The present environmental complexity resulting from technological advancements has made it critical for firms to promote innovation in their activities, products, services and outputs. Innovation is a solution to everyday management problems to successfully adapt to workplace challenges and unanticipated occurrences, the invention of new ideas to improve the workflow and the advancement of novel products and services. However, for a firm to be innovative, it is essential to be led by an entrepreneurial lead. Therefore, we aim to examine the impact of entrepreneurial leader(ship) (EL) on employees’ innovative work behaviour (IWB) with moderating role of Islamic Work Ethics (IWE), with a theoretical lens of Social Cognition and Resource-Based view. To achieve these objectives a self-administered survey questionnaire was circulated among managers, owners and employees of small and medium enterprises (SMEs) in Islamabad. The Partial Least Squares Structural Equation Modelling (PLS-SEM) model was applied for hypotheses testing. The results of SEM demonstrate that EL significantly influences the IWB of employees in SMEs. Similarly, IWE also shows a significant effect on the employees’ IWB. However, an insignificant effect for IWE as a moderator between EL and IWB is observed. Overall, the findings of this research contribute to the existing body of knowledge by conceptualising a theoretical and practical model of entrepreneurial leadership predicting employees’ IWB in SMEs.
AbbasiA. S., RehmanK. U., & BibiA. (2011). Islamic work ethics: How it affects business performance. Actual Problems of Economics, (12), 312. https://ssrn.com/abstract=1992008
2.
AbuznaidS. A. (2009). Business ethics in Islam: The glaring gap in practice. International Journal of Islamic and Middle Eastern Finance and Management, 2(4), 278–288.
3.
AfsarB., CheemaS., & SaeedB. B. (2018). Do nurses display innovative work behavior when their values match with hospitals’ values?European Journal of Innovation Management, 21(1), 157–171.
4.
AkbariM., BagheriA., ImaniS., & AsadnejadM. (2020). Does entrepreneurial leadership encourage innovation work behavior? The mediating roles of creativity self-efficacy and support for innovation. European Journal of Innovation Management, 24(1), 1–22.
5.
AkhtarC. S, IsmailK., HussainJ., & Umair-ur-RehmanM. (2015). Investigating the moderating effect of family on the relationship between entrepreneurial orientation and success of enterprise: Case of Pakistani manufacturing SMEs. International Journal of Entrepreneurship and Small Business, 26(2), 233–247.
6.
AkramT., LeiS., & HaiderM. J. (2017). The impact of relational leadership on employee innovative work behavior in IT industry of China. Arab Economic and Business Journal, 11(2), 153–161.
7.
AliA. J. (1992). The Islamic work ethic in Arabia. The Journal of Psychology, 126(5), 507–519.
8.
AliA. J, & Al-OwaihanA. (2008). Islamic work ethic: A critical review. Cross Cultural Management: An International Journal, 15(1), 5–19.
9.
AltuntasG. (2014). The relationship between entrepreneurship and strategic management: A new model and test of strategic entrepreneurship. Research Journal of Business and Management, 1(2), 103–129.
10.
AlvarezS. A, & BarneyJ. B. (2004). Organizing rent generation and appropriation: Toward a theory of the en-trepreneurial firm. Journal of Business Venturing, 19(5), 621–635.
11.
AmabileT. M. (2004). Stimulate creativity by fueling passion. In LockeE. A. (Ed.), Handbook of principles of organizational behavior (pp. 331–341). Blackwell.
12.
AmabileT. M, GoldfarbP., & BrackfleldS. C. (1990). Social influences on creativity: Evaluation, coaction, and surveillance. Creativity Research Journal, 3(1), 6–21.
13.
AxtellC. M, HolmanD. J., UnsworthK. L., WallT. D., WatersonP. E., & HarringtonE. (2000). Shop-floor innovation: Facilitating the suggestion and implementation of ideas. Journal of Occupational and Organizational Psychology, 73(3), 265–285.
14.
AyyagariM., Demirgüç-KuntA., & MaksimovicV. (2011). Small vs. young firms across the world: Contribution to employment, job creation, and growth [World Bank Policy Research Working Paper, 5631]. https://ssrn.com/abstract=1807732
15.
BagheriA. (2017). The impact of entrepreneurial leadership on innovation work behavior and opportunity recognition in high-technology SMEs. The Journal of High Technology Management Research, 28(2), 159–166.
16.
BagheriA., & AkbariM. (2018). The impact of entrepreneurial leadership on nurses’ innovation behavior. Journal of Nursing Scholar-ship, 50(1), 28–35.
17.
BagheriA., AkbariM., & ArtangA. (2020). How does entrepreneurial leadership affect innovation work behavior? The mediating role of individual and team creativity self-efficacy. European Journal of Innovation Management, 25(1), 1–18.
18.
BanduraA. (1997). Self-efficacy: The exercise of control (pp. ix, 604–ix, 604). W H Freeman/Times Books/ Henry Holt.
19.
BlanchardK. (2017). Rural and remote SMEs’ innovative behavior: Is it in the genes or location? An examination of entrepreneurial traits and characteristics. Strategic Change, 26(4), 301–309.
20.
CaiW., LinL., YangC., & FanX. (2021). Does participation generate creativity? A dual-mechanism of creative self-efficacy and supervisor-subordinate guanxi. European Journal of Work and Organizational Psychology, 30(4), 541–554.
21.
CaiW., LysovaE. I., KhapovaS. N., & BossinkB. A. G. (2018). Does entrepreneurial leadership foster creativity among employees and teams? The mediating role of creative efficacy beliefs. Journal of Business and Psychology, 34(2), 203–217.
22.
CarmeliA., McKayA. S., & KaufmanJ. C. (2014). Emotional intelligence and creativity: The mediating role of generosity and vigor. The Journal of Creative Behavior, 48(4), 290–309.
23.
ChangP. C, ZhangM. J., & WuT. (2021). Developmental human resource configuration, unique human capital, and employee innovative work behavior: A multilevel moderated mediation model. Sage Open, 11(2). https://doi.org/10.1177/21582440211027964
24.
ChenM. H. (2007). Entrepreneurial leadership and new ventures: Creativity in entrepreneurial teams. Creativity and Innovation Management, 16(3), 239–249.
25.
ChenT., LiF., & LeungK. (2016). When does supervisor support encourage innovative behavior? Opposite moderating effects of general self-efficacy and internal locus of control. Personnel Psychology, 69(1), 123–158.
26.
CheongM., SpainS. M., YammarinoF. J., & YunS. (2016). Two faces of empowering leadership: Enabling and burdening. The Leadership Quarterly, 27(4), 602–616. https://doi.org/10.1016/j.leaqua.2016.01.006
27.
DamanpourF., & AravindD. (2012). Managerial innovation: Conceptions, processes and antecedents. Management and Organization Re-view, 8(2), 423–454.
28.
DamperatM., JeannotF., JongmansE., & JolibertA. (2016). Team creativity: Creative self-efficacy, creative collective efficacy and their determinants. Recherche et Applications en Marketing, 31(3), 6–25.
29.
DörnerN. (2012). Innovative work behavior: The roles of employee expectations and effects on job performance[Doctoral dissertation, Verlag nicht ermittelbar].
30.
DuanS., LiuZ., & CheH. (2018). Mediating influences of ethical leadership on employee creativity. Social Behavior and Personality: An Inter-national Journal, 46(2), 323–337.
31.
DunneT. C, AaronJ. R., McDowellW. C., UrbanD. J., & GehoP. R. (2016). The impact of leadership on small business innovativeness. Journal of Business Research, 69(11), 4876–4881. https://doi.org/10.1016/j.jbusres.2016.04.046
32.
DuradoniM., & Di FabioA. (2019). Intrapreneurial self-capital and sustainable innovative behavior within organizations. Sustainability, 11(2), 322–332.
33.
ElrehailH., EmeagwaliO. L., AlsaadA., & AlzghoulA. (2018). The impact of transformational and authentic leadership on innovation in higher education: The contingent role of knowledge sharing. Telematics and Informatics, 35(1), 55–67.
34.
FairbankJ. F, & WilliamsS. D. (2001). Motivating creativity and enhancing innovation through employee suggestion system technology. Creativity and Innovation Management, 10(2), 68–74.
35.
FerreiraA., & FrancoM. (2019). The influence of strategic alliances on human capital development: A study applied to technology-based SMEs. EuroMed Journal of Business, 15(1), 65–85.
36.
FischerT., DietzJ., & AntonakisJ. (2017). Leadership process models: A review and synthesis. Journal of Management, 43(6), 1726–1753.
37.
FontanaA., & MusaS. (2017). The impact of entrepreneurial leadership on innovation management and its measurement validation. International Journal of Innovation Science, 9(1), 2–19.
38.
GongY., HuangJ.-C., & FarhJ.-L. (2009). Employee learning orientation, transformational leadership, and employee creativity: The mediating role of employee creative self-efficacy. Academy of Management Journal, 52(4), 765–778.
39.
GrantR. M. (1996). Toward a knowledge-based theory of the firm. Strategic Management Journal, 17(S2), 109–122.
40.
GuptaV. K, & BatraS. (2016). Entrepreneurial orientation and firm performance in Indian SMEs: Universal and contingency perspectives. International Small Business Journal, 34(5), 660–682.
41.
HafeezM. H, ShariffM. N. M., & bin Mad LazimH. (2012). Relationship between entrepreneurial orientation, firm resources, SME branding and firm’s performance: Is innovation the missing link?American Journal of Industrial and Business Management, 2(4), 153–159.
42.
HairJ. F, HultG. T. M., RingleC. M., & SarstedtM. (2014). A primer on partial least squares structural equation modeling (PLS-SEM). Sage Publications.
43.
HairJ. F, RisherJ. J., SarstedtM., & RingleC. M. (2019). When to use and how to report the results of PLS-SEM. European Business Review, 31(1), 2–24.
44.
HaroonM., ZamanH. F., & RehmanW. (2012). The relationship between Islamic work ethics and job satisfaction in healthcare sector of Pakistan. International Journal of Contemporary Business Studies, 3(5), 6–12.
45.
HenselerJ., RingleC. M., & SarstedtM. (2015). A new criterion for assessing discriminant validity in variance-based structural equation modeling. Journal of the Academy of Marketing Science, 43(1), 115–135.
46.
HuangS., DingD., & ChenZ. (2014). Entrepreneurial leadership and performance in Chinese new ventures: A moderated mediation model of explor-atory innovation, exploitative innovation and environmental dynamism. Creativity and Innovation Management, 23(4), 453–471.
47.
HughesD. J, LeeA., TianA. W., NewmanA., & LegoodA. (2018). Leadership, creativity, and innovation: A critical review and practical recommendations. Leadership Quarterly, 29(5), 549–569.
48.
JabeenR., ShehuA. M., MahmoodR., & MataB. A. K. (2014). TQM and knowledge management impacts on SME performance. International Postgraduate Business Journal, 6(2), 23–43.
49.
JanssenO. (2000). Job demands, perceptions of effort-reward fairness, and innovative work behavior. Journal of Occupational and Organizational Psychology, 73(3), 287–302.
50.
JavedS., MalikA., & AlharbiM. M. H. (2020). The relevance of leadership styles and Islamic work ethics in managerial effectiveness. PSU Research Review, 4(3), 189–207.
51.
KangJ. H, SolomonG. T., & ChoiD. Y. (2015). CEOs’ Leadership styles and managers’ Innovative behaviour: Investigation of intervening effects in an entrepreneurial context. Journal of Management Studies, 52(4), 531–554
52.
KarolR. (2015). Leadership in the context of corporate entrepreneurship. Journal of Leadership Studies, 8(4), 30–34.
53.
KatzD., & KahnR. L. (1978). The social psychology of organizations (Vol. 2, p. 528). Wiley.
54.
KazmiA. (2003). Proposed research agenda in Islamic perspectives on management studies. International Journal of Economics, Management and Accounting, 11(2). https://journals.iium.edu.my/enmjournal/index.php/enmj/article/view/93
55.
KhalilM., & Abu-SaadI. (2009). Islamic work ethic among Arab college students in Israel. Cross Cultural Management: An International Journal, 16(4), 333–346.
56.
KhanK., AbbasM., GulA., & RajaU. (2015). Organizational justice and job outcomes: Moderating role of Islamic work ethic. Journal of Business Ethics, 126(2), 235–246.
57.
KnezovićE., & DrkićA. (2020). Innovative work behavior in SMEs: The role of transformational leadership. Employee Relations: The International Journal, 43(2), 398–415.
58.
KumarN., & RoseR. C. (2012). The impact of knowledge sharing and Islamic work ethic on innovation capability. Cross Cultural Management: An International Journal, 19(2), 142–165.
59.
LecatA., BeausaertS., & RaemdonckI. (2018). On the relation between teachers’ (in)formal learning and innovative working behavior: The mediating role of employability. Vocations and Learning, 11(3), 529–554.
60.
LeeM. C. C., IdrisM. A., & TuckeyM. (2019). Supervisory coaching and performance feedback as mediators of the relationships between leadership styles, work engagement, and turnover intention. Human Resource Development International, 22(3), 257–282.
61.
LeitchC. M, McMullanC., & HarrisonR. T. (2013). The development of entrepreneurial leadership: The role of human, social and institutional capital. British Journal of Management, 24(3), 347–366.
62.
LeitchC. M, & VoleryT. (2017). Entrepreneurial leadership: Insights and directions. International Small Business Journal, 35(2), 147–156.
63.
LydonS. R, & SwierczP. M. (2002). Entrepreneurial leadership in high-tech firms: A field study. Leadership and Organization Development Journal, 23(7), 380–389.
64.
MakriM., & ScanduraT. A. (2010). Exploring the effects of creative CEO leadership on innovation in high-technology firms. The Leadership Quarterly, 21(1), 75–88.
65.
MalikA., & NilakantV. (2011). Extending the ‘size matters’ debate: Drivers of training in three business process outsourcing SMEs in India. Management Research Review, 34(1), 111–132.
66.
McEvilyS. K, EisenhardtK. M., & PrescottJ. E. (2004). The global acquisition, leverage, and protection of technological competencies. Strategic Management Journal, 25(8–9), 713–722.
67.
MemonM. A, TingH., CheahJ. H., RamayahT., ChuahF., & ChamH. T. (2020). Sample size for survey research: Review and recommenda-tions. Journal of Applied Structural Equation Modeling, 4(2), 1–20.
68.
MiaoQ., NewmanA., SchwarzG., & CooperB. (2018). How leadership and public service motivation enhance innovative behavior. Public Administration Review, 78(1), 71–81.
69.
MohamedN., KarimN. S. A., & HusseinR. (2010). Linking Islamic work ethic to computer use ethics, job satisfaction and organisational commitment in Malaysia. Journal of Law and Governance, 5(1), 13–24.
70.
MumfordM. D, ScottG. M., GaddisB., & StrangeJ. M. (2002). Leading creative people: Orchestrating expertise and relationships. The Lead-ership Quarterly, 13(6), 1–46.
71.
MurtazaG., AbbasM., RajaU., RoquesO., KhalidA., & MushtaqR. (2016). Impact of Islamic work ethics on organizational citizenship behaviors and knowledge-sharing behaviors. Journal of Business Ethics, 133(2), 325–333.
72.
MytelkaL. K, & SmithK. (2002). Policy learning and innovation theory: An interactive and co-evolving process. Research Policy, 31(8–9), 1467–1479.
73.
NewmanA., Tse, H. H. M., SchwarzG., & NielsenI. (2018). The effects of employees’ creative self-efficacy on innovative behavior: The role of entrepreneurial leadership. Journal of Business Research, 89, 1–9. https://doi.org/10.1016/j.jbusres.2018.04.001
74.
QuddusM., BaileyH.III., & WhiteL. R. (2009). Business ethics: Perspectives from Judaic, Christian, and Islamic scriptures. Journal of Management, Spirituality & Religion, 6(4), 323–334.
75.
RaeD. (2017). Developing entrepreneurial leadership: The challenge for sustainable organisations. International Journal of Work Innovation, 2(1), 76–100.
76.
RamayahT. J. F. H., CheahJ., Chuah, F., TingH., & MemonM. A. (2018). Partial least squares structural equation modeling (PLS-SEM) using smartPLS 3.0. An updated guide and practical guide to statistical analysis. Pearson.
77.
RautR. D, GardasB., LuthraS., NarkhedeB., & Kumar ManglaS. (2020). Analysing green human resource management indicators of automotive service sector. International Journal of Manpower, 41(7), 925–944.
78.
RenkoM., El TarabishyA., CarsrudA. L., & BrannbackM. (2015). Understanding and measuring entrepreneurial leadership style. Journal of Small Business Management, 53(1), 54–74.
79.
RichterN. F, SinkovicsR. R., RingleC. M., & SchlägelC. (2016). A critical look at the use of SEM in international business re-search. International Marketing Review, 33(3), 376–404.
80.
RisherJ., & HairJ. F.Jr (2017). The robustness of PLS across disciplines. Academy of Business Journal, 1, 47–55.
81.
RosenbuschN., BrinckmannJ., & BauschA. (2011). Is innovation always beneficial? A meta-analysis of the relationship between innovation and performance in SMEs. Journal of Business Venturing, 26(4), 441–457.
82.
SaeedB. B, AfsarB., CheemaS., & JavedF. (2018). Leader-member exchange and innovative work behavior: The role of creative process engagement, core self-evaluation, and domain knowledge. European Journal of Innovation Management, 22(1), 105–124.
83.
SandvikI. L, & SandvikK. (2003). The impact of market orientation on product innovativeness and business performance. International Journal of Research in Marketing, 20(4), 355–376.
84.
SchneiderB. (1990). Organizational climate and culture. Pfeiffer.
85.
ScottS. G, & BruceR. A. (1994). Determinants of innovative behavior: A path model of individual innovation in the workplace. Academy of Management Journal, 37(3), 580–607.
86.
ShalleyC. E. (1991). Effects of productivity goals, creativity goals, and personal discretion on individual creativity. Journal of Applied Psychology, 76(2), 179.
87.
SmithW. K, & TushmanM. L. (2005). Managing strategic contradictions: A top management model for managing innovation streams. Organization Science, 16(5), 522–536, https://doi.org/10.1287/orsc.1050.0134
88.
SrisathanW. A, KetkaewC., & NaruetharadholP. (2020). The intervention of organizational sustainability in the effect of organizational culture on open innovation performance: A case of Thai and Chinese SMEs. Cogent Business & Management, 7(1), Article 1717408.
89.
StraussK., ParkerS. K., & O’SheaD. (2017). When does proactivity have a cost? Motivation at work moderates the effects of proactive work behavior on employee job strain. Journal of Vocational Behavior, 100, 15–26. https://doi.org/10.1016/j.jvb.2017.02.001
90.
StroblA., BauerF., & MatzlerK. (2020). The impact of industry-wide and target market environmental hostility on entrepreneurial leadership in mergers and acquisitions. Journal of World Business, 55(2), 100931. https://doi.org/10.1016/j.jwb.2018.03.002
91.
SubhanQ. A, MahmoodT., & SattarA. (2014). Innovation and economic development: A case of small and medium enterprises in Pakistan. Pakistan Economic and Social Review, 52(2), 159–174.
92.
SurieG., & AshleyA. (2008). Integrating pragmatism and ethics in entrepreneurial leadership for sustainable value creation. Journal of Business Ethics, 81(1), 235–246.
93.
TayebM. (1997). Islamic revival in Asia and human resource management. Employee Relations, 19(4), 352–364.
94.
Van HootegemA., NiesenW., & De WitteH. (2019). Does job insecurity hinder innovative work behaviour? A threat ri-gidity perspective. Creativity and Innovation Management, 28(1), 19–29.
95.
WahabM. A, QuaziA., & BlackmanD. (2016). Measuring and validating Islamic work value constructs: An empirical exploration using Malaysian samples. Journal of Business Research, 69(10), 4194–4204.
96.
WeinbergerE., WachD., StephanU., & WeggeJ. (2018). Having a creative day: Understanding entrepreneurs’ daily idea generation through a recovery lens. Journal of Business Venturing, 33(1), 1–19.
97.
WestM., & FarrJ. (1989). Innovation at work: Psychological perspectives. Social Behaviour, 4(1), 15–30.
98.
WoodmanR. W, SawyerJ. E., & GriffinR. W. (1993). Toward a theory of organizational creativity. Academy of Management Review, 18(2), 293–321.
99.
YangJ., PuB., & GuanZ. (2019). Entrepreneurial leadership and turnover intention in startups: Mediating roles of employee’s job embeddedness, job satisfaction and affective commitment. Sustainability, 11(4), 1101.
100.
YousefD. A. (2000). The Islamic work ethic as a mediator of the relationship between locus of control, role conflict and role ambiguity—A study in an Islamic country setting. Journal of Managerial Psychology, 15(4), 283–298.
101.
YousefD. A. (2001). Islamic work ethic—A moderator between organizational commitment and job satisfaction in a cross-cultural context. Personnel Review, 30(2), 152–169.
102.
ZhouJ., & ShalleyC. E. (2011). Deepening our understanding of creativity in the workplace: A review of different approaches to creativity research. In ZedeckS. (Ed.), APA handbook of industrial and organizational psychology (Vol 1.: Building and developing the organization, pp. 275–302). American Psychological Association.
