Determinants of frugal innovation for firms in emerging markets: the roles of leadership, knowledge sharing and collaborative culture

Abstract

Purpose Due to the vital role of frugal innovation (FI) for firms in developing and emerging economies, the purpose of this study is to investigate the effect of transformational leadership (TL) and knowledge sharing (KS) on FI of firms in supply chains. This study aims to bring deeper insight on the correlation among the constructs by exploring and analyzing the moderating effect of collaborative culture (CC) in the KS-FI relationship. Design/methodology/approach The paper used the quantitative approach and structural equation modeling (SEM) to test the relationship among the latent factors in the proposed research model using data collected from 381 participants in 116 manufacturing and service firms. Findings The findings revealed that TL might be an important precursor to induce significant influences on FI directly or indirectly through its effect on active and passive KS processes in supply chains. In addition, the paper highlights the moderating role of CC in strengthening the impact of KS processes on FI. Research limitations/implications The paper provides a valuable understanding and novel approach for managers to improve firms' FI capability through leadership practice and KS processes. The research findings support the idea that FI capability of firms in developing and emerging nations will be significantly enhanced if leaders are interested in practicing TL style and fostering a climate of collaboration within organization. Originality/value This study contributes to bridging research gaps in the literature and advancing the insights of how TL directly and indirectly fosters FI via mediating roles of active and passive KS processes in supply chains under the climate of collaboration.

Managerial Networking and Frugal Innovation: Situational Leadership Perspective

“…The leaders of SMEs could utilize social networking to help with strategic decision-making ( Hyypiä and Khan, 2018 ). Previous studies evaluated the moderating impact of collaborative culture ( Le, 2021 ), market and technological turbulence ( Dost et al, 2019 ), and bricolage ( Iqbal et al, 2021a ) on the “sustainable leadership-frugal innovation” relationship. Thus, this study considers the research gap based on situational leadership theory by examining the impact of managerial ties on frugal innovation, especially among SMEs in sustainable leadership.…”

“…A close association with competitors can initiate firms to conduct information exchange and inter-firm collaboration. This idea will ultimately reduce implicit collusion ( Li et al, 2014 ), a critical factor in frugal innovation ( Le, 2021 ). Furthermore, communication with managers promote sharing of technology and knowledge ( Li et al, 2008 ; Wang and Chung, 2013 ), fostering collaboration with different stakeholders ( Wu and Peng, 2020 ).…”

“…Thus, this form of leadership encourages followers to perform beyond their expectations, developing stakeholders’ perceptions of the work environment ( Wang et al, 2021 ). Leadership, knowledge sharing, and collaboration based initiatives are vital to fostering frugal innovation ( Iqbal et al, 2021 ; Le, 2021 ).…”

Linkages Between Knowledge Management Process and Corporate Sustainable Performance of Chinese Small and Medium Enterprises: Mediating Role of Frugal Innovation

“… Fischer et al (2021) suggested that we could refer to green goods and renewable processes as eco-innovation. Le (2021) described the FI as “hardware or software advancement in association with green processes and products, including advanced technology involved in saving energy, avoidance of emissions, composting, green products development, organizational environment management. Innovative application at all levels.” Innovative technologies, environmental pollution control, recycling, green product design, and ecological management are key FI priorities ( AlMulhim, 2021 ; Hossain et al, 2021 ).…”

Value Creation through Frugal Innovation, Innovation Capability and Knowledge Sharing in a Circular Economy

“…Innovation capabilities are the main source of innovative knowledge and information from external and internal stakeholders [39]. Organisations obtain advantages of novel ideas by formulating the latest procedures and techniques for designing products and services [40]. Alternatively, frugal innovation is a means by which business firms can use available resources for innovation activities and processes [41].…”