Abstract:

Nowadays, Indonesian Micro and Small Enterprises (MSEs) are faced with challenges and opportunities that arise due to advancement in technology and the changes in the environment. It puts pressure for businesses to have capable leaders that will guide them facing those challenges. Entrepreneurial leadership and agility have shown to be influential towards performance. This study investigates the influence of entrepreneurial leadership towards the business agility. Then how those factors will affect business performance. The method used is a survey of 500 respondents consisting of business owner and manager of MSEs. Structural equation method is used to analyze the data. The result of the study shows that agility has a significantly positive effect on business performance; however, entrepreneurial leadership has no such influence. Agility is proved to be a mediator between entrepreneurial leadership and business performance. This study should provide insight for business persons to further improve their business performance and for academicians to further analyze the variables.