Franchising As Hybrid Organization: Russian Skill

Russia has favorable conditions for development of hybrid cooperation (franchising) on the different markets. On the one hand, as well as for the majority of countries with transition economies many Russian markets has been undersaturated. On the other hand, as for the developed countries, Russia has highly skilled human resources and the developed structure of consumption. In these conditions a model of coordination of the relations of franchising has been more and more popular. The benefit of this form can be explained from the side of institutional approach. The matter is that in real practice to determine the borders of firm is not simple. Key decisions of firm sometimes can be performed not in one center that can complicate distribution of control and responsibility and the determination of its borders. On the other hand, the determination of key decisions in the market, distribution of its assets and responsibility within one firm can strongly increase agency expenses. Therefore the hybrid form of coordination of the relations (to which the franchising belongs) can lower these expenses, but in case of strict accomplishment of terms of the contract. The hybrid forms of coordination includes the combination of characteristics of the market and hierarchy. Transactions are controlled via the price mechanism for coordination. For control and management of united actions, the maintenance of a certain symmetry in relations are necessary the hierarchical elements. The different conditions of franchise are the reasons of risks for both parties. And for decrease in risk of opportunism the special tools are developed for disciplining of the franchisee. The described examples of the Russian franchises through comparison of contract terms showed how hybrid agreements solve the cooperation problems connected with specificity of resources, transactional expenses and the competition