Know Your Tech Needs: 5 Tips all Franchisees Should Know

By Peter B. Paasch, Information Technology Manager, Wisconsin Hospitality Group | July 01, 2008

If your company is a franchisee you have most likely felt the pressure that can come from the franchisor's technology initiatives. Franchisors often have dedicated resources that turn their attention to consolidating the masses. Whether a data warehousing project or a POS consolidation initiative, how can a franchisee's IT staff manage a project they are not in control of or haven't heard much about?

To manage the relationship between the technologies the franchisor wants to deliver and what can practically be implemented in your organization as well as the sometimes frantic executives who feel their company may miss out on the best piece of technology ever, follow the below tips.

Stay Involved
Many franchisors have technology user groups or steering committees that meet regularly. Not participating is like not voting. To influence the outcome you must participate at some level. If there isn't a committee available, make contacts within your franchisor's IT group. Even if the latest project doesn't involve them, they will most likely know something about it and who to contact. A little digging won't hurt and will help you prepare.

Understand the Technology
No matter what area of business the franchisor is trying to address there are always options. Understanding the technology needs of your company in the area your franchisor is trying to address is critical. Doing some independent research on possible solutions will allow you to speak about the franchisor's solution more intelligently. This is important if you disagree with something the franchisor is doing. They have resources and consultants with mounds of compelling evidence. If you don't understand the technology it will show. Even the sometimes technology challenged executives can see when the IT department is unprepared. The bottom line, have an answer for every question. If they surprise you with one you didn't think of the best bet to a solid answer is a solid understanding the topic.

Don't believe the hype
Justification for large projects affecting multiple businesses is hard to do with a single ROI model. Franchisees have all implemented different tools both technical and procedural over the years without the franchisor's knowledge. These tools have addressed all areas of business. Thus the buisness case from the franchisor can not be accepted blindly by the franchisee. Question every number to ensure any assumptions are indicated and accurate for your business.

For example, a former franchisor was pushing for a unified labor and sales forecasting tool with automated scheduling. Initial claims were a drop in labor percent of 1.5 to 2 points, which were also supported by claims from the vendor. That would have been a sizable savings with three month payback for our organization. However our company had put a lot of effort into labor management over the year and as we dug deeper and deeper into the ROI numbers we began to question whether they were applicable or even accurate.

After pressing for our franchisors actual results, we were told the project was not justified internally by labor saving but on a requirement to comply with state and federal labor laws. Early on they had hoped for better labor numbers but did not realize them. Knowing that compliance was not as difficult to manage for the smaller franchisees, the franchisor felt the labor savings approach was the only way to reach the franchise community.

Be prepared
Technology is always a hot topic. Company business leaders don't have to attend a technology conference to have technology on the agenda. And why not, when done right technology can have huge impact on the business. However being blind sided by what your franchisor has on tap can send you scrambling for answers when business leaders return from a conference full of anxiety over future technology projects. If you have already been keeping up with the first few hints handling unexpected barrage of questions should be simple. But in case you haven't, don't panic. Tell the CEO standing in your office you need some time to gather information before answering questions.

It's not all bad
Volume is helpful when trying to get the best pricing. Latching on to a franchisor's project may allow you to obtain products normally priced out of your reach. In some cases the franchisor may even front capitol for start up leaving the franchisee with only small licensing fees. But do your due diligence with every vendor. Not all deals negotiated by the franchisor are right for your company nor do they always have the best price.

Thy key is to remember the name on the buildings may be the same but every business is different. Never loose focus on what your company's needs are. Recommending which franchisor's technology initiatives to pursue and the ones to stay away from is essential to your company's success.

With 11 years of experience in the IT field under his belt, Peter B. Paasch has served as the IT director with the Wisconsin Hospitality Group for the past three years. Prior to his employment with the Wisconsin Hospitality Group, Paasch has worked in the manufacturing and aerospace industries.

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