CEO to CEO: Franchisee Success

Hi-5 ABA franchisees experiencing dramatic success from early in the process draw the attention of those interested in the why and how. What are successful franchisees doing right?

A comprehensive review of franchisee histories across the board, including thoughtful consideration of KPIs, quickly highlights six major differentiating factors for success in the field of ABA.

1. Location. When contemplating where to plant wheat, or orange trees, or marigolds, the wise farmer carefully considers soil and climate. Are the climate and environment conducive to growth?

Other success factors addressed below—Communication, Training, Vision, and Competencies—are more subject to adjustment/development as a business grows; the Location factor is more fixed from the get-go.

No matter how good the seed, or the gardener’s expertise and ongoing attention and care, pineapples don’t grow well in Siberia.  Location is a fixed parameter to clarify before laying the foundation of any business.

 

A franchisee positioned in a suburban area of a state like VA, CA, FL, or MA, which has decent Medicaid reimbursement rates, is geographically positioned for success.

Rural practices may benefit from lower wage requirements, but face challenges when it comes to finding both clients and personnel. Keeping travel time at minimal- to moderate-levels is also a make-it-or-break-it factor for many franchisees.  Long travel times (averaging more than 20 minutes from home to client) not only generate direct expenses related to mileage and travel time, but reduce potential for billable hours and erode employee commitment. Tight geography crucially supports profitability.

2. Analysis, Risk-Assessment and Decision-Making. Many clinicians have strong analytical skills. They are analysts by both trade and education, after all.  Analyzing risk/reward in the face of both danger and opportunity is the first step toward decision-making.  But analysis alone can become an infinite exercise because there is typically no end to the research and discovery of additional pertinent data.

Risk-assessment is about discerning what information is sufficient to take any given step toward a goal. “Sufficiency” occurs when the net likely value of taking a step exceeds the value of waiting for more data.

For example, hiring new techs involves weighing the potential for deploying them profitably against the costs of recruitment, training, supervision, and the probability that they will not work out as employees (for whatever reason(s)).

If the gross profit margin is low (say, less than $3/hour net revenue after total cost of employee), then you need a high probability estimate that the prospective employee will work out. Maybe they are likely to sit for the BCBA exam soon, or you need them on your team for other reasons than simply adding billable hours.

By contrast, if the gross profit margin is high (say, $7/billable hour or better), then you have more reason to take more risks hiring more clinicians.

The key consideration here is that decision-making occurs amidst multiple uncertainties. The pure analyst is aiming to maximally reduce uncertainty. The good decision-maker (executive) is rather looking to maximally reduce the time required to make any decision which (even marginally) advances the organization’s goals.

Running a business involves the ongoing simultaneous navigation of multiple analysis/decision processes.

To avoid costly delays within the business life of each employee and each department, the CEO/COO must perpetually attend to discerning how much information is necessary to make incremental moves which allow the organization to develop and maintain momentum. If the analytical function dominates, the CEO will naturally delay hundreds of small decisions which destroys momentum and can easily cripple any organization’s prospects for success.

Jeff Bezos reportedly embraces “the 70% rule”—make a decision when you have about 70% of the data you’d like to have. Many decisions require less information than 70%, but may depend critically upon one or two pieces of information which make or break the proposed direction.

Ultimately the business of a CEO is what the title conveys—a CEO is the chief officer responsible for executing a business plan. Execution of plans is all about managing decision trees which prioritize, categorize, and guide the decisions made by every person with respect to each goal and project within the organization.

Any lapse or delay in the CEO function creates waste, loss, and inefficiencies for the entire enterprise. A good CEO makes decisions quickly, but is always mindful of ideal execution-timing and how ongoing data may accentuate risks which will consequently require future course adjustments.

Like a ship captain, the CEO must toggle repeatedly between the big-picture function of steering the ship in the face of obstacles and weather and the internal issues of overseeing ship personnel and providing direction to facilitate smooth onboard operations. Lots and lots and lots of decision-making. All day every day. If decisions are sound, timely, and well-communicated, the likelihood of enterprise success is substantially enhanced.

3. Team-building/Bonding/Communication.  Business is a team sport. Team-building is a profound art, requiring a complex skill-set and years of experience to hone.

Franchisees who build relationships with both franchisor personnel and their own clinical staff lay a groundwork of stability which allows them to grow a stable organization and avoid many of the horrors which arise from surprise resignations and chaotic finger-pointing when things go wrong. And things do go wrong in every business, just as they go wrong in every home and in every life.

Bonding involves the formation and maintenance of a heart-to-heart connection between two people—a connection which enables a continuity of trust and growing mutual appreciation, a connection which both parties protect by investing the time and care necessary to understand one another’s concerns, creatively search out ways to meet needs, and work through differences as they arise.

Many success-factor lists, regardless of industry, begin with communication as the most important characteristic of a healthy business culture. But communication is only as good as the connection between the parties. As pairing is prerequisite to good ABA treatment-plan execution, bonding is prerequisite to every successful business relationship.

In the day-to-day business of relating to dozens of people and often handling multiple crises, immediate responses to inquiries, complaints, demands, etc., aren’t always possible. However, immediate responses are often powerful catalysts toward action.

Communication delays, even of short duration, can destroy momentum and destroy valuable opportunities altogether. A culture which prioritizes pairing with personnel (and clients/parents) and the ongoing rapport which keeps pairing fresh, strengthens readiness for communication which effectuates the prompt actions necessary for success.

The breadth and efficacy of communication channels between franchisees and Hi-5 ABA/Processing/Clinical Consulting personnel are nearly 100% correlated with franchisee success.

The one or two exceptionally successful franchisees who don’t maintain high levels of interaction with the Hi-5 ABA organization nevertheless do communicate promptly as needed/requested; they simply have such a high level and strong range of independent competencies that they are effective with less input.

The great franchisee solo artists could, however, benefit from more interaction with our team. We are perpetually developing new systems, trainings, and support aptitudes, which are only accessed through ongoing engagement and awareness.

Hi-5 ABA/Processing/ABC Behavior personnel don’t just credential, bill, collect, provide advances, handle payroll, assemble employee files, and assist with audit prep. We facilitate staff and client referrals, cultivate relationships with payers, experiment with multiple forms of advertising, assemble KPIs, develop business plans and cash flow projections, coach franchisees through a range of management challenges and strategies, and watch out for changes in the industry both nationwide and state-by-state. And we cultivate the aptitudes of many specialty personnel. It still amazes me, with frequency, how problems which first appear outside of anyone’s control or influence get resolved easily when the right experts are engaged.

4. Training. Grasping and digesting the systems, policies, and procedures of any complex organization requires a substantial investment of time and attention. Hi-5 ABA is no different.

Franchisees who skip learning CentralReach, or the sequence of steps required to effectively credential with an insurance payer, obtain a client authorization, confirm terms of coverage, know their reimbursement rates, learn how our ticket system works, fully vet and document each tech, complete session notes, promptly submit timesheets, etc., can experience excruciating delays, disappointments, and losses.

Our system is collaborative. We have specialists in multiple disciplines with whom franchisees should develop active relationships early in the process.

The Clinical Consulting team includes individuals specializing in client recruitment and onboarding, personnel recruitment and onboarding, tech supervision and training, parent training, domestic violence and other threatening situations, interacting with DSS and the courts, complaints to the BACB and/or licensing authorities, team development, and more.

The Business Development team includes individuals specializing in marketing, advertising, website presence/development, cash flow analysis, business planning, financial analysis and projections, contract designs and negotiation, etc.  Even the relatively basic functions of credentialing, billing, and payroll, have their own complexities which are often unique to the jurisdiction or payor.

Too many franchisees, unfortunately, don’t want to spend the time necessary to review insurance manuals, design additional forms necessary in their state, or otherwise build out their grasp of how our systems work.

Neglecting small steps, such as obtaining a full and proper authorization, taking good session notes, promptly submitting timesheets, or failing to build rapport with the correct individual needed to help with a given aspect of establishing a new practice, will delay and potentially torpedo the success of an otherwise promising franchise.

5. Vision. “Where there is no vision, the people perish.” (Pr. 29:18a) We sacrifice and endure hardship because we have a vision—a hope and a plan which promises a result more than worth the cost.  Successful ABA providers care deeply for their personnel and their clients. The best aren’t simply competent. They aren’t even just diligently devoted to a career.  They have a calling and it becomes a life purpose—a reason for being…not the only reason to live, but a major purpose which provides profound meaning to their lives.

Vision isn’t singular with respect to purpose or individual. Vision is shared. It is cultivated. Healthy collaborative vision incorporates and synthesizes the goals and needs of everyone on the team—every staffer, every client, every parent, and every associated organization (including the Hi-5 ABA group, local physicians, teachers, social workers, related service providers, and even other local ABA providers).

The larger, more inclusive and relationally-developed your organization’s vision, the more streams of mutually-inspired support everyone on your team will enjoy. The dynamics of mutual effort and mutual benefit represent the glue which builds lasting relationships. And lasting relationships are of primary concern to successful entrepreneurs playing “the long-game.”

6. Commitment and Competencies—Business, Clinical, and Personal. Novices don’t know what they don’t know. Some with professional credentials, even after decades of experience, remain novices in this sense—relegating them to dysfunctional perspectives, management styles, and poor results.

Those who are not afraid to face deficiencies, who are curious and love learning, grow increasingly comfortable in identifying, acknowledging, and exploring their limitations, blind spots, and need for close engagement with the expertise of others. They remain learners, gradually developing aptitudes and eventual mastery as teachers.

Ultimately, the competencies involved in cultivating a successful ABA practice are not the owner’s personal competencies, but rather the composite competencies of the owner’s team. And the effective integration of those team members together into trustworthy, long-term, mutually-rewarding relationships.

There is no substitute for time and experience when it comes to building a powerful, winning team. Prioritizing relationships over short-term profitability is essential. And that includes relationships with those who leave or live outside your organization.

No, a business won’t survive if it doesn’t make money. The basic business plan should have plenty of solid profit expectation built in. But make sure there is also plenty of margin to take time for that tech who gets sick, is having marital trouble, or is verging on burnout.

Make sure that the BCBA you thought would join you but doesn’t, or the one you thought would be with you forever but leaves after six months, knows you still care about them and their career—that your interest in their welfare wasn’t merely your own self-interest.

We serve in this small, young, but vital ABA industry together. If we are diligent and faithful, our leadership and influence will grow. Let us humbly aspire toward professional excellence and statesmanship.

Let us also welcome and support those who want to make a difference, whether they do it in our shop or set up a clinic across the street. Let us not become distracted by secondary or tertiary concerns—politics, lifestyle choices, religion.

Those who work together, who are mindful of others beyond themselves, will prosper. Those who get lost in fear, anxiety, insecurities, or excessive competitiveness, will ultimately tend toward discouragement and burnout. My prayer is that people like you will help to keep them in the game.  The fields are white unto harvest. We need more laborers to help more families.

Thank you for reading…and for all you do toward promoting and providing ABA services to those who need them everywhere. Godspeed.