Entrepreneurial Leadership and Performance of Small Scale Enterprises in Nigeria
Okechukwu Ferdinand CyrilNwuche, PhD
Abstract
The study examined the effect of entrepreneurial leadership on the performance of small scale enterprises in Nigeria. The study’s specific objective was to ascertain the extent to which situational entrepreneurial leadership and innovative entrepreneurial leadership affect operating efficiency. Descriptive survey research design was used in the study. The study pupation comprised 71,288 small-scale enterprise operators in Nigeria. Since studying the entire population was impractical, a sample size of 399 was determined using the Taro Yamane formula at a 5% margin of error. Primary data were gathered through a structured questionnaire designed using a five-point Likert scale. Multiple regression analysis was used to test the hypotheses. The study found the following: situational entrepreneurial leadership has a positive and significant effect on operating efficiency of small scale enterprises in Nigeria (? = 0.304, p = 0.000); innovative entrepreneurial leadership has a positive and significant effect on operating efficiency of small scale enterprises in Nigeria (? = 0.418, p = 0.000). In concussion, entrepreneurial leadership is not just a managerial attribute but a critical factor in optimizing operations within small enterprises, which often struggle with limited resources and volatile environments. The study recommends owners and managers of small-scale enterprises in Nigeria should actively adopt situational entrepreneurial leadership by tailoring their leadership approaches to suit specific business conditions, employee capabilities, and emerging challenges. This involves assessing each situation independently and responding with the most appropriate leadership behavior, whether directive, supportive, or delegative.
Keywords
Entrepreneurial Leadership
Firm Performance
Situational Entrepreneurial
References
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H. M., Bani-Khaled, A. K., & Al-Hawary, S. I. S. (2024). The impact of entrepreneurial
leadership
on
organisational
performance:
does
innovation
management
matter?. International Journal of Services and Operations Management, 47(2), 236-
Ariyani, D., & Zuhaery, M. (2021). Principal's Innovation and Entrepreneurial Leadership to
Establish a Positive Learning Environment. European Journal of Educational
Research, 10(1), 63-74.
Avordeh, T. K., Salifu, A., Quaidoo, C., & Opare-Boateng, R. (2024). Impact of power outages:
Unveiling their influence on micro, small, and medium-sized enterprises and poverty
in Sub-Saharan Africa-An in-depth literature review. Heliyon, 10(13).
Awashreh, R., & Hamid, A. A. (2025). The role of entrepreneurial leadership in driving
employee innovation: the mediating effect of knowledge sharing. Cogent Business &
Management, 12(1), 2466812.
Bans-Akutey, A. (2021). The path-goal theory of leadership. Academia Letters, 2(748), 10-
Getaneh, A., Terefe, S. D., & Ijigu, A. W. (2024). Linking entrepreneurial leadership to quality
performance of micro and small-scale enterprises in service sector: the mediating role
of service innovation. Cogent Social Sciences, 10(1), 2339526.
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House, R. J. (1971). A path goal theory of leader effectiveness. Administrative science
quarterly, 321-339.
Idagu, C. A., & Friday, E. (2025). Small scale business management in distress economy in
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International Journal of Research Publication and Reviews, 6(3), 1564–1582.
Jundulloh, R., & Nasution, Y. (2024). The Influence of Entrepreneurial Leadership,
Entrepreneurship Competence on Sustainable Organizational Performance: The
Mediation Role of Innovation Capability in MSME. Tazkia Islamic Finance and
Business Review, 18(2), 158-192.
Kadwa, I., & Barnard, B. (2019). The impact of leadership on entrepreneurship and innovation:
Perceptions of entrepreneurs. IUP Journal of Entrepreneurship Development, 16(4), 7-
Lazarova, T., Zhelyazkova, V., & Vazov, R. (2015). Innovation leadership as a key concept in
entrepreneurship. In Proceedings of International Conference for Entrepreneurship,
Innovation and Regional Development ICEIRD (pp. 275-287).
Li, C., Makhdoom, H. U. R., & Asim, S. (2020). Impact of entrepreneurial leadership on
innovative
work
behavior:
Examining
mediation
and
moderation
mechanisms. Psychology research and behavior management, 105-118.
Lotto, J. (2019). Evaluation of factors influencing bank operating efficiency in Tanzanian
banking sector. Cogent Economics & Finance, 7(1), 1664192.
Mohamed, A. A., Ghallab, S. A., Hussien, R. H., & Ragab, O. H. G. (2025). Effect of
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of
Global
Accounting,
8(3),
37
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https://journals.unizik.edu.ng/index.php/joga/article/view/1418/1142
Nworie, G. O., Onyeka, C. M. & Anaike, C. L. (2023). Evaluating the Financial Performance
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Retrieved
from
https://cajitmf.centralasianstudies.org/index.php/CAJITMF/article/view/592
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Businesses in North Central Nigeria. International Journal of Capacity Building in
Education and Management, 6(3), 17-34.
Okafor, O. O., Nworie, G. O., & Onyebuchi, M. H. (2024). Assessing Financial Returns
Through Environmental Responsibility Disclosure Among Listed Oil and Gas Firms in
Nigeria. International Journal of Research Publication and Reviews, 5(4), 545-557.
https://doi.org/10.55248/gengpi.2023.42001
Okoli, D. I. (2024). Effects of small scale industries on the Nigerian economy: A case study of
Anambra State. African Journal of Educational Management, Teaching and
Entrepreneurship Studies, 12(2), 321-341.
Omeihe, I., & Omeihe, K. O. (2023). How Does Entrepreneurial Leadership Pay Off for Small
Businesses? Exploring Contexts to Understand the Value of Entrepreneurial
Leadership. International Review of Entrepreneurship, 21(2).
Opoku, E., Kossidze, A. A., & Lawal, O. S. (2024). Predictive analytics, operational efficiency,
and revenue growth in SMEs in Africa. World Journal of Advanced Research and
Reviews, 23(3), 2281-2291.
Putri, V. P., Fuadiputra, I. R., & Ikhram W, M. (2025). Exploring the Link between
Entrepreneurial Leadership and Innovation Success: Evidence from Small and Medium
Enterprises. Jurnal Manajemen Teori dan Terapan, 18(1).
Putta, S. S. (2025). Impact of situational entrepreneurial leadership style on organisational
innovation in medium scale enterprises (with special reference to auto ancillary
enterprises located in Pune, India). International Journal of All Research Education
and Scientific Methods (IJARESM), 13(6).
Razzaque, A., Lee, I., & Mangalaraj, G. (2024). The effect of entrepreneurial leadership traits
on corporate sustainable development and firm performance: a resource-based
view. European Business Review, 36(2), 177-200.
Rehman, K., Lim, K. B., Yeo, S. F., Ameeq, M., & Asad Ullah, M. (2025). The Synergy of
Entrepreneurial Leadership and Team Diversity: Pathways to Entrepreneurial Success
in Pakistan’s SMEs. Sustainability, 17(5), 2063.
Selvam, M., Gayathri, J., Vasanth, V., Lingaraja, K., & Marxiaoli, S. (2016). Determinants of
firm performance: A subjective model. Int'l J. Soc. Sci. Stud., 4, 90.
Shehu, T. S., Jimoh, O. E., & Shehu, R. A. (2025). Internal Control Mechanism and Operating
Efficiency of Manufacturing Firms in Nigeria. Asian Journal of Advanced Research
and Reports, 19(4), 419-434.
SMEDAN (2017). National survey of micro, small & medium enterprises (MSMEs) 2017.
https://www.nigerianstat.gov.ng/download/966
Sudyantara, S. C., Christian, P., Herubawa, D. A., Wijaya, I., & Munizu, M. (2025). Good
corporate governance as a moderating variable of the influence of leadership style on
financial performance. Jurnal Ilmiah Edunomika, 9(2).
Sultan, M., Hussain, G., Ismail, W. K. W., & Rashid, M. A. (2024). From entrepreneurial
leadership to new product development performance: A study of the Coleman bathtub
model. European Journal of Innovation Management, 27(8), 2623-2645.
Sunarso, B. (2024). Situational Leadership Dynamics: Its Influence On Human Resource
Development In The Entrepreneurial Context. Technopreneurship and Educational
Development Review (TENDER
Performance of Listed Consumer Goods Firms in Nigeria. Journal of Banking, 11(1),
1-38. https://www.researchgate.net/publication/376956491
Alhassan, N. (2023). An exploration of situational leadership support and impact on Ghanaian
SME hotels (Doctoral dissertation, University of Worcester).
Alshawabkeh, R. O. K., Al-Abbadi, L. H., Eldahamsheh, M. M., Al-Quran, A. Z., Almomani,
H. M., Bani-Khaled, A. K., & Al-Hawary, S. I. S. (2024). The impact of entrepreneurial
leadership
on
organisational
performance:
does
innovation
management
matter?. International Journal of Services and Operations Management, 47(2), 236-
Ariyani, D., & Zuhaery, M. (2021). Principal's Innovation and Entrepreneurial Leadership to
Establish a Positive Learning Environment. European Journal of Educational
Research, 10(1), 63-74.
Avordeh, T. K., Salifu, A., Quaidoo, C., & Opare-Boateng, R. (2024). Impact of power outages:
Unveiling their influence on micro, small, and medium-sized enterprises and poverty
in Sub-Saharan Africa-An in-depth literature review. Heliyon, 10(13).
Awashreh, R., & Hamid, A. A. (2025). The role of entrepreneurial leadership in driving
employee innovation: the mediating effect of knowledge sharing. Cogent Business &
Management, 12(1), 2466812.
Bans-Akutey, A. (2021). The path-goal theory of leadership. Academia Letters, 2(748), 10-
Getaneh, A., Terefe, S. D., & Ijigu, A. W. (2024). Linking entrepreneurial leadership to quality
performance of micro and small-scale enterprises in service sector: the mediating role
of service innovation. Cogent Social Sciences, 10(1), 2339526.
Hirt, M. J. K. (2016). Path-goal theory of leadership. In Global encyclopedia of public
administration, public policy, and governance (pp. 1-6). Springer, Cham.
House, R. J. (1971). A path goal theory of leader effectiveness. Administrative science
quarterly, 321-339.
Idagu, C. A., & Friday, E. (2025). Small scale business management in distress economy in
Jaba Local Government Area of Kaduna State: Case study of Sabon Gari District Kwoi.
International Journal of Research Publication and Reviews, 6(3), 1564–1582.
Jundulloh, R., & Nasution, Y. (2024). The Influence of Entrepreneurial Leadership,
Entrepreneurship Competence on Sustainable Organizational Performance: The
Mediation Role of Innovation Capability in MSME. Tazkia Islamic Finance and
Business Review, 18(2), 158-192.
Kadwa, I., & Barnard, B. (2019). The impact of leadership on entrepreneurship and innovation:
Perceptions of entrepreneurs. IUP Journal of Entrepreneurship Development, 16(4), 7-
Lazarova, T., Zhelyazkova, V., & Vazov, R. (2015). Innovation leadership as a key concept in
entrepreneurship. In Proceedings of International Conference for Entrepreneurship,
Innovation and Regional Development ICEIRD (pp. 275-287).
Li, C., Makhdoom, H. U. R., & Asim, S. (2020). Impact of entrepreneurial leadership on
innovative
work
behavior:
Examining
mediation
and
moderation
mechanisms. Psychology research and behavior management, 105-118.
Lotto, J. (2019). Evaluation of factors influencing bank operating efficiency in Tanzanian
banking sector. Cogent Economics & Finance, 7(1), 1664192.
Mohamed, A. A., Ghallab, S. A., Hussien, R. H., & Ragab, O. H. G. (2025). Effect of
Entrepreneurial Leadership on Team Climate and Innovative Work Behavior among
Staff Nurses. Assiut Scientific Nursing Journal, 13(51), 34-42.
Mutshidza, M. K., Nkondo, L. G., & Khohomela, N. T. (2024). The role of entrepreneurial
leadership in influencing the performance of SMMEs in the Vhembe district
Municipality. International Journal of Business Ecosystem & Strategy (2687-
2293), 6(4), 208-217.
Nawaz, A., Wenqi, J., & Akhtar, S. (2025). Entrepreneurial leadership and organizational
performance: employee creativity and behavior. Management Decision, 63(7), 2486-
Nworie, G. O. & Mba, C. J. (2022). Modelling financial performance of food and beverages
companies listed on Nigerian exchange group: the firm characteristics effect. Journal
of
Global
Accounting,
8(3),
37
-
https://journals.unizik.edu.ng/index.php/joga/article/view/1418/1142
Nworie, G. O., Onyeka, C. M. & Anaike, C. L. (2023). Evaluating the Financial Performance
of Listed Food Product Enterprises in Nigeria: The Cost of Capital Factor. Central
Asian Journal of Innovations on Tourism Management and Finance, 4(9), 31-45.
Retrieved
from
https://cajitmf.centralasianstudies.org/index.php/CAJITMF/article/view/592
Okafor, C. A., & Chia, I. I. (2024). Digital Strategies and Operational Efficiency of Small
Businesses in North Central Nigeria. International Journal of Capacity Building in
Education and Management, 6(3), 17-34.
Okafor, O. O., Nworie, G. O., & Onyebuchi, M. H. (2024). Assessing Financial Returns
Through Environmental Responsibility Disclosure Among Listed Oil and Gas Firms in
Nigeria. International Journal of Research Publication and Reviews, 5(4), 545-557.
https://doi.org/10.55248/gengpi.2023.42001
Okoli, D. I. (2024). Effects of small scale industries on the Nigerian economy: A case study of
Anambra State. African Journal of Educational Management, Teaching and
Entrepreneurship Studies, 12(2), 321-341.
Omeihe, I., & Omeihe, K. O. (2023). How Does Entrepreneurial Leadership Pay Off for Small
Businesses? Exploring Contexts to Understand the Value of Entrepreneurial
Leadership. International Review of Entrepreneurship, 21(2).
Opoku, E., Kossidze, A. A., & Lawal, O. S. (2024). Predictive analytics, operational efficiency,
and revenue growth in SMEs in Africa. World Journal of Advanced Research and
Reviews, 23(3), 2281-2291.
Putri, V. P., Fuadiputra, I. R., & Ikhram W, M. (2025). Exploring the Link between
Entrepreneurial Leadership and Innovation Success: Evidence from Small and Medium
Enterprises. Jurnal Manajemen Teori dan Terapan, 18(1).
Putta, S. S. (2025). Impact of situational entrepreneurial leadership style on organisational
innovation in medium scale enterprises (with special reference to auto ancillary
enterprises located in Pune, India). International Journal of All Research Education
and Scientific Methods (IJARESM), 13(6).
Razzaque, A., Lee, I., & Mangalaraj, G. (2024). The effect of entrepreneurial leadership traits
on corporate sustainable development and firm performance: a resource-based
view. European Business Review, 36(2), 177-200.
Rehman, K., Lim, K. B., Yeo, S. F., Ameeq, M., & Asad Ullah, M. (2025). The Synergy of
Entrepreneurial Leadership and Team Diversity: Pathways to Entrepreneurial Success
in Pakistan’s SMEs. Sustainability, 17(5), 2063.
Selvam, M., Gayathri, J., Vasanth, V., Lingaraja, K., & Marxiaoli, S. (2016). Determinants of
firm performance: A subjective model. Int'l J. Soc. Sci. Stud., 4, 90.
Shehu, T. S., Jimoh, O. E., & Shehu, R. A. (2025). Internal Control Mechanism and Operating
Efficiency of Manufacturing Firms in Nigeria. Asian Journal of Advanced Research
and Reports, 19(4), 419-434.
SMEDAN (2017). National survey of micro, small & medium enterprises (MSMEs) 2017.
https://www.nigerianstat.gov.ng/download/966
Sudyantara, S. C., Christian, P., Herubawa, D. A., Wijaya, I., & Munizu, M. (2025). Good
corporate governance as a moderating variable of the influence of leadership style on
financial performance. Jurnal Ilmiah Edunomika, 9(2).
Sultan, M., Hussain, G., Ismail, W. K. W., & Rashid, M. A. (2024). From entrepreneurial
leadership to new product development performance: A study of the Coleman bathtub
model. European Journal of Innovation Management, 27(8), 2623-2645.
Sunarso, B. (2024). Situational Leadership Dynamics: Its Influence On Human Resource
Development In The Entrepreneurial Context. Technopreneurship and Educational
Development Review (TENDER
