EFFECT OF LEADERSHIP SKILLS AND TECHNICAL SKILLS ON GROWTH OF SMALL AND MEDIUM ENTERPRISES IN SOUTH EAST NIGERIA

Abstract

Despite the significant contribution of SMEs to national economic development and various government support initiatives, including credit schemes, tax incentives, and regulatory interventions, the sector has continued to experience declining performance. This decline is reflected in the reduction of SMEs’ contribution to Nigeria’s GDP from 50% in 2021 to 43.3% in the fourth quarter of 2022. The study specific objective was to examined the effect of leadership skills and technical skills on the growth of small and medium enterprises in South East, Nigeria.  Survey designed was adopted wherein, a sample of 400 owners/managers of SMEs was drawn by using Taro Yamani (1967) from 57,035 population. The sample was selected using convivences sampling technique. Data was collected using a five-point Likert scale questionnaire and analyzed using the Partial Least Squares Structural Equation Modelling (PLS-SEM). The findings revealed that leadership skills and technical skills had positive and significant effect on growth of small and medium enterprises in South East, Nigeria. Based on the findings, the study recommends that SME managers should invest in continuous leadership development and managerial training, particularly in strategic decision-making, employee motivation, delegation, conflict management, communication, team building, and problem-solving. They should also cultivate participative leadership practices that encourage employees to contribute ideas and take responsibility for organisational objectives. In addition, managers with adequate technical competence can improve operational efficiency, reduce errors and wastage, adapt to technological changes, improve product or service quality, and respond more effectively to customers’ needs.