Measuring success in family businesses: The concept of configurational fit

The problems associated with measuring success in small businesses are primarily caused by a lack of comparable data due to the ambiguity of success and by subjective biases. Success evaluation is dominated by the estimates of business owners, who tend to overestimate overall success and internal strengths. However, reliable success measurement instruments would be useful for small business owners/managers as well as small business policymakers. The main purposes of this article are to compare various measures of success, to explore the differences in their outcomes, and to analyze whether a model of success measurement using configurational fit can be used to overcome subjective biases. The study is based on a recent survey of 103 small family-owned businesses in the eastern Austrian border region. Our analysis of the data confirmed the existence of the measurement problems mentioned above. While some individual indicators show significant biases as well as effects due to company age, size and industry, the aggregated indicator based on the concept of configurational fit seems to be an appropriate means of overcoming most of these drawbacks.