Linking entrepreneurial leadership to quality performance of micro and small-scale enterprises in service sector: the mediating role of service innovation

Abstract

This study aimed to investigate the mediating effect of service innovation on the link between entrepreneurial leadership and quality performance of micro and small-scale enterprises in the service sector in the North Shoa Zone of the Amhara Region, Ethiopia. The primary data were collected using a stratified random sampling technique. A total of 369 questionnaires were distributed to managers/owners of sampled enterprises, with 348 (94.3%) respondents returning correctly filled questionnaires. Structural equation model was used to test the research hypotheses. The results revealed that entrepreneurial leadership and service innovation have direct positive effect on quality performance. Similarly, entrepreneurial leadership has a direct positive effect on service innovation. Moreover, service innovation has a significant partial mediation role in the link between entrepreneurial leadership and enterprise quality performance. The theoretical implications of this study suggest that entrepreneurial leaders play a crucial role in driving service innovation, which, in turn, positively affects the quality performance of micro and small-scale enterprises in the service sector. From a practical perspective, the findings suggest that organizations should focus on cultivating entrepreneurial leadership behaviors and encouraging service innovation to enhance the overall quality performance of their enterprises in the study area.