Entrepreneurial management, competitive advantage and SME performance: evidence from an emerging economy

Abstract

Purpose There is a paucity of empirical studies on the impact of entrepreneurial management on small and medium enterprises (SME) performance. Against this backdrop and drawing upon the resource-based view, this study aims to explore the relationship between entrepreneurial management and SME performance and the mediating role of competitive advantage in an emerging economy. Design/methodology/approach This study adopted a survey research design and a quantitative approach. A self-reported questionnaire was used to collect data from a conveniently selected sample of 174 manufacturing SMEs in Nigeria. This study performed mediation analysis to test the proposed hypotheses using Hayes’ PROCESS macro v4. Findings The findings indicate that entrepreneurial management positively impacts competitive advantage and SME performance. Furthermore, competitive advantage has a positive impact on SME performance and plays a significant mediating role in the relationship between entrepreneurial management and SME performance. Research limitations/implications This study only examines manufacturing SMEs in a single country, Nigeria; thus, the generalisability of its findings is limited. Practical implications The findings of this study offer practical implications for SMEs and SME owners or managers. The findings suggest that to gain a sustainable competitive advantage and achieve superior performance, SMEs should pursue opportunities regardless of the available resources, promote flat and flexible organisation structures, adopt fast growth orientation and strategies, reward employees based on the value they add to the organisation and foster an entrepreneurial culture. Originality/value To the best of the authors’ knowledge, this study is the first to provide empirical evidence of the mediating effect of competitive advantage on the relationship between entrepreneurial management and SME performance in an emerging economy. This study demonstrates that implementing entrepreneurial management practices by SMEs can result in sustainable competitive advantage and superior performance.