The Secret to Growing Great Clips

Mike RozmanFranchise Finance

Ray Barton, Chairman, Great Clips

Imagine you are the franchisor of a relatively small upstart franchise brand and you are on stage at your very first franchisee convention. You look out at your franchisees and see a system that has 150 units and is adding about ten per year. How would you feel about announcing that your brand will reach 3000 units in the next 13 years? If you are Ray Barton, CEO of Great Clips, you would feel a great sense of hope; hope that the prediction is taken up as a guiding vision for your system. And in hindsight, if you are Ray, you feel entirely vindicated (even if you were a few years behind schedule).

Ray was deploying a tactic management gurus refer to as a “Big Hairy Audacious Goal” – or BHAG – whether he knew it at the time or not. The BHAG concept (pronounced BEE-hag) was popularized by Jim Collins and Jerry Porras in their 1994 book, Built to Last, and Barton’s successful use of it is a reminder to all business leaders who seek growth that a BHAG is a concrete way to cut through the noise in order to get to what’s important.

Ray’s BHAG: 3000 units by the year 2000, or as it became universally known at Great Clips: “3000 by 2000.” And it was naturally adopted as part of the company’s very culture. Ray’s wife, Mary Lou Barton, an active Great Clips franchisee to this day, summed it up perfectly when she admonished her husband in her midwest accent, “Ray, you have to stop talking about these 3000 units, people are starting to believe you!”

The challenge, of course, is not words, but rather the actions: what must a business do to actually achieve the BHAG. Great Clips, for instance, invested heavily in a rifle development strategy which called for heavy concentration in a given territory. No franchises would be sold in territories that were not ready for development. How many franchisors are willing to say no to a franchisee fee? Great Clips did regularly, for they believed growth outside the rifle strategy was inconsistent to achieving their BHAG. Their plans and strategies were directed to achieving their BHAG… exclusively! Quite simply, they towed the line and stayed true to their BHAG with the discipline of a trained soldier. And it worked.

So if you seek sustainable growth, consider setting a BHAG as an inspirational, yet concrete, guiding vision. But like Great Clips, be prepared to make the investments in people, process, and technology to position your organization to achieve it.