Advertisement

Franchisor–Franchisee Relationship Quality and Performance: Influence of Personality Traits

  • Luís Fernando Varotto
  • Juracy Gomes Parente
  • Evandro Luiz Lopes
Conference paper
Part of the Developments in Marketing Science: Proceedings of the Academy of Marketing Science book series (DMSPAMS)

Abstract

Literature in franchise has virtually ignored the role of psychological aspects on firm results. The present study aims to examine the influence of franchisees’ personality on franchisor–franchisee relationship quality and financial performance. This study used a self-report survey from 342 franchisees selected from 3 franchise networks. Personality was represented by the Big-Five personality traits: extraversion, agreeableness, conscientiousness, emotional stability, and imagination. Relationship quality was conceptualized through a second-order construct (trust, commitment, and satisfaction), while financial performance was represented by sales growth and profitability. A Partial Least Squares (PLS) structural equation model was conducted. Three personality dimensions produced the predicted effect on relationship quality—agreeableness (positively), emotional stability (positively), and imagination (positively). Financial performance was affected by conscientiousness (positively), emotional stability (positively), and imagination (positively). As expected, relationship quality presented a positive and significant effect on financial performance. Results indicate that personality does influence relationship quality and performance in a particular manner in the Brazilian context, suggesting that factors such as culture and market stability may have influence on the relationship between personality traits and both relationship quality and financial performance.

Keywords

Franchise Personality traits Relationship quality Performance Big five 

References

  1. Anderson, J., & Narus, J. (1990). A model of distributor firm and manufacturer firm working partnerships. Journal of Marketing, 54, 42–58.CrossRefGoogle Scholar
  2. Athanasopoulou, P. (2009). Relationship quality: a critical literature review and research agenda. European Journal of Marketing, 43, 583–610.CrossRefGoogle Scholar
  3. Banker, R. D., Potter, G., & Srinivasan, D. (2005). Association of nonfinancial performance measures with the financial performance of a lodging chain. Cornell Hotel and Restaurant Administration Quarterly, 46, 394–412.CrossRefGoogle Scholar
  4. Barrick, M., Mount, M., & Gupta, R. (2003). Meta-analysis of the relationship between the five-factor model of personality and Holland’s occupational types. Personnel Psychology, 56, 45–74.CrossRefGoogle Scholar
  5. Barrick, M., Mount, M., & Judge, T. (2001). Personality and performance at the beginning of the new millennium: What do we know and where do we go next? International Journal of Selection and Assessment, 9, 9–30.CrossRefGoogle Scholar
  6. Barrick, M. R., & Mount, M. K. (1991). The Big Five Personality Dimensions and Job Performance: A Meta-Analysis. Personnel Psychology, 44, 1–26.CrossRefGoogle Scholar
  7. Baum, J. R., & Locke, E. A. (2004). The relationship of entrepreneurial traits, skill, and motivation to subsequent venture growth. Journal of Applied Psychology, 89, 587–598.CrossRefGoogle Scholar
  8. Blut, M., Backhaus, C., Heussler, T., Woisetschläger, D. M., Evanschitzky, H., & Ahlert, D. (2011). What to expect after the honeymoon: Testing a lifecycle theory of franchise relationships. Journal of Retailing, 87, 306–319.CrossRefGoogle Scholar
  9. Bolander, W., Satornino, C. B., Hughes, D. E., & Ferris, G. R. (2015). Social networks within sales organizations: Their development and importance for salesperson performance. Journal of Marketing, 79, 1–16.CrossRefGoogle Scholar
  10. Brown, J. R., & Dev, C. S. (1997). The franchiser-franchisee relationship. Cornell Hotel and Restaurant Administration Quarterly, 38, 4–38.CrossRefGoogle Scholar
  11. Buss, D. (1991). Conflict in married couples: Personality predictors of anger and upset. Journal of Personality, 59, 663–703.CrossRefGoogle Scholar
  12. Buss, D. (1992). Manipulation in close relationships: Five personality factors in interactional context. Journal of Personality, 60, 477–499.CrossRefGoogle Scholar
  13. Caughlin, J. P., Huston, T. L., & Houts, R. M. (2000). How does personality matter in marriage? An examination of trait anxiety, interpersonal negativity, and marital satisfaction. Journal of Personality and Social Psychology, 78, 326–336.CrossRefGoogle Scholar
  14. Chandler, G. N., & Hanks, S. H. (1993). Measuring the performance of emerging businesses: A validation study. Journal of Business Venturing, 8, 391–408.CrossRefGoogle Scholar
  15. Chin, W. W., Marcolin, B. L., & Newsted, P. R. (2003). A partial least squares latent variable modeling approach for measuring interaction effects: Results From a Monte Carlo simulation study and an electronic-mail emotion/adoption study. Information Systems Research, 14, 189–217.CrossRefGoogle Scholar
  16. Chiou, J.-S., Hsieh, C.-H., & Yang, C.-H. (2004). The effect of franchisors’ communication, service assistance, and competitive advantage on franchisees' intentions to remain in the franchise system. Journal of Small Business Management, 42, 19–36.CrossRefGoogle Scholar
  17. Ciavarella, M. A., Buchholtz, A. K., Riordan, C. M., Gatewood, R. D., & Stokes, G. S. (2004). The Big Five and venture survival: Is there a linkage? Journal of Business Venturing, 19, 465–483.CrossRefGoogle Scholar
  18. Costa, P. T., & McCrae, R. R. (2008). The revised NEO personality inventory (NEO-PI-R). In The Sage handbook of personality theory and assessment, (2nd ed., pp. 179–198). London: Sage Publications.Google Scholar
  19. Craighead, C. W., Ketchen, D. J., Dunn, K. S., & Hult, G. T. M. (2011). Addressing common method variance: guidelines for survey research on information technology, operations, and supply chain management. IEEE Transactions on Engineering Management, 58, 578–588.CrossRefGoogle Scholar
  20. Dant, R. P., Grünhagen, M., & Windsperger, J. (2011). Franchising research frontiers for the twenty-first century. Journal of Retailing, 87, 253–268.CrossRefGoogle Scholar
  21. Dant, R. P., Weaven, S. K., & Baker, B. L. (2013). Influence of personality traits on perceived relationship quality within a franchisee-franchisor context. European Journal of Marketing, 47, 279–302.CrossRefGoogle Scholar
  22. Doney, P., & Cannon, J. (1997). An examination of the nature of trust in buyer-seller relationships. Journal of Marketing, 61, 35–51.CrossRefGoogle Scholar
  23. Donnellan, M. B., Conger, R. D., & Bryant, C. M. (2004). The Big Five and enduring marriages. Journal of Research in Personality, 38, 481–504.CrossRefGoogle Scholar
  24. Driskell, J. E., Goodwin, G. F., Salas, E., & O’Shea, P. G. (2006). What makes a good team player? Personality and team effectiveness. Group Dynamics: Theory, Research, and Practice, 10, 249–271.CrossRefGoogle Scholar
  25. Ernst, H., Hoyer, W. D., & Rubsaamen, C. (2010). Sales, marketing, and research-and-development cooperation across new product development stages: Implications for success. Journal of Marketing, 74, 80–92.CrossRefGoogle Scholar
  26. Farrington, S. M. (2012). Does personality matter for small business success? South African Journal of Economic and Management Sciences, 15, 382–401.CrossRefGoogle Scholar
  27. Funder, D. (1994). Explaining traits. Psychological Inquiry, 5, 125–127.CrossRefGoogle Scholar
  28. Ganesan, S. (1994). Determinants of long-term orientation in buyer-seller relationships. Journal of Marketing, 58, 1–19.CrossRefGoogle Scholar
  29. Geyskens, I., Steenkamp, J., & Kumar, N. (1999). A meta-analysis of satisfaction in marketing channel relationships. Journal of Marketing Research, 36, 223–238.CrossRefGoogle Scholar
  30. Goldberg, L. (1992). The development of markers for the Big-Five factor structure. Psychological Assessment, 4, 26–42.CrossRefGoogle Scholar
  31. Goldberg, L. R. (1990). An alternative “description of personality”: the big-five factor structure. Journal of Personality and Social Psychology, 59, 1216–1229.CrossRefGoogle Scholar
  32. Grayson, K. (2007). Friendship versus business in marketing relationships. Journal of Marketing, 71, 121–139.CrossRefGoogle Scholar
  33. Griffith, D., Noble, S., & Chen, Q. (2006). The performance implications of entrepreneurial proclivity: A dynamic capabilties approach. Journal of Retailing, 82, 51–62.CrossRefGoogle Scholar
  34. Grünhagen, M., & Dorsch, M. J. (2003). Does the franchisor provide value to franchisees? Past, current, and future value assessments of two franchisee types. Journal of Small Business Management, 41, 366–384.CrossRefGoogle Scholar
  35. Hair, J. F., Sarstedt, M., Ringle, C. M., & Mena, J. A. (2012). An assessment of the use of partial least squares structural equation modeling in marketing research. Journal of the Academy of Marketing Science, 40, 414–433.CrossRefGoogle Scholar
  36. Hair, J. F., Jr., Hult, G. T. M., Ringle, C. M., & Sarstedt, M. (2014). A Primer on Partial Least Squares Structural Equation Modeling (PLS-SEM) (1st ed.). London: Sage.Google Scholar
  37. Heide, J., & Wathne, K. (2006). Friends, businesspeople, and relationship roles: A conceptual framework and a research agenda. Journal of Marketing, 70, 90–103.CrossRefGoogle Scholar
  38. Heinström, J. (2003). Five personality dimensions and their influence on information behaviour. Information Research, 9, 1–24.Google Scholar
  39. Hennig-Thurau, T., Houston, M. B., & Heitjans, T. (2009). Conceptualizing and measuring the monetary value of brand extensions: The case of motion pictures. Journal of Marketing, 73, 167–183.CrossRefGoogle Scholar
  40. Hough, L., & Eaton, N. (1990). Criterion-related validities of personality constructs and the effect of response distortion on those validities. Journal of Applied Psychology, 75, 581–595.CrossRefGoogle Scholar
  41. Huntley, J. K. (2006). Conceptualization and measurement of relationship quality: Linking relationship quality to actual sales and recommendation intention. Industrial Marketing Management, 35, 703–714.CrossRefGoogle Scholar
  42. Jr, P. C., McCrae, R., & Dye, D. (1991). Facet scales for agreeableness and conscientiousness: A revision of the NEO personality inventory. Personality and Individual Differences, 12, 887–898.CrossRefGoogle Scholar
  43. Judge, T. A., Heller, D., & Mount, M. K. (2002). Five-factor model of personality and job satisfaction: A meta-analysis. Journal of Applied Psychology, 87, 530–541.CrossRefGoogle Scholar
  44. Karney, B. R., & Bradbury, T. N. (1995). The longitudinal course of marital quality and stability: A review of theory, method, and research. Psychological Bulletin, 118, 3–32.CrossRefGoogle Scholar
  45. LePine, J., Colquitt, J., & Erez, A. (2000). Adaptability to changing task contexts: Effects of general cognitive ability, conscientiousness, and openness to experience. Personnel Psychology, 53, 563–594.CrossRefGoogle Scholar
  46. Lohmoller, J.-B. (1989). Latent variable path modeling with partial least squares. Heidelberg: Physica-Verlag.CrossRefGoogle Scholar
  47. Lumpkin, G. T., & Dess, G. G. (1996). Clarifying the entrepreneurial orientation construct and linking it to performance. Academy of Management Review, 21, 135.Google Scholar
  48. Malhotra, N. K. (2010). Marketing research: an applied orientation (6th ed.). Upper Saddle River, NJ: Prentice-Hall.Google Scholar
  49. Mohr, J. J., & Spekman, R. E. (1994). Characteristics of partnership success: Partnership attributes, communication behavior, and conflict resolution techniques. Strategic Management Journal, 15, 135–152.CrossRefGoogle Scholar
  50. Morgan, R., & Hunt, S. (1994). The commitment-trust theory of relationship marketing. Journal of Marketing, 58, 20–38.CrossRefGoogle Scholar
  51. Morrison, K. A. (1997). How franchise job satisfaction and personality affects their performance, organizational commitment, franchisor relations, and intention to remain. Journal of Small Business Management, 35, 39–67.Google Scholar
  52. Neal, A., Yeo, G., Koy, A., & Xiao, T. (2012). Predicting the form and direction of work role performance from the Big 5 model of personality traits. Journal of Organizational Behavior, 192, 175–192.CrossRefGoogle Scholar
  53. Palmatier, R. W. (2008). Interfirm relational drivers of customer value. Journal of Marketing, 72, 76–89.CrossRefGoogle Scholar
  54. Palmatier, R. W., Dant, R. P., & Grewal, D. (2007). A comparative longitudinal analysis of theoretical perspectives of interorganizational relationship performance. Journal of Marketing, 71, 172–194.CrossRefGoogle Scholar
  55. Palmatier, R. W., Dant, R. P., Grewal, D., & Evans, K. R. (2006). Factors influencing the effectiveness of relationship marketing: A meta-analysis. Journal of Marketing, 70, 136–153.CrossRefGoogle Scholar
  56. Peeters, M. a. G. (2006). The Big Five personality traits and individual satisfaction with the team. Small Group Research, 37, 187–211.Google Scholar
  57. Podsakoff, P. M., MacKenzie, S. B., Lee, J. Y., & Podsakoff, N. P. (2003). Common method biases in behavioral research: A critical review of the literature and recommended remedies. Journal of Applied Psychology, 88, 879.CrossRefGoogle Scholar
  58. Ringle, C. M., Wende, S., & Becker, J.-M. (2015). SmartPLS 3. Bönningstedt: SmartPLS. Retrieved from http://www.smartpls.com.Google Scholar
  59. Schimmack, U., Radhakrishnan, P., Oishi, S., Dzokoto, V., & Ahadi, S. (2002). Culture, personality, and subjective well-being: Integrating process models of life satisfaction. Journal of Personality and Social Psychology, 82, 582–593.CrossRefGoogle Scholar
  60. Schultz, D., & Schultz, S. (2012). Theories of personality (10th ed.). Boston, MA: Cengage Learning.Google Scholar
  61. Seibert, S. E., & Kraimer, M. L. (2001). The Five-factor model of personality and career success. Journal of Vocational Behavior, 58, 1–21.CrossRefGoogle Scholar
  62. Soontiens, W., & Lacroix, A. (2009). Personality traits of franchisees – McDonald’s restaurants in Australia. Problems and Perspectives in Management, 7, 238–244.Google Scholar
  63. Strutton, D., Pelton, L., & Lumpkin, J. (1995). Psychological climate in franchising system channels and franchisor-franchisee solidarity. Journal of Business Research, 2963.Google Scholar
  64. Tett, R. P., & Burnett, D. D. (2003). A personality trait-based interactionist model of job performance. Journal of Applied Psychology, 88, 500–517.CrossRefGoogle Scholar
  65. Thoresen, C. J., Bradley, J. C., Bliese, P. D., & Thoresen, J. D. (2004). The big five personality traits and individual job performance growth trajectories in maintenance and transitional job stages. The Journal of Applied Psychology, 89, 835–853.CrossRefGoogle Scholar
  66. Triandis, H. C. (1997). Handbook of personality psychology. New York, NY: Elsevier.Google Scholar
  67. Venkatraman, N., & Ramanujam, V. (1986). Measurement of business performance in strategy research: a comparison of approaches. Academy of Management Review, 11, 801–814.Google Scholar
  68. Venkatraman, N., & Ramanujam, V. (1987). Measurement of business economic performance: an examination of method convergence. Journal of Management, 13, 109–122.CrossRefGoogle Scholar
  69. Walter, A., Mueller, T., & Helfert, G. (2000). The impact of satisfaction, trust, and relationship value on commitment: Theoretical considerations and empirical results. In IMP Conference ProceedingsGoogle Scholar
  70. Wang, X., & Yang, Z. (2013). Inter-firm opportunism: a meta-analytic review and assessment of its antecedents and effect on performance. Journal of Business & Industrial Marketing, 28, 137–146.CrossRefGoogle Scholar
  71. Watson, A., & Johnson, R. (2010). Managing the franchisor–franchisee relationship: a relationship marketing perspective. Journal of Marketing Channels, 17, 51–68.CrossRefGoogle Scholar
  72. Weaven, S., Grace, D., & Manning, M. (2009). Franchisee personality: An examination in the context of franchise unit density and service classification. European Journal of Marketing, 43, 90–109.CrossRefGoogle Scholar
  73. White, J. K., Hendrick, S. S., & Hendrick, C. (2004). Big five personality variables and relationship constructs. Personality and Individual Differences, 37, 1519–1530.CrossRefGoogle Scholar
  74. Williams, L. J., & Brown, B. K. (1994). Method variance in organizational behavior and human resources research: Effects on correlations, path coefficients, and hypothesis testing. Organizational Behavior and Human Decision Processes, 57, 185–209.CrossRefGoogle Scholar
  75. Wilson, D. (1995). An integrated model of buyer-seller relationships. Journal of the Academy of Marketing Science, 23, 335–345.CrossRefGoogle Scholar
  76. Zhao, H., & Seibert, S. E. (2006). The big five personality dimensions and entrepreneurial status: a meta-analytical review. The Journal of Applied Psychology, 91, 259–271.CrossRefGoogle Scholar
  77. Zhao, H., Seibert, S. E., & Lumpkin, G. T. (2010). The relationship of personality to entrepreneurial intentions and performance: A meta-analytic review. Journal of Management, 36, 381–404.CrossRefGoogle Scholar

Copyright information

© Academy of Marketing Science 2017

Authors and Affiliations

  • Luís Fernando Varotto
    • 1
  • Juracy Gomes Parente
    • 1
  • Evandro Luiz Lopes
    • 2
  1. 1.EAESP-FGV/Universidade Nove de JulhoSão PauloBrazil
  2. 2.Universidade Nove de Julho/UNIFESPBauruBrazil

Personalised recommendations