Does transformational leadership facilitate SBU innovation? The moderating roles of SBU culture and incentive compensation

Abstract

The present research attempts to investigate the relationship of transformational leadership with technological innovation and the moderating effects of organizational culture and incentive compensation on this relationship. Useful paired data was gathered from 102 senior managers and 267 employees in 102 Taiwanese SBUs, and The response rate was 26.15 percent and 22.82 percent for senior managers and employees, respectively. The results showed that transformational leadership had a significantly positive influence on technological innovation, including product, process, and service innovation. However, the positive moderating effects of organizational culture and incentive compensation on the relationship between transformational leadership and technological innovation were not significant. We also implemented the mediated regression analysis of organizational culture for the leadership-innovation linkage but without significant effects in our data set.