President’s Perspective: How We Make Decisions (part 2)

This post is part of a series by D.P. Dough CEO and President, Matthew Crumpton. Mr. Crumpton writes these posts to share a behind-the-scenes glimpse of the day-to-day operations of an emerging franchisor, as well as a level of candidness not typically seen on a company’s blog. We hope that this transparency can be insightful for those who are learning about franchising and franchise concepts, and help to illustrate the challenging and rewarding work that goes into building a top-notch franchise system.

The D.P. Dough Franchising Decision-Making Process (Part 2)

In my last post, I opened up the curtain to show the internal process that we use for making decisions (both large and small) about the D.P. Dough brand. Now, I would like to zoom-in on how specifically we determine what to do next. (Surprisingly, it is not limited to throwing darts at a list of current restaurant and franchise industry trends.) But, seriously…

Determining What To Do Next

The last post was about how we make decisions once the options are on the table. This post is about how we find the options (to put on said table). In other words, “what do we do next?”

When we began the process of building business systems to grow Dan Haley’s niche concept, the best way to describe the state of the franchise was optimistic anarchy. All franchisees believed in the calzones only, college campus focused, late-night delivery elements of D.P. Dough that now form our brand identity. Most of the franchisees also shared our values, especially the work ethic part. But, with nine different logos, unique menus at every location, and a different kind of mozzarella cheese in each store, we had some important decisions to make. It was difficult to know where to start.

Find The Bright Spots

Over time, we found that the best way to succeed (in any aspect of business) is to find out what tactics and techniques are being used by the most successful stores and to apply them to other locations. Ask yourself, “where are things going really well and what are they doing to make it that way?” In Switch, Dan Heath and Chip Heath’s excellent book about leading organizational change, the authors describe this as “finding the bright spots.”

Shortly after reading Switch, I interviewed the top five restaurants for same store year-over-year growth and for overall net sales. I asked each of the successful owners the same questions about their local marketing practices. (For example, “What paid advertisements have you done in the last year?”, “Which paid ads brought the best results?”, “How do you use coupons?”, “How do you market to campus organizations?”, etc.) I wrote down all of the answers to each question. Then, I analyzed the answers to find the common effective marketing practices that all of the top locations used.

A list of four key marketing practices emerged from that bit of informal research. We shared the results of the marketing practices of the bright spots at the annual D.P. Dough Owner Conference this past summer. To my delight, pretty much all of the franchisees who were not already using the “bright spots” marketing tactics implemented some or all of those strategies in their stores. The result was material year over year growth. I can’t disclose the numbers for legal reasons, but suffice it to say, the strategies translated to other markets.

My belief in the process of finding the bright spots means that in many cases I am (or our marketing department is) more of a journalist than a visionary. That sounds about right to me. We, as the franchisor, have a responsibility to find out what is working, then become an evangelist for the best practices – whatever they may be. The thing that absolutely does not matter is who it was that thought of the idea for the successful tactic. I don’t care if I never come up with a “bright spot” idea on my own again. Don’t get me wrong. I love experimenting with new ideas and pushing the creative envelope for marketing. Still, results are what is most important. Not egos.

Testing 1, 2, 3

Not every new concept is proven. If that were the case, there would never be any new ideas. As a smaller franchise, we have the luxury to allow franchisees to experiment with different marketing and food ideas in their store to see what works. Of course, we work alongside franchisees in implementing and measuring any market tests. And we have some clear boundaries around what we will and will not consider as a test. (See The Big Three from last post). But, without a doubt, D.P. Dough franchisees and employees play a very important role in the evolution of the brand.

Feedback First

Testing a concept in a market or two is one thing. Requiring any system-wide change is quite another. If we, as the franchisor, do not have the buy-in of most of the franchisees for any required change, it is unlikely to happen.

This was not immediately apparent to me, as a recovering lawyer. (I still have my law license. I’m just not in the trenches of the legal practice everyday anymore. (Thank God!)) Just because a contract says that you have certain legal rights does not mean that you will actually be able to get your entire franchise system to go along if the change doesn’t make sense.

The much better way to implement a new policy is to test the concept to make sure that it works. Then, reach out to (some or all) franchisees to get feedback. This Summer, we were preparing to make some changes to the national Zone of the Day calendar, which would have affected all D.P. Dough owners. After asking many franchisees for feedback on the changes, a few of them felt strongly (for reasons that I had not previously considered) that the change should not be made. We ended up addressing those owners’ concerns and modifying the change we had planned to make.

There may be times when all franchisees are not in agreement with a change. That will happen anytime there are a lot of people with different opinions. Still, the importance of trust between franchisor and franchisee cannot be understated. Consistent communication and genuine openness to feedback is the beginning of building that trust.

Even though I have learned that lesson, I know that I still have many more to learn.

Matt Crumpton, CEO and President (read Matt’s bio here)
D.P. Dough Franchising, LLC
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