Controls Can Be too stringent.
In a belated attempt to improve standards and tighten corporate control McDonald's instituted the controversial Franchising 2000. Among other things this called for grading franchisees, with those receiving the lower grades being penalized. McDonald's also wanted to take away any pricing flexibility for its franchisees: All restaurants now had to charge the same prices, or risk losing their franchise. Not surprising, some franchisees were concerned about this new"get tough" management Can controls be too stringent? As with most things, extremes are seldom desirable. All firms need tight controls over far-flung outlets to keep corporate d maintain a management alert to emerging problems and opportunities an desired image and standard of performance. In a franchise operation this is all the more necessary since the company is dealing with independent entrepreneurs rather than hired managers. However, controls can be rigid that no room is left for special circumstances and opportunities. If the enforcement is too punitive, the climate becomes more that of a police state than a team work relationship with both parties cooperating to their mutual advantages. This brings us to the next insight for discussion.