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Franchising’s Very Own Herman Cain

GOP presidential candidate Herman Cain, former Godfather Pizza CEO
GOP presidential candidate Herman Cain. photo/gage skidmore

It's been a meteoric rise. Former franchisor CEO Herman Cain, whose father was a janitor and mother a domestic worker, is in a statistical tie with fellow presidential candidate Mitt Romney. According to the most recent CNN/ORC International survey (pdf), Romney leads Cain 26 to 25 percent, well within the margin of error of 3 percentage points.

Who is he?

Herman Cain's career has been shaped by franchising. If he became President, that would make three Presidents in a row that have worked in franchising. First, there was George W. Bush, a franchisee of the Texas Rangers baseball team. Then came President Barack Obama, whose first job was as an ice cream scooper in a Honolulu Baskin-Robbins franchise. Now it might be a franchisor's turn.

As the regional vice president of Pillsbury's Burger King division, Cain spent time "dodging grease fires and broiling hamburgers," according tohis website, HermanCain.com. Under his leadership a low-performing Philadelphia region of 450 Burger King quick service restaurants rose to become one of the franchisor's best within three years.

Cain was appointed president and CEO in 1986 of Pillsbury's troubled subsidiary, Godfather's Pizza, as the franchisor teetered on the edge of bankruptcy. The chain had grown rapidly and then taken a nose dive. Profits crashed and franchise owners were up in arms.

After a drastic downsizing in which the firm became profitable, Cain and his management team acquired Godfather's in a leveraged buyout

How does he lead?

Last week the Omaha World-Herald interviewed former Godfather colleagues and franchisees to get a sense of Mr. Cain's leadership style. Reporter  Steve Jordon writes,

"Cain said he wouldn't spend advertising dollars on out-of-date restaurants with poor operations, so he told franchise holders to renovate their restaurants and bring operations up to date. 'If they didn't make that investment, upgrade their operations, I didn't have to shut them down. They shut themselves down." It was the pizza version of what Cain calls the 'wagon speech' that his grandfather used to give family members when he was going into town: "Them that's going — get on the wagon. Them that ain't — get out of the way.'"
"He was a great leader," said John Chisholm of Omaha's Rigel Corp., a large and early Godfather's franchise holder. He said pre-Cain leaders had gotten away from restaurants and food, instead focusing on finances. "Herman helped very much as far as getting us back to the basics," Chisholm said, and in recognizing that some franchise holders "shouldn't have been in that business."
"Herman did some good things, but other people contributed to that as well," said Gary Batenhorst of Omaha, who has been an attorney for Godfather's since the Willy Theisen [founder] days. "Ron [current CEO Ronald Gartlan] obviously had a very significant amount to do with things getting back on track. Herman made contributions as well."

His position as CEO focused on working with small business owners, Main Street. ABC News reports that Spencer Wiggins worked for Cain at Burger King and followed him to Omaha. According to the article, "Wiggins said Cain urged his other employees to get into the kitchens themselves – which Cain did as well – and help make pizza. He used motivational speeches to help the downtrodden employees and franchise owners and catchy phrases, such as telling his employees to SIN or 'solve it now.' . . . At Godfather's, Cain closed down low performing franchises as CEO, Wiggins said, but he was able to 'turn the ship around.' The company lost jobs then but, Wiggins said, Cain created more than he lost under his stewardship."

In 1987, Cain predicted that the chain would have 1,200 locations by 1990, but that never happened. He stepped down as CEO from the Omaha, Nebraska-based franchising firm in 1995, but remained chairman for several more years. According to the Godfather's Pizza website, as of June 14, 2011, the chain had 622 locations in 39 U.S. states.

The right sound bite at the right time

In 1994 Cain became president of the National Restaurant Association, a lobbying group for America's restaurateurs. As the Association's head, he spoke with President Clinton at a nationally televised town hall meeting. President Clinton said that the new health care bill would not harm American business owners and their employees. "Quite honestly, Mr. President, your calculations are incorrect," Mr. Cain replied on television. "In the competitive marketplace, it simply doesn't work that way." Newsweek named Herman Cain the primary saboteur of Hillarycare.

Cain was appointed in 1994 as a board member of the Federal Reserve Bank of Kansas City, Missouri. He hosted a radio talk show on Atlanta's WSB 750 AM /95.5 FM, "The Herman Cain Show," until February 2011.

Song and dance


Video of Herman Cain while CEO of Godfather's Pizza. Courtesy Omaha World Herald.

These sorts of cheesy song and dance routines, like Mr. Cain's video above where he changes the lyrics of John Lennon's "imagine" song to words themed around a brand, are farily common in franchising.

One leader in the franchise world thinks Cain's singing can be bonding for franchisees and corporate leadership. Attorney Bob Purvin, CEO and chair of the two-decade old American Association of Franchisees and Dealers, jokes of the chorus line (above): "If I had choreographed it, it would have been much shorter!"

The AAFD, a trade group that advocates franchisee-friendly contracts and fair franchising practices, is noted for annual dinner galas where Purvin, franchise store owners and executives of franchising corporations come to the stage in top hats or cowboy outfits to sing and dance about fair franchising. Purvin adds a practical note of why these things are used in franchising, where franchisees and franchisors can often be at odds with each other. "I do believe music and song can bring humanity and civility to many discussions, and helps to bring perspective to a world that is all too serious," he says.

Who knows? If Cain is elected president of the United States, he may reach into that old franchising tool bag and get divided Republican and Democrat lawmakers to sing and dance together for a brief moment on CSPAN — complete with coattails, top hats, canes and sexy leg kicks.

Well, maybe not.

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