Impact of Entrepreneurial Leadership, Entrepreneurial Self-Efficacy, Basic Psychological Needs Satisfaction, and Training Effectiveness on Entrepreneur Resilience in Malaysian SMES

Abstract

The COVID-19 Pandemic has impacted industries worldwide, affecting virtually every industry and business field as it spreads. Small and medium-sized businesses, in particular, have been particularly hard hit due to a scarcity of funding and a lack of entrepreneurial skills such as resilience. However, research on resilience at an individual level is underexplored, with even less attention on resilience in the context of entrepreneurs. Thus, this study examined entrepreneur resilience in Malaysian SMEs related to entrepreneurial leadership, entrepreneurial self-efficacy, basic psychological needs satisfaction, and training effectiveness. Social cognitive and self-determination theories underpin the study framework. Integrating both theories can provide a motivating lens to facilitate a more holistic understanding of resilience factors. Indeed, addressing the entrepreneurs' basic psychological needs and satisfaction can help entrepreneurs overcome their fear of failure. The study used a quantitative approach to collect primary data from 221 Malaysian small and medium-sized enterprises (SME) entrepreneurs through an online questionnaire. Partial Least Squares-Structural Equation Modeling (PLS-SEM) was used to analyze the data. The findings reveal that entrepreneurial self-efficacy is statistically significant and positively impacts entrepreneur resilience. Meanwhile, basic psychological needs satisfaction mediates the relationship between entrepreneurial leadership, entrepreneurial self-efficacy, and entrepreneur resilience. The second contribution of this study is that it establishes a moderating impact on training effectiveness. As a result, this study discovered that entrepreneurial self-efficacy, basic psychological needs satisfaction, and training effectiveness directly or indirectly impacted entrepreneur resilience. Entrepreneurial leadership, on the other hand, is the inverse. Many previous studies on the factors influencing resilience yielded inconsistent and incoherent findings. Therefore, this study contributes to the theoretical debate on exploring resilience concepts, measures in SMEs, and the factors that influence resilience at the entrepreneur level.