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Innovation performance of small and medium enterprises: The impact of transformational leadership and work engagement in small and medium manufacturing enterprises in the Greater Kampala Metropolitan Area, Uganda
Mariam Nakate
Abstract
The purpose of this paper is to explore the relationship between transformational leadership, work engagement, and innovation performance in the context of small and medium manufacturing enterprises in the Greater Kampala Metropolitan Area, Uganda. This study was grounded in the upper echelons theory and social exchange theory. A cross-sectional research design was employed to collect data from 326 small and medium-sized manufacturing enterprises in the Greater Kampala Metropolitan Area, Uganda. Data were collected using a structured, self-administered questionnaire. The data were analysed using the Statistical Package for the Social Sciences (version 27) and the Hayes Process Macro (version 4.2). The findings indicate that transformational leadership (β = .509, p<.001) and work engagement (β = .256, p<.001) have a positive and significant influence on innovation performance. The results revealed that transformational leadership significantly predicts work engagement (β = .543, p < .001). Work engagement significantly mediated the relationship between transformational leadership and innovation performance (β = .135, 95% Boot CI = .073, .206). The study concludes that work engagement mediates the relationship between transformational leadership and innovation performance. Owner-managers seeking to enhance the innovation performance of their SMEs should attend leadership symposia to improve their transformational leadership behaviour. Creating an atmosphere where employees’ needs are catered to, they can express themselves, trust is built, and relationships are fostered, making employees feel part of the firm and resulting in more innovative initiatives. This study advances understanding of innovation performance in manufacturing SMEs in developing countries, particularly Uganda.
