IDEAS home Printed from https://ideas.repec.org/h/spr/sprchp/978-3-319-10184-2_3.html
   My bibliography  Save this book chapter

Using Organizational Capability and Transaction Cost Theory to Explain Multi-unit Franchising

In: Interfirm Networks

Author

Listed:
  • Dildar Hussain

    (ESC Rennes School of Business)

  • Josef Windsperger

    (University of Vienna)

Abstract

This study presents a new model of franchisor’s choice of multi-unit franchising (MUF) by combining organizational capability and transaction cost theory. According to the transaction cost theory, high franchisees’ transaction-specific investments and high behavioral uncertainty increase the franchisor’s propensity to use MUF and high environmental uncertainty decreases the propensity to use MUF. Based on the organizational capability view, MUF increases the franchise firm’s capabilities (such as knowledge transfer and monitoring capabilities) and hence its competitive advantage compared to a single-unit franchising system. Specifically, highly intangible system-specific know-how requires high knowledge transfer and monitoring capabilities and therefore increases the franchisor’s propensity to use MUF. The results from the German franchise sector show that the combined application of transaction cost and organizational capability theory of MUF significantly increases the explanatory power of the research model. Overall this study adds to the literature by showing that—complementary to the transaction cost view—organizational capability theory explains MUF as knowledge transfer and exploitation mechanism.

Suggested Citation

  • Dildar Hussain & Josef Windsperger, 2015. "Using Organizational Capability and Transaction Cost Theory to Explain Multi-unit Franchising," Springer Books, in: Josef Windsperger & Gérard Cliquet & Thomas Ehrmann & Georg Hendrikse (ed.), Interfirm Networks, edition 127, pages 35-55, Springer.
    • Handle: RePEc:spr:sprchp:978-3-319-10184-2_3
    DOI: 10.1007/978-3-319-10184-2_3
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Chen-I Huang & Yung-Fu Huang & Manh-Hoang Do & Thi-Lien-Huong Nguyen, 2023. "Sustainable Competitive Advantage for Multi-Unit Franchising: From the Taiwanese Franchise Market Perspectives," Sustainability, MDPI, vol. 15(21), pages 1-17, October.
    2. Dildar Hussain & Marijana Sreckovic & Josef Windsperger, 2018. "An organizational capability perspective on multi-unit franchising," Small Business Economics, Springer, vol. 50(4), pages 717-727, April.
    3. Muriel Fadairo & Cintya Lanchimba & Josef Windsperger, 2015. "Network Form and Performance. The Case of Multi-Unit Franchising," Working Papers halshs-01128075, HAL.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:sprchp:978-3-319-10184-2_3. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.