Unpacking the Role of Leadership and Entrepreneurial Skills: Mediation Moderation Enhancing the Firm Innovativeness

Abstract

New managerial skills are necessary for the development of innovative and effective business models, but the literature currently in publication does not empirically comprehend managerial skills as precursors to strategy transformation and firm innovative performance. This essay makes the case that management human capital, which is made up of leadership and entrepreneurial abilities, is a crucial enabler of novel and efficient BMI and the ensuing creative performance of the company. It does this by drawing on the dynamic managerial capacities hypothesis. Additionally, the research model suggests that the relationship between human capital and novel and effective BMI is favourably moderated by managerial cognition. The study's findings, which were derived from a sample of 312 IT and technology-related SMEs in the Philippines, offer fresh perspectives on the value of managerial skills in a digital economy. This study contributes to management literature by showing that the advantages of managers' human capital for novel and efficient BMI depend on its form: leadership skills have no effect on firm innovative performance, either directly or indirectly through novel and efficient BMI, whereas entrepreneurial skills which is essential for firm innovative performance. As a result, this study offers compelling proof of the value of entrepreneurial abilities in promoting novel and efficient BMI to improve firm innovative performance. Overall, this study confirms the importance of managers' performance advantages and their dynamic capacities for strategic change made possible by novel and efficient BMI, but it also shows that the effect mechanisms are different from those observed in non-digital research contexts.