Performance and Control across Multiple Markets

By: Tatiana Sandino, Dennis Campbell and Shelby Yu

Format:Print
| Language:English

Abstract

Chain organizations typically operate units across different types of markets, with significantly diverging customer bases. Such market-type dispersion potentially influences performance through two channels: it makes performance a noisier indicator of store manager effort, and it makes chain level decisions less optimal for individual stores. This paper examines the impact of market-type dispersion on chain and store performance in the convenience store industry. Our findings indicate that market-type dispersion has a negative impact on chain and store performance; they also indicate that these effects are mitigated by two control mechanisms: franchising and standardization.

Keywords

Governance Controls; Organizational Design; Markets; Franchise Ownership; Performance; Retail Industry

Citation

Sandino, Tatiana, Dennis Campbell, and Shelby Yu. "Performance and Control across Multiple Markets." American Accounting Association Financial Accounting and Reporting Section Paper, January 2008.