Ceo Satisfaction and Firm Performance in Family Firms: Divergence between Theory and Practice

This study employs structural equationmodeling (LISREL 8.0) to investigate a model of therelationship between chief executive officer (CEO) joband life satisfaction, as well as the relationshipbetween CEO job and life satisfaction and firmperformance. Consistent with recent research, ourmodel also includes several potential mediators of thejob/life satisfaction relationship – overall stress,work conflict, nonwork conflict, and nonworksatisfaction. We rely on questionnaire data from 221owner/managers of family owned and controlledautomobile dealerships. Results indicate that CEO joband life satisfaction are more strongly correlatedthan among average American workers, as predicted, butthat there is no moderator effect on firm performance.Nor does life satisfaction mediate the relationshipbetween job satisfaction and firm performance.Contrary to theory, there are no significantrelationships with firm performance. Theorganizational implications of CEO satisfaction forfirm performance are considered.