Employee's performance: An empirical study of enterprising family firms

Abstract

The study has been designed to analyze probable determinants of employee's performance in family firms. Although many studies have adequately conceptualized about employee's performance against various factors in terms of level or amount, almost all those studies have considered business firms generally. As a result, a vacuum of knowledge has been created of the same concept in the case of special category of business like family firms. Existing limited studies also have made contradictory conclusions. The researchers of this study have concerned over significant features of family business to derive a theory about employee's performance. To solve the controversy of employee's performance in family firms, a quantitative methodology was adopted. Data were collected from hundred and thirteen employees from fifteen family businesses located in Western Province in Sri Lanka. Correlation and ordinal logistic regression analysis were used to elaborate the relationships. Correlation analysis indicated that both family involvement and employee's engagement have correlated to employee's performance. Family involvement in case of holding positions in functional and strategic levels by family members has shown no correlation to employee's performance. Yet, having a family member as immediate boss/supervisor of an employee in the job has made strong correlation to employee's performance. Regression analysis is evident that almost all coefficients of odds of employee have negatively related to employee's performance. Yet, all odds of employee's engagement are significantly related to employee's performance. It further shows that being the lower odds of employee's engagement increases being in the lower levels of employee's performance.