Social capital and SME performance: the moderating role of emotional intelligence

Abstract

Purpose Lack of extant studies on the moderating role of emotional intelligence on the relationship between social capital and firm performance necessitated this study. The purpose of this paper is to examine the extent to which emotional intelligence moderates the relationship between social capital and small and medium-scaled enterprises’ (SMEs’) performance. Design/methodology/approach A total of 1,532 SMEs were selected through simple random sampling technique from a population of 5,009 SMEs. Structural equation modelling using AMOS was used to analyse the relationship between the variables. Findings The results revealed that social capital has a positive and significant relationship with emotional intelligence. Moreover, the study also showed that emotional intelligence has a positive and significant relationship with SME performance. Finally, the study found that emotional intelligence enhances the relationship between social capital and SME performance. Practical implications SME owner/managers are advised to enact policies that encourage the establishment of meaningful social networks and also help employees understand their emotions while creating social capital as both would help improve the performance of their firms. Originality/value This paper breaks new ground by identifying emotional intelligence as an enabler of SMEs performance where there is adequate social capital.

Effect of social capital on agribusiness diversification intention in the emerging market

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“…In fact, as the implication of Morrow et al (2017), its existing measurement is in a vague methodology or a lack of theory-based and validated measurements (Snoxell et al, 2006). As a consequence, most of the existing empirical studies apply partial approaches with one or a few facets of SC (Seghers et al, 2012;Morrow et al, 2017;Xu et al, 2018;Boohene et al, 2019;Chmel ıkov a et al, 2019;Calcagnini and Perugini, 2019;Cofr e-Bravo et al, 2019;Sallah and Caesar, 2020), while it is a multidimensional construct (Nahapiet and Ghoshal, 2000;Gedajlovic et al, 2013). Thus, scholars need to weigh each measure depending on the context of the study before applying for their studies (Veerle et al, 2012).…”

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“…Xu & Li (2019) even added that intellectual capital is positively associated with firm earnings, operation efficiency, and profitability. Along with that finding, social capital and financial capital also have shown that it has positive and significant influences on business (financial) performances among SMEs around the word (Abbas, 2018;Adlešič & Slavec, 2012;Boohene et al, 2019;Chittithaworn et al, 2011;Fatoki, 2011;Philip, 2011;Omar & Azmi, 2020;Sombolayuk et al, 2019;Utari & Dewi, 2014). Nakku et al (2020) added that the effect of financial capital on SME's performance will be stronger when government support existed.…”

Examining Perceived Entrepreneurial Stress: A Causal Interpretation through Cross-Lagged Panel Study

“…Due to the entrepreneur's immersion in their jobs and a blurred line between work and social life, an entrepreneur's social life quality is compromised. Their desire to be part of a social network is essential to relieving entrepreneurial jobs' pressure [106]. Further, as their work and social lives become intertwined, the quality of social life suffers compared to the entrepreneurs' perceived social life.…”