Employee work engagement in "high-failure" entrepreneurial organizations

The failure rate of projects is often high in entrepreneurial organizations. Drawing on self-determination theory, we develop a model of how employees’ perceived organizational project failure frequency impacts work engagement contingent on their perceptions of team diversity and team member satisfaction. Using data on 438 leaders and members of entrepreneurial project teams from 49 research and development organizations, we find evidence of a quadratic moderating relationship of team diversity and team member satisfaction, respectively, on the relationship between project failure frequency and work engagement. The impact of project failure frequency was diminished at medium levels of team diversity and team member satisfaction but less so at low and high levels.