Cómo controlan los franquiciadores españoles a sus franquiciados?/How do Spanish Franchisors control their Franchisees?

In franchises, a bad performance by a franchisee has a strong negative impact over the whole chain, explaining why the management control systems (MCS) are key for the running and success of the franchise. Based on the distinction among outcome, behaviour and social controls (Ouchi, 1979) and the diagnostic and interactive styles of control use (Simons, 1995), this paper analyzes the prevailing pattern in the design and use of MCSs in franchises from a Transaction Cost Economics perspective. Through a domestic survey, data from 240 franchisors located in Spain were obtained, which was subsequently analysed using structural equations. Results show that social controls and interactive use are the trending pattern in management control in Spanish franchisors, pointing out a relational tendency in the franchise, oriented to value creation and mutual dialogue. The inclusion of transaction cost variables reveals a high influence of uncertainty in the franchisor's control. However, variables of this theory, such as specific assets investment and frequency of the relationship, have a secondary role in MCS design and use. [PUBLICATION ABSTRACT]