Why an Optimistic Culture is Vital to Success

Culture has a powerful influence over people's behaviour and performance. It is the beliefs that people in a group buy into. In other words "how we do things around here". And largely it comes from the leader.

This applies as much to a franchisee's individual business, as it does to the larger franchise network to which they belong. Culture also influences broader professional associations such as the whole of the franchising sector.

For instance last week in a talk on the topic of culture at the FCA National Convention, I asked what made people feel good about being part of the franchising sector. Some clear themes emerged - the open sharing of information, entrepreneurial passion and a desire to make a positive difference to people's lives.

These beliefs and behaviours are very much part of our franchising culture - our way of doing things - and it is something I'm sure you are proud of. I certainly am.

How to turn franchisees into advocates for your system

There was a lot of interest in one chart I presented which showed the best predictors of whether a franchisee would reccommend their franchise system to others, sometimes referred to as franchisee validation. This data is from a huge study we have been conducting on the attitudes of over 7,000 franchisees.

If you think it is how much money a franchisee is making, you'd be wrong. Money is important but it is not the most important factor.

The most significant predictor of franchisee validation, with a whopping correlation coefficient of 0.66 (anything over 0.4 is big), turns out to be how optimistic the franchisee feels about the future of the business.

The other top four significant predictors, in order, were:

  • Their confidence in the integrity of leadership.
  • How connected they felt to the brand and other people in the network.
  • How easily they felt they could resolve disagreements with the franchisor.
  • Their satisfaction with the financial performance of their business.

Optimism breeds hope and without hope it's difficult to get excited about anything. Napoleon said "Leaders are dealers in hope". The job of a franchisor CEO is to provide people with this sense of hope - a feeling that this franchise network offers them a future they can look forward to.

Until next time,

Greg Nathan

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