The Impact of Digital Leadership on SMEs’ Innovation Performance: A Mediation-Moderated Model of Digital Capability and Innovation Culture

Abstract

Small and medium enterprises (SMEs) endeavor to achieve sustainability in the digital transformation age while leaders strive to develop their digital capabilities in response to the changes in the management landscape. The primary aim of this study is to investigate the effect of digital leadership (DL) on Kuwait’s SME innovation performance. Further, examine the intermediate role of digital capability (DC) and innovation culture (IC) in the relationship between digital leadership and innovation performance. This study adopted a quantitative method. It administered a questionnaire survey to collect the data and managed to gather 274 valid data from out of 400 Kuwaiti SME owners and CEOs. The results revealed that digital leadership profoundly influenced the innovation performance of Kuwaiti SMEs. Digital capability was critical in mediating the relationship between SMEs’ digital leadership and innovation performance, and innovation culture was pivotal in moderating the same relationship.