The bright side and dark side of trust: The mediating effect of franchisor trust on performance

Abstract

Previous literature has not examined the dual role of trust in franchise relationships. We extend the franchise and relational governance literature by showing that trust has both a “bright side” and a “dark side” in franchisor–franchisee relationships. Based on transaction cost and knowledge‐based reasoning, we argue that intangible knowledge assets and environmental uncertainty have an indirect effect on performance via trust, due to its relational risk and knowledge exchange effect. Using data from the franchise sector in Germany, we show that trust positively mediates the impact of intangible knowledge assets and negatively mediates the impact of environmental uncertainty on franchisor performance. The first effect refers to the “bright side” of trust showing that intangible brand name assets increase trust which, in turn, has a positive effect on performance. Conversely, the second effect refers to the “dark side” of trust highlighting that environmental uncertainty diminishes trust resulting in a negative effect on performance.

It takes two to tango: A taxonomy of franchise success determinants

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Franchise internationalization: a bibliometric analysis with a focus on marketing, digital transformation, and sustainable development

“…Asimismo, los franquiciadores más antiguos ingresan a los mercados internacionales, tienen una mayor capacidad para desarrollar nuevas capacidades que mejoran las relaciones franquiciador-franquiciado [9]. Para futuras investigaciones, los autores plantean como propuesta el examinar la relación de la confianza entre los activos específicos del sistema y el rendimiento, con medidas alternativas de activos intangibles específicos del sistema [26]. De igual manera, se propone concentrar las investigaciones tanto en franquicias privadas y las más pequeñas que se identifican como empresas familiares, con la intención de demostrar las diferencias significativas debido a las condiciones culturales, económicas y políticas del país de origen [8].…”

Network innovation versus innovation through networks

“…It might be possible that certain nodes get (re)engaged with significant time-lags and as such remain dormant first or higher order elements of a network's service ecosystem due to the changing needs and preferences of the collaborative organization. However, the intermittent nature of interaction/cooperation with certain nodes becoming dormant for a sufficiently longer period of time, may lead to a decline of productivity attributable to organizational A c c e p t e d m a n u s c r i p t forgetting (de Holan & Phillips, 2004;Thompson, 2007), loss of network identities (Eklinder-Frick, Eriksson & Hallén, 2014) and strategic blindness as "hidden costs of trust" (Selnes & Sallis, 2003;Minarikova, Mumdziev, Griessmair & Windsperger, 2020). In essence, the efficacy of such collaborative networks for dynamic co-creation of value depends, to a reasonable extent, upon the perseverance of identities, quality of social embeddedness and the innovative generativity in their social capitals.…”