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Purpose Executive leadership plays a crucial role in initiating, shaping and directing strategic reorientations. But it must somehow mediate between forces of inertia and fundamental changes. This paper aims to address the unresolved paradox: how do executives address these conflicting demands? Design/methodology/approach This paper aims to interweave two streams of seminal research in organizational evolution and organizational culture to develop a typology of strategic reorientations. The four types of strategic reorientations are illustrated with the help of published cases and biographies of CEOs, mostly of high visibility international companies such as Heineken, Burger King and Starbucks. Findings Combinations of high and low levels of executive team consensus on its external adaptation tasks and on its internal integration tasks provoke four different types of strategic reorientations: chaotic, negotiated, muted and promising. Research limitations/implications Until appropriate methods of empirical research can be found to test this framework, one has to rely on some anecdotal support as preliminary and cursory evidence. This study can inform a wide body of research which incorrectly suggested that consensus among executives during strategic reorientation has a unidirectional, positive impact on organizational performance. Directions to explore how top executives may develop ambidextrous leadership are suggested. Practical implications Seeking high growth, executive teams must have a good mix of managerial and entrepreneurial cognitions. Therefore, executives having dissimilar skills and backgrounds should be inducted in the team periodically, instead of hiring hurriedly at the eleventh hour. Otherwise, the new executives may contribute too high or too low levels of consensus of each type needed for optimal strategic reorientation. Social implications The paper has not attempted this aspect. Originality/value This paper contributes a novel framework that combines two streams of seminal research, which, each by itself, would not sufficiently address the unresolved executive paradox.

The purpose of this paper is to extend insight about processes and routines needed for franchise replication and makes an important contribution to understanding ways through which dynamic capabilities are created. Based on a grounds-up study, this paper utilizes a storyline approach (Miles & Huberman, 1994) to present interview data obtained from interviews with elite informants (IEIs) of the host company and its archival data. Evolution of capabilities, both substantive and dynamic, are captured in the findings section. Of the seventeen interviews, seven subjects were location heads and ten corporate executives. Interviews with corporate executives included questions pertaining to their functional specialty as well. Finally, implications for future research and practice are discussed.

We advance franchising research by explaining the important role, so far overlooked, of different franchising forms in developing low-cost competitive advantage. We analyze the most meaningful cost drivers for franchising systems: economies of scale, reduced transaction costs, economies of learning, reduced monitoring costs, standardization, and relative bargaining power. Our analysis suggests that asymmetrical cost effects are likely for franchisors and franchisees. For franchisors, relative to single-unit franchising (SUF), multi-unit franchising (MUF) should yield lower costs from scale economies and monitoring, higher costs from bargaining power, and similar costs from learning economies and standardization. For franchisees, lower costs for MUF are indicated from scale economies and standardization but not for monitoring. Within MUF, comparisons between area development franchising (ADF) and incremental franchising suggest that ADF yields lower costs from scale economies and learning economies for the...

In the US economy, retail chains are extremely important since they account for a very high share of GDP relative to manufacturing sector. Retail is dominated by large franchised chains, particularly in the restaurant industry. A proven business format comprising a differentiated menu, exterior and interior design of the outlet, logos, etc., draws the interest of many prospective franchisees simultaneously, especially to large chains because it reduces their risk. Theoretical arguments are built, supported in relevant research, to present three hypotheses. Together, they form a theory of how franchising helps large chains despite abating of resource scarcity and escalation of threat from agency problems. Developing such a theory is important because extant research does not adequately address the boundary condition of large chains, even though many of them have been becoming from large to mega for many years. This theory is tested in a longitudinal sample from Quick Service Restaurant magazine, which has been publishing a list of top 50 restaurant chains for many years. All of three hypotheses are strongly supported. The paper closes with discussion of results and their implications for practice and research.

When franchisors pursue different priorities, different agency problems become relevant, which drive the franchisors’ choices among various franchising organization forms. We use archival and key informant data from a multi-industry sample of 94 franchisors to examine franchisors’ choices of organization forms based on their goals for growth, uniformity and local responsiveness. Our results indicate that franchisors emphasizing high growth are more likely to use multi-unit rather than single-unit franchising and, within the multi-unit franchising form, they are more likely to use area development franchising than incremental franchising. Franchisors emphasizing uniformity instead of growth are more likely to use area development franchising, but those emphasizing local responsiveness are more likely to use incremental franchising. We discuss the implications of these results for franchising research and practice.

Chief executives must allocate their scarce time for scanning efforts among relevant domains of their firms' external environment and their firms' internal circumstances. We argue that high-performing CEOs vary their relative scanning emphases on different domains according to the level of dynamism they perceive in their external environments. The concepts of dominant logic and sector importance were used to develop predictions about which external domains and which internal domains should receive relatively more or less scanning emphasis in external environments that, overall, are more dynamic or more stable. A field survey of 105 single-business manufacturing firms evaluated CEOs' scanning emphases and firm performance. Results indicated that, for dynamic external environments, relatively more CEO attention to the task sectors of the external environment and to innovation-related internal functions was associated with high performance. In stable external environments, however, simultaneously increased scanning of the general sectors in the external environment and efficiency-related internal functions produced higher performance. These relationships were strongest between relative scanning emphases among domains and sales growth. We discuss the implications of these results for researchers and practitioners. Copyright © 2003 John Wiley & Sons, Ltd.

Franchising is ‘a key tool in the entrepreneur’s tool box’. This paper advances strategy-structure fit in entrepreneurship research by exploring the role played by the different forms of franchisin...