Stimulating exploitative and exploratory innovation through transformational leadership and knowledge management capability: the moderating role of competitive intensity

Abstract

PurposeGiven the importance of leadership practices and knowledge resources in fostering innovation capabilities of firms, the purpose of this study is to explore the influence of transformational leadership on exploitative and exploratory innovation via mediating role of knowledge management capability. This study also attempts to increase understanding of the appropriate mechanisms for firms to pursue innovation capability by examining the moderating mechanism of competitive intensity.Design/methodology/approachThis study utilized the structural equation modeling and cross-sectional design to test hypotheses in the proposed research model using survey data collected from 351 participants in 120 manufacturing and service firms.FindingsThe findings indicate that transformational leadership induces greater effect on exploratory innovation compared to its effect on exploitative innovation. The mediating role of knowledge management capability between transformational leadership and aspects of innovation capability is also supported. Especially, the influences of knowledge management capability on exploratory innovation capability are enhanced and depended on the degree of competitive intensity.Research limitations/implicationsFuture research should examine the mediating mechanisms of knowledge acquisition, knowledge sharing and knowledge application to provide deeper insight on the role of specific components of knowledge management capability in linking transformational leadership and innovation capability.Practical implicationsThe paper highlights the important role of transformational leadership practices for fostering knowledge management capability and specific aspects of innovation capability under high level of competitive pressure.Originality/valueThe paper is unique in the attempts to provide a prospective solution for firms to pursue and improve innovation based on the meaningful insights on the mediating role of knowledge management capability and moderating effect of competitive intensity in the relationship between transformational leadership and specific dimensions of innovation capability.

Analysing the mediating role of organisational citizenship behaviour between transformational leadership and education 4.0 using PLS-SEM approach

“…According to earlier research (Al-Amin, 2017; Mangkunegara and Huddin, 2016), there is a considerable link between transformative leadership and employees' job performance. Le and Le (2023) studied the influence of transformational leadership on exploitative and exploratory innovation via mediating role of knowledge management capability and the results indicated that transformational leadership induces greater effect on exploratory innovation as compared to its effect on exploitative innovation. Gui et al (2022a, b) studied the effect of transformational leadership on radical and incremental innovation through the mediating role of knowledge sharing behaviours and discovered that transformational leadership style is the main driving force of knowledge sharing process.…”

“…According to earlier research (Al-Amin, 2017; Mangkunegara and Huddin, 2016), there is a considerable link between transformative leadership and employees' job performance. Le and Le (2023) studied the influence of transformational leadership on exploitative and exploratory innovation via mediating role of knowledge management capability and the results indicated that transformational leadership induces greater effect on exploratory innovation as compared to its effect on exploitative innovation. Gui et al.…”

“…Transformational leadership style together with operating the appropriate, necessary and timely supports in long time to help directors/manages to create a positive environment that facilitates knowledge sharing activities and significantly contribute to enhancing innovation capabilities for their firms (Le and Lei, 2019). Le and Le (2023) investigated the influence of transformational leadership and trust on knowledge collecting and knowledge donating and found that trust acts as a mediator between transformational leadership and knowledge sharing processes. Asrar-ul-Haq and Kuchinke (2016) noted that transformational leadership encourages workers to do well at their jobs.…”

How knowledge-based HRM practices and market turbulence foster organizational innovation capability: a two-path mediating role of knowledge sharing

“…From this approach, KHRM practices can be viewed as a kind of unique and valuable resources that help firms to pursue key organizational outcomes such as innovation competence because it contributes to improving the employee skills, knowledge and abilities to obtain expected results of organization (Seeck and Diehl, 2017; Le and Ha, 2023). Regarding the KBT, the literature indicated that knowledge is the most basic strategic resource (Grant, 1996) that helps firms promote internal capabilities and enhance organizational performance (Le and Le, 2023a, b). According to KBT, firms can foster innovation capability and overcome the key competitors if they successfully manage their knowledge capital (Grant, 1996; Le and Lei, 2019).…”

Optimizing transformational leadership and knowledge management as keys to innovation

“…Leadership styles, as identified by Nguyen et al (2021), had a direct impact on innovation within the organization. Innovation is widely recognized as a crucial factor for companies to gain a competitive edge and has garnered significant attention from academia in recent years due to the rapid shifts in market demands, technology, and growing competitive pressure (Le and Le, 2023). In literature, innovation is described as the ability of an organisation to introduce and implement new ideas, products, services, procedures, technology, organisational structures, plans, and programmes in order to enhance organisational performance and attain a sustainable competitive advantage (Islam et al, 2021;Lei et al, 2020).…”