UNDERSTANDING LEADERSHIP COMPETENCIES AND ITS IMPACT ON SMALL BUSINESS PROFITABILITY: EVIDENCE FROM SUB-SAHARAN AFRICA
DOI:
https://doi.org/10.14456/aamr.2024.39Keywords:
Artificial Intelligence, Communication, Managerial Roles, Technological Adoption, NigeriaAbstract
Small and Medium-sized Enterprises (SMEs) are of utmost importance in the global economy and aacademic research on leadership has continued to evolve significantly. But in Nigeria, they are challenged in many areas such as management and leadership competencies, profitability, sales growth, competitive advantage, increased market failures, and many other obstacles. This study therefore aims to investigate the effect of leadership competencies on SME profitability, in Lagos state, Nigeria, which is the most densely populated and largest consumer market in Africa. A descriptive survey approach was employed, and the research population consisted of selected small businesses in Lagos, Nigeria. The sample size of 742 was established and the sample was selected using proportionate and stratified sampling approaches. A multistage sampling technique was used for this study because SMEs are scattered across the five geo-political zones of Lagos State. A closed-ended questionnaire was created and administered, 701 responses were collected, resulting in a response rate of 95%. The findings also demonstrated a substantial correlation between management roles and self-efficacy (β = 1.2663, t = 31.2138, p < 0.05). Therefore, small and medium-sized enterprises in Nigeria need to enhance their understanding, establish effective administration, and cultivate leadership skills to enhance their profitability. The study also suggests that the management of SMEs, especially the owners/managers, should enhance their leadership and entrepreneurial skills, driven by the need for achievements.
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