If there was one issue that galvanized Dunkin’ Donuts franchise owners in 2009 it was compliance. According to estimates provided to the DDIFO over 675 stores were placed onto the Operations Compliance Team in 2009.
Over the last 12 months, we have talked with dozens of franchise owners about their experience with the Compliance Team. Many described their participation as painful, frightening and abusive. But, as we enter the New Year, there appears to be a shift in the way the Brand is utilizing compliance and in the way franchise owners are responding.
One franchise owner who asked to remain anonymous said he has operated a small network for 13 years. When we spoke in December, 2009, he was weeks away from graduating from compliance. While the process was challenging, he says it was worth the effort. We asked him to grade his experience.
“Overall I’d give it a B. At first, I felt threatened and felt they suspected me of something. But, working with my Compliance OM (Operations Manager) every week for the past 11 months was very helpful. There was good communication and clear expectations. He told me exactly where I stood,” he said.
This franchise owner’s story stands in contrast to tales told by other franchisees we talked with earlier in 2009. It could be reflective of his specific experience or, it could be an indication that compliance is evolving into a more collaborative procedure.
According to Andrew Mastrangelo, Manager of Public Relations for Dunkin’ Brands, compliance is designed to enhance, coach and teach franchise owners. “We’re continuing to work with our franchisees in a collaborative way in regards to focusing on store standards and to improve the guest experience.” He declined to get into further detail about how the system might change under the leadership of new CEO Nigel Travis and incoming Brand Operating Office Paul Twohig.
But, Scott Campbell, franchise owner and co-chairman of the Brand Advisory Council’s (BAC) Operations Compliance subcommittee, says he wouldn’t be surprised if compliance undergoes an overhaul in 2010. He says there have been discussions about possibly folding compliance into field operations. The result would be a greater emphasis on collaboration and less of an emphasis on litigation.
“In the past franchisees would tell me that compliance was easy to get into and hard to get out of. There was a sense that it was an extension of Loss Prevention and fears that entering compliance would lead to a legal exit,” said Campbell. “But, we’ve seen progress in the program from the franchisee perspective and I think it makes sense to have compliance and operations under one umbrella. It means one point of contact and much better communication overall.”
That kind of organizational change could mean the end of the system where a franchisee is assigned a new OM to work with them through compliance process. Sometimes, according to franchise owners we’ve talked with, Compliance Team OMs were difficult to work with and rude to employees.
One franchisee, who asked that his name be withheld, says the OMs are key to the process. “They could communicate better from the start when there are new initiatives so we know exactly what is expected. If Dunkin’ actually ran stores they would know what it’s like for us, but they don’t so their OMs have to do a better job.”
Without fail, franchise owners say they believe compliance to brand standards is crucial to the success of their business. But, they also say they would much rather work with an OM they know to improve their shortcomings.
For now, compliance still falls under the purview of Vice President of U.S. Compliance and Business Development for Dunkin’ Brands Bill Bode. DDIFO President Jim Coen wonders if a reorganized compliance program can still be administered by an executive whose role is to develop new stores and market development agreements. “Compliance and development don’t really belong together,” said Coen. “similar to what Nigel did with having loss prevention report to finance instead of legal it would be better for all parties if compliance reported to operations as opposed to development.”