THE INFLUENCE OF THE RELATIONAL MARKETING PARADIGM ON THE GOVERNANCE OF THE NOVEL CHANNEL FORMAT NAMED SOCIAL FRANCHISING: AN EXPLORATORY QUALITATIVE ANALYSIS OF FOUR SOCIAL FRANCHISES FROM THE UK

Abstract

This paper explores the influence of the relational paradigm on the governance structure and performance of the novel inter-organizational format named social franchising. This format has emerged as a channel strategy to tackle the issues of growth and financial sustainability social enterprises face, to enhance the alleviation of poverty and to address the need to reduce fiscal deficits and satisfy social needs. We explore the issue of social franchising from a social network theory perspective through case study analyses of four social franchises active in the United Kingdom. We collected data through face-to-face, semi-structured interviews from the owners of the Social Franchisor. We coded the behavior 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 behavior. Our findings indicate that relational embeddedness plays the preeminent role in the design of the governance structure and the performance of social franchises. We learned that the biggest challenges 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 the ability to focus on supporting the whole network.