Knowledge attributes and the choice of knowledge transfer mechanism in networks: the case of franchising

In this paper we develop a knowledge-based view on the choice of knowledge transfer mechanisms in franchising that integrates results from the information richness theory. Starting from the information richness theory we argue that tacitness of system knowledge, operationalized by codifiability, teachability and complexity, determines the information richness of the knowledge transfer mechanisms of franchising firms. We examine the following hypotheses: (1) If the franchisor’s knowledge is characterized by a high degree of codifiability and teachability and a low degree of complexity, knowledge transfer mechanisms with a lower degree of information richness are used; (2) If the franchisor’s knowledge is characterized by a high degree of complexity and a low degree of codifiability and teachability, knowledge transfer mechanisms with a higher degree of information richness are used. We test these hypotheses by using data from 52 franchising firms in the Austrian franchise sector. The data provide support for the hypotheses.