Franchise teamwork – Lessons from the America’s Cup

By Sarah Stowe | 29 Oct 2015 View comments

Teamwork is an essential requirement in any franchise operation. Teamwork ensures everybody is aware of their respective responsibilities, resulting in a highly competitive and effectively performing franchise system.

In all steps of the franchise process, be it internal operations of the Franchisor, the interface to Franchisees, or the internal operations of the Franchisees, having delegated roles and responsibilities makes the process of getting the job done far more effective.

Peter Buckingham uses the America’s Cup racing in San Francisco as an example to show how to run an efficient operation. Three years ago the concept of racing 72’ catamarans on hydrofoils was just a dream. International yachting came together and decided to build and race America’s Cup 45 catamarans, to have sailors become used to racing such vessels, and then graduate to AC72s about a year before the America’s Cup.

This was a ‘start from scratch’ event where the teams had to design and build their vessels, learn to sail them and become extremely competitive for the racing that was to start in July 2013, with the finals of the America’s Cup in September 2013 in San Francisco.

Though they did not win in this nail-biting series, the performance of the Emirates Team New Zealand holds lessons on how to build and sustain a Franchise system.

Proof of Concept

The design phase involved around 35 design engineers and very sophisticated computer modelling on a high end Dell computer platform run at the Cambridge University in New Zealand.

The boat designed for Emirates Team New Zealand originally looked like it would break up due to massive forces, but these issues were slowly overcome to create the magnificent craft that was finally used for the race. Hydrofoiling had also never been done on large racing catamarans but Emirates Team New Zealand worked out a way and led the competition, which had to follow to remain competitive.

A franchise system has similar issues. What are we going to sell, will it work, how do we make it and does the community want to purchase or use it? Peter Ritchie, ex-McDonalds Australia and now Chairman of Mortgage Choice says there must be a ‘proof of concept’. Competition then often follows suit, but the leader has to adapt to stay ahead of the competition, just like Team New Zealand tried to do. Unfortunately for them, the competition learnt from them, and went a step better to eventually win the series 9 races to 8.

Effective use of people power

Emirates Team New Zealand had around 105 people involved; with families, the team had to relocate around 300 people to San Francisco from May until the end of the America’s Cup in September. Grant Dalton, the CEO of the operation ran an extremely effective team, and just to further make his life even more complicated, he actually was one of the crew on board the boat. 

In the Emirates Team NZ, everyone knew exactly what they had to do with no room for ‘not my job’ situations. What they had done was to systemise basically every process they undertook, and keep it consistent at 100% performance.

Top performers in franchising have similar job functions and job descriptions.

Most successful businesses can delegate as long as there is a process that establishes the basics of what they wish to achieve. Some of the better Franchisors are able to achieve this; the ones that are of concern are those where the lines become so blurred, everyone is trying to do everything – and not very effectively.

When one appoints someone as a Manager, let them do their job as per their guidelines and KPIs. Many CEOs become experts on such matters as where to place a store, for instance. They can obviously make suggestions but it is best to leave such decision-making to the person appointed to do so. Too often in a Franchise operation, one can see the Founder or CEO still wanting to make every decision, whereas their responsibility is to make sure the process is in place to create the best results.

Delegation was very visible within the Emirates Team New Zealand environment; even though CEO Grant Dalton was part of the crew on the boat, he did not contribute to the brains trust in the running of the boat on the water. It was left to the skipper Dean Barker and his tactician and strategist to make all the decisions in the race.

Boats like these are run purely on muscle, with no stored energy allowed. Even running hydraulics to trim the boat is all generated by pumping those grinding handles. 

Similarly, a good franchise system is normally run with very little excess fat, and the best way to do this is by making sure everyone knows their job and does it effectively. 

Focus on the main event

The Emirates Team NZ was focused only on winning the America’s Cup. The atmosphere was all about being focused on the goal, and making tiny changes to improve the performance. In the period between winning the Louis Vuitton Cup and the beginning of the finals, changes were being made to the boat, and every night after racing, everything was checked, double checked and altered if it could improve performance.

Australian Jimmy Spithill who skippered the successful US defender, Oracle was equally focused and probably made the greatest recovery in international sport, coming from 1 – 8 down to eventually roll Emirates Team NZ 9 – 8. His focus and determination is now legendary, as he did not waver despite being the underdog for over a week.

Top franchise systems display the same focus. Companies like McDonalds are reputed for making sure they achieve the absolute best in product and processes. McDonalds founder Ray Krok was often seen picking up discarded pickles because he was annoyed that a McDonald’s driveway looked messy. His philosophy was to do whatever was needed to achieve the best result, irrespective of the cost, and then be able to reproduce that time and again.