This article responds to the calls from the research field to find effective ways to distinguish between different categories of family firms. The authors contribute to this literature by extending and refining previous family firm typologies. To attain this objective, the authors introduce the professionalization construct as basis for distinguishing family firms. As this construct is often approached in an oversimplified, one-dimensional manner, they first conduct an exploratory factor analysis to reveal its multidimensional nature. Based on these results, drawn from a representative sample of 532 Belgian family businesses, a cluster analysis facilitates a distinction between different “types” of family firms based on a multidimensional conceptualization of firm professionalization.

In family business literature, business professionalization is often simplified into a binary characteristic, that is, the presence of a nonfamily manager. We contend that other professionalization features, which may act simultaneously, can influence firm performance. This study addresses professionalization as a multidimensional construct, as intended by general management literature, and assesses the impact on business performance based on these underlying dimensions. Using a representative sample of 523 private Belgian family businesses, we identify five different dimensions of the professionalization construct by means of an exploratory factor analysis. Further regression results revealed significant positive effects of increasing nonfamily involvement, implementing human resource control systems, and/or decentralizing authority on firm performance. However, nonfamily involvement only seems to improve firm performance if there is sufficient decentralization of authority and an average or even low amount of formal financial control systems.

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