Working Systems
In the late 1980s, hairdresser Denis McFadden had an idea. He In the late 1980s, hairdresser Denis McFadden had an idea. He ran a trial promotion for a no-appointment, fixed price haircut, and the response was outstanding. With the concept tested and proven, in 1990 McFadden began franchising under the brand name Just Cuts. Today, there are 129 Just Cuts salons in Australia and 20 in New Zealand. The company's goal is to have 500 salons worldwide.
According to operations manager, Elizabeth Scheurer, a confidential operations manual lies at the heart of their success. "This covers all of the basic training and general principles driving the business," she says. "That's everything from the day-to-day running of the salon and OH S (Occupational Health and Safety) to security and retailing our own products.
"The manual gives us a way of monitoring and assessing how the business is working for our franchisees. It helps them to recruit fully qualified stylists, and to keep them. We find that our hairdressers really appreciate the systems, too - they enjoy working when they know they can deliver. For instance, we have developed a very rigorous greeting and departing system so that customers have that 'wow' feeling for the whole time they're in the salon.
"The beauty of all this for our franchisees is that they buy a business they can work on, rather than in, right from the start. They simply follow the procedures to the letter. That's also what makes it possible for them to have more than one franchise - it's easy to put a team leader in position."
Meticulous in detail, the manual is far from set in stone. "You have to go with the times," says Scheurer. "We're constantly evolving, training, asking what are the clients' needs and wants. We have meetings with franchisees where they share their ideas for improvement. Even if an idea seems way out, we'll give it a trial. If it works, it goes into the manual."
If systems are good, are more systems better? Not necessarily, says Rana Pala, partner and head of growth services New South Wales with BDO Chartered Accountants and Advisers. BDO specialises in helping businesses to grow. And, to ensure their clients get the right help at the right time, they developed the DIAMOND Model of Business Growth. This describes growth stages as Dreaming, Initiating, Attacking, Maturing, Overhauling, Networking and Diversifying.
Pala believes that too much systemisation at the 'dreaming' and 'initiating' stages can actually be bad for business. "This is when you need to retain some of the entrepreneurial spirit that got the business started in the first place," he says. "While systems are important, they need to be developed on a case by case basis and enhanced as the business grows.
"We were recently called in by a management consultancy business that had three stakeholders in three different states, and all were very keen to grow. The problem was that they had all come out of much larger organisations where the systems had been very defined. They copied these exactly right from the start, and this backfired. It was all too anal - the systems became a barrier to growth."
Richardson agrees that enough is enough. "When you're thinking about innovation, the prize goes to the person who both produces and manages change," she says. "In this case, change means systemising to the point where you can enjoy your business, not to be a servant to the system. If you go that far you have missed the whole point of the exercise."
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