Process and Variance Modeling in Family Business Research

What is it about?

Aligning theory (explaining how and why about something) and methods (techniques to gather and analyze data) is a key part of any research field. Two types of models are generally discussed: process models and variance models. Process models explain the sequencing of events that lead to an outcome. Variance models explain how constructs are related. This article discusses the basic differences and assumptions associated with process and variance models highlighting three key issues regarding modeling—time and causality, measurement and operationalization, and model specification.

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Why is it important?

Models are an important component of research design that serve as intermediaries between theories and data, often directing decisions about methods and statistics. Understanding models leads to better research and conclusions drawn from data.

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