INFLUENCE OF TRANSFORMATIONAL LEADERSHIP STYLES ON GROWTH OF ONLINE CLOTHING SMALL AND MEDIUM ENTERPRISES IN NAIROBI CITY COUNTY, KENYA

Abstract

Globally, SMEs play a critical role in the economic growth, job creation and development of entrepreneurship culture in both developed and developing countries. SMEs contribute to job creation at a faster pace than larger companies, this has forced governments across the globe to increasingly encourage entrepreneurship through SMEs as part of their overall national development policy. However, approximately 80-90% of SMEs fail within 5-10 years. For SMEs to survive in the competitive environment, compete internationally and experience rapid growth, they need a transformational leader to overcome their depressive conditions and reach a more competent level. Thus, the current study aimed to investigate influence of transformational leadership styles on growth of small and medium enterprises with focus on online clothing businesses in Nairobi City County. The study was guided by the following specific objectives, that is: to determine the influence of idealized influence, and individualized consideration on growth of online clothing businesses in Nairobi City County. Descriptive research design was adopted in this study. The target population of this study was 211 online clothing businesses operating within Nairobi City County. Simple random sampling technique was adopted to sample 84 respondents. Questionnaires were used to collect primary data. The study used both qualitative and quantitative data where quantitative data was coded and entered into Statistical Packages for Social Scientists (SPSS Version 28) and was analyzed using descriptive statistics. Inferential statistic was also used to establish the relationship between the independent and dependent variables. The study concludes that leadership principles such as idealized influence, and individualized consideration are crucial for fostering sustainable growth in SMEs. Leaders who embody these qualities promote ethical workplaces and empower employees, fostering a culture of innovation, trust, and collaboration, ultimately driving organizational performance and long-term success. The study emphasizes that for SMEs to achieve sustainable growth, leaders should focus on idealized influence and individualized consideration. Implementing these principles promotes employee well-being, ethical practices, and open communication, fostering a collaborative culture. By nurturing employee talents, organizations can enhance morale, stimulate innovation, and improve performance, setting the stage for long-term success in a competitive market. The research urges leaders to re-evaluate and improve their strategies for better organizational results.

Key Words: Transformational Leadership Styles, Growth of Small and Medium Enterprises, Idealized Influence, Individualized Consideration