The Added Value of Operational Efficiency in Franchises

There is overwhelming proof of the relationship between efficiency and profit. The more operational efficiency you can introduce to your business, the more money you are going to make.

But how does being part of a franchise affect this equation?

For a start, being in a franchise network makes the equation easier to balance. Here is how leaders and managers can improve efficiencies of operational management – and how it gets easier as part of a franchise network.

What is a business process?

A business process is a group of “related, structured activities or tasks” performed by your team and equipment. This group of tasks happens in a specific way in order to produce a specific result.

The simplest example would be something like a production line. One person assembles the product. Another person packs it. A third person addresses it.

The business process would describe how all of those people and the machines they use work together create the packaged product and ship it to an address.

Business process improvement – how it works

Improving your business processes isn’t something you do just once. It is an ongoing process of iteration and testing. You improve one small element of how you package your product. You test to see how well that improvement has worked. Then you continue to improve.

There are several important things to bear in mind when it comes to improving the way any process you use in your business works:

1) It’s a constant process

If you agree with the saying that “there is no such thing as perfection”, you will find yourself well at home with business process improvement.

That’s because, as any experienced business owner will tell you, there is almost always something you can improve. Such as:

• Optimising your team and their actions
• Ensuring you are spending your money effectively
• Making sure you are using the right technology in appropriate places

As a small business owner, there is no silver bullet for “perfecting” your business processes. The key is a gradual improvement in all of the different aspects of the way each process works.

2) Take a step back

It is important to step back and think about how you organise the work your business does. If every member of your team does things however they like, you will never find out if there is a “best” way.

You need a structured system of business processes for every task your business needs to accomplish every day. Only then will you even begin to understand how you could improve your efficiency.

This structured attitude should apply to everything you do. From hiring the right people to delivering each individual service to each individual customer.

3) Automate repetitive tasks

Many companies waste a lot of time, money, and effort by manually performing repetitive tasks. Smart businesses automate wherever they can.

A good example of this is Fantastic Services‘ use of technology to automate many of the things our franchisees need to do every day.

For instance, finding new clients and collecting payments is essentially automated. This means our franchisees can concentrate on delivering their services to the highest possible standard.

4) Understand employee productivity KPIs

Overloading a team member with too much work can lead to burnout. But under-loading them is an easy way to waste both their potential and their productivity.

Selecting the most suitable Key Performance Indicators for each of your employees’ productivity can be a challenge. But it is also one of the best things you can do if you want to improve your overall operational efficiency.

When considering what the best KPI for employees is though, bear in mind:

1. The need to individualise – different job roles should have different KPIs attached. Having different KPIs for each job role ensures each team member knows what their personal objectives are when performing that function. You might also consider individual KPIs for team members with different career goals, strengths or personal interests.
2. Motivation, not punishment – your reason for setting these goals should be a positive one. An employee made eager to engage with their job by smart KPIs will produce better, more productive results.
3. Bring together personal and business objectives – well-chosen KPIs will show each of your employees what your business expects of them and bring them closer to understanding your goals as a company.

Overall, a team that understands what it needs to be doing, how to measure how well it is doing, and why it is doing it, will perform better than a team that does not.

5) Know your utilisation levels

Utilisation levels are one of the most important KPIs to track for your company as a whole – especially if you are a services company.

The clearest example is employee time usage. How much of their time at work is your employee spending productivity?

Track it. Find out. Then see how you can improve it.

Franchises and business process improvement

But how do franchises relate to business process improvement?

In general, there are many benefits to becoming part of a franchise network. For example, as a Fantastic Services franchisee, you would receive initial training so you know how to operate a successful business. You would have regular clients found for you by our extensive marketing efforts. You would be operating under a well-known, reputable brand name.

But perhaps the most important thing you would get is access to business processes that have already been highly refined. Your franchisor has already done all of the hard work involved in perfecting those processes.

Of course, from time to time, an individual franchisee may hit upon another improvement to a certain process. That’s an advantage too. It’s like having a dozen, a hundred – in Fantastic Services’ case, over 500 – other business owners all putting their minds to the task of improving the services you deliver.

Combined with the already-refined business processes you will be using when you open the doors of your new business, there is a great deal that being part of a franchise network will do for your operational efficiency.

Interested in how Fantastic Services’ business processes boost the efficiency of your new franchise?

Let’s talk about it. With over 500 successful franchises in the UK alone, we know how to get our franchisees off to a powerful start.

• Last update: April 9, 2021

Posted in Industry Insights