According to a concept called ________ theory, it is more effective for the units of a growing chain to be run by franchisees than by managers because managers are usually paid a salary and may not be as committed to the success of their individual units as franchisees, who are in effect the owners of the units they manage.
A) incentive
B) stimulus
C) agency
D) stewardship
E) motivation

Question

Quizplus · Accepted Answer

Agency theory suggests that there is a difference in interests between the owners (principals) and the managers (agents) of a company. Franchisees, acting as owners, are more likely to align with the company's success goals than salaried managers, who may not have as much at stake personally.

According to a Concept Called ________ Theory, It Is More