Leading well pays off: mediating effects and multi-group analysis of strategic performance
Abstract
Purpose
The purpose of this paper is to reveal the mediating role of leadership style on the relationship between strategy and company performance.
Design/methodology/approach
The study uses empirical data gathered from top managers in a stratified sample of 476 Danish private businesses.
Findings
The results show the mediating effects of leadership styles on strategic performance. In particular, both supportive and directive leadership styles partially mediate the effect of the differentiation strategy, while the supportive leadership style displays a stronger mediating effect than the directive one. The multi-group analysis shows the moderating impact of the manager’s tenure, managerial level, strategy clarity, industry and business environment risk.
Research limitations/implications
The study is limited by its nature and the specificity of the national context in which it was conducted. In this vein, the evidence collected here can be enlarged and complemented by having access to panel data or the generalization of some results to neighboring or other developed countries.
Practical implications
Several implications of the findings for managerial practices are discussed.
Originality/value
There are very few discussions of the mediating effect of leadership style between strategy and performance. The paper fills the gap by examining the role of leadership style planning on the relationship between those two variables in Denmark.
Keywords
Acknowledgements
Qinglan Chen and Luca Giustiniano are very grateful to Professor Børge Obel and his colleagues from the Interdisciplinary Center for Organizational Architecture (ICOA), Aarhus University, Denmark, for their hospitality and insightful discussions. This research was supported in part by grants from Chinese and Danish Government Scholarship (201308350036), grants from the Natural Science Foundation of Guangdong Province (2014A030313421) and funding from the ICOA, Aarhus University, Denmark to Qinglan Chen.
Citation
Chen, Q., Eriksson, T. and Giustiniano, L. (2017), "Leading well pays off: mediating effects and multi-group analysis of strategic performance", Management Decision, Vol. 55 No. 2, pp. 400-412. https://doi.org/10.1108/MD-06-2016-0401
Publisher
:Emerald Publishing Limited
Copyright © 2017, Emerald Publishing Limited