Ambidextrous leadership and innovation performance in MSMEs: balancing exploration and exploitation

  • Dina Noval Madurani 
    Universitas Terbuka
    Indonesia
  • Muhammad Karisma Alam
    Universitas Terbuka
    Indonesia
  • Nadya Kariza
    Universitas Terbuka
    Indonesia

Abstract

While crucial for Micro, Small, and Medium Enterprise (MSMEs) survival and growth, innovation drivers like ambidextrous leadership remain relatively understudied in this context, particularly concerning the distinct roles of opening (OBL) and closing (CBL) leadership behaviors. This study aims to examine the distinct influences of closing behavior leadership (CBL) and opening behavior leadership (OBL) on innovation performance within Indonesian MSMEs. Employing a quantitative, cross-sectional survey design, data were collected from 115 employees across various Indonesian MSMEs, characterized predominantly by young workers with high school education. Data were analyzed using Partial Least Squares Structural Equation Modelling (PLS-SEM). Findings reveal that both CBL (β = 0.174, p = 0.018) and OBL (β = 0.509, p < 0.001) significantly and positively influence innovation performance. Notably, the impact of OBL was found to be substantially stronger than that of CBL in driving innovation performance within this sample. This research validates the applicability of ambidextrous leadership theory in the vital MSMEs sector and provides practical insights for MSME leaders, suggesting that while both structuring and creativity-enhancing behaviors are beneficial, fostering opening behaviors appears particularly crucial for maximizing innovation outcomes in these enterprises.

Lisensing Information
Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License.

References
  1. Achmad, G. N., Yudaruddin, R., Nugroho, B. A., Fitrian, Z., Suharsono, S., Adi, A. S., Hafsari, P., & Fitriansyah, F. (2023). Government Support, Eco-Regulation and Eco-Innovation Adoption in SMEs: The Mediating Role of Eco-Environmental. Journal of Open Innovation. https://doi.org/10.1016/j.joitmc.2023.100158
  2. Alghamdi, F. (2018). Ambidextrous Leadership, Ambidextrous Employee, and the Interaction Between Ambidextrous Leadership and Employee Innovative Performance. Journal of Innovation and Entrepreneurship, 7(1), 1–14. https://doi.org/10.1186/S13731-018-0081-8
  3. Chelliah, M. K., Aravindan, K. L., & Muthaiyah, S. (2022). Entrepreneurial Orientation and Open Innovation Promote the Performance of Services Smes: The Mediating Role of Cost Leadership. Administrative Sciences, 13(1), 1.
  4. Cheung, G. W., Cooper, H. D., Rebecca, T., & Wang, L. C. (2024). Reporting Reliability , Convergent and Discriminant and Best ‑ Practice Recommendations. In Asia Pacific Journal of Management (Vol. 41, Issue 2). Springer US. https://doi.org/10.1007/s10490-023-09871-y
  5. Duc, L. A., Tho, N. D., Nakandala, D., & Lan, Y. (2020). Team Innovation In Retail Services: The Role of Ambidextrous Leadership and Team Learning. Service Business, 14(1), 167–186. https://doi.org/10.1007/S11628-020-00412-X
  6. Gerlach, F., Hundeling, M., & Rosing, K. (2020). Ambidextrous Leadership and Innovation Performance: A Longitudinal Study. Leadership & Organization Development Journal, 41(3), 383–398. https://doi.org/10.1108/LODJ-07-2019-0321
  7. Hamdani, L., Subing, H. J. T., & Yusfiarto, R. (2024). Catalysing Sustainability: Exploring Factors Shaping Green Initiatives in Micro, Small, and Medium-Sized Enterprises. Journal of Environmental Assessment Policy and Management, 26(02), 2450004. https://doi.org/10.1142/S1464333224500042
  8. Harsanto, B., Mulyana, A., Faisal, Y. A., Shandy, V. M., & Alam, M. (2023). Sustainability Innovation in Small Medium Enterprises (SMEs): A Qualitative Analysis. Qualitative Report, 28(11), 3257–3271. https://doi.org/10.46743/2160-3715/2023.6193
  9. Homayoun, S., Salehi, M., ArminKia, A., & Novaković, V. (2024). The Mediating Effect of Innovative Performance on the Relationship Between the Use of Information Technology and Organizational Agility in SMEs. Sustainability, 16(22), 9649. https://doi.org/10.3390/su16229649
  10. Jaidi, N., Siswantoyo, Liu, J., Sholikhah, Z., & Andhini, M. M. (2022). Ambidexterity Behavior of Creative SMEs for Disruptive Flows of Innovation: A Comparative Study of Indonesia and Taiwan. Journal of Open Innovation, 8(3), 141. https://doi.org/10.3390/joitmc8030141
  11. Janssen, O., & Van Yperen, N. W. (2004). Employees’ Goal Orientations, the Quality of Leader-Member Exchange, and the Outcomes of Job Performance and Job Satisfaction. Academy of Management Journal, 47(3), 368–384. https://doi.org/10.2307/20159587
  12. Jia, R., Hu, W., & LI, S. (2022). Ambidextrous Leadership and Organizational Innovation: The Importance of Knowledge Search and Strategic Flexibility. Journal of Knowledge Management, 26(3), 781–801. https://doi.org/10.1108/JKM-07-2020-0544
  13. Kalathingal, S., & Ambrammal, S. K. (2025). Innovation Capabilities and Sustainability in Msmes. An Analysis Of Empirical Studies. The International Journal of Entrepreneurship and Innovation. https://doi.org/10.1177/14657503241307141
  14. Klonek, F. E., Gerpott, F. H., & Parker, S. K. (2020). A Conceptual Replication of Ambidextrous Leadership Theory: An Experimental Approach. Leadership Quarterly, 101473. https://doi.org/10.1016/J.LEAQUA.2020.101473
  15. Lopez, M., & Esteves, A. (2023). Leadership Styles and Innovation Management: What Is the Role of Human Capital? Governance, 13(2), 47. https://doi.org/10.3390/governance13020047
  16. Luu, T. T. (2017). Ambidextrous Leadership and Organizational Innovation Capability: The Moderating Role of Organizational Culture. Leadership & Organization Development Journal, 38(2), 229–253.
  17. Lyver, M. J., & Lu, T.-J. (2018). Sustaining Innovation Performance in SMEs: Exploring the Roles of Strategic Entrepreneurship and IT Capabilities. Sustainability, 10(2), 442. https://doi.org/10.3390/SU10020442
  18. Mascareño, J., Rietzschel, E. F., & Wisse, B. (2021). Ambidextrous Leadership: Opening and Closing Leader Behaviours to Facilitate Idea Generation, Idea Promotion and Idea Realization. European Journal of Work and Organizational Psychology, 30(4), 530–540. https://doi.org/10.1080/1359432X.2021.1872544
  19. Nirwal, P., & Bhardwaj, A. (2025). Mapping the Nexus of Green Innovation and Sustainability in MSMEs: A Bibliometric Perspective. Business Strategy and Development, 8(3). https://doi.org/10.1002/bsd2.70192
  20. Pickssius, M. W., Silva, R. D. F., & dos Santos, R. D. C. (2024). A Liderança No Estímulo Da Inovação Em Startups: Uma Revisão Sistemática Da Literatura. https://doi.org/10.48075/csar.v27i47.33813
  21. Pullen, A. J. J., de Weerd-Nederhof, P. C., Groen, A. J., Song, M., & Fisscher, O. A. M. (2009). Successful Patterns of Internal SME Characteristics Leading to High Overall Innovation Performance. Creativity and Innovation Management, 18(3), 209–223. https://doi.org/10.1111/J.1467-8691.2009.00530.X
  22. Rahmat, D. A., Rumanti, A. A., Pulungan, M. A., Rizaldi, A. S., & Amelia, M. (2024). Evaluating the Role of Open Innovation and Circular Economy in Enhancing Organizational Performance: Insights from Batik Small and Medium Enterprises in Banyuwangi, Indonesia. Sustainability, 16(24), 11194. https://doi.org/10.3390/su162411194
  23. Rosing, K., Frese, M., Frese, M., & Bausch, A. (2011). Explaining the Heterogeneity of the Leadership-Innovation Relationship: Ambidextrous Leadership. Leadership Quarterly, 22(5), 956–974. https://doi.org/10.1016/J.LEAQUA.2011.07.014
  24. Tarihoran, A. D., Hubeis, M., Jahroh, S., & Zulbainarni, N. (2023). Market-Based Dynamic Capabilities for MSMEs: Evidence from Indonesia’s Ornamental Fish Industry. Journal of Open Innovation. https://doi.org/10.1016/j.joitmc.2023.100123
  25. Zacher, H., & Rosing, K. (2015). Ambidextrous Leadership and Team Innovation. Leadership & Organization Development Journal, 36(1), 54–68.
  26. Zacher, H., & Wilden, R. (2020). Aligning Leader Behaviors With Innovation Requirements Improves Performance: An Experimental Study. Frontiers in Psychology, 11, 1332. https://doi.org/10.3389/fpsyg.2020.01332
  27. Zacher, H., & Wilden, R. G. (2014). A Daily Diary Study on Ambidextrous Leadership and Self‐Reported Employee Innovation. Journal of Occupational and Organizational Psychology, 87(4), 813–820. https://doi.org/10.1111/JOOP.12070
  28. Zhai, Y., Sun, W.-Q., Tsai, S.-B., Wang, Z., Zhao, Y., & Chen, Q. (2018). An Empirical Study on Entrepreneurial Orientation, Absorptive Capacity, and SMEs’ Innovation Performance: A Sustainable Perspective. Sustainability, 10(2), 314. https://doi.org/10.3390/SU10020314

Downloads

PDF

Statistic

Abstract Views
: 46 times
PDF
: 15 times