Franchising Information

Franchise opportunities are all around us today. You may pop into Starbucks for coffee and then head for lunch at MacDonalds before returning home and ordering your dinner from another local franchise, Pizza Hut. Many of the most popular outlets you visit may be franchises as they offer the security of a brand name and the attraction of starting your own business.

The world of Franchise is certainly complex but many people are now seriously looking at starting a franchise as they look to leave their routine day jobs and embark on an exciting business opportunity and run their own business. Indeed many franchise fairs and seminars are now the perfect location to meet franchise experts and discuss funding and business plans to determine what type of niche you may quickly recoup your investment with.

Selecting the correct franchise opportunity is vital and you should research the company history and seek advice from current franchise owners before making important decisions. Many franchise opportunities allow you a great degree of freedom with your marketing and advertising, however many others have trademark guidelines and company policies which you must be aware of before launching a promotion.

Joining your local chamber of commerce or business club is a good first step as many business owners have experience in the franchise industry and also have a great network of contacts that could give your franchise business a great head start. Your local business enterprise will also be able to help you formulate a business plan and budget as well as possibly providing a small grant for start up costs.

Starting your own franchise has never been easier and you could even lead you on the road to becoming a multi franchise where you also recruit others to join your network.

Before Gertrude Ederle began her historic swim off of Cape Griz-Nez, France, she
underwent extensive training for endurance and technique—even though she was
already an accomplished record-breaking swimmer with Olympic medals to her
name. Outsourcing IT may not garner the same attention as being the first woman
to swim the English Channel, but it is no less important to gather as much
experience and knowledge as possible on a small scale before diving in for the big
swim.

The trend toward IT outsourcing is increasing dramatically. According to a report by
Foote Partners, as much as 45% of North American IT work will be outsourced by
2005. And there are good reasons behind this trend. Bruce Caldwell, principal
Gartner analyst believes companies can generate 20-30% savings through
outsourcing. This substantial savings potential isn’t easily overlooked, yet it isn’t the
number one reason companies are choosing to outsource right now. In a recent
survey by The Outsourcing Institute, the primary reason behind outsourcing is to
improve company focus. Other motives include freeing up internal resources,
accessing top-notch capabilities, and accelerating time to market. The survey also
indicated that 55% of firms who outsource do so within IT—more than any other
area.

As more companies begin outsourcing some or all of their IT function, it becomes
difficult to ignore the competitive pressure. With competitors achieving their IT
needs at 20-30% less cost, and getting ahead in the market because of increased
focus within the company, those who ignore the outsourcing trend could potentially
lose ground very quickly.

At the same time, outsourcing horror stories abound. According to Gartner research
firm, half of the current outsourcing projects will not meet the company’s
expectations and will be considered failures. While the vast majority of these failures
are only minor disappointments where the company decides to outsource to another
vendor, certainly a few are major catastrophes. An anonymous case study in IT
Metrics Strategies discusses a CIO who chose to outsource to beat competitors to
market. The outsourcer had promised to meet a deadline his staff had said was
impossible. When the outsourcer failed, the CIO couldn’t rebuild his team fast
enough to finish the job. In the end, the product never got to market at all.

So how do you secure all the benefits of this outsourcing wave without getting
dragged into the undertow? The key is strategic, selective outsourcing. According to
Corey Ferengul, VP of the IT research firm META Group, an increasing number of
companies are choosing to outsource non-core IT tasks. Common responsibilities
going to third-party providers include Web hosting, call centers, data storage, and
database administration.

“There’s a learning curve and a life cycle to outsourcing,” said Caldwell, “and it can
be expensive finding the right vendor, as well as going through the transitions of
taking your operations to that vendor.” Stable, yet customizable IT functions provide
an excellent training ground for outsourcing. Any function with known benchmarks
for performance and results, as well as available, reliable outsourcing partners is a
good place to start.

Ultimately you may want to outsource your entire IT department, but first you need
to get a handle on managing an outsourced process. Some companies may discover
they don’t need to incur the risks and organizational chaos of switching to total IT
outsourcing. By nimbly carving out and outsourcing small pieces of the IT function
that deliver the most cost and quality benefit, companies may find they are already
receiving maximum savings at minimal risk. However, they will have done some
carefully planned and executed experimentation before making that decision.

Gertrude Ederle once said of the sea “I never feel alone when I’m out there.” The
channel became her ally as she swam her way to England in record time. By starting
on a small, strategic scale, you’ll turn IT outsourcing into your ally rather than a
cold, tumultuous, foreboding sea.

Outsourcing seems to be the new-new thing and approximately 50% of our major corporations are doing it. What are the costs? The benefits? And what skills need to be managed in order to make it work optimally?

Let’s get a clear understanding of what we mean by outsourcing: it’s the shifting of easily codified jobs – such as help desk support, call centers, system maintenance, and programming jobs – to countries that can manage them more cheaply.

While this function is allegedly freeing up our people from some of the mundane tasks of our workplaces, it’s bringing with it an entirely new set of problems: how do we manage people across continents; how do we know our brand is being maintained when we have no direct control over managing foreign employees; how do we restructure our workspaces once our lower level jobs are farmed out.

WHAT ARE THE COSTS OF OUTSOURCING?

John Ribeiro in a recent article in Darwin, states: “According to the National Association of Software and Service Companies (NASSCOM)… outsourcing to India has saved the U.S. banking industry $6 billion to $8 billion.”

Indeed, I’ve heard it said that the only reason American companies are outsourcing work is to save money. Let’s take a brief look at the pros and cons of the financials for a moment:

Cost savings: mainly in the area of salaries and management time.

Additional expenditures: vendor selection (legal, travel, time), exchange rates, training, time lag issues, client retention, management or techie retraining.

One of the costs I’ve heard discussed is the human cost: that company employees get resentful when their job descriptions get changed, and have a period of time where they suffer resistance. Eventually, they do come ‘round to recognizing that they are being given higher-value tasks in place of their old work – assuming that they even desire new tasks and don’t end up quitting. There don’t seem to be any figures available on this cost.

But there is an additional, unspoken cost. Our relationship with the end customer.

We’ve all dealt with service people from India when we call to ask a question of a vendor. First there is the long, long delay before the phone gets answered. And then there is the accent.

Are the service reps and techies smart? Yes, they are. Are they smarter than Americans? It depends on the person. But they are always cheaper. Do they do the job? Usually. Depends on how well they’ve been trained and managed. They certainly know what to say, how to say it, how to answer questions.

But what about brand management? Do they give the identical service that the company espouses in-house (or, um, in-States)? The answer here is, generally, ‘no’ and deserves further discussion.

HOW DO OUTSOURCED REPS DELIVER BRAND AMBASSADORSHIP
Because lower-level jobs are being filled by people who speak English as a second language, AND who have not had the appreciation of ‘service’ instilled in them since birth, these foreign reps will, at best, do a technically good job. Say what you want: we Americans are raised understanding that we must serve customers and must be served by vendors. People in India are raised to believe they are a replenishable commodity.

Unless trained to do so, the foreign workers will NOT carry the company standard, and in a problem situation, may run. I’ve had several people hang up on me when it became clear that my problem was more complex than they could manage.

Do I shrug, and say, “Oh well. He was Indian. He didn’t know any better.” Or do I say, “Why isn’t ABC Company giving me the service they promise on their ads?”

Every single person who works in a company – Every. Single. Person. – is a company’s Brand Ambassador. That means, those young Indian people living in Bangalore (I’ve been there. Outside of the pollution in the city, it’s lovely. Smells like sandalwood throughout the villages.) or wherever, must act exactly like the people you have in the States. If you don’t, you are not managing your brand appropriately.

And therein lies the largest problem created by Outsourcing (other than taking jobs away from an already depleted workforce here in the States): how do American managers effectively communicate with the foreign providers who are answering our phones and doing our programming? How do we make sure that the way we treat customers here in the States is the same way we treat customers in Malaysia, or wherever?

What is our brand? And how do we manage the brand over time and through space?

We need to create a new way to transfer skills and beliefs across continents in order to ensure that our brand is represented effectively in every client interaction. Every client interaction.

BELIEF AND SKILLS TRANSFER
For some reason, some companies still think their ‘brand’ is a visual logo rather than a complete relationship and story. Our brand is the story we tell about ourselves to our customers (defined as employees, vendors, and purchasers of our products) and the relationship we have with all of them. Think about Harley Davidson: somehow they manage to get people tattooing the brand on their bodies! Think about Apple: they’ve taken their IPOD and created fabulous ads that make us get more atuned (ahem… sorry) to what their brand is: cutting edge, different, funky, creative, and funfunfun. Not to mention that the ad itself makes me want to dance – and then dance to a store and buy a new MAC. (Note: their website does NOT maintain their brand, however.)

OK. So we’ve got this story and this customer experience in our States-side company, but we don’t have the way forward to ensure we duplicate this with our Outsourced employees.

I recently met with a new client team as they were incorporating an Indian vendor’s offering into their roles. They had spent 4 days together, aligning their outcomes, working relationships, communications, and jobs. Their mission statement was the same, their company vision. They had me in to do a final check.

I began by asking the new vendor what his job was: to hire the best techies around. Good. What else? Well, what else is there?

“How do you plan on managing Company X’s brand?”
“What do you mean? All I have to do is hire the right people. After that, they’re on their own.”
“Really! And how are they going to be managed daily? How will you ensure that the service they offer in the States will be the same service you offer from here?”
“John (the tech manager) will manage it.”
“John, do you recognize that as one of your new jobs?”
”Um, I guess I hadn’t.
“How will the customer’s specs be delivered? Will the Indian tech folks speak with the customers directly?”
“No.”
“So, how will the information be transferred across the sea?”

You get the point here. They hadn’t thought through all of the daily dynamics. Within an hour, no one knew their jobs or their roles, people were switching job descriptions on one hand, and recognizing new, unspoken, aspects of their jobs on the other.

This is a small company. It’s highly likely that larger, more experienced companies, know how to ask all of the right questions to get it right from the start. But how many don’t?

Have your internal and outsourced teams design communication systems that will make it viable to ensure all aspects of your brand get carried through from one country to the other. Make sure it’s seamless – that all customers get treated exactly the same, regardless of where your support staff sit. Make sure that the folks who are giving work up to the outsourced people will take responsibility for it, and be happy with the new work they’ll be undertaking.

It’s not ok just to manage the vendor by choosing wisely. It’s imperative you have a hands-on relationship with each employee, regardless of where they sit. Remember: they are all your customers.

Cross cultural negotiation is one of many specialized areas within the wider field of cross cultural communications. By taking cross cultural negotiation training, negotiators and sales personnel give themselves an advantage over competitors.

There is an argument that proposes that culture is inconsequential to cross cultural negotiation. It maintains that as long as a proposal is financially attractive it will succeed. However, this is a naïve way of approaching international business.

Let us look at a brief example of how cross cultural negotiation training can benefit the international business person:

There are two negotiators dealing with the same potential client in the Middle East. Both have identical proposals and packages. One ignores the importance of cross cultural negotiation training believing the proposal will speak for itself. The other undertakes some cross cultural training. He/she learns about the culture, values, beliefs, etiquette and approaches to business, meetings and negotiations. Nine times out of ten the latter will succeed over the rival.

This is because 1) it is likely they would have endeared themselves more to the host negotiation team and 2) they would be able to tailor their approach to the negotiations in a way that maximises the potential of a positive outcome.

Cross cultural negotiations is about more than just how foreigners close deals. It involves looking at all factors that can influence the proceedings. By way of highlighting this, a few brief examples of topics covered in cross cultural negotiation training shall be offered.

Eye Contact : In the US, UK and much of northern Europe, strong, direct eye contact conveys confidence and sincerity. In South America it is a sign of trustworthiness. However, in some cultures such as the Japanese, prolonged eye contact is considered rude and is generally avoided.

Personal Space & Touch: In Europe and North America, business people will usually leave a certain amount of distance between themselves when interacting. Touching only takes place between friends. In South America or the Middle East, business people are tactile and like to get up close. In Japan or China, it is not uncommon for people to leave a gap of four feet when conversing. Touching only takes place between close friends and family members.

Time: Western societies are very ‘clock conscious’. Time is money and punctuality is crucial. This is also the case in countries such as Japan or China where being late would be taken as an insult. However, in South America, southern Europe and the Middle East, being on time for a meeting does not carry the same sense of urgency.

Meeting & Greeting: most international business people meet with a handshake. In some countries this is not appropriate between genders. Some may view a weak handshake as sign of weakness whereas others would perceive a firm handshake as aggressive. How should people be addressed? Is it by first name, surname or title? Is small talk part of the proceedings or not?

Gift-Giving: In Japan and China gift-giving is an integral part of business protocol however in the US or UK, it has negative connotations. Where gifts are exchanged should one give lavish gifts? Are they always reciprocated? Should they be wrapped? Are there numbers or colours that should be avoided?

All the above in one way or another will impact cross cultural negotiation and can only be learnt through cross cultural training. Doing or saying the wrong thing at the wrong time, poor communication and cross cultural misunderstandings can all have harmful consequences.

Cross cultural negotiation training builds its foundations upon understanding etiquettes and approaches to business abroad before focusing on cross cultural differences in negotiation styles and techniques.

There are three interconnected aspects that need to be considered before entering into cross cultural negotiation.

The Basis of the Relationship: in much of Europe and North America, business is contractual in nature. Personal relationships are seen as unhealthy as they can cloud objectivity and lead to complications. In South America and much of Asia, business is personal. Partnerships will only be made with those they know, trust and feel comfortable with. It is therefore necessary to invest in relationship building before conducting business.

Information at Negotiations: Western business culture places emphasis on clearly presented and rationally argued business proposals using statistics and facts. Other business cultures rely on similar information but with differences. For example, visual and oral communicators such as the South Americans may prefer information presented through speech or using maps, graphs and charts.

Negotiation Styles: the way in which we approach negotiation differs across cultures. For example, in the Middle East rather than approaching topics sequentially negotiators may discuss issues simultaneously.

South Americans can become quite vocal and animated. The Japanese will negotiate in teams and decisions will be based upon consensual agreement. In Asia, decisions are usually made by the most senior figure or head of a family. In China, negotiators are highly trained in the art of gaining concessions. In Germany, decisions can take a long time due to the need to analyse information and statistics in great depth. In the UK, pressure tactics and imposing deadlines are ways of closing deals whilst in Greece this would backfire.

Clearly there are many factors that need to be considered when approaching cross cultural negotiation. Through cross cultural negotiation training, business personnel are given the appropriate knowledge that can help them prepare their presentations and sales pitches effectively. By tailoring your behaviour and the way you approach the negotiation you will succeed in maximising your potential.