Transformational leadership effects on employee bootleg innovation in the context of digital transformation: Creative self-efficacy mediation and leader-member exchange moderation

Abstract

This study examined the relationship between transformational leadership and employee bootleg innovation through the mediating role of creative self-efficacy and the moderating role of leader-member exchange (LMX). Data were collected from 279 employees and 56 matched supervisors within a large Chinese digital transformation group. A moderated mediation model analysis found that transformational leadership predicts higher employee bootleg innovation. Creative self-efficacy mediated the positive relationship between transformational leadership and employee bootleg. Additionally, leader-member exchange significantly moderated the relationship between transformational leadership and creative self-efficacy, for a further enhancement of bootleg innovation. These findings underscore the importance of transformative leadership in fostering digital employee innovation. This study provides further evidence of the relevance of self-determination theory in explaining the leadership and employee innovation, relationship within the context of digital transformation. By implication, creative self-efficacy and leader-member exchange are modifiable factors by digital transformation entities seeking a competitive advantage.