Trust, Decision Rights Delegation, and Performance: The Case of Franchising

Marc Herz; Clemens Hutzinger; Haris Seferagic; Josef Windsperger

doi:10.1111/jsbm.12227

Trust, Decision Rights Delegation, and Performance: The Case of Franchising

Marc Herz, Clemens Hutzinger, Haris Seferagic, Josef Windsperger

Department of Accounting, Innovation and Strategy

Publications: Contribution to journal › Article › Peer Reviewed

Abstract

Previous research has not examined the relationship between trust, decentralization, and franchisor performance. Complementary to the literature on autonomy and relational governance from franchisees’ perspective, this study focuses on the franchisor's perspective on the impact of decentralization and trust on performance. Consistent with the embeddedness view, the results show that trust is a facilitator of decentralization in franchise networks, thereby increasing the positive performance effect of decision rights delegation. Overall, the study offers a new perspective on the relationship between formal governance—through decision rights allocation—and trust as a relational variable in interorganizational networks.

Original language	English
Pages (from-to)	973–991
Number of pages	19
Journal	Journal of Small Business Management
Volume	54
Issue number	3
DOIs	https://doi.org/10.1111/jsbm.12227
Publication status	Published - Jul 2016

Austrian Fields of Science 2012

502044 Business management

Keywords

ALLIANCE GOVERNANCE
EXPLICIT KNOWLEDGE
FAMILIARITY BREED TRUST
FORMAL CONTRACTS
INTERORGANIZATIONAL TRUST
INTERPERSONAL-TRUST
PLURAL FORM
RELATIONAL GOVERNANCE
SUPPLIER RELATIONSHIPS
TRANSACTION-COST

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10.1111/jsbm.12227

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title = "Trust, Decision Rights Delegation, and Performance: The Case of Franchising",

abstract = "Previous research has not examined the relationship between trust, decentralization, and franchisor performance. Complementary to the literature on autonomy and relational governance from franchisees{\textquoteright} perspective, this study focuses on the franchisor's perspective on the impact of decentralization and trust on performance. Consistent with the embeddedness view, the results show that trust is a facilitator of decentralization in franchise networks, thereby increasing the positive performance effect of decision rights delegation. Overall, the study offers a new perspective on the relationship between formal governance—through decision rights allocation—and trust as a relational variable in interorganizational networks.",

keywords = "BWL, IB, CSP, ALLIANCE GOVERNANCE, EXPLICIT KNOWLEDGE, FAMILIARITY BREED TRUST, FORMAL CONTRACTS, INTERORGANIZATIONAL TRUST, INTERPERSONAL-TRUST, PLURAL FORM, RELATIONAL GOVERNANCE, SUPPLIER RELATIONSHIPS, TRANSACTION-COST",

author = "Marc Herz and Clemens Hutzinger and Haris Seferagic and Josef Windsperger",

note = "Publisher Copyright: {\textcopyright} 2016 International Council for Small Business",

year = "2016",

month = jul,

doi = "10.1111/jsbm.12227",

language = "English",

volume = "54",

pages = "973–991",

journal = "Journal of Small Business Management",

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T1 - Trust, Decision Rights Delegation, and Performance

T2 - The Case of Franchising

AU - Herz, Marc

AU - Hutzinger, Clemens

AU - Seferagic, Haris

AU - Windsperger, Josef

PY - 2016/7

Y1 - 2016/7

N2 - Previous research has not examined the relationship between trust, decentralization, and franchisor performance. Complementary to the literature on autonomy and relational governance from franchisees’ perspective, this study focuses on the franchisor's perspective on the impact of decentralization and trust on performance. Consistent with the embeddedness view, the results show that trust is a facilitator of decentralization in franchise networks, thereby increasing the positive performance effect of decision rights delegation. Overall, the study offers a new perspective on the relationship between formal governance—through decision rights allocation—and trust as a relational variable in interorganizational networks.

AB - Previous research has not examined the relationship between trust, decentralization, and franchisor performance. Complementary to the literature on autonomy and relational governance from franchisees’ perspective, this study focuses on the franchisor's perspective on the impact of decentralization and trust on performance. Consistent with the embeddedness view, the results show that trust is a facilitator of decentralization in franchise networks, thereby increasing the positive performance effect of decision rights delegation. Overall, the study offers a new perspective on the relationship between formal governance—through decision rights allocation—and trust as a relational variable in interorganizational networks.

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KW - CSP

KW - ALLIANCE GOVERNANCE

KW - EXPLICIT KNOWLEDGE

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KW - FORMAL CONTRACTS

KW - INTERORGANIZATIONAL TRUST

KW - INTERPERSONAL-TRUST

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KW - SUPPLIER RELATIONSHIPS

KW - TRANSACTION-COST

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M3 - Article

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JO - Journal of Small Business Management

JF - Journal of Small Business Management

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ER -

Trust, Decision Rights Delegation, and Performance: The Case of Franchising

Abstract

Austrian Fields of Science 2012

Keywords

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