But is it possible that the managers citing this lack of confidence are putting a new face on the old “not invented here” mentality? Many companies using “closed” models for innovation have long used it as a defense to maintaining their internal staffs and large R&D budgets. P&G and others are showing the true power of open innovation models in the market today. When speaking with most franchise industry people, and there are some exceptions out there, most of their views represent the closed model. If it doesn’t fit their view of the world, mostly based on quarter century old paradigms, then it won’t fly.

So what are the other potential barriers to innovation? Strategos, Gary Hamel’s consulting firm, released a survey with senior executives in 2004 on the key barriers to effective innovation. Some interesting statistics in that study regarding the top factors cited as barriers…

• Short term focus/ focus on operations (63%)
• Lack of time, resources or staff (52%)
• Lack of systematic innovation process (33%)
• Leadership expects payoff sooner than is expected (31%)
• Management incentives not structured to reward innovation (31%)

Also interesting that only 15% cited “we don’t know how to think out of the box” as a barrier to innovation. Now because managers think its so doesn’t make it so. This survey reflects beliefs not necessarily realities – a case in point being the excuse of having inadequate resources to innovate. That is as much a reflection of folks not really doing what they should be doing as anything. The bottom line is this: there’s a direct relationship between innovation and failure. The key killer of innovation is the lack of tolerance for failing – a necessity for innovation which directly reflects an organization’s culture. Watch no risk no innovation below for insights on this important barrier to innovation and if you are ready to really impact the way your franchise system works, take some risk and set up a test drive of our franchise flywheel application. Innovation isn’t as scary as people believe.

Like most people we speak to, this organization is using spreadsheets, outlook, old versions of ACT and other fragmented tools to run their business. In reality many of these folks cannot tell “come here” from “sic ‘em” without involving many hours of effort and people’s time. There is no 360 view of the business. There is no coordination of communication, orchstrated work flows and as a result there are many more people being employed to do mundane things. Even more obviously, what those folks ARE DOING is not nearly as productive as it could be. This is usually acknowledged by the people we talk to and then, as in our call last week, comes THE DISCUSSION. What’s the price ?

Now price is an important variable and its an important question. I mean you have to deliver value for the dollar. We understand that and really see this as our primary advantage. For this ZOR the price would be a mere one hundred and fifty dollars a month. That’s right $150 a month. What was surprising is that THIS WAS OBJECTIONABLE. Can you believe it ? I can’t. $150 a month is a mere $1,800 a year to have something that actually helps you MANAGE your business instead of it managing you. $150 a month is what many companies spend on a single mobile telephone bill per executive manager. It’s a single dinner with a franchise prospect. It is less than 10% of the average franchise unit fee. How is that objectionable?

Do you think franchising generally has ignored the benefits that technology and systems offer? What can explain this type of thinking? We continue to mine for the insightful ZORS who can see the value in the franchise flywheel. Can you help us find some more evolved ZORS to speak with?