The Mediating Role of Employees’ Entrepreneurial Intentions in the Relationship between Entrepreneurial Leadership and Business Performance in Small and Medium Manufacturing Enterprises in Addis Ababa

Abstract

The study empirically investigates the mediating role played by entrepreneurial intentions in the relationship between entrepreneurial leadership and business performance. Simple random sampling technique was employed to select 361 respondents from the target population in the small and medium enterprises and questionnaires were used as a data collection instrument. The study focuses on the often-overlooked dimensions of autonomy and networking within entrepreneurial leadership, seeking to investigate their impact on financial and non-financial performance. By employing a Structural Equation Modeling, the study findings reveal that a significant positive influence of autonomy and networking on financial performance. However, the study does not find a significant mediating role of entrepreneurial intentions in the relationship between entrepreneurial leadership and business performance. The findings will help policymakers and small and medium enterprises leaders with actionable strategies to encourage the promotion of entrepreneurial leadership practices that empower employees and facilitate valuable connections.