The influence of the relational marketing paradigm on the governance structure of the novel channel format named social franchising: an explorative qualitative analyses of four social franchises from the UK

Abstract

This paper explores the influence of the relational paradigm on the governance structure and performance the novel interorganisational format named social franchising which has emerged as a channel strategy to tackle the issues of growth and financial sustainability that social enterprises face, to enhance the alleviation of poverty and to address the need to reduce fiscal deficits and to satisfy social needs. We explore the issue of social franchising through case study analyses of four social franchises active in the UK from a social network theory perspective. We collected data through face to face semi-structured interviews from the owners of the Social Franchisor. We coded behaviour of actors on the four constructs of governance and performance into eight relational norms and classified outcomes as levels of relational embeddedness. Propositions were developed to explain the outcome of each behaviour. Our findings indicate that relational embeddedness plays the preeminent role in the design of the governance structure and the performance of social franchises. We learn that the biggest challenges that social franchisors face are: the creation of a straightforward clear model, the training of the partners to a different operationally-wise and commercially-wise culture, and their ability to focus on supporting the whole network.