Maximizing Multi-location Performance

Submitted by Marty Rogoff, Partner, CANDOR

Every day, executive companies with multiple locations are challenged by the difficulty of profitable growth. The plan that was projected to simply replicate the success of the first unit instead yields unexpected complexity and problems. Executives often find themselves asking questions about their people, their sites and their efficiencies.

About the people:

• Did we prepare our managers to succeed in an off-site situation?
  Compare the way we supervise our children when they live at home and when they are away at college. While you hope prior training will help them make the right decisions, they will be confronted with many challenges and decisions.
• Why is a particular multi-unit manager successful?
  Energy and thoughtful consideration must be put into the recruitment, interviewing, selection and development of this individual, who is the primary communicator to the individual units and has tremendous influence over their successes.
• How do we manage and motivate employees we don’t see every day?
  Does the company have a culture of trust and empowerment? How do executives learn this management philosophy, which is critical to the success of multiple location organizations?

About the sites:

• Which locations have the upside potential that warrant investment?
  A unit’s potential has to be measured against its demographic make-up as well as some statistical secondary influencers. A high revenue location may actually be underperforming, and a low one may be overachieving.
• Why does this site never succeed, no matter who is the manager?
  The "Demographic DNA" of a site can unearth certain success factors and/or failure factors that will give keen insights into both current performance and future potential.
• Why is one unit performing better than another only one mile away?
  Is it the manager or staff? A specific competitor? Only a regression-like analysis can isolate the issue so that top management can address it.

About the efficiency and productivity:

• Why can’t we duplicate the efficiency we had when we were only one unit?
  Multiple locations make it a totally different business, requiring new communication vehicles, management styles and skill sets.
• What about the importance of communication to the "field?"
  The greatest complaint that non-Home Office employees have is that "no one tells us anything," which results in low morale, high turnover and poor execution.
• Why is there a "Home Office vs. Field / Us vs. Them" mentality?
  Competition may yield positive attitudes, but when fingers are pointed and blame assessed, the poisoned environment becomes difficult to overcome.

When a company expands to multiple locations, the entity cannot be managed the same way as it was. If the issues above — and others — are not anticipated nor managed, the problems in the new company will grow exponentially. However, with the correct assessments, analyses and planning, profitability can reach the desired level, while also developing a structure for continued growth.

Marty Rogoff, a former retail executive and professor, is a partner at CANDOR, which focuses on productivity for multi-location organizations. He can be reached at mrogoff@candorpartners.com.