Creating a Consistent Franchisee Hiring Process
With the structure of franchising under fire from the NLRB, now more than ever it is important for franchisors to make sure their systems are air tight and that they are prepared for the final ruling, one way or the other. Even though the ruling has not yet been decided, the uncertainty that the situation is impacting the entire industry.
While the NLRB ruling only applies for McDonald’s for now, many franchisors and franchisees have concerns about how the ruling could create huge changes to their business operations. Depending on which way the decision goes, the 18 million people whom are employed in the franchise sector will be impacted in some way. The NLRB ruling could change franchise operations across the country and would go against the way franchising is supposed to empower individual small business owners.
By Adam Robinson
As a franchisor, you’ve built a system for just about everything. You have a system for generating franchise leads and a system for qualifying those leads. You have a system for getting new franchisees signed and a system to make sure they get financed. Then there’s your system for site selection, leasing and build out. Once your new location is up and running, you’ve created a system to help franchisees with marketing, with operations and with processing payments.
What about your franchisee’s system for hiring?
For most concepts, labor costs are the single largest expense at the unit level. Yet, there is insufficient focus on strategic hiring to make sure the franchisee is hiring the right people. This gap results in unfilled positions and higher turnover, both of which cost big money to the operator and to the franchisor.
To top it all off, increased government scrutiny of our industry’s labor practices probably has your general counsel warning you about the legal risks of getting involved with implementing hiring standards.
But people are your business. What’s a franchisor to do?
The most successful companies have figured out that the key to operational excellence is through improved hiring practices. The idea of better people means better customer experience, lower turnover and better morale. Inevitably, the highest performing units in any system are the ones that have mastered the process by which they hire and select employees. Through hiring platforms, a system that is able to be implemented at each unit level, franchisors can rest assured that franchisee hiring practices are consistent.
In other words, a little bit of guidance on hiring process can go a long way.
The hiring process can be broken down into three components: sourcing, selection and verification. Let’s analyze each of these steps.
This is the process by which you market your open position and receive applicants. For most franchisees, that means using mass-market sites like Indeed or Craigslist or industry-specific recruiting sites.
In the 1990s through the late 2000s, job boards like CareerBuilder were really the only viable option for finding candidates. This model forced you to pick and choose where you posted because a single job typically costs in the hundreds of dollars. Now, it’s possible to post to multiple locations on the Internet for a flat fee, which reduces your franchisee’s cost-per-candidate and frees them from having to shop around for the “right” job board.
These developments mean that your franchisees have access to a market of candidates that’s larger than ever, at a cost that’s lower than ever. These new sourcing engines, which are now being integrated into turnkey recruitment platforms, are available to your franchisees today.
In addition to improvements in job-posting technology, the rise of social media means that Twitter, Facebook and LinkedIn have emerged as meaningful recruitment options for your franchisees. Since they’re already spending big money on their social media presence, why not push open jobs through those same networks?
This stage of the hiring process is where applicants are being vetted for job and culture fit. The tools available to your franchisees can include things like automated pre-hire assessments, as well as interview guides and scorecards.
If sourcing is your lead generation engine, then selection is your lead qualification engine. And, as in marketing, there are ways to qualify your applicants that are more efficient than others.
What most of your franchisees are probably doing now is receiving resumes by email, then opening each email and responding directly to each applicant. By using pre-hire assessments and auto-responders, your franchisees can follow up with candidates immediately and qualify their candidate leads more efficiently. The use of these types of tools can cut administrative time by as much as 80 percent and top-quality candidates view your franchisee more favorably because of the rapid response they receive after applying for the job.
Once your franchisees have narrowed their applicant list down to a few interested and qualified individuals, it’s time to bring these finalists in for an interview. The best-run interviews are scripted and focused on the job at hand, which means that your franchisees are asking targeted, legally compliant questions the same way in each interview. Scorecards ensure that they’re measuring applicant fit the same way each time, which reduces the chances that they’ll get into legal issues around their hiring practices.
Verification means following up with assessments, reference checks and background checks to ensure that your franchisee’s new potential hire has the skills they’ve represented, and that they’re suitable for employment.
Assessments are a critical part of the verification process, and should measure a candidate’s ability to achieve the desired outcomes for that role. Good assessments will give your franchisees an objective score and will supplement the data they’ve received so far on the candidate. However, many franchisees think that an assessment by itself is enough to make a hiring decision — it’s not. It’s simply one factor among many that, when combined, give them a comprehensive picture of a candidate’s likelihood of success.
Most managers dislike conducting reference checks, but they’re essential to a thorough hiring process. The best predictor of future performance is past performance in similar roles, so getting feedback from prior managers is a must.
Background checks are a must-do activity (assuming a particular state permits their use) that many franchisees are already engaged in. While there is typically a cost associated with running background checks, the protection they provide is worth every penny.
If you’re a franchisor, you’re in the business of creating systems that help franchisees build and manage successful companies. Core to that effort is the hiring process, and you’re limited in the kinds of help you provide in this regard. By arming yourself with hiring best practices and knowing what solutions are available, you can provide your franchisees with the guidance they need to become competent hiring managers, as well as outstanding franchisees.
Adam Robinson is the founder and CEO of Hireology, a go-to hiring platform. Find him at fransocial.franchise.org.