I receive a periodical from Franchising.com, Multi-Unit Franchisee, that I subscribed to during my years as a franchise owner. I’ve been out of that world for a little while now, but I still enjoy reading it. I like staying somewhat connected to the franchise industry, seeing which concepts are growing, which industries are attracting attention, and how some of the larger multi-unit operators are thinking about their businesses.
Recently, I was reading an interview with the CEO of a large fitness franchisee that operates dozens of locations across the country. As I made my way through the first section of the interview, I started noticing some very familiar terminology.
Purpose. Leadership. Communication. Core values. Fundamentals.
These are words I use almost every day in my work with leadership teams, many of which are running businesses considerably smaller than his. And yet, here was the CEO of a company doing tens of millions of dollars in revenue, growing largely through acquisition, talking about many of the same topics I stress daily.
One of the things he discussed was celebrating wins that give the team purpose. He talked about developing leaders who believe in the business and lead by example. When asked about their core values, he shared things like “be humble, hungry, and smart,” “relentlessly execute the fundamentals,” “grow and develop future leaders,” and one I particularly liked, “be a day maker.”
I don't know exactly how they define “be a day maker” inside their organization, but I like it. I can imagine a lot of ways a company could bring something like that to life through the way people treat customers and each other. More importantly, it sounds like something you could actually recognize when you saw someone doing it. Core values are much more useful when people understand what they look like in practice.
As I continued reading, I kept thinking about how easy it is to assume that the issues facing a larger company must be fundamentally different from those facing a smaller one. In many ways, of course, they are. As a company grows, complexity is inherent. Accounting becomes more sophisticated. HR becomes more complicated. You add locations, technology, reporting, layers of management and people with increasingly specialized responsibilities. There is simply more to manage.
But the fundamentals remain remarkably similar.
Do we have the right people? Do they understand where we're going? Do they believe in it? Are we developing good leaders? Do people understand our values and what those values actually mean? Are we communicating well? Are we consistently executing the things that matter most?
I experienced some of this myself when I went from owning and operating two locations with about 36 employees to eventually serving as COO of an organization with 18 locations around the country and over 200 employees. Much of that growth had occurred through acquisition, which added another layer of complexity. Those locations had previously operated under different owners and leaders, and the people working in them had developed different expectations and different ways of doing things.
One of the things I spent a significant amount of time doing was working with our Center Directors, essentially the general managers of each location. We had weekly coaching conversations about leadership, expectations and our core values. We talked about what the organization expected from them and, just as importantly, what they should expect from the people they were leading.
The concepts weren't particularly complicated. The challenge was getting those concepts to travel through the organization.
As the COO, I could work directly with our Center Directors, but I couldn't personally reinforce our expectations with every employee in 18 locations every day. Our Center Directors had to understand them well enough to reinforce them with their teams. Those team members had to see the same standards reflected in the decisions being made around them. As the organization grew, we needed more process around training, communication and measuring performance, but what we were trying to reinforce hadn't really changed.
I think this is where growth can create an interesting challenge for a leadership team. The business legitimately needs more sophistication as it gets larger, and that sophistication requires attention. You need better systems, more capable leaders, additional expertise and probably a lot of things you didn't need when the company was smaller. But none of that replaces the fundamentals that helped build the company in the first place. None of that replaces the core purpose of why you exist as an organization.
In fact, I wonder if the fundamentals become easier to lose as the organization becomes more complex.
An owner with 15 employees can probably reinforce the company's purpose, values and standards personally. Add locations and layers of leadership, and that becomes impossible. Other people now have to carry those things forward. Eventually, the difference between a core value that influences the organization and one that becomes words on a wall may depend on whether every level of leadership understands it, models it and expects it from the people they lead.
That's part of what I found interesting about this particular interview. There are undoubtedly much more complicated things occupying the CEO's attention as his company continues to grow. Yet when given an opportunity to talk about running the business, he kept coming back to people, purpose, leadership development, communication, core values and executing the fundamentals.
Maybe that's part of what good scaling actually looks like. The business becomes more sophisticated without allowing the things that matter most to become unnecessarily complicated.