‘Digitalisation + leadership’ = ? High innovation output? A mediating model based on environment

Digital leadership (DL), as a crucial element of dynamic capabilities, exerts a significant influence on innovation performance (OIP). This study conducts an empirical analysis of survey data collected from 332 organisations in China to investigate the mechanisms by which digital leadership impacts innovation performance. The findings reveal that business model innovation (BMI) serves as a mediating factor between digital leadership and innovation performance, thereby providing theoretical support for the dynamic capabilities view (DCV). Furthermore, the study incorporates environmental dynamism (EnD) as a situational variable within the model, elucidating the boundaries of digital leadership's effectiveness. The results indicate that, irrespective of whether environmental dynamism is classified as high or low, it adversely affects the indirect relationship between digital leadership and innovation performance through business model innovation. This research offers practical implications for organisations seeking to enhance their innovation performance, underscoring the significance of digital leadership and business model innovation in the rapidly evolving digital economy. Additionally, it highlights the potential limitations that may emerge in highly dynamic environments concerning the facilitation of innovation performance through business model innovation in management practices.