Impact of Entrepreneurial Leadership on Innovative Work Behavior: Examining Mediation and Moderation Mechanisms

PURPOSE: Based on social cognitive theory, the present study aimed to explore the impact of entrepreneurial leadership on employees’ innovative work behavior through the moderating path of entrepreneurial self-efficacy in technology-based SMEs. The study also explains the mechanism through which a firm’s innovative environment mediates the relationship between entrepreneurial leadership and employees’ innovative work behavior. METHODS: To pursue the objectives, this study has used data from a sample of 350 supervisor–subordinate dyads working in cross sectional small and medium enterprises (SMEs) operating in the Jiangsu province of China. Based on social cognitive theory and specific continuum of self-efficacy theory, a conceptual model was developed and the hypotheses were tested with the help of SPSS 20. FINDINGS: Empirical findings recommend a significant positive effect of entrepreneurial leadership on employees’ innovative work behavior. The study suggested that firm’s innovative environment mediates the relationship between entrepreneurial leadership and the employees’ innovative behavior. The results also confirmed that entrepreneurial self-efficacy exerts a positive moderating effect on the association of entrepreneurial leadership and employees’ innovative behavior. CONCLUSION: Findings of the present research work have several implications for the management and policymakers of high-tech SMEs who want to augment their employees’ innovative behavior in order to compete in a highly competitive and challenging business environment. To the best of authors’ knowledge, this work is the first attempt that presents an empirically supported comprehensive model for the development of employees’ innovative behavior within entrepreneurial-based high-tech SMEs. It contributes to literature by examining the mediation and moderation process for the development of employees’ innovative behavior.