انتخاب شرکا در یک سازمان بین المللی فرانشیز (فرانچایز)
|کد مقاله||سال انتشار||تعداد صفحات مقاله انگلیسی||ترجمه فارسی|
|2934||2006||21 صفحه PDF||سفارش دهید|
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Publisher : Elsevier - Science Direct (الزویر - ساینس دایرکت)
Journal : International Journal of Hospitality Management, Volume 25, Issue 1, March 2006, Pages 108–128
Whilst there has been research into the selection of partners in joint venture arrangements, there has been little investigation into the selection process involved in selecting franchise partners. This paper aims to provide an insight into the process of selecting potential franchise partners in the European Division of an international organisation. Interviews, observations and document analysis were used as qualitative data collection techniques. Findings suggested that the organisation employed both partner and task related criteria to select potential franchisees. However, the process of selection is not just about employing a number of selection criteria, it is a substantial multidimensional organisational activity which involves human dynamics. The paper discusses the real-life complexities of selecting franchise partners and illuminates the challenges franchising organisations face internationally in their determination to grow.
Business format franchising can be defined as ‘the granting of a license for a predetermined financial return by a franchising company (franchisor) to its franchisees, entitling them to make use of a complete business package, including training, support and the corporate name, thus enabling them to operate their own businesses to exactly the same standards and format as the other units in the franchised chain’ (Grant, 1985, p. 5). Originating in the USA, franchising emerged as a powerful new way of facilitating the growth of service organisations. Ingram (2001) states that the trend towards more franchised outlets seems set to continue around the world not least in hotels, restaurants and pubs. Lashley and Morrison (2000) also pointed out that business format franchising has become an established global enterprise trend within the service sector, in general, and specifically within the hospitality services sector. These two authors indicated that franchising has become a mature industry in the United States and well established in the UK and in the preface of their edited book, they recognised the growing significance of this business format. These authors showed forecasts that the number of UK franchised units will double from 66,670 in 2000 to 121,963 in 2002. In year 2000, the estimated number of franchised locations in the US is more than 320,000 in 75 industries accounting for $1 trillion in annual US retail sales. That is more than 40% of total sales. It is also estimated that franchising employs more than 8 million people in the US (New Business Centre, 2002). International franchising, gives those industries and organisations whose products cannot be exported (such as services) an opportunity for market expansion. From a business perspective, it involves less risk than some other means of internationalisation, notably direct investment (Aydin and Kacker, 1990). Although franchising is expanding faster and more vigorously than other forms with intensifying competition both domestically and internationally (Castrogiovanni and Justis, 1998), the internationalisation of franchise systems is under-researched (Quinn and Doherty, 2000). Several authors have proposed theoretical frameworks for investigation of the international franchising phenomenon (See Eroglu, 1992 and Karuppur and Sashi, 1992). Each of these investigations, whether descriptive or theoretical, conceptual or empirical, raises the basic question of how different international franchisors select and recruit franchise partners in different country markets. Little is still known about what happens after the decision has been made for an international expansion of franchise activities and to use a certain co-operative venture. The decision-making criteria used to select and recruit franchise partners particularly needs to be investigated because although the international collaborations have become increasingly important, many of them result in dissolution leading to adverse monetary and strategic effects because of the failure of organisations to select the ‘right’ partner (Madhok and Tallman, 1998). This paper aims to contribute to the filling of these gaps by presenting the empirical findings related to the decision-making criteria used in the process of identifying franchising opportunities and selecting franchise partners in different country markets. This paper particularly seeks to address the influence of cultural differences on the franchisee selection decision-making process, which, it is hoped, will both illuminate the challenges franchise organisations face internationally and highlight the options that companies may consider as part of their growth strategies. The paper begins by reviewing the literature around the concepts of international franchising and partner selection. It then describes the research process. The findings are then discussed by means of two underlying themes with regard to the franchisee selection process—first prospective partner identification in different country markets and, second, screening and selecting these partners in the organisation. Finally, conclusions are drawn about the franchisee recruitment process and the selection criteria utilised, particularly in foreign markets.
نتیجه گیری انگلیسی
Franchising is seen as an important organisational activity both in the generic marketing management and in the service management literatures. In spite of its importance, literature on franchising continues to be vague and incomplete. Previous studies into domestic franchising developed a comprehensive understanding about the franchise and franchisor relationship in relation to power and control struggle after the establishment of the partnership (See Dewhurst and Burns, 1993; Morrison, 1996). International franchising literature evaluated the influence of different antecedents on the internationalisation process of franchise systems (See Eroglu, 1992; Karuppur and Sashi, 1992). However, there appears to be limited research into an organisation's actual expansion practices. The issue of how international organisations recruits their franchise partners and the decision-making criteria used to select the partners in particular are the key aspects waiting to be explored. This paper enables a deeper understanding of the actual decision-making processes and the human dynamics of these within an organisation. These dynamics take place not only inside the organisation, but outside in the market. The interactions between organisational members and prospective franchisees are particularly important in terms of developing a meeting of minds and making the international expansion happen. This paper strongly suggests that the interactions and the attempts to create a co-operative environment between the partners do not become established overnight. Instead, a significant part of the relationship develops before an agreement is struck and there is in fact a ‘mutual evaluation’ between the partners to assess whether there is a room for a long and happy ‘commercial marriage’. Disregarding these non-economic aspects of the practice means ignoring the real-world complexities of the organisation's international franchise activities. Having identified the real-life processes and complexities of international franchise that involve the dedication of a remarkable level of resources and activities, it can be concluded that internationalisation of a franchise system goes further than choosing a certain expansion mode and identifying the antecedents of international franchising. It is a substantial multidimensional organisational activity and, more importantly, it is not an easy straightforward process. In addition, as it has been mentioned before previous research into the partner selection has mainly focused on joint venture partnerships (Al-Khalifa and Peterson, 1999; Awadzi et al., 1988; Gerringer, 1991; Tatoglu, 2000). They therefore avoid serious linkage to the strategic context of franchise partnerships and the selection criteria associated with establishing these. The paper clearly demonstrates the strategic context in which franchisee selection decisions are taken and the partner selection criteria employed. Findings of this study suggest that there are three important contextual variables, which have a bearing on the franchisee selection criteria employed. These are the strategic context of the organisation, different country markets and the nature of the business itself (franchise partnership). The organisation employs both partner related and task related criteria to select partners. The emphasis placed on these criteria however differs in different stages of the decision-making process, for example, more emphasis is placed on partner related criteria during the early stages of the decision-making process and the partner related traits of the franchisees form a context for the organisational members to decide if the potential franchisees have the ability and the background to meet the task related criteria. As projects are assessed internally, organisational members start thoroughly analysing their organisation's expectations and compare the franchisees’ current and future task-related capabilities to those deemed necessary for franchise success. The ultimate goal is to bring the organisation's (franchisor) expectations into alignment with the franchisees’ traits and capabilities. Franchising products takes place in an international context and it is likely that this context will create or result in a number of barriers and problems to the international expansion process. The overall suggestion is that all the parties in the decision-making process should develop a better understanding of the internal and external environments in which a franchise organisation functions. The abilities, skills, experience and, more importantly, the commitment and the integration of the market based organisational members into the culture of the organisation, and the development of a certain degree of local awareness by the senior decision makers appear to be the key factors in the successful development of a franchise organisation. It is recommended, therefore, that a franchise organisation develops an appropriate organisational culture where top management and market-based organisational members cooperate and communicate effectively. Market-based organisational members could be trained in order to develop a better understanding of the strategic priorities of the organisation, and top management could be encouraged to socialise more in the market in order to increase their own local knowledge and awareness. In addition, franchising is an expansion mode, which appeals to international organisations, particularly service organisations. This is due to the low level of risk associated with these modes and the rapid growth opportunity they provide. However, as the findings indicated, implementation of this expansion mode is not a straightforward activity, especially in international markets. International organisations should therefore consider the opportunity cost of using this international expansion mode. Being more flexible and using other international expansion forms such as direct investment or joint venture partnerships might accelerate international expansion and open doors to wider market coverage. 6.1. Limitations and suggestions for future research As in any research project, this study has several limitations. For instance, the hotel industry has been chosen as the focus of the study, and the comparability with other industries is therefore questionable. Although the research findings have not indicated any substantial differences in terms of the international management of the hotel firms and other types of organisations, the findings of this research cannot be generalised. This study used a single case study approach and carried out in-depth analysis. It could be useful to choose a multiple case study approach, in order to increase the rigour of research and be able to complement the first study by focusing on an area not originally covered. In addition, this study was carried out in the Europe, Middle East and Africa region of the company. The international expansion practice of the participant organisation in other regions of the world may differ. The findings therefore are limited to an illumination of international expansion decision-making practice within Europe, Middle East and Africa. This study investigated the franchisee selection and the recruitment process of an international organisation. Further research could investigate the issue from the perspective of potential partners (franchisees) in the market. It could explore how franchisors are selected by franchisees. Further research can also identify intrapreneurial role and importance of organisational members in the process. Moreover, as organisations become larger and more complex the challenge for them will be to find a way to allow empowerment to nurture innovative, opportunity seeking, entrepreneurial employees, whilst encouraging accountability (Simons, 2000). Further research can shed light to how international expansion decisions are taken within the organisation and the possible control systems that could be utilised in the decision-making process. Finally, stakeholder theory is concerned with the strategic management of groups and individuals who can affect the organisation (Freeman, 1984). Another area that could have been explicitly explored further is the role that stakeholders play within the international franchise process. Further studies can aim to identify the stakeholders in an organisation's process of franchising their products internationally and evaluate how different stakeholder groups impact this process.