The Impact of Transformational Leadership on Entrepreneurial Orientation via the Mediating Role of Organizational Learning Capability

Abstract

The current research aims to investigate the effect of transformational leadership on entrepreneurial orientation in Jordanian commercial banks, and whether organizational learning capability mediates the effect of transformational leadership on entrepreneurial orientation. Adopting a quantitative research design, data were collected by means of a questionnairebased survey of employees in Jordanian commercial banks. Based on 330 usable responses, the results revealed the significant effect of transformational leadership and two of its dimensions (inspirational motivation and intellectual stimulation) on entrepreneurial orientation. Two other dimensions (idealized influence and individualized consideration) did not contribute to entrepreneurial orientation. Additionally, the results showed that transformational leadership has a significant effect on organizational learning capability, and that organizational learning capability in turn affects entrepreneurial orientation. The findings confirm that organizational learning capability fully mediates the effect of transformational leadership on entrepreneurial orientation. A number of recommendations are advanced, the most important of which is that banks should improve and develop managers' transformational attributes by training them on how to deal with employees in order to increase their entrepreneurial orientation. Banks should also consider improving their learning capability, as Journal of Business & Management (COES&RJ-JBM), 8(2), pp.65-111 66 this plays a significant role in enhancing and supporting the effect of transformational leadership attributes on entrepreneurial orientation.

The Role of Transformational Leadership and Entrepreneurial Orientation on Lecturer Performance

“…Transformational leadership refers to leaders who can inspire their followers to reach the desired goals and challenge them to achieve these goals in new ways [11]. Transformational leadership has four dimensions based on [12], including inspirational motivation (how leaders inspire their followers to achieve the desired goals), idealized influence (conditions where followers believe in leaders, that will drive them to achieve common goals rather than individual goals), intellectual stimulation (conditions where leaders challenge status conditions quo and encouraging followers to think about new different ways), and individual consideration (a condition where leaders are present as mentors to provide emotional support to their followers).…”

“…The effect caused by transformational leadership on entrepreneurial orientation has been proven by several previous studies. Research conducted by [11] on 330 employees of Jordanian commercial banks shows that transformational leadership have some influence on entrepreneurial orientation. In addition, research conducted by [19] on 158 respondents in Africa, shows that there is also an effect of transformational leadership on entrepreneurial orientation.…”

The Impact of Human Resource Management Practices on Organizational Learning at Jordanian Commercial Banks

“…In addition, the financial area contributes to the Jordanian GDP by 20% of the nation's GDP on average during 2000-2010 (OECD, 2018). Based on the literature review, many studies have studied many factors that have a possible impact on organizational learning in Jordanian commercial banks, such as transformational leadership dimensions (Ahmad Al-Azzam, 2015), strengthening corporate capacity building (Al-Shamayleh, 2019), Knowledge-sharing tools (Obeidat & Otibi, 2015), and leadership and entrepreneurial orientation (Nofal & Jaradat, 2020). However, there is a gap in existing studies, indicating that there is a lack of research addressing the specific relationship between HRM practices and organizational learning in Jordanian commercial banks.…”