Ceo satisfaction and firm performance in family firms: Divergence between theory and practice

This study employs structural equation modeling (LISREL 8.0) to investigate a model of the relationship between chief executive officer (CEO) job and life satisfaction, as well as the relationship between CEO job and life sat isfaction and firm performance. Consistent with recent research, our model also includes several potential mediators of the job/life satisfaction rela tionship - overall stress, work conflict, nonwork conflict, and nonwork sat isfaction. We rely on questionnaire data from 221 owner/managers of family owned and controlled automobile dealerships. Results indicate that CEO job and life satisfaction are more strongly correlated than among average Ameri can workers, as predicted, but that there is no moderator effect on firm pe rformance. Nor does life satisfaction mediate the relationship between job satisfaction and firm performance. Contrary to theory, there are no signifi cant relationships with firm performance. The organizational implications o f CEO satisfaction for firm performance are considered.