Briefly explain the concepts of partnerships and franchises

What will be an ideal response?

Two additional forms of organization structure are the professional partnership and the franchise system. Although
both are as much forms of legal ownership as they are organizational structures, they offer a few unique structural
characteristics that can be brought to bear on persistent organizational problems. In addition, both are common
fixtures on the business landscape.
1. Professional partnerships In several industries, the professional partnership is the structural form of choice. In
a professional partnership, the company is organized as a group of partners who own shares or units in the
company. Generally, the partners vote on a managing partner who will act as a supervisor, but this person serves at
their pleasure. Consequently, a senior partner has significant authority and prestige but perhaps not nearly the
power that a CEO of a large firm has over subordinates. Partnerships are pyramid-shaped structures, with each
partner having a number of associates (of various levels). Industries in which the partnership form is common
include the legal offices, accounting firms, consulting firms, advertising agencies, and real estate companies.
2. Franchise structure The franchise system not only transfers ownership of local facilities to a franchisee, it
likewise shifts all local management responsibility to the franchisee. One purpose of using a franchise model is that
it enables a firm to grow rapidly because much of the capital costs are picked up by the franchisees. However, the
franchise model fundamentally changes the organizational structure of the firm. A franchisee assumes all
management responsibility for individual business locations. For the right to the franchisor's business model and
brand name, the franchisee pays a royalty percentage and other fees to the franchisor.