Achieving Agility and Dynamic Capabilities on Sustainable Performance: Evidence from the Upstream Oil and Gas Sector

Abstract

Purpose: This paper aims to seize the understanding of the effect of TMT commitment (TMC), leadership agility development (LAD), field agile leader (FAL), and operational capabilities (OC) on the field unit performance (FUP) in Indonesia oil and gas sector. Design/methodology/approach: Research instruments were developed and distributed throughout field operation units in the Indonesian oil and gas sector, resulting in 175 data from field operation leaders across Indonesia's operating oil and gas companies. Structural equation modeling (SEM) LISREL were used to examine the developed hypotheses. Findings: This research finds that TMT commitment and leadership agility development on field agile leaders, directly and indirectly, play a significant role in the Indonesian oil and gas sector. Leadership agility development has a strong influence on the field of an agile leader. Furthermore, field agile leaders influence operational capabilities, which then affects unit performance significantly. Practical Implications: The findings have several implications for professionals in the oil and gas sector. The finding of this research also describes the pivotal role of leadership agility development to make the leader more resilient and agile. Originality/value: The proposed model will describe the input-process-output phases in creating value. This research also contributes to how leadership agility can be promoted and organizational agility and development.