At #IFA2015 during the Tuesday Business Solution roundtable session, I sat at Table 82. The discussion was moderated by Catherine Monson, CEO of FASTSIGNS International, and the topic was “Building Trust Between the Franchisor and Franchisee.” The group at the table included franchisor management from several brands of various sizes, multi-unit franchisees from two major brands, and a few suppliers.

The conversation was robust and the group benefited greatly from having both franchisors and franchisees represented. All the advice shared at the table circulated around one theme – communication. Communication and collaboration between franchisor and franchisee is critical to both the health and the growth of the brand. In addition, several participants emphasized that communicating bad news effectively was even more important than communicating good news.

As a technology supplier in the franchise industry, I was interested in this topic because technology has become mission critical to both franchisors and franchisees. The franchisor is expected to lead the way by presenting a clearly defined, comprehensive technology strategy that will drive bottom-line growth. At the same time, the process of developing a technology roadmap needs to include collaboration with franchisees to get buy in on planned technology investments.

What happens though when there are franchisees with more technology experience than the franchisor? This may be ok early on when you can count the number of units on one or two hands. However, as a brand starts to scale, the franchisor needs to focus on operational efficiency and scalability which are typically driven by technology. If the franchisor is not leading the way, tech-savvy franchisees will try to fill that gap but that can lead to a fractured, disconnected franchise system.

On a call I had recently with the CEO of a fast-growing franchise brand, he said that one of their business objectives is to effectively become a technology company to properly support system growth and the needs of their franchisees. They have been listening intently to their franchisees and identifying areas for improvement – both in efficiency and quality. Technology was determined to be the solution in 75% of these identified areas for improvement.

How would your brand answer the following communication-related questions?

• How do you communicate technology initiatives and/or issues to franchisees?
• Do you solicit feedback and suggestions from your franchisees?
• Are you holding technology-focused virtual roundtables with your franchise advisory council or other franchisees?

#IFA2015 Table 82 had the answer to these questions – communicate thoroughly and collaborate frequently from the very beginning.

NOTE: As a general disclaimer, I am a recovering software engineer and I’ve been that IT guy at times so I feel qualified to point fingers and assign blame.

The blame in this matter falls solely and squarely on the IF statement. You don’t have to be a programmer to understand the IF statement. If you have used a spreadsheet, you’ve probably dealt with writing an IF statement in a formula.

So why is it the IF statement’s fault? IF statements force black and white logic on situations that are gray. What does that mean exactly? It means that real world requirements must get translated into conditional logic to get implemented in software.

So WHO should be the translator?

The business unit manager understands the requirements. The IT guy understands how the software works. Ideally, the manager and the IT guy would work together to translate the requirements. Let’s look at a typical exchange between a business unit manager and an IT guy using the proverbial “forest and trees” reference.

Quit laughing. You know you have been involved in this EXACT conversation. Maybe not about a forest but about a CRM system or an expense tracking system. So tell me now who’s fault is it that IT guys are so hard to work with?

If you look at the average IT job posting, it will have all the requisite technical jargon. Agile this. JSON that. SQL something else. Here are the UNWRITTEN requirements for the job:

• Mind reader
• Photographic memory
• Magician
• Futurist
• Robot

Now this is not to say that some IT guys don’t make things harder than they need to be. Some can be a serious pain in the ass. Others are simply in over their heads technically and are struggling to keep up. And every one of them has a personal life that is forever impacted by their career decision to be an IT guy. “Available 24 x 7 x 365” is great for marketing purposes but it also takes a huge toll on the actual people doing the job.

So the next time you find yourself ready to strangle your IT guy, take a deep breath and count to 10 using the following logic:

IF Counter = 9 THEN
SET Counter = 1
END IF

Your alternative is to build the forest yourself and we all know you will never make it past the third tree. Or you can call CTO Nation and hire a translator (aka Chief Technology Officer).

If you have ever been involved in purchasing technology for your business, there is a good chance you have heard (or said) one or more of the following statements after sitting through a product demo:

• That seems easy to use
• I’m sure we can customize it if we need to
• They said it can integrate with pretty much anything
• It looks like it has the reporting we need
• This will free up a lot of time

When you are faced with a business problem that needs to be solved, it’s natural to want to find the answer quickly. Buyers WANT there to be the perfect solution and will assume features exist and/or look past glaring deficiencies. Of course, the devil is in the details and those details are sometimes missed during high-level demos.

With the challenges of technology product selection in mind, I have three observations to consider:

• All product demos are not equal
• Beware of the educated but inexperienced buyer
• Buy technology based on a long-term strategy

These observations will save your business money and improve the results you get from your technology investments.

Understanding Product Demos

It’s important to recognize that there are TWO types of demos – product information and product selection demos. Product information demos are typically the response to a Request for Information (RFI) and are intended to provide a general overview of scope and capability. These demos are useful to help buyers structure and prioritize their requirements based on what is available on the market. If it’s clear that high priority requirements are not available yet on the market, the decision to build/customize becomes relevant.

Product selection demos are the response to a Request for Proposal (RFP) where there is a clearly defined list of requirements that need to be met. This detailed list should be prioritized and products should be evaluated accordingly. Gaps should be documented and evaluated during the selection process. If there are other features or circumstances that mitigate an identified gap, these should also be documented.

If you do not evaluate products against a detailed requirements list, you risk selecting the wrong product due to unclear expectations and inaccurate assumptions.

Educated But Inexperienced Buyers

Competent business professionals will be thorough in their research on product categories and best practices. They may demo a variety of products to get a better sense of what is available. In a fairly short period of time, most professionals can become educated on a technology category.

But nothing replaces experience.

An employee may understand the business requirements better than anyone else but that does not make them an experienced buyer. If you assign a buying decision to an employee who has not bought that type of technology before or at least been involved in an implementation of similar technology, you may be setting the project up to fail before it ever gets started.

Long-term Strategy

Technology takes time. Time to implement. Time to learn. Time to see the results you wanted. And even more time to recover from when the project fails.

My point? Take the time to flush out a long-term technology strategy that supports your business objectives and that you can afford. Your business will feel the long-term effects of technology purchases (both good and bad) and one thing you cannot afford is a series of “buy and try” experiments. Put the same effort into your technology strategy that you put into your sales and marketing strategy.

The bottom line is that too many businesses suffer from failed technology projects and incur unnecessary system switching costs because of some basic missteps. You can avoid these issues by having experienced technology leadership on your management team. Learn more about hiring a part-time Chief Technology Officer to protect your technology investments.

Technology is supposed to make everyone’s life easier. As a franchisor, you invest in technology to grow and support your franchise system. As a franchisee, you invest in technology to grow and support your unit(s).

With such a demand for technology, it makes sense that roughly a third of the suppliers at #IFA2015 are providing or supporting technology in some way. There will be many contracts signed at or after #IFA2015 as new investments in technology are made and previous investments are replaced.

So it’s all good right?

Not so fast. The investment made in technology goes WAY beyond the contracts that are signed. When I’m talking with CEOs and business owners, I describe a technology investment life-cycle that has three phases:

1. Implementation – getting technology up and running
2. Retention – managing the technology you have
3. Innovation – enhancing/upgrading technology to support growth

Unfortunately, most businesses only focus on Phase 1. New projects are assigned to a department manager or the overworked “IT guy” and once the new system is up and running, they check the box and move on. The result? Six or twelve months down the road, the CEO is asking why they are spending money on systems that everyone hates and that no one is using correctly.

For a franchise system with different technologies at both the franchisor and franchisee level, the result can be a long list of failed projects. This is why the role of Chief Technology Officer (CTO) is so critical. An experienced CTO focuses on all three phases of technology investment with respect to overall business objectives. Additionally, the CTO can see above the day-to-day technology issues and address problems at a strategic level.

For a franchise system, let’s look at three compelling reasons to have a Franchise CTO in place:

1. Franchise Development – Your franchise development team should be focused on sales and marketing. If they are responsible for managing the systems they depend on – CRM, lead generation, marketing automation, etc – who’s doing the selling? The CTO will manage the technology vendors, make sure staff get trained on a regular basis, and monitor system performance against objectives.
2. Franchisee Management – Supporting your franchisees is a multi-department effort and franchisees need dependable, streamlined communication. While trying to manage the technology “by committee” simply doesn’t work, the CTO will manage across stakeholder boundaries. This greatly improves the interaction with the technology vendors and improves overall project results.
3. Franchisee Guidance – Technology requirements and recommendations from a franchisor need to be communicated effectively to franchisees. Discussions about technology are often contentious and frustrating to franchisees. Instead of having the CEO or Director of Operations handling these conversations, imagine having a CTO present the technology roadmap at the annual franchisee summit.

Why don’t more franchisors have CTOs on their management team? The primary reason is cost. Most franchisors recognize the need but they can’t justify the cost of a full-time CTO.

CTO Nation was founded to address this very challenge. We provide experienced Chief Technology Officers on a part-time, fixed-fee basis. No more watching the clock on a high-priced consultant. Hire a Franchise CTO to make sure you maximize the return on investment in technology for your franchise system.

Topic

On this CTO Nation webinar, we focused on the types of technology that franchisors and franchisees should be familiar with. Growing your franchise system requires efficient processes, scalable technology, and the right people. We discussed how to address areas as you develop a technology strategy for your brand.

We covered the following topics:

• Prioritizing technology initiatives
• Developing realistic budgets and timelines
• Improving end user adoption & satisfaction
• Ensuring data security compliance
• Taking business continuity planning seriously

Presenters

Greg Cory, CEO of CTO Nation discussed these topics and more with our guest speakers – Amit Pamecha, CEO of FranConnect and Ken Colburn, CEO of Data Doctors Computer Services.

ATLANTA, Feb. 9, 2015 /PRNewswire-iReach/ — CTO Nation, provider of part-time Chief Technology Officer resources, has launched its Franchise CTO service line. Franchise CTO will provide significant value to franchisors and their franchisees by addressing the need for technology leadership in small businesses. Fixed fee pricing will range from $1,500 to $5,000 per month, a fraction of the cost for full-time, experienced CTOs with full salary and benefits packages.

The CTO Nation model was designed to help companies that traditionally underestimate the need for technology leadership. While most companies contract with outside professional services such as financial and legal, technology is usually left to whomever is available and marginally technical. The result? Failed projects, a revolving door of vendors, manual business processes and more. The risk? Significant liability with regard to cyber security and other business continuity issues.

Companies under $50 million in annual revenue have limited budgets for technology departments. However, they have the same technology issues and challenges as larger companies, with arguably more business risk due to their size. In addition to strategic guidance and planning, CTO Nation focuses on technical assessments, vendor management, project oversight, end user adoption, and business continuity. CTOs will also perform technical due diligence in support of M&A activity.

The franchise industry is faced with all the traditional techBANnology issues from retail and service businesses. Additionally, franchisors require specific technology to manage and support their franchisees. The Franchise CTO service line will provide management, oversight and continuity for a franchisor’s technology strategy and help communicate that strategy to the franchisees.

According to Greg Cory, CEO and founder of CTO Nation, “Adding experienced technology leadership can generate a 10-20% bottom line improvement for most businesses. Small businesses, and franchises in particular, must continue to invest in technology to stay competitive and technology needs to be represented in the C-suite and in the board room.”

About CTO Nation

CTO Nation provides a scorecard based on a technical assessment of client business objectives, current processes, installed systems, vendor performance and other details. The scorecard identifies the potential revenue impact of the current technology strategy and provides an action plan for addressing deficiencies. Currently, CTO Nation provides two service levels – Advisory Services and Management Services – which correlate to 25% and 50% time respectively. Shared services include software training on mainstream technologies, collaborative workshops to assist technology buying decisions and technology innovation research. To learn more about CTO Nation services, visit www.ctonation.com.

Media Contact

Jack Burris
Burris Agency
202-549-7159
jburris@burris.com

Let’s do a quick count of technology-related products, software, and services that most businesses use. The list would include phone, Internet, website hosting, CRM, email marketing, accounting, supply chain, payment processing, etc.

So just by covering the basics, a business relies on 8 to 10 technology vendors. Further complicating things, some systems require coordination of multiple product and service vendors. Integration, upgrades, training, and other related issues have to be addressed.

Depending on the type and size of your business, you may be spending 5-10% of annual revenue on technology. How many technology-related vendors does your business depend on? Who is responsible for managing them?

It’s a very good time to evaluate your vendor management strategy. Take this 5 question evaluation by CTO Nation for a evaluate your business.

This is the first in a series of technology-related public service announcements (PSAs) brought to you by CTO Nation.

The technology-related failures listed below were collected from a variety of companies. We hope you can learn from their cringe-inducing experiences. All company names and employee references have been removed to protect the innocent (and embarrassed):

“I found out the other day that we’ve been sending our marketing emails from Outlook for the past month because no one bothered to tell [the marketing intern] that we had a MailChimp account. We figured it out when an email was sent out using the “cc” feature. The hate mail we got back was not what we were shooting for on that marketing campaign.”

— Managing director, regional insurance brokerage

“I get at least two emails every week trying to sell me FREE cloud storage. But [my IT guy] wasn’t backing up Quickbooks correctly and we just lost most of our Q4 financial data when the office server crashed.”
— Controller, multi-unit hair salon

“Our domain registration still had [a former employee’s] email address so no one saw the renewal notices. It expired and someone in Belarus bought it and now we are trying to figure out how to get it back.”

— Owner, marketing firm

“We found out that [our IT guy] wasn’t actually doing any programming. His girlfriend was literally doing it for him at night. Our system went down one morning and when he had no idea where to look to see what was wrong, he finally had to come clean.”

— IT director, call center

“The programmers migrated our in-house order management system to new servers over the weekend. Somehow they missed one of the database connection settings and we didn’t catch it until the evening reports ran on Monday night. Some data was lost permanently and it took us almost a week to salvage the remaining data that was split across the old database and the new database.”
— Owner, building supplies company

This is just a small portion a fairly long list and we’ll share some of the others along the way. If you have any good ones to add to the list, send us an email with the details.

When performing technology assessments, I like to ask the following basic question: “How many spreadsheets do you depend on to run your business?”

Almost without exception, there is some mild embarrassment and a number is muttered in a barely audible voice. Many of these businesses have the necessary systems in place but for a variety of reasons, they resort to spreadsheets for critical functions. Common reasons include 1) lack of end-user training on existing systems 2) pride of ownership over an “awesome spreadsheet,” or the global standard 3) “because that’s how we’ve always done it.”

Don’t get me wrong, I’m a big fan of spreadsheets when they are used appropriately. The spreadsheet is arguably the most useful business software tool ever created. From basic data collection to advanced features like pivot tables, the spreadsheet is powerful because of its ease of use and its flexibility. More recently, cloud-based spreadsheets like Microsoft Office365 and Google Sheets have solved the challenge of spreadsheet collaboration.

The problems begin when spreadsheets are being used as the primary holder of critical business data or for key, recurring management reports. We have all seen examples of a management report that is some employee’s sole purpose in life for one whole week every month. Another popular one is the sales forecast spreadsheet that is emailed around with versions managed by creative file names like “Sales Pipeline – Final FINAL” or “Q4 Forecast v4 (2).”

So the real question is “how much is this reliance on spreadsheets costing your business?” What is the impact of taking a week to create a report that really should be available in real-time? Or what about the cost of lost data when a spreadsheet gets deleted, corrupted, or even stolen? My bet is that there are spreadsheets that easily have an opportunity cost of a million dollars or maybe even MORE.

Does your business have any of these spreadsheets?

The good news is that the solution may be already be within arm’s reach. By taking the simple step of better utilizing available tools, you can improve process efficiency and reduce business risk. The next step is to ensure that you are getting the full ROI on the systems you have implemented.

If your technology strategy is underperforming, you need to consider adding technology leadership to your C-suite. CTO Nation provides part-time CTO services that will drive bottom line growth for your business.

Having spoken with a few hundred business owners and CEOs over the years, I have heard many opinions about technology and its relative priority in their businesses. Their business strategies tend to focus on sales, marketing, product/service delivery, and customer service. They know how to control advertising costs, marketing spend, and general operating costs, but technology is a scary black hole.

The reality is that as we near the end of 2014, technology is mission critical in every facet of a business. Each department has multiple systems they are budgeting for, using, or upgrading. Systems need to work as expected and scale when needed. Back in the day, if systems were down, the old standby paper-based processes kicked in to get the job done. But those options aren’t practical when businesses are running on limited staff.

At no fault of their own, non-technical CEOs do not have the experience to make complex technology decisions. On the finance and legal matters, they bring in a CPA or an attorney to guide them. However, on the technology side, they assign critical technology decisions to the “resident techie” that can build a web page or get corporate mail working on the CEO’s phone.

When you consider the true cost of technology, the importance of experienced technology leadership is clear. Financial statements don’t accurately reflect the cost of a failed software implementation, poor end-user adoption, or system downtime. Recovering from a data breach or other business interruptions can cost a business significant time and money.

Fortunately, there is a solution to this gap in technology leadership. While most businesses cannot afford a full-time Chief Technology Office (CTO), they still need one. So how do you get an experienced CTO at a price you can afford? The same way that businesses hire CPAs and attorneys – with a part-time and retainer-based model.

CTO Nation was launched to fill this exact need – to add technology leadership to the C-suite through a practical and affordable pricing model. We are building a network of experienced CTOs that can be part of your management team. With the right leadership, your technology strategy will drive real bottom line growth. It is time to make technology an asset instead of a liability.