Abstract
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This paper aims to identify the driving variables in the franchise decision to expand abroad. It also explores the effect of a set of factors on the intensity of the…
Abstract
Purpose
This paper aims to identify the driving variables in the franchise decision to expand abroad. It also explores the effect of a set of factors on the intensity of the internationalization process pursued by franchise companies. To achieve this goal, the author considered the following variables: the role of management and franchising experience, brand awareness and the sector of activity (product versus service). The international franchise ratio and the size of the chain were also considered.
Design/methodology/approach
This study uses a quantitative approach applied to the Spanish franchise system, which occupies the second position in Europe in terms of the number of franchisee outlets (65,810) and the first position in Europe in terms of the number of franchisors (1,232). Moreover, in early 2016, a total of 302 Spanish chains were doing business in 137 foreign countries with 20,891 outlets established abroad. Data were obtained from secondary sources (i.e. the Spanish Franchise Association, the leading Spanish franchising Consultant Group, etc.) The most important international franchising associations were also considered. Multiple regression analyses were used to test the research hypotheses.
Findings
Results conclude that that franchisor’s brand awareness plays an important role in the decision of becoming a global franchise chain. In addition, the franchising experience, business orientation (product versus service), the international franchise ratio and the company size have significant impacts on the intensity of the internationalization process pursued by the franchisors.
Originality/value
The scant attention given to this topic has usually been examined from the US and British base and has focused on a reduced number of sectors of activity such as hospitality and manufacturing doing business in a single region (i.e. developed or emerging nations). To fill this gap, this work analyzes the international spread of the entire Spanish franchise system, which in early 2016 had presence in 137 foreign countries and operated in a total of 52 different sectors of activity.
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Alexander Rosado-Serrano, Teresa Longobardi and Justin Paul
The purpose of this paper is to examine whether operating countries influence restaurant franchising system performance and what would be an optimal international franchise…
Abstract
Purpose
The purpose of this paper is to examine whether operating countries influence restaurant franchising system performance and what would be an optimal international franchise proportion.
Design/methodology/approach
The authors observed ten publicly traded franchise firms that operated between 1995 and 2015. Data analysis is conducted through a generalized linear model (GLM) of panel data.
Findings
The model confirms a curvilinear U-shaped relationship between international franchise expansion and firm performance, similar to domestic franchising. The authors found that international franchisors have a higher optimal franchise proportion than domestic franchisors. The authors did not find that operating countries influence firm performance.
Originality/value
This study contributes to franchising literature by expanding limited empirical studies on international franchising. It provides practitioners with a new optimal franchise proportion at the international level.
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Nabil Ghantous and Shobha S. Das
The purpose of this paper is to investigate international franchise performance. It focuses on how franchisors conceive their international performance, the drivers of their…
Abstract
Purpose
The purpose of this paper is to investigate international franchise performance. It focuses on how franchisors conceive their international performance, the drivers of their international performance, and how age-at-entry moderates the impact of their resources and capabilities (R&C) on international performance.
Design/methodology/approach
Using the lens of the resource-based view of the firm, the authors build on franchisor voice from a qualitative study (n=28) to propose a research model of international franchise performance. A second, quantitative study (n=89) tests the model with PLS structural equation modeling.
Findings
Franchisors view international performance in terms of relationship satisfaction with foreign franchisees and performance in comparison to competitors. The empirical results show that relationship satisfaction significantly improves comparative performance. Both franchisor-owned resources, the brand and knowhow, enhance only comparative performance, while all three international relational capabilities, related to knowhow transfer, monitoring, and contract design, and both reconfigurational capabilities, related to organizational responsiveness and innovativeness, improve relationship satisfaction. Only contract design and innovativeness increase comparative performance. Finally, late internationalization reinforces franchisor ability to leverage relational and reconfigurational capabilities for better relationship satisfaction.
Originality/value
This paper contributes to research on international franchise performance. It uses a mixed-method design and offers the first quantitative investigation of the drivers of international franchise performance. This research also integrates the role of franchisor R&C with franchisor strategic choices, through the moderating effect of internationalization timing.
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Serdar Ulubeyli and Dilek Yorulmaz
The purpose of this paper is to report the possible impact of intellectual capital (IC) on firm reputation (FR) and investigates if there is a relationship between FR and market…
Abstract
Purpose
The purpose of this paper is to report the possible impact of intellectual capital (IC) on firm reputation (FR) and investigates if there is a relationship between FR and market internationalization (MI).
Design/methodology/approach
The data were collected from engineering consultancy firms (ECFs) in Turkey. The study employed structural equation modeling to examine the hypothesized relationships between IC, FR, and MI of ECFs.
Findings
ECFs with strong human and structural capital can have a good FR. However, healthy relational capital may not lead to the same effect on FR. On the contrary, FR can create high-quality relational capital for ECFs. Lastly, a good FR, based on robust human and structural capital, can provide the success of ECFs’ MI process.
Research limitations/implications
This model may be analyzed for other knowledge-intensive business services. Also, subsequent researches may investigate potential variations in results about other sectors and geographical areas. Moreover, various constructs may be included in the model. However, a greater number of samples could lead to distinctive outcomes.
Practical implications
The research may be a general guide for related professionals and their companies to build long-term strategies, given IC, FR and MI. In this respect, they should take into account human and structural capital for MI.
Social implications
ECFs that can be active in the international arena may maintain their services by financial sustainability. Thus, the advantage may result in a prosperous society.
Originality/value
The study is first to suggest a model joining IC and FR for the MI process of ECFs. This is suitable for competition of ECFs that are willing to be sustainable firms.
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Pedro Lucas de Resende Melo, Julio Araújo Carneiro-da-Cunha and Renato Telles
The purpose of this paper is to understand the relationship between franchisee support and brand value in micro-franchise chains. This study aims to understand the importance of…
Abstract
Purpose
The purpose of this paper is to understand the relationship between franchisee support and brand value in micro-franchise chains. This study aims to understand the importance of value delivery in support to the micro-franchisee aiming at increasing brand value.
Design/methodology/approach
The sample was composed of 148 micro-franchisees belonging to 70 chains located in Brazil. The questionnaire aimed to verify the franchisee’s degree of concordance with the support and brand value provided by the franchisor through a Likert scale. The questionnaire structure comprised of ten metrics associated with franchisee support, four metrics associated with the brand value perception and four potentially intervenient metrics. A regression analysis was carried out to confirm the results for the factor analysis, assuming that the three factors associated with support as independent variables and the brand factor as a dependent variable.
Findings
The three factors related to franchisee support were found to be significant predictors of brand value. Based on the values of the coefficients, it is possible to infer the positive nature of the association. An increase in franchisee support leads to an increase in the franchisee perception about brand value. The positive effect of training and franchisor’s support in prospection and installation improvement on the brand value evaluation by franchisees was supported by the statistical analyses conducted.
Research limitations/implications
This research complements the studies on brand citizenship behavior and franchisee brand commitment; the greater the support provided to the micro-franchisee, the greater its commitment to the brand values of the chain. This contribution is critical because we deal with micro-enterprises in a business environment with an intense resource scarcity. These aspects place restrictions on the delivery of support and brand value in these franchise chains.
Practical implications
Structured support plans and greater approximation with franchisees seem to be alternatives for this perception of value to be increased in micro-franchise chains. The attractiveness of a micro-franchise chain can be enhanced if the franchisor is able to show to its potential micro-franchisees that it offers adequate support for its business; and also for the capture of new micro-franchisees.
Social implications
The social implications aimed at entrepreneurs with low financial expenditure. The sustainability of these businesses is highly relevant in the case of emerging markets given the high rates of unemployment and informality. Hence, micro-franchises become one of the means for micro-entrepreneurs to enter the job market.
Originality/value
When dealing with micro-franchises, there is an intensification of this scarcity of resources due to the smaller amount captured by the franchisor, as well as the lower technical level found in the franchisees. The relationship between brand value and the perceived level of support and the consequent franchise satisfaction with the chain in franchises, symbolized by brand citizenship behavior, is still little studied, and there are promising new studies, especially on the different types of franchises.
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Stephanie Fabri, Lisa A. Pace, Vincent Cassar and Frank Bezzina
The European Innovation Scoreboard is an important indicator of innovation performance across European Member States. Despite its wide application, the indicator fails to…
Abstract
Purpose
The European Innovation Scoreboard is an important indicator of innovation performance across European Member States. Despite its wide application, the indicator fails to highlight the interlinkages that exist among innovation measures and focuses primarily on the linear relationship between the individual measures and the predicted outcome. This study aims to address this gap by applying a novel technique, the fuzzy-set qualitative comparative analysis (fsQCA), to shed light on these interlinkages and highlight the complexity of the determinants underlying innovation performance.
Design/methodology/approach
The authors adopted a configurational approach based on fsQCA that is implemented on innovation performance data from European Member States for the period 2011–2018. The approach is based on non-linearity and allows for the analysis of interlinkages based on equifinality, that is, the model recognises that there are different potential paths of high and low innovation performance. In addition, the approach allows for asymmetric relations, where a low innovation outcome is not the exact inverse of that which leads to high innovation outcome.
Findings
The results clearly indicate that innovation outcomes are not based on simple linear relations. Thus, to reap the desired effects from investments in innovation inputs, the complex set of indicators on which innovation performance is based should be taken into consideration. The results clearly indicate the elements of equifinality and asymmetric relations. Different paths lead to high innovation performance and low innovation performance.
Originality/value
The method applied to investigate the determinants of innovation performance is the prime original factor of this study. Thus, the study contributes to literature by highlighting the complexity involved in understanding innovation. By recognising and attempting to detangle this complexity, this study will assist not just academics but also policymakers in designing the necessary measures required to reach this important outcome for a country’s competitive edge.
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Karine Picot-Coupey, Jean-Laurent Viviani and Paul Amadieu
Why do some retail networks operate shop-in-shops along with stand-alone units while others do not? Drawing on a resource-based and intellectual capital (IC) perspective as a…
Abstract
Purpose
Why do some retail networks operate shop-in-shops along with stand-alone units while others do not? Drawing on a resource-based and intellectual capital (IC) perspective as a broad theoretical lens, the purpose of this paper is to focus on retailer-run shop-in-shops and examine the determinants of their adoption.
Design/methodology/approach
To gain a comprehensive understanding of shop-in-shop adoption by retail branded networks, a research design mixing a quantitative study (n = 170) and a qualitative study (n = 19) was adopted to test nine hypotheses regarding these determinants of the adoption of retailer-run shop-in-shops and explore in greater depth the processes whereby they actually occur.
Findings
The main findings show that intangible resources are major determinants of the choice to operate shop-in-shops while tangible resources are minor determinants. The more robust results of the analysis lie in the positive effect of own-label merchandise range, premium pricing strategy, positioning based on symbols, retail concept fast renewal and high sector specialisation on the choice to operate a shop-in-shop. The effect of financial constraints on the decision to expand via shop-in-shops is limited.
Research limitations/implications
The authors emphasise the importance of marketing-related and company-related characteristics in differentiating the likelihood of retail networks to expand via shop-in-shops. These results lend support to the relevance of a resource-based and IC perspective in explaining the propensity of retailers to develop via shop-in-shops.
Practical implications
The decision to operate shop-in-shops should depend on the extent to which intangible resources – the most important being retail positioning grounded in symbols, an own-label merchandise range, and a high retail branded network reputation – can be valued and enhanced. Expanding a retail network via shop-in-shops does not appear to be a financially constrained expansion strategy: it must be considered as a relevant first best strategy when an independent and young retail company has intangible resources to value but limited tangible resources.
Originality/value
The study contributes to channel management and retailing research in four ways. First, it precisely delineates the specific characteristics of shop-in-shops. Second, it provides theoretical explanations – based on a resource and IC perspective – of determinants that influence the choice of shop-in-shops. Third, it empirically tests the influence of marketing-related and company-related characteristics when adopting shop-in-shops. Fourth, it provides insights into how adopting shop-in-shops. To the authors’ knowledge, the research is on the first to analyse theoretically and test the determinants for the choice of retailer-run shop-in-shops.
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The purpose of this study is to identify the impact of intellectual capital on the innovation performance of the Jordanian banking sector and identify the moderating role of big…
Abstract
Purpose
The purpose of this study is to identify the impact of intellectual capital on the innovation performance of the Jordanian banking sector and identify the moderating role of big data analytics.
Design/methodology/approach
For this study's purposes, 333 questionnaires were analysed. Convergent validity, discriminant validity and reliability tests were performed through structural equation modelling (SEM) in the Smart-PLS program. A bootstrapping technique was used to analyse the data.
Findings
Empirical results showed that each of the components of intellectual capital and big data analytics explains 63.5% of the variance in innovation performance and that all components of intellectual capital have a statistically significant impact on innovation performance. The results also revealed that the relationship between structural capital and innovation performance is moderated through big data analytics.
Research limitations/implications
This cross-sectional study provides a snapshot at a given moment in time, a methodological limitation that affects the generalisation of its results, and the results are limited to one country.
Practical implications
This study promotes the idea of focusing on components of intellectual capital to enhance innovation performance in the Jordanian banking sector and knowing the effect of big data analytics in this relationship.
Social implications
This study makes recommendations for financial policymakers to improve the effectiveness of intellectual capital practices and innovation performance in the context of big data analytics.
Originality/value
This study has important implications for leaders in the Jordanian banking sector, in general, as the study highlights the importance of intellectual capital to enhance the innovation performance, especially in light of the big data analytics in this sector, and thus increase the innovative capabilities of this banks, which leads to an increase in the level of innovation.
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Leadership behaviour of R&D project managers (RDPMs) is a matter of ongoing interest, as they require a number of traits in order to potentially influence the delivery of…
Abstract
Purpose
Leadership behaviour of R&D project managers (RDPMs) is a matter of ongoing interest, as they require a number of traits in order to potentially influence the delivery of projects. However, little empirical evidence exists on factors explaining the traits of RDPMs, making it difficult for industry managers to develop tailored strategies and criteria for selecting people with right skills and behaviours. The purpose of this paper is to fill this gap in knowledge.
Design/methodology/approach
The authors test 45 traits with data from a survey of 208 RDPMs, using exploratory factor analysis to establish factors of RDPMs’ traits and the associated measurement items.
Findings
The study finds that selected 45 traits can be consolidated in a set of higher order variables/factors that RDPMs need to have including creativity, reasoning and learning; risks and failure acceptance; analytical and originality attributes; realistic and objective approach among others.
Research limitations/implications
The study shows that traits have strong inter-relationship represented by empirically robust underlying factors.
Practical implications
Practically, the results will help industry mangers in implementing tailored strategies in consolidated areas (as identified through factors) and be more effective in skills and competencies development of research and development staff and potentially save costs on human inventory management.
Originality/value
The study empirically established new managerial and leadership behavioural factors.