The Impact of Leader’s Innovational Capability on Business Performance
DOI:
https://doi.org/10.14513/tge-jres.00445Keywords:
innovation, leadership, performanceAbstract
Purpose – This study explores the innovation capabilities of business leaders in relation to organizational performance. Previous research has confirmed that business performance largely depends on its ability to adapt to market changes. The process is strongly influenced by leadership and the leader’s innovation skills. Effective leaders needs to respond quickly and effectively to external changes; while also placing significant emphasis on their employees. As industrial development, inherently drives innovation, businesses and their leaders must be equipped to implement new ideas, techniques and technologies, identify challenges and provide creative solutions.
Design/methodology/approach – Based on the literature review two research questions were formulated: 1. Does the innovation capabilities of leaders influence the business performance? 2. Are there significant differences in innovation capability based on the leader’s gender, firm size, county and industry sector? Recently several international publications were issued in the topic, which formed the basis of the aspects of the performance and the innovation capabilities. Based on these aspects, a survey was conducted in 2024, among Hungarian industrial listed in the EMIS database (n=415).
Findings – The findings indicate that the leader’s innovation capabilities have a significant impact on business performance. With respect to demographic characteristics, a significant relationship was found between innovation capability and both the company’s geographical location and its industry sector. However, the leader’s gender and the company size showed no significant influence on innovation capability.
Originality – The outcomes of the study offer practical implications by highlighting the Hungarian regions and industry sectors where supporting innovation activities among SMEs may be most beneficial. Furthermore, the findings outline directions for further research including in-depth interviews, with leaders and more detailed analyses of demographic variables.
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