Effect of Leadership Styles on Performance of Micro, Small and Medium Enterprises in South West Nigeria

Abstract

The study primarily examined how leadership style affects the performance of MSMEs in Southwest Nigeria. The effects of autocratic, transactional, and transformational leadership styles were considered. Four hypotheses were formulated and tested. The research used a multiple-case study approach to collect and analyse data. Semi-structured interview was the main tool for data collection. Descriptive statistics of organisational performance of responding MSMEs were tabulated and research hypotheses were tested using correlation analysis. The research found a significant connection between how well the MSMEs in SW Nigeria perform and the styles of leadership employed. The study also indicated that the performance of MSMEs was substantially impacted by the mix of autocratic and participative (Transactional and Transformational) leadership styles. The study concluded that, a leadership style that is both autocratic and participative may invariably result in high performance. Secondly, leaders should evaluate situations and espouse the most suitable leadership style. The study recommended that the styles of MSME leaders should conform to the prevailing circumstances. Secondly, MSMEs leadership should priorities development of employees and their requirements. Lastly, Governments at all levels should promote entrepreneurship through the general educational system.