6 Benefits of Franchise Scorecards to Your Business

Running a franchise organisation is no small feat. There are many things to manage, weigh, and measure daily – leaving accuracy, timely decisions, and up-to-date information as primary necessities for operational success. And just like any successful business, measuring those things means you’ve got to be able to accurately evaluate the metrics that matter most for your franchise system.

However, accessing real-time business data at the unit level is a common issue in the modern business community, significantly if every process depends on manual execution. Fortunately, in today’s digital world, franchisors and franchisees can harness the power of technology to help plan, execute, track and report all the pertinent information on a platform.

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Franchise scorecards effectively provide this information while also providing an objective means of measuring performance against established goals and objectives. In addition to allowing for a reliable baseline from which to measure performance, franchise scorecards also provide a mechanism that can be used by franchisors to communicate with franchisees about the expectations for success in their unique business environment.

Using franchise scorecards is the best way to ensure those needs are met. In this article, we’ll look at 6 of the benefits of using scorecards in your business:

1. Strategic planning

Franchise scorecards give your business a vital and robust framework for setting up key performance areas. Real-time data and well-designed reports allow franchisors and franchise managers to identify trouble areas or highlight opportunities quickly. As a result, franchisors can focus on the most critical strategic issues.

2. Franchisee performance communication execution

Most Franchisees feel they have invested substantial time, money, and effort into building their franchises. On the other hand, Franchisors often have difficulty communicating the gaps between what is executed and what is required by the franchise SOP. The franchisors must have a consistent performance standard across ALL outlets and adequately execute strategy. A franchise performance scorecard helps communicate to individual franchisees the strengths and weaknesses of the entire franchise system. This unbiased, systematic evaluation approach based on data captured from the system allows both franchisors and franchisees to focus on the specifics of performance rather than on the blurry conversations based on feelings and little recollections of who did and said what when.

3. Project and innovative alignment

Franchise scorecards also help Franchisors introduce and implement new initiatives across the franchise network. In addition, franchise scorecards can help franchisors ensure that franchisees are onboarded on these new initiatives and stay targeted on the strategic objectives of the franchise.

4. Better performance reporting

Overall, a franchise performance scorecard where franchisees know how they are fair compared to the network can positively impact the franchise. Learning how to improve and where to improve can spur the franchisees to focus on correcting the problem areas. Franchisees, ahead of the other franchisees, can also feel a sense of achievement and be motivated to keep performing well. Besides, a little competition amongst franchisees gives each franchisee a little push and can positively influence overall franchise network performance.

5. Better training and feedback

Franchise managers and operations teams can use the performance data to recommend training improvements. Training managers can also use the data from the Overall Franchise Performance scorecard to improve the training system and identify necessary operational support areas.

6. Improving activities through franchisee mentorship

The franchise scorecard is grounded in the franchisor’s company’s strategic objective and competitive demands measurements. The franchise scorecard helps the franchisor and their management team increase individual franchisee and outlet performance by offering real-time and in-depth mentorship. These franchisee mentorship sessions are designed to improve day-to-day operations through a data-driven culture and communication. Reviewing a standard franchise scorecard allows the Franchisor and Franchisee to discuss shared goals grounded in a structured format and pre-determined performance standards that help drive stakeholder alignment. Ongoing improvement is vital.

CONCLUSION

In essence, the franchise scorecard naturally serves as a common platform that provides a vital link between the franchisor and the franchisees. It allows real-time data gathering to inform decisions on needs and areas of improvement. More than that, it fosters discussions about critical performance issues based on documented data and breaks silos that are difficult to overcome within a growing franchise network.

Read More: Develop Franchise Scorecards to Maximise Franchise Units Performance