Paul Orfalea founded Kinko's in 1970 and led it until 2000. He is co-author of The Entrepreneurial Investor: The Art, Science, and Business of Value Investing.
QWhat were the biggest challenges in trying to control the look and feel of individual outlets while expanding to more than 1,000 locations?
Nurse Next Door
When we started out, the color of a Kinko's store was determined by what was on sale at the local paint store. Later, we branded the company so that every store looked similar. But the biggest challenge is not controlling the look and feel of individual stores; it is deciding what you must control and giving up the rest.
I could have dictated anything, but once you start doing that, you demoralize your work force and end up having to dictate everything. You want your employees to make good decisions for themselves. So decide right away what few things you must control and leave everything else to local employees and customers.
A company's culture is more important than the color of the counters in a store -- and that's what you should strive to replicate across your business. I think effective culture-building can be summed up in three words: frequent flier miles. I was always in the stores and so were my co-founders and managers, who were required to spend at least 50 percent of their time in the stores. We roamed from store to store, telling workers what we liked about their branch and what cool things we had seen at other locations. We listened to employees, and then we pitched their ideas around the company.
There are three important things to remember during rapid growth. First, devote your time and energy to the environment and the culture rather than the vendor contracts, operations challenges, and the like. Second, happy fingers ring happy cash registers. Recognize and reward the contributions of the employees who are closest to the customers. And third, participation builds strong feelings of ownership.
Encourage debate and discussion to keep your co-workers engaged. We held frequent employee meetings to encourage open communication. We had idea contests with lucrative prizes, and once a year we would send a winning store's co-workers to Disneyland. And the company's top executives would work in their place.