Inclusive leadership and organizational performance: The role of exploitative innovation strategy

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Abstract

This research tests a new variable developed using dynamic capability theory, namely the exploitative innovation capability (EIC) variable which is thought to be able to mediate and improve organizational performance (OP) in relation to inclusive leadership (IL). Inclusive leadership is believed to be a variable that is able to have a good impact on human resource performance so that it will indirectly have a good impact on improving organizational performance (Siyal et al., 2023; Gong et al., 2021; Al-Atwi & Al-Hassani, 2021), but this research has not been completed due to research by Mitchell et al. (2015) and Xiaotao et al. (2018) stating different results. This research will prove the role of inclusive leadership in improving organizational performance by testing the role of exploitative innovation capability. Data were collected from 110 respondents in the tourism services sector in Central Java, Indonesia. This research approach is structural equation modeling partial least squares (SEM-PLS) which is useful for exploring inclusive leadership and organizational performance. Then a mediation test is used to test the mediating role of exploitative innovation capability. This research finds that exploitative innovation capability is able to mediate the relationship between inclusive leadership and organizational performance, and is able to improve organizational performance through a mediating relationship.

Keywords: Inclusive Leadership, Exploitative Innovation Capabilities, Organizational Performance

Authors’ individual contribution: Conceptualization — D.M.V.; Methodology — D.M.V.; Validation — S. and I.D.; Formal Analysis — D.M.V.; Investigation — D.M.V.; Supervision — S. and I.D.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: M1, 036, Z32

Received: 08.11.2023
Revised: 08.03.2024; 04.04.2025
Accepted: 14.04.2025
Published online: 16.04.2025

How to cite this paper: Verawati, D. M., Suharnomo, & Djastuti, I. (2025). Inclusive leadership and organizational performance: The role of exploitative innovation strategy. Corporate & Business Strategy Review, 6(2), 81–89. https://doi.org/10.22495/cbsrv6i2art8