An Analysis of the Impact of Leadership Styles of SMEs Owner/ Managers on the Organisational Financial Performance. The Case of Glenview Carpentry Sector

Abstract

The research aims to give an in-depth account of the existing leadership styles of Small to Medium Business owners operating in the carpentry sector of Zimbabwe. To achieve this, the researcher proposed the hypothesis that there are ineffective leadership styles practised in SMEs operating in Zimbabwe which in turn impact negatively on the financial performance of SMEs and the economy in general. This study is important because SMEs, despite their contribution to the Zimbabwe economy, have not been given their due attention as the previous researches on leadership styles have been biased towards the larger enterprises. The vehicle for investigation is the survey questionnaire which will be filled by owners in the Glenview Carpentry Complex in Harare. In this study 12 business people, 10 males and 2 females were used as the research subjects. This already showed that the majority of SMEs are owned by males. It was also established that most of the owners have acquired some level of education. The results also indicate that the leadership styles practiced by the research subjects are democratic and charismatic style while autocracy is present to a higher extent. The results also indicated that the Machiavellie style is not so commonly practised among SME leaders. The research concludes that SME owners exercise control over how people go about tasks in the department. The research also concludes that when SME owners make decisions they announce them. The study further concludes that when mistakes occur SME owners will seek to find out who is responsible and making it clear they will not be tolerated. Lastly the study concludes that some SME owners do not mind mistakes as long as people use them as genuine learning situations. The study recommends that SME leaders should put controls in place to ensure efficient levels of financial performance. The researcher also recommends leadership training for SMEs owner/managers.