Individual entrepreneurial orientation on MSME's performance: the mediating effect of employee motivation and the moderating effect of government intervention

PurposeThis research would like to address the issues associated with individual entrepreneurial orientation, which involves entrepreneurial leadership and entrepreneurial ability as the key determinants of MSME growth. It will also explore both mediating and moderating roles of employee motivation and government intervention, respectively during the pandemic situation.Design/methodology/approachA purposive sampling technique was applied during pilot study and during the final data collection phases. Exploratory Factor Analysis (EFA) was conducted using varimax rotation to reduce a large number of variables into a smaller set of interpretable underlying factors. Further CFA and SEM are respectively applied to examine the psychometric properties of the scales and test the hypotheses of the research model.FindingsThe study's findings revealed a favourable association between entrepreneurial orientation, business financing, management, market practices, and MSME growth performance. The results support the notion that government policy plays a significant role as a full moderator.Practical implicationsAlthough the MSME sector receives government support, its implementation requires a skilled leader who can run the business profitability. The findings support this objective.Originality/valueThis paper seeks to give important insights into one of the understudied but quickly expanding MSME entrepreneurship, and how this environment influences individual entrepreneurial orientation and the formation of entrepreneurial leadership. This opens up a previously unexplored area for fresh insights and future study on enhancing entrepreneurship development research and practice for the MSME sector.