Don't Confuse Leadership and Management

"We thought she was ready."

That's what Marcus, a multi-unit franchisee in the Southeast, said when he promoted his highest-performing general manager to a regional role overseeing four stores.

She had the best sales numbers, ran a tight operation, and was the go-to for solving store-level issues. On paper, she was the obvious choice. But six months into the new role, Marcus noticed something was off. Employee turnover started creeping up. Store managers complained they felt micromanaged or unsupported. Team morale dipped and so did performance.

It wasn't a failure of effort; it was a failure of fit.

Marcus realized too late: He had promoted a great manager into a leadership role without developing the skills needed to succeed in that space.

What she lacked wasn't competence; it was the ability to lead across locations, communicate vision, and develop other leaders. And what it cost Marcus was more than operational disruption. It delayed his growth strategy and weakened his confidence in his own succession plan.

In a multi-unit franchise operation, this kind of misstep doesn't just impact one location. It can ripple across your entire system. And it often comes down to one overlooked truth:

Great management does not equal great leadership.

When you're scaling fast and managing multiple units, you need more than strong managers. You need people who can carry your vision, values, and standards across your organization. If you're only rewarding execution, you're unintentionally building a leadership gap—and weakening your succession bench.

The key distinction

Managers ensure today runs smoothly. Leaders ensure tomorrow is better. In a single-unit operation, strong management can carry the day. But as a multi-unit owner, you can't be in every store, every day.

You need leaders who can:

• Develop others
• Make values-based decisions
• Model behaviors
• Solve problems without always escalating them to you

Promoting based solely on operational success often leads to unit-level burnout and inconsistent execution and culture breakdowns across locations. A leadership team should guide people and performance, not manages tasks. Promoting the wrong leaders can create a fragile succession pipeline when you're ready to step back or sell.

Common mistakes

Many franchisees unintentionally stall growth by promoting high performers who haven't been trained to lead. It's a case of rewarding short-term results over long-term thinking and mistaking loyalty or tenure for leadership potential.

You need to develop internal leadership capability as the organization scales. Reality check: If you're still the one that team members come to for all major decisions, your organization isn't scalable; it's dependent.

Not sure where your team stands? Take this free three-minute Franchisee Growth & Succession Planning Assessment to identify gaps in leadership, team development, and business structure.

Leadership model

Here's what distinguishes emerging leaders from excellent managers in your system:

• They develop people, not just processes.
• Leaders coach others, build depth, and create stability even when they're not present.
• They think beyond their store.
• They understand how their decisions affect the broader organization and make choices aligned with enterprise-wide goals.
• They take responsibility.
• When something goes wrong, leaders own it. They don't blame the system, the staff, or the franchise; it's about reflection, learning, and adapting.
• They embody your "why."
• Leaders connect the dots between your personal vision and the daily work. They don't just enforce standards; they live them.

Pro tip: The best leaders in a multi-unit operation don't need to be micromanaged. They extend your influence, not your workload.

Shift your culture 

To build a scalable organization and prepare for future transitions, you have to start rewarding the right behaviors.

Here's how:

• Develop a leadership track inside your organization that's distinct from operational management
• Create performance reviews that evaluate coaching, decision-making, and team development, not just metrics
• Assign cross-unit leadership projects to identify who can think beyond the four walls of their location
• Offer coaching and mentorship, especially to GMs and area managers who show strategic thinking or culture-building skills

Key insight: Leadership development is succession planning in motion, and it's one of the most powerful ways to protect the value of your business.

Take the next step

If you're building or growing a multi-unit operation, your success hinges on more than just operations; it depends on people who can lead with your values when you're not in the room.

Download The Franchisee's Guide to Growth & Transitions, an in-depth guide that includes tools, assessments, and strategies to help you identify and develop leaders, prepare for ownership transitions, and scale your business intentionally.

Kendall Rawls with Rawls Succession Planners knows and understands the challenges that impact the success of a complex, privately held, and family-owned business. Contact us today to arrange a consultation and discover how we can empower you to overcome obstacles and achieve lasting success. Whether you're navigating regulatory shifts or striving to build a top-tier team, we're here to help you thrive in today's multi-unit franchising landscape. For more information, visit seekingsuccession.com or email kendall@rawlsgroup.com.