This study develops a new perspective on the franchisor’s choice of international governance modes as a value creation and value appropriation mechanism. Value creation refers to knowledge creation from the joint use of the franchisor’s intangible system-specific knowhow and foreign partners’ intangible local market knowhow; value appropriation refers to efficient knowledge exploitation based on transaction cost savings under conditions of uncertainty and transaction-specific investments. Based on primary data from 162 international franchise systems headquartered in eight countries, the results highlight the importance of intangible knowledge-based resources (franchisor’s system-specific knowhow and franchise partners’ local market knowhow) and transaction cost factors (transaction-specific investments, environmental uncertainty, and cultural uncertainty) for the franchisor’s choice between equity modes, such as wholly-owned subsidiaries, and joint venture franchising, and non-equity modes, such as single-unit franchising, area development franchising, and master franchising.

Governance of international franchise networks: Combining value creation and value appropriation perspectives / Jell-Ojobor, Maria; Hajdini, Ilir; Windsperger, Josef. - In: JOURNAL OF BUSINESS RESEARCH. - ISSN 0148-2963. - 139:February(2022), pp. 267-279. [10.1016/j.jbusres.2021.09.001]

Governance of international franchise networks: Combining value creation and value appropriation perspectives

Jell-Ojobor, Maria
Membro del Collaboration Group
;
2022

Abstract

This study develops a new perspective on the franchisor’s choice of international governance modes as a value creation and value appropriation mechanism. Value creation refers to knowledge creation from the joint use of the franchisor’s intangible system-specific knowhow and foreign partners’ intangible local market knowhow; value appropriation refers to efficient knowledge exploitation based on transaction cost savings under conditions of uncertainty and transaction-specific investments. Based on primary data from 162 international franchise systems headquartered in eight countries, the results highlight the importance of intangible knowledge-based resources (franchisor’s system-specific knowhow and franchise partners’ local market knowhow) and transaction cost factors (transaction-specific investments, environmental uncertainty, and cultural uncertainty) for the franchisor’s choice between equity modes, such as wholly-owned subsidiaries, and joint venture franchising, and non-equity modes, such as single-unit franchising, area development franchising, and master franchising.
2022
International governance mode, Franchising, Equity versus non-equity mode, Value appropriation perspective, Value creation perspective
Governance of international franchise networks: Combining value creation and value appropriation perspectives / Jell-Ojobor, Maria; Hajdini, Ilir; Windsperger, Josef. - In: JOURNAL OF BUSINESS RESEARCH. - ISSN 0148-2963. - 139:February(2022), pp. 267-279. [10.1016/j.jbusres.2021.09.001]
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Utilizza questo identificativo per citare o creare un link a questo documento: https://hdl.handle.net/11385/211799
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