In 1990 Michael Hammer and James Champy wrote block-buster business book; “Re-Engineering Corporation, a manifesto for Business Revolution.” It was a sign that stodgy old company that the world was changing and if they do not change it, they would be left in the dust. Indeed, the book was greeted with cheers from business people across North America and then the world, but why? Because the authors were right, change was no longer coming, change was here.
Now fast forward to 2008 and take a look at the franchising industry, an industry that prides itself on amendments, where winners and losers in the marketplace adapt in real time to the economic conditions, changes in regional variations and of course desires and will consumers who buy the end products or buy services. Those franchising companies that fail to adapt, well, they die.
Just look at the restaurant franchises that were caught off guard and the South Beach Diet and the Atkins Diet reached epic proportions in the media. Krispy Kreme got creamed and Deli Schlotsky is not moving fast enough and filed for bankruptcy. If this teaches us a concession, that no matter how big franchising system gets, you will never forget the strategies that got you there. The agility of the franchising business is a wonderful thing and gives them a better choice, but if they do not embrace the challenge of change or make use of this option, the competition will; game over!
When Franchising Organization starts to behave like a government it is definitely time for some re-engineering. No matter what all franchisors must be agile and able to adapt to rapidly changing market or turbulent economy. If they do not take advantage of opportunities or risk problems in their tracks, then they do it at the expense of their franchisees.