Quality or quantity (of candidates)
Monday morning, as soon as we arrived at the office, the phone rang. At the other end of the line, the developer of a young street food franchise network asks us to « quickly find » candidates who will allow him to expand his network.
Without hesitation, he sets out his conditions: « You will be paid upon signing the contract, based on success only ».
He explains that his management has set a target of a dozen openings this year. Half of the year has already passed, he has only signed 5 contracts. So: he needs candidates!
But what kind of candidates? « With or without premises, ex-employees, technicians, shopkeepers, men, women, couples or partners, graduates, knowing the local fabric, looking for work, receiving unemployment benefits…? »
« Find us candidates, regardless of their profile, age, experience, we must achieve our goals this year » he replies.
This exchange, bordering on caricature, reflects the state of mind of some network developers whose remuneration is based on the number of contracts signed during the year. This type of request often comes from less mature networks that have difficulty convincing entrepreneurs to commit to them.
We then explain to our interlocutor that the franchise world is changing. From our window, we notice that the preselection criteria are evolving. More and more networks are reaching a level of maturity that encourages them to favor long-term recruitment techniques.
Aggressive » recruitment is out of fashion. It has been a great success for lawyers working for franchisees and for franchisors, who are forced to defend themselves. It has impacted the cash flow of the brands and caused a lot of stress to the network managers. Above all, it has had painful consequences for the families of ex-franchisees who have lost their financial contribution and even mortgaged their property.
If the developer must obviously keep his role of recruiting franchisees, we think that his remuneration must evolve towards more operational performance criteria and that his pre-selection techniques must be inspired by headhunting firms.
Operational performance criteria
Just like the ideal candidate, the ideal recruitment process probably does not exist. But attitudes are changing. Some brands are already setting up validation committees that make each player involved in the candidate pre-selection process accountable. The opening project is presented in all its aspects (geomarketing, business plan, profile of the candidate, who in some cases comes on site to « sell his file »). In case of disagreement between the different departments present, the management decides.
Gone are the days when the « sales developer » persuaded future franchisees to sign, leaving the animator to « manage » with profiles that were far removed from the concept.
More and more, the variable remuneration of the developer is linked to the economic performance of the franchisee after the first year. The measurement of the difference between the candidate’s forecast – not validated by the company – and the actual performance observed on the first balance sheet makes it possible to allocate – or not – the balance of the bonus on its objectives.
For his part, the network coordinator, who does not receive any remuneration upon signature, will have to validate the profile of the future franchisee. If he feels that the profile is unsuitable for the concept, he will pass on the information in order to
a) obtain the opinion of a third person of the network,
b) propose additional training adapted to the perceived shortcomings,
c) Oppose his entry into the network.
However, it is important to ensure that the workload and the scope of the network do not lead the franchisor to refuse profiles on the unstated pretext that this would give him even more work.
This professionalization of franchisee recruitment is a step in the right direction to promote franchising which, let’s not forget, is less prone to failure than other forms of isolated entrepreneurship.
In a large majority of the +/- 2,000 networks, the recruitment of new franchisees is traditionally carried out in consideration of the application file, previous professional experience, the weight of the financial contribution, or even the fact that the candidate has a well-placed location. However, experience has shown that the human factor plays an essential role in the success or failure of a new establishment. It is surprising to observe that so few developers, at the network head level, have implemented tools to decode the human element, relying simply on their « feeling ».
To improve franchisee performance over the long term, some networks have implemented proven methods for selecting entrepreneurial candidates, backed by tools for measuring behavior and assessing learning capabilities.
This rigorous approach based on reliable data allows correlations to be made between observed performance and profiles. In the age of analytics, the portrait of high potentials is refined as feedback is received.
This new method, assimilated to predictive recruitment, is a technique of pre-selection of candidates, assisted by algorithms, which allows network managers to anticipate the behavior of a franchisee in his future environment.
Thanks to personality analysis tests designed and developed in the United States in the middle of the last century, recruiters can predict, among other things
The ability of a future franchisee to be a « Top performer » via an adapted segmentation matrix.
The training needs – apart from technical aspects – adapted to new entrants (diplomacy towards the network manager, ability to apply an operating manual, team management, etc.)
The possible evolutions (to remain a single franchisee, to become a master or multi-franchisee…)
The profile of the collaborators that the franchisee will be able to manage in « behavioral complementarity
The profile of the network coordinator who will assist the franchisee
This method of behavioral analysis and team management is not only useful during the recruitment period. It is useful throughout the contract.
Network managers need to develop their teams. For example, the development manager will be trained to evaluate several parameters of a candidate’s personality before recruitment: his or her level of proactivity, need to take on challenges, structuring, calculated risk-taking… This way, his or her teams will adopt the management style best suited to the issues at stake: close control or delegation, more technical or commercial dimension, directive or persuasive tone…
The homogeneity of the teams built with « complementary » profiles gives a new dynamic to the whole network and reduces conflicts. The network coordinator will make sure that there are commercial temperaments in a sales outlet, complemented by more managerial or technical profiles.
In addition, some networks will require the franchisee to absorb a large amount of technical, management and regulatory information in a very short period of time in order to ensure the growth of the network. The speed with which the candidate can process this information becomes a key factor that is not easily perceptible on a CV or in an application file. Having detected this information through the analysis of the graph from the test, the development manager will choose either to continue the recruitment process by proposing a training program adapted to the candidate or not to validate the candidate. This decision will save him/her from a probable entrepreneurial failure with all the psychological and financial consequences that follow.
The machine will not replace the human being
Predictive recruiting is a decision support tool used by the developer who deciphers the machine’s algorithm. He sees what the machine does not and vice versa. The graph shows him the personality of the franchisee on which he will build his operational action plan (for example, the adaptation of the training of the animator to the profile of the franchisee).
But let’s be careful, ethics and practice say that you can’t make an interview depend on a test taken at a distance. Above all, the developer should not consider using predictive recruitment as a crystal ball.
There is no such thing as zero risk, and regardless of the franchisee’s graph, all profiles can end up in litigation one day!
Distributor of the FlagFranchise candidate pre-selection algorithm in France