LEADERSHIP EFFECTIVENESS MODEL FOR SMALL AND MEDIUM ENTERPRISES (SME)

Abstract

SMEs will have position, potential and important role in order to realize economic development goals. In Sukabumi District, the role of SMEs can be seen in terms of providing a business opportunity, jobs and increased exports. SMEs in Sukabumi District are able to survive  longer than large-scale enterprises in facing the economic crisis, because they have the unique characteristics. The characteristics are more flexible and able to utilize local resources so that they can be relied upon to support the economic security. The role of SMEs which is so great in supporting economic security, should be balanced with leadership effectiveness, so it can improve the performance of SMEs in the future. This study has a specific target such as the appearance of a leadership effectiveness model for SMEs. With the discovery of the leadership effectiveness model, it is expected that the all SMEs can implement the model and improve their performance. The research method applied in this research is quantitative method by using statistical analysis tools such as SEM combined with qualitative method to confirm the statistical results. The results of the research show that the leadership effectiveness takes effect on the performance of SMEs. This research creates output of leadership effectiveness model for SMEs. Leadership effectiveness will be created if it contains three elements, they are leader and subordinate relationship, task structure, and strength of leader position.

Keywords: Leadership, effectiveness, performance, SMEs