25 Oct Franchise Advisory Councils in the Real World (part 2)
How to Run a Franchise Advisory Council (FAC) that will Power Your Franchise Network towards Success
Franchise Advisory Councils are created in order to benefit the well-being of the business, by providing the Franchisor with insights and suggestions from the Franchisees.
How does a franchisor create and run an FAC that will show productive results and yield returns on the time invested by its members? Here are a few guidelines that have proven to be effective in your Franchise Advisory Council.
Guidelines for Running a Great Franchise Advisory Council
- Set your ground rules for the FAC and have a clear set of “By-Laws”. It will help create clarity on what is expected of its members and also assist in creating an environment that is inclusive of everybody present. A good FAC will encourage various viewpoints, and hold an attitude that says that all ideas are good ideas.
- In order to create an environment in which open sharing is encouraged, no person should be quoted or have a suggestion attributed to them outside of the meeting. Ground rules also help to ensure that the hierarchy is still observed. Some confusion can occur on the exact purpose of a franchise advisory council, where some members may believe that they are supposed to hear and sign-off the ideas presented to them by the Franchisor. This isn’t the case and a good set of by-laws will provide clarity in this regards and many others too.
- An effective meeting will see goals being set, and actively pursued after being documented and broken down into steps. Progress on these goals should be discussed and difficulties should be addressed. Tangible results can do wonders for positive energy and the generation of new ideas and larger goals, and this is the progress that will yield a productive outcome.
- Ensuring that travel, conference venue costs, accommodation and other expenditures associated with FAC meetings are covered by the franchisor is generally standard practice, however, the franchisor may include some or all of these costs may be included in a separate FAC levy that the franchisees pay. These meetings are held for the sake of the business, and therefore it not necessary to provide its members with monetary compensation for their time, as this may start to confuse the objective of the meeting.
- Maintaining contact, even telephonically or by web conference, with FAC members between meetings should also serve as a way of keeping the affairs that were discussed at the top of mind for everyone involved so that the general running of a business does not overwhelm those topics.
- If your network is large, and consequently your FAC is large, then divide your FAC meeting into groups of smaller participants to confer together and then having each group report back to the meeting has value in two different senses: it prevents the dominant personalities from taking charge and missing the opportunity to hear what some of the quieter participants may have to contribute. Furthermore, if the feedback given by multiple groups is similar, it means a good general consensus is reached on the topic.
- Inviting members to contribute to the agenda will instil further value felt by the franchisees, as well as broadening the horizon that exists for improvements for the business. Once the Franchisor has established a basic agenda he wishes to address, this can be sent to the board members, who can be offered and opportunity to add any further topics. Once all the feedback has been incorporated, a final agenda can be distributed. In this way, all of the issues can be addressed and each member has the chance to play a very active role in communicating on behalf of the franchisees.
Pitfalls to Avoid When Running an Efficient Franchise Advisory Council
There are also some pitfalls to avoid. Here are a few practices that have proven to be ineffective, or even destructive, in building a FAC that fosters positive growth through communication.
- The purpose of an FAC is for a franchisor to have a panel of advisors who are able to make suggestions. It may seem obvious, but a common pitfall is to fail to put action to the great ideas shared in an FAC meeting. If minutes are not taken and referred to again at a later time, then golden propositions are lost through simple forgetfulness. These ideas are usually not disregarded or lost on purpose, but more due to poor mechanics in the running of an FAC meeting. Ideas should be given actions with timelines, and progress on these should be addressed in subsequent meetings.
- An over-eager approach to action is also not recommendable. A meeting that is run according to an agenda that was created days before the meeting will serve no greater goal. Issues within the business that the franchisor or the franchisees may observe should be recorded and added to the agenda.
- Remember not to confuse the role of an FAC. Although this point was mentioned already, a truly common problem many FAC develop is the idea that an FAC should serve as a decision-making body. An FAC is not a soundboard to approve the goals and ideals for the company set out by the Franchisor. It serves as an Advisory board only, to share ideas and make suggestions. It should be seen as an opportunity for the franchisees to give the franchisor insights into the business from their perspective.
- Another downfall of FAC meetings is if management uses this platform as a means to showcase its successes. This is an easy mistake to make, but ideas should be discussed at their inception and not only at their completion and success. This can create an alienation, as FAC members will no longer feel included, or even useful. The idea is to use these meetings to discuss strategy moving forward, or new concepts, or review the business and pinpoint areas that can be improved.
- Meetings that are held infrequently can lead to the agenda not being prioritised well. While these meetings may be difficult to attend as it will involve travel and a sacrifice of time for many FAC members, meetings can be held via webinar in between conference dates. This will assist in refreshing the agenda and keeping it at the forefront of the members’ minds. A meeting via webinar can also greatly decrease costs, but it should not replace the regular face to face conferences.
Having the wrong number of board members can have a profoundly negative impact on the success of the meetings. In some businesses, the franchisor may choose the board members, while other businesses may follow an election process. Having too many members will involve much higher costs to run a meeting, while not being efficient as a group. If the business is large and comprised of a number of franchisees, more than one FAC can be established, in order to keep things productive.
Fewer than four members are no longer considered a board. Too few members will result in a shortage of input and a lack of flow. A good number of franchisees to have on the board of a FAC is usually between 5 and 25. This will vary between businesses, as do the terms of their positions. A term can be between 1 and 3 years, and a mixture of experienced and new members will be staggered for better balance. A franchisor may also see fit to implement a maximum time period that a franchisee may hold a position on the board, to enable more franchisees an opportunity to participate.
The True Power of a Franchise Advisory Council lies in Honouring its Purpose
Most successful franchises have adopted some form of an FAC, while many others wonder at what point they should try to establish one. This will vary greatly from business to business based on its needs and its growth, as well as its industry. While there is no solid answer to this question, it is advisable to start an FAC earlier rather than later. A smaller group may start out less formal but will play a vital role in establishing open lines of dialogue early on.
A great way to improve the mechanics of running an FAC and implement a streamlined and convenient approach is to make use of software such as FZM’s FAC module. Agendas can be added to or viewed, minutes of past meetings can be accessed, other FAC members can be contacted, calendar events and geographical locations can be marked and progress on goals can be tracked and added to. These types of systems are great for ensuring that all the board members receive the same information, so it limits miscommunications or misunderstandings, as well as being one centralised point that everyone can access at any time, for any information relating to an FAC meeting. Contact us now to see how the FZM FAC module can be of assistance to you.