Franchise Organizations

"Chains are one of the dominant forms of organization of our times."

"One of the most powerful features of the plural form in the restaurant setting is its capacity to provide both uniformity and systemwide adaptation, control and innovation."

"Maintaining the uniformity of units in a chain is what preserves its shared identity."

"Company employees are subordinates of the chain operator, and franchisees are partners with the chain operator."

"Franchisees benefit from the profits of a unit; chain operators benefit from a royalty based on a franchisee's revenue."

"The text here refers to a quantitative analysis of chain restaurants that was conducted by the author and reported on in this book."

"In the franchise arrangement, the chain operator captured less information."

"For company units the structure was hierarchical; for franchisees, it was federal."

"The addition of units is a management objective in itself and has its own dynamics."

"The need to grow fast was what made the constraints binding."

"In franchise units, "proportional response" is the key pattern, reflecting the chain operators' need to focus only on issues that truly affected the business."

"Paying constant and explicit attention to the details of the business was how the chain operator established uniformity in the company arrangement."

"The mechanisms for monitoring and managing uniformity in the franchise arrangement were less extensive than in the company arrangement."

"Two plural processes increased the level of uniformity across the chain: ratcheting and modeling."

"Along with the centralization of local responses, most chains used specialized people and departments to respond to local conditions."

"The local production of local responses led to a greater number and variety of local responses than the company arrangement."

"The presence of franchisees who could choose whether to use the staff resources or develop their own responses added market pressure to the organization."

"Company and franchise units played a complementary role in accomplishing systemwide adaptations."

"The plural form [a chain organization including both company and franchise units] enhanced a chain's ability to accomplish systemwide adaptations."

"What may matter most is how well the overall system functions: in particular, whether it is leveraging the strengths of both sides to the fullest to meet the management challenges."

"Rather than specialize innovation and control activities into entirely autonomous structures, the processes of the plural form capitalize on these similarities and differences."