Transformational leadership and exploratory innovation: The moderating role of intrinsic motivation and environmental dynamism

Abstract

The study investigated whether transformational leadership influences exploratory innovation and intrinsic motivation and environmental dynamism moderate this relationship. While leadership’s impact on innovation has been broadly studied, specific effects of transformational leadership on exploratory innovation are underexplored in the literature. Further, the roles of intrinsic motivation and environmental dynamism as moderators are not fully explained in the literature. The study conducted in Sri Lanka intends to fill these gaps in the extant literature. A survey was conducted to collect data and statistical analyses were performed to test the hypothesized relationships. Findings revealed transformational leadership’s significant positive effect on exploratory innovation. Moreover, intrinsic motivation and environmental dynamism were found to significantly moderate this relationship. Environmental dynamism amplifies the direct effect of transformational leadership on exploratory innovation, particularly in highly dynamic contexts. The study contributes to the theoretical understanding of transformational leadership’s role in exploratory innovation and provides practical strategies for organizations to navigate the complexities of a rapidly changing technological landscape.