Franchising is processed as if it were a prison.

August 29, 2012

Phil Zimbardo says evil comes from hierarchy.

The Stanford Prison Experiment

  • Franchising harms people, over time by both sides (see Clay/Prisoner 416 and mock guard talk: start at 2:46). No regret, guilt. Only after upon reflection.
  • Prisoner 8612 @ 1:36 (after 36 hours ‘incarceration”)
  • Let me in on some knowledge…I know you’re a nice guy (You don’t know that).
  • People didn’t say anything.
  • Prisoner 819 did a bad thing… I have to prove I’m not a bad prisoner.
  • The situation degrades over time.
  • How program dissenters are treated by peers and guards (one sign of resistance: Prisoner 416). The guards go crazy. Not a hero but a troublemaker.
  • The Stanford Prison Experiment Slide Show

Problems with authority. Breaks from reality. Damaged feeling function. Lack of trust. Anger. Barrenness.

What do you think they chose? Most elected to keep their blanket and let their fellow prisoner suffer in solitary all night.


Gag orders distort & defeat rational investment decision making

September 30, 2010

Franchising is as healthy as its secrets.

Confidentiality agreements are used promiscuously:

  1. pre-sale (when looking),
  2. at any cash payment for “wrongs” during the relationship,
  3. at renewal,
  4. at listing of business for sale,
  5. when you exit, and
  6. at any lawsuit end.

In my 15 minutes of fame, I was asked a question:

[John O'Toole] Can you suggest one thing within the framework we’ve defined that would improve – not totally correct; we’ve passed that, we’re not astronauts – but one thing we could do that would make a real impact on these 40,000 victims, self-imposed victims in some cases? What could we do?

Mr Stewart: Outlaw gag orders. Outlaw gag orders.

Confidentiality agreements encourage opportunistic franchisor behavior because they conceal bad behavior to unsuspecting current and future financial market investors. They are a very large source of imperfect investment information.

Silence puts gold in only the pockets of those proposing these “agreements” that are tethered to the franchisee’s life savings.

More corrosively, they operate internally the same way a false prisoner confession works.

Psychologically they create an internal silencing mechanism, part of which is explained by the concepts of cognitive dissonance, learned helplessness, and obedience (Milgram, Stanford prison, Abu Ghraib). The experience of franchising can be engineered to provide a subtle and not so subtle method of mind control as was seen in the ’70s case of est.

The victim becomes convinced that they were the cause of their own suffering.


Executives are judged on the integrity of their field heavies

March 29, 2010

Senior executives of franchises have a big problem:

They have to rely on their subordinates to “manage” their franchisees.

These middle- and lower-level supervisors can quickly degenerate, self-select or be developed into a cynical prison guard mentality (see Stanford prison experiment).

A publicly-traded company’s market reputation is based on those who act very much like a prison officer screw:

The slang word screw originated in the Victorian era when a prison warder or officer would give a prisoner a pointless task as a punishment.

A well-run Attorneyless Franchisee Network tests and diagnoses all levels of managers.

Some pass the test.

Lots don’t.


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