Pay – Consider A Franchisee Assessment

Over the past six to 12 months, I have worked with a number of franchise owners who plan to sell franchises. In all cases, they had sold franchises in the past and had seen mixed results. Sometimes it had worked out. Other times, not so much. This time, all of them wanted to make sure that they sold to someone who was likely to succeed. They all recognized the risks associated with selling to the wrong franchisee, but did they do a franchisee assessment?

For the franchisee, one thing is clear. There’s a real turn-key value of buying a franchise compared to starting a business from scratch. As a franchisee you’re buying into a tried-and-tested business model and the related systems that should help the business run smoothly. Despite all of this helpful infrastructure, a franchisee’s success is never a “given.” In the wrong hands, a viable business can easily become a failed business. Sadly, when a franchisee fails, it reflects poorly on the whole brand.

Use a Franchisee Assessment to Improve Success

Many experienced franchisers have learned that it’s riskier to sell a franchise than it is to hire an employee. Here are some reasons why:

    • It is harder to “manage” a problematic and independent franchisee, there is often less room for oversight
    • A franchisee will probably have much more visibility and influence than an employee. If/when things go poorly, it’s often more public.
    • If you think severance pay is expensive/inconvenient, try getting rid of a franchisee
    • Just like employees, some franchisees just don’t fit with the culture or don’t understand the full responsibilities of business ownership.

Risk Management For Franchisers

So what’s an aspiring franchiser to do? How can they increase their odds of selling a franchise to someone who is likely to succeed? One easy and effective option is to do a Basic Franchisee Assessment. Here’s how it works:

Basic Franchisee Assessment

  • Potential franchisee answers some questions online
  • I/O Advisory Services prepares a short report based on the online assessment. This report will identify potential red flags (and/or notable strengths) that should be considered prior to selling to the potential franchisee
  • Awareness of these red flags may suggest that these issues should be probed during meetings/interviews that take place before the sale of the franchise (see Enhanced Franchisee Assessment)

Sometimes, the Basic Franchisee Assessment Report raises concerns that warrant a closer look. In these situations, I recommend that these concerns are addressed during meetings or interviews with the aspiring franchisee. A wise way to prepare for these meetings or interviews is to do an Enhanced Franchisee Assessment. Specifically, this includes:

Enhanced Franchisee Assessment

  • Prepare interview questions to confirm or refute the red flags or issues of concern that were raised during the basic assessment
  • Propose coaching and/or training to support the franchisee so that they can succeed in their role as a business owner and leader
Franchisee Working Well

As your (franchise) business grows, I/O Advisory Services can provide you with occasional Human Resources (HR) support. This is much more cost-effective than having someone play this role on a full-time basis when the need is temporary and periodic. I will help you identify the appropriate profile of hard and soft skills that your future employees should posses. Then, I can create interview questions that will help you tell the difference between job applicants who can say the right things during an interview versus job applicants who can actually deliver once they’ve been

hired. I’ll also help you make sure that your reference checks yield worthwhile insights, rather than being a meaningless formality.

Note – In July 2016, I reconnected with Ms. Erin Hamilton, the founder of MOGL Small Business Services. MOGL connects Ottawa businesses with MBA-level business talent on an on-call basis. My conversation with Erin about the work I’ve been doing with owners of franchises inspired this blog post.

Contact me by email, phone, or via direct message on Twitter, Facebook, or LinkedIn if you’d like to discuss any of these services in more detail.

Contact Helen

More than career coaching, it’s career psychology®.

I/O Advisory Services – Building Resilient Careers.

What Do HR And Psychology Have To Do With Cyber Threats?

Where is the Real Threat?

In the internet world festooned with apps we know it’s important to use strong passwords to secure our own email, social media accounts, and electronic devices. On the corporate side, another important consideration is the role that humans play in cyber threats. People with access to big data, personal information, intellectual property (IP), and critical infrastructure (e.g., power supplies, water treatment, hospitals, railways) can sometimes be the weak link in the chain.

HR as Part of Risk Management

For a while, I’ve been thinking about cyber crimes and cyber security and how to adapt what I learned and applied when I worked in a very secure (Top Secret) environment. In that workplace, we were extremely careful about how people were hired. Also important was how they were treated after being hired. I call my adaptation of those processes and policies “HR as Part of Risk Management.” I’ll admit that this may not be a stylish title but it does address something that most approaches to risk management are missing.

Employees: Often the Weakest Link 

Ominous Dark Buildings

Traditionally, risk management includes “human factors” but to date, relatively little attention has been paid to this source of risk. Normally, 90% of our collective efforts have focused on technical or IT-related interventions to protect us from cyber threats. Yes, these are important. However, to focus on them and not address the human element, psychology or employees’ behaviour is like locking the

front door but leaving the back door open. The fact is that sometimes security breaches reported as cyber attacks are caused by actions that take place inside the organization. As Dermot Williams, the CEO of  IT security firm Threatscape says, “when it comes to organizations, often the employees who are the weakest link.”

Although I have a lot more to say on this topic, for now, I’ll share an article that I wrote called Is Cyber Security Alone Ever Enough?, published in FrontLine Security in October 2016. Take a few minutes and read.

In the meantime, if you have HR or career-related matters that you’d like to discuss, please contact me by email, phone, or via direct message on Twitter, Facebook, or LinkedIn if you’d like to discuss any of these topics in more detail.

More than career coaching, it’s career psychology®.

I/O Advisory Services – Building Resilient Careers.

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