Greetings from sunny Las Vegas and the beautiful MGM Grand hotel and convention center. Once again this year, the IFA Convention is proving to be a gathering of the best and brightest of the franchising world. The IFA has a jam packed agenda of thought-provoking speakers–such as the keynote speaker for yesterday’s opening gala, Governor Mitt Romney, who closed his remarks by reminding everyone, "If you want to be a good franchisor, listen to the ideas of your franchisees"–and great educational programs on any variety of topics facing franchisors and franchisees today.
This morning’s IFA Super Session was no exception. We were treated to an outstanding presentation from 7-Eleven President and CEO Joseph DePinto, the original "Undercover Boss." DePinto was frank about the troubles he found upon taking over a moribund 7-Eleven in 2005. He found a top-down culture whose growth had stagnated and was resting on the laurels of having invented the convenience store. He knew radical change was necessary.
To propel 7-Eleven back to growth, DePinto turned to the concept of Servant Leadership found prominently in the writings of James Hunter. DePinto overhauled all aspects of 7-Eleven culture, following a new credo of "Serve. Lead. Do What Is Right." He challenged every employee of the company to have a new customer and franchisee-focus, accountability for their actions, and responsibility for results.
"Baking" the concepts of Servant Leadership into 7-Eleven’s DNA was not easy, and it did not happen overnight. It required a complete overhaul of 7-Eleven’s human resource program. A fresh look at distribution systems that were resulting in 60 or more individual deliveries to a single store each week. Inventory management programs that ensure the right products are on the right shelves–a break with the "push" inventory systems of the past. A requirement that every management employee of the company spend 3 full months working in a retail store. The establishment of a franchisee advisory council–and the willingness to listen when those franchisees told the Franchisee Service Center that things weren’t right.
But, to steal from DePinto, all those hard things were the "right thing to do." And, while DePinto says 7-Eleven is "not there yet", the changes he has instituted have resulted in 7-Eleven having phenomenal worldwide growth. New US franchises are up by over 1,000 locations since 2005, and the ROI for all US franchises is up almost 30% despite the recession. Worldwide, 7-Eleven now has almost 40,000 locations and opens a new store an average of one every 3.5 hours.
There wasn’t a person in the hall this morning who didn’t leave believing that he or she can learn from the transformational servant leadership DePinto has brought to 7-Eleven to improve our organizations. And in all begins with listening to our customers, empowering our employees, and learning from and with our franchisees. Serve. Lead. Do What Is Right.