Managing negative emotions from entrepreneurial project failure: When and how does supportive leadership help employees?

Drawing on Affective Events Theory and a sample of 112 matched manager-employee dyads involved in failed corporate entrepreneurial projects, we develop and test a model of when and how managerial leadership can foster high employee performance in their subsequent endeavors. Through path analysis modeling, we show that perceptions of supportive managerial leadership behaviors can limit the detrimental effects of recalled negative emotions from prior project failures on employee job satisfaction, and through job satisfaction, on employee performance. However, the benefits of supportive managerial leadership behaviors dissipate with more time since the project has failed.