1. Introduction
To adapt to changing environmental conditions, businesses should closely follow the ever-changing trends and they should attach great importance to new products and services in their work in order to protect their market share. The rapid change in their needs and expectations has forced companies to compete in global and local markets to innovate. Innovation is considered as the most important differentiation strategy to gain a competitive advantage in the future (Li, Maggitti, Smith, Tesluk, & Katila, 2013). Innovation increases the ability of firms to meet new market demands and helps firms to position themselves in the face of new technological developments.
Leaders take on an important role in the realization of organizational learning, high creativity and achieving innovation with the acquisition of knowledge through effective communication methods, its dissemination and internalization throughout the organization (Van de Ven & Engelman, 2004). In highly competitive, uncertain conditions, the leadership roles of managers become important. In studies addressing the effect of leadership on innovation, mostly focused on foreseeing environmental changes, trends (Papadakis & Bourantas, 1998) and the innovation that will be realized as a result of these measures demonstrate an attractive vision to their audience regarding the results of their activities (Hasen & Kahnweiler, 1997). However, there is research gap in strategic management literature that the studies about the role of strategic leadership styles in innovative performance are limited (Rıfat & Canbolat, 2021) and usually focus on transformational sub-dimensions of strategic leadership. This study aims to fulfill this area with the contribution based on the relationship with transformational, managerial, political and ethical sub-dimensions of strategic leadership and innovative performance.
In the literature part, the variables are defined in terms of strategic management literature. In this section, the studies conducted in the literature on the relationship between the variables are also explained, and the research model and hypotheses are included in line with the information based on the literature part. This research was conducted on 345 white-collar employees working in manufacturing sector in Istanbul. The methodology part of the research has three sub-titles; research design-participant characteristics, sampling procedures and instruments. In the findings part, the results of the study are shared with the analysis in terms of EFA, correlation analysis and ANOVA-tests. In the conclusion part, the findings of the study are shared contributions of the research and discussed with the strategic management literature.
2. Literature Review
2.1. Strategic Leadership
The root of the concept of strategy dates back to Ancient Greek times. The concept was formed by combining the words “stratos” and “ago” in Ancient Greek and means “to send, to direct, to send, to carry and to herd” (Burnes, 2004). Some scholars describe strategy as “management’s game plan” (Thompson & Strickland, 2001); some define it as “making a difference” (Porter, 2002). More specifically, strategy is not the same as a long-term plan. Strategy covers all work done by the organization. The concept of leadership has been one of the subjects that attracted the attention of many researchers from Plato to the present day (Barutçugil, 2014). The concept of leadership has become a focal point in the field of management, especially since the beginning of the 20th century, and has become one of the concepts on which researchers work the most (Dhammika, 2014). Although it was believed that leadership was innate at the beginning of the 20th century, with the studies carried out at Lova University in the 1930s, the view that effective leadership could be developed with education and experience was adopted, and the Trait Theory, which accepted that the characteristics of the leader were the most important factor determining the effectiveness of the leadership process, was put forward (Elkins, 1980). Another theory that explains the concept of leadership is that the factor that makes leaders effective is the behaviors they display while leading rather than the characteristics they have (Owens & Valesky, 2007). After the 1970s, the Situational Leadership Theory put forward by Hersey and Blanchard emerged (Barutçugil, 2014). In theory, it has been emphasized that different situations require different leadership styles in the leadership process (Gray & Starke, 1988).
In the literature, there are different opinions on whether strategic leadership is a separate type of leadership or not (Altınkurt, 2007). While other types of leadership appeal to individuals at all levels, strategic leadership appeals only to senior decision makers (Vera & Crossan, 2004). While Baron and Henderson (1995) consider strategic leadership as a separate type of leadership, Davies, Davies, and Ellison (2006) state that strategic leadership is not a type of leadership like transformational leadership and instructional leadership; it simply states that it is a necessary trait for all types of leadership.
A strategic leader is expected to play a major role in reaching a common goal, creating teams and developing manpower (Adair, 2004). In order to conduct empirical studies on strategic leadership, Pisapia has developed a scale consisting of five dimensions. The strategic leadership dimensions in this scale can be explained as follows (Pisapia, Reyes-Guerra, & Coukos-Semmel, 2005).
Transformational. According to Bass (1990), leaders value the opinions of their employees and an awareness and understanding of the group’s mission and goals when they achieve acceptance, they put their employees above the group’s self-interest. Transformational leadership emerges when they move towards their benefit while ensuring the development of the group or organization, they also increase the audience’s desire for personal development. Awareness of key organizational issues rather than responding to the interests they provide is one of the crucial features. On the one hand, it increases the trust of the audience and encourages the audience to exist problems related to success, growth and development (Bass & Avolio, 1990). Pisapia (2007) describes the transformational leader as those who implement the constructive and destructive aspects of the managerial practices of the leaders. Transformational leaders focus on development, organizational vision, and alignment with the organization’s environment. Transformational leaders achieve these results in one or more ways: they can be charismatic and inspiring to their audience; every single viewer meet their emotional needs and/or mentally stimulate the audience they can (Bass, 1990).
Managerial. According to Pisapia (2009), managerial skill is the leadership’s focus on preserving and maintaining the current structure of the organization. Executive leaders are very good at managing day-to-day activities and short-term goals (Mullins, 1996). They can make changes in the existing functioning of the organization when there is a demand for better and when they need to be more effective (Pisapia, 2009). According to Kotter (2020), management is about coping with complexity, leadership is about coping with change. Companies manage complexity by planning and budgeting; sets goals or objectives for the future, detailed information to achieve these goals steps and then resources to carry out those plans. On the one hand, leading the organization for constructive change begins with determination; a vision of the future is created and to achieve that vision strategies are developed to create the necessary change. Executive leaders interact with people in a storyline or they relate according to the role they play in a decision-making process (Zaleznik, 1999). Although executive leaders struggle to create value for their organizations, they are better off as they maintain the values that have been created (Rowe, 2001).
Ethical. The aim of ethical leadership is to clarify the ethical dimensions that exist in every managerial decision and to ethical principles that guide the decision-making process in organizations (Jose & Thibodeaux, 1999). Ethical leaders can guide the organization’s ethical policies and practices through ethical codes, they can clearly define, provide continuing education on ethical issues, they can run ethics committees to respond to the problems of the customers, awards (Howell & Costley, 2006). Ethical leaders are also often aligned with the values of the organization. They use symbols, protocols, speech and slogans. But every under these circumstances, actions are more important than speech and slogans (Daft, 2000). For this reason, a good leadership role model should be chosen for the moral learning of the employees. The role model emphasizes visible behaviors and how certain values are may also indicate that it will be applied. Leader as a role model behavior will be very helpful in establishing an ethical organizational culture. However, it is also possible that the same role model can have negative effects on the audience should not be forgotten (Howell & Costley, 2006).
Political. The concepts of politics and political skill are negative perceptions for many managers (Ferris, Perrewe, Anthony, & Gilmore, 2000). Political talent provides leaders with flexibility and the opportunity to work effectively in the organization’s adaptability to the external environment where constant changes are experienced (Adair, 2005). Political skill, first of all through persuasion, manipulation and negotiation and it is defined as the ability to influence others in the workplace today to understand it in some way and to use this information to achieve organizational goals. It is seen as the ability to use others in the process of influencing. Therefore, political leaders can easily perceive social signs and conditions in which audiences can read their behavioral motives and it can be said that they build communication networks effectively (Treadway, Hochwarter, & Ferris, 2004). Political skill not only determines the type of behavior the leader uses, but also affects their individual outputs (Douglas & Ammeter, 2004). There are also studies that follower reactions of political skill (Treadway et al., 2004) and team revealing its positive effects on performance (Ahearn, Ferris, Hochwarter, Douglas, & Ammeter, 2004).
2.2. Innovation Performance
The concept of innovation is defined as a new structure or management process, a policy, a new plan or program, a new production process, a new product or service produced in the enterprise (Damanpour & Evan, 1984). Freeman (1982) defines the concept of innovation as technical, design, production, management and commercial activities that involve the marketing of a new (or improved) product or the commercial use of a new (or improved) process or equipment for the first time (Bessant & Tidd, 2007). According to Sanchez, Lago, Ferras and Ribera’s study (2011) innovation management is the whole of innovative activities that includes the creation of an innovative vision, the harmonization of business strategies, the dissemination of strategy to all organizational levels, the analysis of competitive mechanisms such as market trends, technologies and competitor movements.
Firm innovation is conceptualized from two different perspectives. First perspective innovation a behavioral variable, namely the rate of innovation introduced by the firm, the second point of view is is the organization’s willingness to change (Calantone, Cavusgil, & Zhao, 2002). Innovation performance is necessary condition for the business to continue its activities and competitiveness and it is the degree of innovation that indicates innovation businesses with high performance will increase their competitive power in the long run and keep the business environment dynamic (Wattanasupachoke, 2012). Innovation performance is the result of the organizational management’s policies to support the innovative environment and should be evaluated considering its role (Fleacă, 2018). Organizations often invest significant time, money, and other resources in their pursuit of getting innovative opportunity. From this point of view, the most basic element of the innovation process is the commercial potential. Innovation performance can be seen in different ways for sectors, countries or organizations. Since it can be detected, different criteria are used for its measurement. At the beginning of the most frequently used criteria in measurements, R & D expenditures, gray-collar workers, indicators such as the number of patents received but still this is difficult to say that indicators can reveal an objective result (Eryiğit, 2013). On the other hand, organizations that focus on to improve and increase their innovation performance oriented organizational culture (Avcı, 2009), cooperation with their competitors and solidarity (Zeng, Xie, & Tam, 2010) and government resources, also the top management that the support factor for innovation has the highest impact on innovation performance (Değirmencioğlu, 2006). In the literature, Samur (2011) compares innovation performance with new product and production performance and it has significant and positive effects on the financial structure of the organization. Zehir and Özşahin (2008) stated that the speed of strategic decision making has a positive effect on innovation performance. Transformational and transactional leadership affects organizational culture (Rajabi, 2020), transformational leadership has a positive and significant effect on organizational innovation (Çağlıyan, Attar, & Külahlı, 2021). Transformational leadership has a direct impact on innovation (Jung, Chow, & Wu, 2003), transacitional leadership positively affects creativity (Hussain, Abbas, Lei, Haider, & Akram, 2017) among the findings of the scholars. As a matter of fact, in the research of Si and Wei (2012) suggested that there is a significant relationship between transformational leadership and innovation performance.
The hypotheses and research model determined in the light of all these explanations are as Figure 1.
H1: There is a positive correlation between strategic leadership and innovative performance.
H2: There is a positive correlation between transformational leadership and innovative performance.
H3: There is a positive correlation between political leadership and innovative performance.
H4: There is a positive correlation between ethical leadership and innovative performance.
H5: There is a positive correlation between managerial leadership and innovative performance.
3. Methodology
3.1. Research Design and Participant Characteristics
The research has a quantitative research design and was planned in cross-sectional type in order to determine the effect of strategic leadership perceptions of white-collar employees on the firm innovation performance. The research was conducted on 345 white-collar employees that work in industrial establishments operating in the East Marmara Region of Turkey. The research is limited to those working in production enterprises operating in Istanbul, working actively between the research dates and volunteering to participate in the research.
3.2. Sampling Procedures
For research data collection method questionnaire application was implemented during May, June, July and August in 2021. The survey response rate is 77% (345/450). A total of 450 questionnaires were delivered to the top, middle and low management level followers of the companies, 345 of those were completed. According to the demographics variable Table 1, 35% are female, 65% are male. 32% of the followers are managed by top, 41% of the followers are managed by middle level, 27% of the followers are managed by low level. 13% are between the ages of 20 - 30, 42% are between the ages of 31 - 40, 25% are between the ages of 41 - 50, 20% are between the ages of 51 - 60. More than half of sample 58% have Bachelor Degree.
3.3. Instruments
For measuring innovation performance, the emergence of a product and service idea, its production and the whole process until its introduction to the market is considered (Ernst, 2001). The innovation performance scale was developed by Calantone, Cavusgil and Zhao (2002) and translated in Turkish by Avcı (2009), validity and reliability were established. Items of innovative performance scale;
“our business is among the first to offer new goods and services in the market, our company try new ways to get things done, our company tries new methods to improve its activities, new goods and services created by our business have increased in the last 3 years, our firm often tries out new ideas”. The strategic leadership scale was developed by Pisapia (2006) with four sub-dimensions; transformational (16 items), managerial (16 items), ethical (16 items) and political (16 items) and totally the scale consists 64 items.
4. Findings
Firstly, the reliability and validity of the variables’ measurements were measured in order to reach meaningful results from the acquired data. The scales, whose validity had previously been validated, were reduced to sub-factors and made available for additional studies using Exploratory Factor Analysis (EFA). Explanatory Factor Analysis (EFA) is an analysis technique used to reduce the variables to a smaller number of main dimensions in order to understand the relationships among many variables that are estimated to be related. In this analysis, for all the scales, expressions with a factor load of 0.40 and above, as suggested by Hair, Anderson, and Tatham (1998), were gathered together. The fact that the KMO value used in each of the scales is above 0.70 indicates that the variables are related to each other and share common factors. Principal component factor analysis was performed on the scales, and the hypothesis of whether the correlation matrix is equal to the unit matrix was tested with Bartlett’s Test of Sphericity. In the EFA applied to the strategic leadership scale (Table 2), the KMO value was found to be 0.83. It has been observed that this value is at a “good” level (Kaiser, 1974). Bartlett’s Test of Sphericity test showed a statistically significant χ2 result (χ2 = 5173, df = 354, Sig < 000) and supported the application of factor analysis to variables. The strategic leadership dimension, EFA, recommends that there are four dimensions to the scale. These dimensions are; transformational, managerial, political, ethical. Table 2 shows the eigenvalue, explained variance and reliability (α) coefficients of strategic leadership. It is seen that the dimensions have eigenvalues over 1 and represent 77.51% of the total variance explained. In addition, Cronbach’s alpha values of the dimensions reveal that high internal consistency is achieved. Since items have loading value below 0.40, they were removed from the analysis.
In the EFA applied to the strategic leadership scale (Table 3), the KMO value was found to be 0.81. The innovative performance dimension, EFA, recommends that there is one dimension to the scale. Table 3 shows the eigenvalue, explained variance and reliability (α) coefficients of innovative performance. It is seen that the dimensions have eigenvalues over 1 and represent 64.17% of the total variance explained. In addition, Cronbach’s alpha values of the dimensions reveal that high internal consistency is achieved.
As can be seen in Table 4, according to the results of the correlation analysis, it has been determined that the relationship between the innovation
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Table 2. Factor analysis of strategic leadership.
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Table 3. Factor analysis of ınnovative performance.
**Correlation is significant at the 0.01 level.
performance variable and strategic leadership is at a positive and significant level, and the transformational leadership dimension has the highest correlation among the dimensions.
One-way ANOVA test was conducted whether there were any differences in terms of age on the perception of strategic leadership. Since Levene test resulted that accepted the groups are not equal (p = 0.65 > 0.05) and ANOVA may be conducted. For understanding which groups of the participants show difference, Sheffe and Tukey’s tests were applied. Since groups are not equal, Sheffe test results were applied. According to Sheffe test results it was found that there is a difference on age. According to Table 5, mean of the 20 - 30 age was 3.5987, mean of the 31 - 40 was 3.5233, mean of the 41 - 50 was 3.4555, and, mean of the 51 - 60 was 3.1211 (Table 6).
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Table 5. ANOVA test of strategic leadership.
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Table 6. Hypothesis accepted/rejected.
*p is significant at the 0.01 level (2-tailed).
5. Conclusion
Innovation strategies draw the framework of innovation and creativity that provides guides the activities for businesses in order to continue their lives by adapting to changes and then preparing them for the future. The fact that the organizations have to adapt to the changing environmental conditions in a short time causes the work to slow down and sometimes to come to a standstill. The continuation of the functioning of the organizations is only possible with leaders who adapt instead of resisting the developing and changing conditions, influence the employees and involve them in this changing process, have high teamwork skills, and finally see the organization as a whole and are brave enough to take strategic decisions about the organization (Ling, Simsek, Lubatkin, & Veiga, 2008). Therefore, it is possible to say that leadership has taken different forms over time in parallel with today’s changes and gained a new dimension beyond classical leadership approaches (Gelatt, 2016). On the other hand, according to Mistarihi’s (2021) study results there are no statistically significant differences among respondents toward strategic leadership behaviors and characteristics attributed to their personal and occupational variables.
This study focuses on understanding the relationship between strategic leadership and innovative performance. It was conducted on 345 white-collar employees working in the manufacturing sector in Istanbul, Turkey. As a result of the factor and correlation analysis there is positive and significant relationship between strategic leadership and innovative performance. According to correlation analysis transformational leadership and political leadership sub-dimensions have higher correlation with innovative performance, managerial and ethical leadership have positive relation with innovative performance as well. This study was also found that there are differences based on ANOVA test analysis in the perception of strategic leadership according to the age level. Individuals at 20 - 30 ages have higher strategic leadership perception than others. According to Rıfat and Canbolat (2021) they found a positive and significant relation between transformational leadership sub-dimension of strategic leadership and innovative performance. There is a positive relationship between transformational leadership and organizational innovation (Çağlıyan, Attar, & Külahlı, 2021) and that transformational leadership has a direct impact on organizational innovation and organizational creativity (Jung et al., 2003) are among the findings of the strategic management literature which this study’s findings are also supported. According to the results of ANOVA test, the age between 20 - 30 years old of the followers have higher perception of strategic leadership (Mean = 3.5987). Generation Y is the common name given to those born between 1980 and 2000 (Broadbridge, Maxwell, & Ogden, 2007). They declared “the most entrepreneurial generation in history” (Martin, 2005), their expectations in work place are fast promotion, independent environment, flexibility (Zemke, 2001), they also tend to add value to the organization’s strategic direction (Munro, 2010).
There are certain limitations to the methodology and sample size of this research. The research was carried out with only quantitative research method. While the quantitative research model measures the relationship between the variables through numerical data, the qualitative research model has a more exploratory approach instead of measuring the relationship between the variables. For this reason, the use of in-depth interview method in explaining the relationship between leadership type and innovative performance in future research will enrich the research results. In future studies, help can be obtained from the qualitative research method by adding the in-depth interview method. The research was carried out only on white-collar workers working in the manufacturing sector in Istanbul. It is recommended to expand the sample and the sector in future studies.