Building innovative work behavior in MSMEs: the role of transformational leadership, adaptive organizational culture, and employee resilience

Innovative work behavior (IWB) is critical for strengthening the competitiveness of micro, small, and medium enterprises (MSMEs). This study examines how transformational leadership relates to IWB through adaptive organizational culture and employee resilience. Using a quantitative cross-sectional design, data were collected from 494 MSME employees across seven provinces in Indonesia and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS. The findings show that transformational leadership is positively associated with adaptive organizational culture, employee resilience, and IWB. Employee resilience is also positively associated with IWB, whereas adaptive organizational culture does not directly predict IWB. Adaptive organizational culture does not significantly mediate the relationship between transformational leadership and IWB, while employee resilience significantly mediates this relationship. A significant sequential pathway also links transformational leadership to IWB through adaptive organizational culture and employee resilience. These findings suggest that employee resilience is an important mechanism connecting transformational leadership with IWB in resource-constrained MSMEs. The study extends Social Exchange Theory and Conservation of Resources Theory by integrating organizational and psychological pathways to explain IWB.