Leading Innovation in Small and Medium-Sized Enterprises: Understanding the Role of Empowering Leadership and Organisational Climate

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Hoang, Giang ORCID: 0000-0003-4830-1569 (2019) Leading Innovation in Small and Medium-Sized Enterprises: Understanding the Role of Empowering Leadership and Organisational Climate. PhD thesis, Victoria University.


Innovation is critical for sustainable business performance in the contemporary, global economic and social context. Small and medium-sized enterprises (SMEs) are well positioned to innovate because of their potential for rapid adjustment. Although leadership and organisational climate have been identified as playing key roles in innovation, little is known about how such influences play out in SMEs. This study explored the relationship between innovation and empowering leadership and the mediating role of climate for innovation in the context of Vietnamese tourism SMEs. A review of theory and empirical evidence revealed limitations with respect to the concept of empowering leadership and its influence in organisational climate and on subsequent innovation. This study used a sequential exploratory research design to explore these relationships. The systematic literature review (SLR) and qualitative study informed an integrated model of the relationship between empowering leadership, other leadership behaviours, climate for innovation and innovation. The quantitative study tested the model using structural equation modelling (SEM) and found that, contrary to expectations, empowering leadership did not have a direct positive relationship with SME innovation. Instead, the results indicated that empowering leadership influences innovation through the mediating effect of climate for innovation. In addition, the results suggest that where leaders initiate structure among their followers, there is an indirect effect on SME innovation, which is also mediated by a climate for innovation. The findings from this study not only provide deeper understanding of innovation management practices in Vietnamese SMEs, but also contribute new knowledge to the study of innovation and leadership. The results offer significant insights into scholarly debates about regional differences in leadership by demonstrating the way in which leaders shape the context for innovation in a dynamic economy in the Asia-Pacific region. In particular, the findings have implications for developing and managing innovation in tourism SMEs in Vietnam that may be generalisable to neighbouring economies. Further benefits include building the evidence base for how to leverage the advantages of empowering leadership to deliver innovation outcomes through an explicit climate for innovation in tourism SMEs.

Item type Thesis (PhD thesis)
URI https://vuir.vu.edu.au/id/eprint/39474
Subjects Historical > FOR Classification > 1503 Business and Management
Historical > Faculty/School/Research Centre/Department > College of Business
Keywords leadership; innovation; small and medium-sized enterprises; SMEs; organisational climate; organisational culture; Vietnam
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