Franchising exchanges $ for passivity and distrust

As someone who has been a franchisee, worked with franchisees for 10 years and also worked in a provincial psychiatric hospital, the following Erving Goffman quote has always intrigued me:

• Society is an insane asylum run by the inmates.

Goffman is arguably the most famous sociologist of the 20th century and his 1961 book Asylums: Essays on the Social Situation of Mental Patients and Other Inmates promises to be fascinating.

I am just starting into it but by scanning Wikipedia and the book itself, these are the themes I will be looking for as I read it:

• a mental-hospital patient is formed more by the institution (not the illness),
• patient’s reactions and adjustments are similar to those of inmates in other types of institutions,
• two classes are created and maintained within every institution (guard and captor),
• the features of the structure is primarily to create predictable of behavior of both classes, and
• Goffman defines a new term “total institution”.

Total Institutions are closed worlds such as prisons, army training camps, naval vessels, boarding schools, monasteries, and nursing homes where:

• the inmates are regimented,
• surrounded by other inmates, and
• unable to leave the premises.

I think franchise systems have many of these prison-like characteristics and that being a franchisee is a life altering event. One franchisee described it as undergoing 3 divorces at one time.

I have noted the similarity between a franchisee and being a member of a cloistered religious order or cult.

You enter into a totally new faith-based world, a re-birth actually (foreign language, working 60-70 hours per week, long-term relationships put on hold, charismatic leadership, etc.)

Franchising powerfully changes the investor’s personality and personal identity as does every closed world. (But, dangerously, without any emotional safeguards for the initiate nor any models/myths/maps to return from their adventure.)

For me, modern franchising primarily produces two “products”:

1. an investor who is both cognitively and emotionally incapable of defending himself (so institutionalized, so passive as to be unable to help himself, even if they had the individual economic resources to do so) and
2. an investor who is also impossibly distrustful of everyone else (many times the most suspicious of those most able to help them); although together as a group, they could solve their collective problem.

Franchising has the power to create and then imprint learned helplessness (a psychological condition in which a human being or an animal has learned to act or behave helpless in a particular situation, even when it has the power to change its unpleasant or even harmful circumstance.).

All authorities can “brand” this helplessness because humans tend to:

1. underestimate the influence of the situation and
2. overestimate our individual defenses.

I’ll report back.

Slaves lose everything in their chains, even the desire of escaping from them: they love their servitude. Jean-Jacques Rousseau

Identity Changes: On Cooling out the Franchisee

You’re making me angry.

You wouldn’t like me when I’m angry.

A Canadian born sociologist called Erving Goffman (1922 -1982) wrote a very relevant essay called: On Cooling out the Mark.

Anyone involved in franchising should read it. link, free .pdf download

You may or may not understand that you are a mark (in other people’s eyes) but it should be part of your business investigation to find out what new identity you will be asked to adopt.

This is where The Mask that eats your Face comes in: Franchising is a deeply, profoundly personally transformative process.

Goffman was a titan in the field of social theory: how we fit (or don’t) within society. We’ll be returning to this work and other of his.

You may think you are buying a simple product but you are not.

Franchising will change every significant relationship you have in your life. And it doesn’t matter if you reach your financial goals or not.

• As a matter of fact, I often sympathize more with those poor souls who do make more money than they know what to do with (franchisees and franchisors). Their success often blinds them fatally to the greatest joys in life. Only survival can be sustained by a constant diet of junk food relationships.

You can choose to try to understand the dynamics and gain some control. Or simply let it wash over you.

• But a word of caution from someone who has watched many people choose: Not everyone gets out alive and there are no short-cuts in this journey.

If you can’t hear this, drag your significant-other over to the monitor. No guff…

The Philosophy of taking a Loss

This is a very interesting article picked up by an excellent law weblog. In Cooling the Mark Out, sociologist Erving Goffman says:

The confidence of the mark is won, and he is given an opportunity to invest his money in a gambling venture which he understands to have been fixed in his favor The venture, of course, is fixed, but not in his favor.

The mark is permitted to win some money and then persuaded to invest more. There is an “accident” or “mistake,” and the mark loses his total investment.

The operators then depart in a ceremony that is called the blowoff or sting. They leave the mark but take his money.

The mark is expected to go on his way, a little wiser and a lot poorer.

Of course, sometimes something wises the victim:

In order to avoid this adverse publicity, an additional phase is sometimes added at the end of the play.

It is called cooling the mark out.

After the blowoff has occurred, one of the operators stays with the mark and makes an effort to keep the anger of the mark within manageable and sensible proportions. The operator stays behind his teammates in the capacity of what might be called a cooler and exercises upon the mark the art of consolation.

An attempt is made to define the situation for the mark in a way that makes it easy for him to accept the inevitable and quietly go home. The mark is given instruction in the philosophy of taking a loss. [my emphasis]

Brilliant. Check out the rest of Michael Webster’s excellent weblog, The Bizop News. It is a must read if you want to understand the psychology and law of fraud.

The original article, On Cooling the Mark Out: Some Aspects of Adaptation to Failure, University of Chicago.

Fascinating and very applicable whenever the fraud sausage explodes, to use one of Michael’s vivid expressions.