AN EMPIRICAL EXAMINATION OF THE INTERACTIVE EFFECTS OF GOAL ORIENTATION, PARTICIPATIVE LEADERSHIP AND TASK CONFLICT ON INNOVATION IN SMALL BUSINESS

Abstract

This study investigates the relationship between task conflict and innovation in small business. It also investigates the interactive effects of an entrepreneur's goal orientation and participative leadership style on the relationship between task conflict and innovation in small business. Hierarchical multiple regression analysis of data collected from 201 small businesses found a significant and positive relationship between task conflict and innovation. Analysis also revealed significant two-way interactive effect of an entrepreneur's participative leadership style and task conflict on innovation and significant three-way interactive effect between entrepreneur's goal orientation, participative leadership style and task conflict on innovation in small business. Results showed the relationship between task conflict and innovation is strongest in a small business of which the entrepreneur adopts a participative leadership style and the primary goal is growth and profit. Both the theoretical and practical implications of the results are discussed.