We present the concept of organizational misfit as a complement to multi-contingency theory fit
concepts for organizational performance. Firms with misfits have opportunity losses that firms
without misfits do not suffer. Using data from 232 small and medium sized Danish firms, we
confirm the hypotheses that firms with either or both situational and contingency misfits have
lower performance increases than firms without misfits. Further, a firm may not obtain increased
performance from the elimination of misfits piecemeal, but will obtain significant nonlinear positive
increases when misfits are fixed within a holistic or systems approach
