Franchise model
Three forms of cooperation, new agreement templates and rules for joining the chain.
Case studies
Case Study 03
From a franchise model to the capabilities that build results
Rebuilding the franchise model, operating standards and accountability for results in a nationwide chain of jewellery stores
The franchise model sets the rules of cooperation. How they are applied every day is decided by the people who run the stores and their teams.
The project combined organising the chain's model with competency assessment, training, management tools and a recovery programme. It covered both designing organisational solutions and preparing people to apply them: recognising needs, developing skills, supporting implementation and decisions on further accountability.
A selected management experience underlying HEFT7. The project predates HEFT7 and was led by the founder as part of her responsibility for the retail chain and the development of the franchise system. The description covers activities documented in materials from 2009–2011.
Key elements of the project
- c. 90stores in a nationwide chain
- 3models of cooperation with partners
- 2 volumesof the operating manual
- c. 30individual competency assessments of staff
- 11locations covered by the recovery programme
Illustrative image. It does not show a store covered by the project.
01
Situation
A nationwide premium jewellery brand was developing a chain of about 90 stores, located mainly in shopping centres. Sales were run by franchise partners and agents. The brand was distinguished by its own design studio and signature collections.
In 2010 the chain's turnover grew by about 3.9% year on year. The result of the organisation as a whole, however, did not reflect the situation of individual locations. Some stores recorded declines exceeding 10%, and differences in sales effectiveness pointed to untapped potential in the existing chain.
- c. 90stores, mainly in shopping centres
- +3,9%growth in the chain's turnover in 2010, year on year
- >10%decline in turnover in some stores
Partners operated on different terms, and the way stores were run was not based on a uniform management standard. Further development required putting the relationship with head office in order and preparing staff to manage according to common rules.
02
Problem
A shared brand did not provide a shared way of managing.
Varied agreements and terms of cooperation made it difficult to enforce uniform rules of service, display and work organisation. Head office needed tools to define expectations of partners, support their delivery and assess performance.
In the group of stores analysed, the excess of stock relative to display capacity ranged from about 38% to 169%. This hindered rational management of the range and the assessment of the real needs of individual locations.
Turnover alone did not explain the differences between stores. It had to be established to what extent they resulted from location, offer, stocking, quality of service and the way the team was managed.
Equally important were the competencies of the people running the stores: the ability to set targets, plan work, analyse data, motivate staff and develop their skills.
The project required combining three elements: a coherent chain model, prepared staff and effective supervision of the delivery of change.
03
Diagnosis
First the conditions of running the business were assessed, then the way the store was managed.
The analysis covered the local environment, the situation of the shopping centre and the operation of the store itself. We examined competition, changes in the centre, the sales structure, stocking, display, work organisation and the manager's competencies.
A three-stage process was adopted:
- 01Intro DiagnosisData and comparisons
Analysis of the terms of cooperation, rent, turnover, sales indicators and stocking relative to the chain.
- 02In-store DiagnosisPractice in action
Observation of the store's work, analysis of mystery-shopper research, a conversation with the manager and a self-assessment of management approach.
- 03Total DiagnosisConclusions and decisions
Identifying the causes of deviations, the potential for improvement and the actions for the specific location.
In one of the largest stores analysed, turnover fell by 11.4% and the number of transactions by 13%, while the turnover of the whole chain grew by 3.9%. Conversion was 7% against 13–15% in comparable locations.
- −11,4%of store turnover
- −13%of the number of transactions
- +3,9%of the whole chain's turnover
- 7% vs 13–15%conversion against comparable locations
The diagnosis showed that external factors did not explain the full scale of the decline. Significant constraints concerned target setting, day-to-day work organisation and the standard of service.
An estimate, not a resultSimulations indicated a potential of about PLN 120–170 thousand in additional annual turnover if a selected sales parameter were improved to the adopted reference level. These were alternative estimates for one location, not results achieved.
04
Direction of the transformation
On the basis of the diagnosis, eight interrelated lines of action were defined.
- 01
A common chain standard
Uniform rules of service, display, work organisation and cooperation with head office.
- 02
Three models of cooperation
Partner, patronage and agency models, linked to the partner's investment commitment.
- 03
Management by indicators
Assessment of conversion, basket value, items per transaction and other sales parameters.
- 04
Stocking matched to the location
Taking account of display capacity and the customer profile.
- 05
Competency diagnosis
Assessment of the skills of the people running stores and of their development needs.
- 06
Training with knowledge verification
Thematic programmes ending in examinations.
- 07
Support with executive powers
The ability to temporarily take over the management of a location covered by the recovery programme.
- 08
Uniform selection of managers
Practical tasks, competency assessment and preparation for taking on responsibility.
05
Scope of work
Operating standards
A two-volume manual covering cooperation with head office, service, display, work organisation and marketing.
Daily management
Checklists, rotas that take customer traffic into account, sales targets and individual log-ins for sales staff.
Measurement and oversight
Indicators, store rankings, footfall counting and mystery-shopper research.
Staff competencies
Development Center assessments, identification of development needs and training with examinations.
Selecting managers
An organised process of recruitment, assessment and preparation for running a store.
Systems and sales support
Participation in designing POS and CRM modules and work on customer and adviser motivation programmes.
Recovery programme
Diagnoses, action plans, monitoring of delivery and the possibility of temporarily taking over management.
06
Delivery
A common basis for action
In 2009–2010 a manual was prepared that set in order the rules for running stores. Partners received a common reference point for customer service, display, work organisation and cooperation with head office.
In parallel, indicators, rankings and performance discussions were developed. According to a report from January 2011, footfall counting covered 92 locations from Q4 2010.
Recognising competencies and development needs
At the end of 2010 about 30 store managers were covered by a competency assessment. We analysed communication, customer service, team management and motivation, work with data and planning the store's development.
- Communication
- Customer service
- Team management and motivation
- Work with data
- Planning the store's development
Training was tied to the requirements of the specific role. Examinations verified knowledge, while visits and checks on agreed tasks made it possible to see how it was used in practice.
From recommendation to action
The initial support team focused on diagnosis. The limited ability to influence the implementation of recommendations showed the need to extend its powers.
In 2011 the recovery programme covered 11 locations designated by the Management Board. The team was given the ability to temporarily take over management of a store.
Programme assumptionThe mode of work adopted assumed about two weeks of diagnosis, a week for the report and decisions, and actions with an expected effect over a horizon of one to three months. This was a programme assumption, not confirmation that all locations achieved the result.
Difficult decisions based on facts
The store manager received specific tasks, deadlines, tools and support. The next assessment took into account delivery of what was agreed and the conditions in which the manager operated.
Failure to carry out the agreed actions was the basis for further decisions, including a change of the person running the store. The recovery programme was also continued during personnel changes, to preserve continuity of action.
A new manager went through a standardised assessment, training ending in an examination and practice in a pilot store.
07
Confirmed project results
The project led to the development and launch of the key elements of a common system for managing the chain.
The organisational results included:
- a two-volume operating manual;
- three models of cooperation and new agreement templates;
- indicators, rankings and footfall counting in 92 locations;
- about 30 individual competency assessments of staff;
- a three-stage method of store diagnosis;
- a recovery programme covering 11 locations;
- a standardised process for selecting and preparing new managers.
Tools were created that linked an assessment of the business situation with an assessment of competencies and task delivery. Staff development was tied to the chain's operating standards and to accountability for implementing change.
08
Limitations of the project
The available materials do not contain a comparable measurement of store results after the recovery programme ended.
The case study presents the organisational solutions and scope of activities documented in 2009–2011. It does not attribute to the project any unconfirmed growth in sales, profitability or lasting improvement in all locations.
09
Conclusion
Developing a franchise network requires consistency between the cooperation model, work standards, partners' competencies and the way results are assessed.
Standards set expectations. Diagnosis makes it possible to recognise barriers. Staff development prepares people to act. Clear accountability and powers make it possible to carry out agreed changes.
Management takeaway
"Standards define how things are done. Leaders translate them into the team's daily work."
The effectiveness of the programme depends on combining development support with an assessment of progress. Decisions about people should take into account the business conditions, the resources available, the diagnosed needs and the delivery of agreed actions.
2026 perspective
From experience to method — the Leadership Academy
Developing leaders as part of an organisation's transformation.
The experience described in this project is a reference point for HEFT7's contemporary concept of leadership development programmes. It combines business strategy, the organisational model, staff competencies and the customer experience.
The approach below presents a development of the method from 2026, separate from the historical implementation.
Strategy and expectations of leaders
The programme begins by defining the company's objectives and the changes needed to achieve them. On that basis the requirements for managers, franchise partners and teams are defined.
Differences between roles are taken into account, and it is checked whether the structure, powers and resources allow the assigned responsibility to be carried out.
Diagnosis of the organisation and competencies
The analysis covers results, processes, organisational culture, employee experience and the customer journey. It makes it possible to distinguish training needs from problems that require a change of structure, processes or division of tasks.
A leadership model visible in daily work
The company's goals and values are translated into specific practices: setting targets, delegating, giving feedback, developing employees, holding difficult conversations and managing change.
Learning combined with implementation
The Academy includes workshops, coaching, mentoring, exchange of experience and projects addressing real business problems. Participants work on tasks of their own teams, and their line managers support the application of new skills.
05
Decisions matched to the situation
The assessment of a leader combines business results with the quality of management.
SituationDirection of action
Good result and mature management practices
Talent development, succession and mentoring of other leaders.
Good result with worrying management practices
Work on behaviours and limiting risk to the team and the customer.
Result below expectations with good management practices
Verification of resources, the location's potential and organisational barriers.
Result below expectations and significant management gaps
A development or intervention plan, and an assessment of progress and fit with the role.
06
Measuring effects
Before the programme starts, a baseline and a way of assessing change are defined. Measurement may cover commercial results, customer satisfaction, staff turnover and engagement, application of management standards and the readiness of successors.
A pilot makes it possible to verify the solutions before the programme is extended. The aim is for the new practices to become a lasting part of day-to-day management.
10
Competencies used in the project
11
The seven HEFT7 disciplines
Historical experience presented in the layout of today's HEFT7 method.
- 01
Diagnosis
Analysis of store operating conditions, indicators, work standards and staff competencies.
- 02
Strategy
Defining the chain management model, the forms of cooperation and the direction of recovery actions.
- 03
Design
The manual, management tools, agreement models and processes for assessing and selecting managers.
- 04
Preparation
Competency assessment, training and definition of the powers of the recovery team.
- 05
Implementation
Introduction of standards and tools and launch of the programme for 11 locations.
- 06Partial scope
Measurement
Indicators, rankings and footfall counting; no final measurement of the programme's effects in the available documentation.
- 07Unconfirmed
Stabilisation
The model envisaged handing stores over to ongoing oversight; the durability of the effects is not documented in the available material.
- Stage completed
- Partial or unconfirmed scope
Developing a chain and the competencies of its leaders?
Developing a franchise, changing the management structure and a Leadership Academy all require a common reference point: business objectives and how people deliver them.
HEFT7 combines designing the chain's model with competency diagnosis, leadership development and the implementation of management standards. We help prepare the organisation and its staff for the next stage of development.