Psychological ownership and franchise growth

Abstract

PurposeThe primary purpose of this paper is to verify the importance of psychological ownership in the organisational context of a franchise by testing predicted relationships concerning feelings of ownership towards branding, legal ownership of complementary assets, organisational commitment, and a willingness on the part of franchisees to diffuse a franchise brand to peers.Design/methodology/approachEvidence is presented from an empirical study on the largest taxi franchise fleet in Taiwan. Two formal questionnaires/surveys were conducted in May 2005 and September 2005, from which data were collected from 147 franchisees. Regression analysis is employed to test seven hypotheses.FindingsThe empirical results demonstrate that analysing the psychological ownership of a franchise brand from two dimensions (i.e. the degree of psychological ownership and the self‐centred propensity towards psychological ownership) sees an increase in explained variance in organisational commitment and brand diffusion in the context of the franchise organisation. It also illustrates that both dimensions of psychological ownership are negatively affected by the ownership of the non‐brand‐specified complementary assets owned by a franchisee.Research limitations/implicationsThe majority of previous research has investigated the phenomenon of franchising from the perspective of the agency theory or of resource scarcity; and has focused on the franchisor's concerns. A major implication of this study indicates that these perspectives, while essential, are insufficient in explaining the growth through franchising strategies. Researchers need to consider how to integrate asset ownership (or property rights) and affect elements in order to influence a franchisee's cognition and behaviour entrepreneurially. A limitation of this study is that it is conducted within the respective boundaries of cultural, professional, and industrial factors.Practical implicationsThis study indicates that entrepreneurs can achieve better brand diffusion effects for franchise growth if they engage in merging the structures of asset ownership and psychological ownership.Originality/valueThis is the first paper to examine the psychological ownership of branding within the setting of a franchise organisation and highlights the importance of a sense of ownership in entrepreneurship.

More than just agents: the role of executives' psychological ownership in aligning interests of principals and agents

“…Third, the percentage of share ownership ( %execown ) translates to legal ownership, which can also evoke feelings of ownership (e.g. Hou et al. , 2009).…”

“…Third, the percentage of share ownership (% execown) translates to legal ownership, which can also evoke feelings of ownership (e.g. Hou et al, 2009). Fourth, the market share of the company (mkshr) impacts the control of the company in an industry and, by extension, the control of its executives in the firm.…”

Effect Brand Psychological Ownership and Value Congruity to Brand Attachment and Behavioral Brand Loyalty Through Customer Brand Engagement

“…The concept of psychological ownership can be directed at the organisation (or workplace) as a whole or at specific aspects of the organisation such as the group, job and work tools (Hou et al 2009). Collective psychological Proceedings of the5 th European International Conference on Industrial Engineering and Operations Management Rome, Italy, July 26-28, 2022 © IEOM Society International ownership, indicating personal feelings of shared ownership at a group level, is more pervasive in collective cultures because individuals with collectivistic values see themselves as intimately connected to their in-groups and are, therefore, more inclined to perceive ownership of objects from a shared ("our") context (Kou & Powpaka,2021).…”

Linking Ethnic Identification to Organisational Solidarity

“…Psychological ownership posits that ownership is a means of defining one's self, one's possession, and one's territorial boundary (Pierce, Kostova, & Dirks, 2003). Psychology of possession is innate in every individual such that they sometimes define themselves by what they possess (Hou, Hsu, & Wu, 2009;Peng & Pierce, 2015). Possession may be material or immaterial and the effect of ownership perception may reflect in employees' behavioural, emotional and psychological patterns (Peng & Pierce, 2015).…”