Social franchising and the LEYF Experience


For those wonderfully supportive people who follow this blog, you may have noticed a gap in production; this is because I have been staying in the Shropshire Hills for a week.  It’s a place where I have no phone or internet network and, like many young people, I have a real sense of disconnect as I come to terms with being unable to commune with anyone except my husband and the Shropshire Hills.

The challenge of any blogger is choosing what to blog about; there is just so much irritating rubbish and nonsense that it’s hard to know what to opt for. And those who know me well will soon enough attest as to how I can rant about almost anything – lousy childcare, poor use of tax payers’ money, overblown tributes to poor services, Children’s Centres with nothing except some anecdotal stories as evidence, litter and the sense that no one cares if we ruin our own environment, apprentices and the failure to give them an education of real value, organisations that think they can be a social enterprise just by saying they offer a social value… But enough already, before this list itself turns into a rant!

The trouble with being away with only your thoughts and a mountain of books to read is that you have time to think – and in my case the woes of the world soon begin to weave a misty dissatisfaction into the crevices of my mind.  However, on a more positive note, as I am so often starved of quality thinking time in my daily job as Chief Exec of LEYF, being able to wallow in ideas and thinking like this is a great opportunity.

So, with all this glorious time on my hands, what are the questions I ponder most?  First of all, it’s if we at LEYF can really build a better future for London’s children: to what extent and how exactly does what we do everyday in our soon-to-be 22 community, workplace and Children’s Centre nurseries truly make a difference?  Can we then bottle this into a social franchise model that will genuinely work for others, offering a real alternative that is not just the ‘next big thing’ for social enterprise to do – and can we avoid the cynicism that followed the previous trend that saw so many organisations convert to CICs as a good way to brand as a social enterprise, a pattern now being pursued by some public sector organisations?

Having spent over a year examining social franchising as a means of growing our organization – with the simple aim of giving as many children as possible the ‘LEYF experience’ – we realised that replication through franchising is a very challenging and demanding strategy for growth. This is confirmed in the books about commercial franchises, such as McDonalds and Starbucks (two quite different approaches, each equally successful); such is the varied nature of my reading list!

However, LEYF has never been an organisation to let a bit of doom and gloom stand in the way  of progress, let alone social good; and personally I have always been a glass half full girl, taking an optimistic and positive attitude to most things.

So, rather than give up at the first or second hurdle, we started to look into new ways of understanding the full range of options in front of us.  Surprisingly, a bank then came to the rescue, in the form of six staff from RBS who are now helping us draft a robust business plan.  This has also strengthened our relationship with the bank; a position which may prove beneficial later on as we unpack the much-loved government ideas of payments by results, along with social impact bonds. At the same time, our relationship with our prime supporter, Middlesex University, remains strong and interest from policy makers heartening.

As we start to now roll out the franchise plan itself, we remain pragmatic (this has not become one of my rants quite yet); there is history in the sector which suggests franchising has a habit of collapse, whilst sustainability and quality issues naturally abound.  As with all new ideas (or new configurations on existing ideas), there are resistors, antagonists and a level of contention and competition; and where would we be without the harbingers of doom?

In fact, aside from confronting all the gloomy predictions, ensuring we cross every ‘t’ and dot every ‘i’ will be the only way forward if we are to have a strictly controlled franchise, both in line with our own industry legislation and covering every possible issue surrounding intellectual property.  On an even more practical level, and so perhaps most critically, we have to make sure the manual is absolutely perfect and the fee correct: we have noticed many failed franchises never set a correct fee and so have quickly become a drain rather than an asset.

So, we are interested in your thoughts about social franchising as a means of social replication.  Is it of interest to you?  Does it hit your rant list?  Would you do it?  Would you recommend it?  Would you want to be a LEYF franchisee? Would you come to a franchise tea party – does it have a Mad Hatter appeal?

As always, I love to hear your thoughts… so feel free to rant, blog, comment or simply share.

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  1. #1 by Jean Hudson on April 27, 2011 - 1:18 pm

    It is good to look at the bigger picture to expand and grow especially in this current climate but it is even better we adopt an ethical model for doing so as children and big business do they mix? I like the idea of social franchising as a means of growing the organisation because often when families leave Leyf Queensbourough to go to Colchester, Australia, Malaysia, Denmark etc they are often heard saying ‘I wish I could take the nursery with us.’ Leyf has an excellent model of quality and this is very much part of our intellectual property that is worth trading…June are we talking about world domination here!

    • #2 by June O'Sullivan on May 1, 2011 - 2:39 pm

      Thank you for this. I think we have some way to go to make everyone realise that franchising and businesses are not always bad things and can and do good. The social aspect of the franchising model is the challenge so we can show quite clearly how we do good. Franchising is definately a useful way to grow a business but in the case of LEYF, we also want to grow an idea and show how a concept of creating childcare services for mixed communities can , done right, give all children who attend the best of times but guarantees through its model that children who may be disadvantaged or come from disdavantaged families benefit and get a step up towards achieving their full potential.

  2. #3 by stewart thomson on April 27, 2011 - 9:50 am

    I think we do need to look at more ethically sound businesses. LEYF has no doubt an enviable brand of excellence in the delivery of high quality child care. The challenge is to retain the “brand” identity which has been build up over a significant period of time. The term social franchise is critical here and the need to differentiate between standard franchising which is about low cost expansion, maximising profit and a sustained brand image. The key for LEYF is to to convey the reason for the social franchising is to expand access to affordable high quality chlid care with all the quality standards associated with the brand. I am partisan though as a LEYF trustee!

    • #4 by June O'Sullivan on May 1, 2011 - 2:48 pm

      Absolutely, the idea of the social franchise is to get our LEYF model out to as many communities as is appropriate and ensure all children have a hugely good experience while guaranteeing that children from poorer and more disdvantaged backgrounds have the best experience. It’s shocking to realise that children from poorer backgrounds and neighbourhoods are still far more likely to get poor or just adequate childcare when we know from the various international research that these are the very children who cannot cope with poor quality experiences and are therefore doubly disadvantaged. Social franchising is about replicating a strong reputable brand through a solid business model and hopefully getting the LEYF experience to more children. Its ambitious and not without risk, but the alternative is to grow by opening more and more nurseries ourselves or do nothing. Right now, we have to look at the best way to ensure that growth and keep LEYF’s integrity and I am glad you as a trustee understand and support our effort to examine the franchise route.

  3. #5 by Karen Drury on April 26, 2011 - 7:32 pm

    I’m a bit disturbed that Starbucks is being held up as a socially considerate brand; 97% of its water brand is completely for profit, despite being presented as a charity brand. Starbucks is for profit (its most recent results have just been announced), not for social good. In the UK, Starbucks makes a habit of opening stores without planning permission and putting local venues out of business.

    Perhaps more worrying is the idea that replicating the sort of service that Leyf offers is the same as replicating sales of coffee.

    • #6 by June O'Sullivan on May 1, 2011 - 2:59 pm

      When reading the book Pour your heart into it, I was struck by a number of ideas Howard Schultz refers to as lessons he learned while trying to grow a company. They are in fact standard good organisational practice such as his ideas about giving staff training and support, lessons he learned which now ensurehe gives staff chances to develop and test new ideas, the succuccessful and unsuccessful ways to engage with the CEO as the company grows. Starbucks is not a franchise. It is very critical of franchsies but it does recognise, whatever its business model the importance of brand integrity, staff engagement and communication when growing a company whatever model you use. Its that element of Starbucks I refer to in my blog and which I found helpful when considering growing a company . Interestingly. Ray Kroc in his book about MacDonalds identofied some similar advice. He was much more helpful when it came to franchises, as like them or not, MacDonalds has certainly got franchising down to a fine art. At LEYF, the big task is to examine and develop a franchise model which can offer a sustainable business model, if we learn from other organsiations then we can adapt our particular LEYF way of doing things to get the social benefit and extend that benefit so more people can access it. No doubt, we will challenged as we forge our way, and the more that happens the more we can scrutinise and reflect and in the end get a better and stronger result.

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