Leadership practices influencing stakeholder satisfaction in Thai SMEs

Abstract

Purpose – The purpose of this paper is to investigate the leadership and management practices that positively affect stakeholder satisfaction, an under-studied area important for both academic researchers and leaders. Relationships between 23 leadership and management practices and overall stakeholder satisfaction (OSS) were examined. Design/methodology/approach – Avery and Bergsteiner ' s (2010, 2011a) sustainable leadership (SL) model provided the theoretical framework for a cross-sectional survey research design used to gather empirical data from 439 managers of small- and medium-sized enterprises (SMEs) in Thailand. Findings – Results show all SL practices except financial market orientation were significantly related to OSS, and the more an organisation adopts significant SL practices, the higher the OSS is likely to be. The particular SL practices that positively predicted enhanced OSS were amicable labour relations, staff retention, strong and shared vision, strategic and systemic innovation, and high staff engagement and quality. Research limitations/implications – Future research should further examine relationships between SL practices and a range of organisational performance outcomes in different contexts, as well as the relationship between SL practices and sustainable human resource management (SHRM), and between SHRM and stakeholder satisfaction. Practical implications – The findings provide guidance on which SL practices to adopt for managers of SMEs in Thailand and possibly in other countries, who wish to improve their stakeholder satisfaction and sustain their business success. Social implications – Policy makers may gain insights into practices that drive performance in SMEs, a strong force in many economies. Originality/value – This study extends current knowledge of leadership and management practices that positively predict enhanced stakeholder satisfaction, an area in which empirical evidence has to date been largely lacking.