Abstract

Purpose - Competitive industry structure and recent economic depression challenge a survival of Korean small- and medium-sized food franchising companies (SMFCs), albeit the explosive growth of the Korean food service industry for last few decades. Against this backdrop, it examines how these SMFCs overcome liabilities of smallness and resource scarcity to strengthen competitive advantage in the market. To tackle this, in this article we focus on corporate entrepreneurship and human resources as a knowledge-based asset for these SMFCs. Furthermore, the ratio of employee turnover is high in SMFCs. We view that such brain-drain may result in poor performance of the Korean SMFCs. As such, we pay attention to the role of organizational commitment to an organization as a solution for enhancing individual-level employees' loyalty toward their organization. Research design, data, and methodology - Our research question is to what extent corporate entrepreneurship (i.e., innovative organizational culture, organizational autonomy, and administrative innovation) affects an individual-level attitude toward the organization and, in turn, employee creativity and satisfaction in the Korean SMFCs context. We collected data from employees in SMFCs for three months. A total of 126 valid questionnaires were collected, and analyzed the data using partial least squares path modeling. Results - The reliable and valid measurement model feed into testing the structural model. Our findings suggest that innovative organizational culture and organizational autonomy positively affect employee commitment. Particularly, organizational autonomy has a greater effect than innovative culture on employee commitment. However, the relationship between administrative innovation and employee commitment is not significant. We also find that employee commitment positively affects both employee creativity and satisfaction. Conclusions - Our contribution to the existing franchising business and management literature is twofold. First, the conceptual model includes three antecedents in the organizational entrepreneurship dimension to organizational commitment. Second, we conceptualize organizational commitment as employee commitment, and validate its impact on employee creativity and job satisfaction at an individual performance level. Overall, this article suggests that it is critically important for the Korean SMFCs to develop corporate entrepreneurship in order to facilitate employees' positive attitudes toward their organizations.