How Organizational Improvisational, Transformational Leadership

Styles Impact Innovation Performance of Start-Up Companies in

VUCA Environments

Wenxi Xiong

and Yongzhong Yang

Business School, Sichuan University, China

Keywords: Organizational Improvisation, Transformational Leadership, Start-Ups, Innovation Performance.

Abstract: Entering the competitive VUCA environment, the traditional management model with prediction and control

as the main measures has not adapted to the needs of the times in certain situations, and it has become a hot

topic for start-ups to survive and grow in the current unpredictable environment and achieve breakthrough

innovation. This study constructs a correlation model between organizational improvisation, transformational

leadership, and innovation performance of start-ups, and uses the VUCA environment as a moderating

variable. The findings confirm that all dimensions of organisational improvisation and transformational

leadership significantly affect the innovation performance of start-ups; Organizational improvisation and

transformational leadership positively interact to influence innovation performance of start-ups, i.e.

organizational improvisation and transformational leadership reinforce each other's influence on innovation

performance of start-ups; The VUCA environment positively moderates the impact of organizational

improvisation and transformational leadership on innovation performance of start-ups. This study will help

start-ups to fully grasp the fleeting opportunities and respond to the changing external environment in a timely

manner to further enhance the competitive advantage of start-ups, and provide practical guidance for top

managers of start-ups to enhance their innovation performance.

1 INTRODUCTION

The international situation is characterized by

"Volatility", "Uncertainty", "Complexity" and

"Ambiguity". VUCA environment characteristics are

becoming more and more obvious. Under the VUCA

era environment, how start-ups can turn crisis into

safety, survive and grow in the crisis has become an

issue of concern for all sectors of society.

The first thing that start-ups in dynamically

changing environments need to do to achieve

sustainable and healthy growth is to change the

decision-making paradigm away from the traditional

strategic thinking of planning, execution, feedback

and review, and to think and act, practice and

improve, innovate and integrate with more flexible

and improvised strategies (Tang & Zhou, 2017).

The concept of organizational improvisation

refers to the key elements of an organization's

strategic actions in a complex environment, and it

differs from the traditional strategic decision-making

https://orcid.org/0009-0005-5551-3959

model in that it integrates planning, decision-making,

and execution. Organizational improvisation can help

organizations better complete the decision-making

process when unexpected events or changes in the

environment deviate from expectations.

Organizational improvisation also reflects the

richness of a leader's experience, judgment, and

decisiveness.

Weick (1993) points out that transformational

leaders give their employees more autonomy and

encourage them to think outside the box and promote

improvisation. In today's competitive world,

transformational leaders are one of the most

responsive types of leaders and are valued more than

ever for building strong confidence through advance

learning and preparation, and for learning by

experience without fear of failure, so that

organizations can adjust quickly in a VUCA

environment, calming immediate fluctuations while

making intuitive and rational decisions to seize future

opportunities.

Xiong, W. and Yang, Y.

How Organizational Improvisational, Transformational Leadership Styles Impact Innovation Performance of Start-Up Companies in VUCA Environments.

DOI: 10.5220/0012997300003838

Paper published under CC license (CC BY-NC-ND 4.0)

In Proceedings of the 16th International Joint Conference on Knowledge Discovery, Knowledge Engineering and Knowledge Management (IC3K 2024) - Volume 3: KMIS, pages 295-304

ISBN: 978-989-758-716-0; ISSN: 2184-3228

295

Based on this, this paper will focus on the

relationship between organizational improvisation,

transformational leadership and innovation

performance of start-ups, and explore the

mechanisms of organizational improvisation and

transformational leadership on innovation

performance of start-ups.

2 BACKGROUND OF THE

STUDY

VUCA was first proposed by the U.S. military to

describe the complex and changing military

environment at that time, and with the development

of information technology such as big data, artificial

intelligence and cloud computing, as well as the

constant changes in the international market, the

external environment in which the organization

operates has become more and more characteristic of

VUCA. Bennett & Lemoin (2014) mentioned VUCA

as "Volatility", "Uncertainty", "Complexity",

"Ambiguity" in " Harvard Business Review", which

will become a trend in the future, and explains its

meaning. Troise et al.(2022) used digital

technological capabilities, relational capabilities, and

innovative capabilities premised on organizational

agility - the ability to quickly anticipate or respond to

external changes - is critical to surviving and

competing in today's turbulent VUCA environment

characterized by technological advancement and

digitalization.

The study of improvisation first began with jazz

metaphors, so early research on organizational

improvisation was mainly based on the perspective of

jazz metaphors. Through specific studies, researchers

attempted to summarize the characteristics of the

concept of improvisation in jazz improvisation,

differentiate the degree and form of improvisation,

explore the mechanisms of improvisational

behaviors, and discover the role of improvisational

metaphors in jazz performances in organizational

practices. Weick (1998) firstly blended improvisation

with organizational management by observing top

managers and found that they would, like jazz

musicians, identify and aim at the goals and make and

follow rules, engage in directed activities, and

suggested characteristics of groups with high

improvisation skills. When improvisation is

combined with team and environmental moderators,

it has a positive impact on team innovation, as well as

suggesting that organizational members can improve

their improvisational skills through training. Fultzz &

Hmieleski (2021) established a model linking

organizational improvisation with new venture

performance, demonstrating that improvisation

ability is a resourceful means for startups to identify

new opportunities and gain performance advantages.

For the transformational leadership research. At

the individual level, the main areas involved are job

performance, job satisfaction, employee happiness,

individual knowledge sharing, employee creativity,

employee emotions, and self-coordination. Stanescu

et al. (2019) point out the positive and significant

relationship between transformational leadership and

employee innovative behavior and psychological

empowerment by creating a greater sense of

empowerment, leaders can have a higher positive

impact on the employee's level of employee

innovation. At the organizational level, current

research focuses on the study of transformational

leadership on organizational performance. Ng (2017)

developed an integrative model using five theoretical

driving mechanisms to explain the impact of

transformational leadership on performance

outcomes. Mach et al. (2021) explored how

transformational leadership affects team performance

through team cohesion and how this relationship is

moderated by prior team performance. The results of

the study indicated that transformational leadership

indirectly affects team performance through the

mediating role of team cohesion, and that when the

level of prior performance is high, the this indirect

effect is more significant.

In exploring the relationship between work

environment and creativity, Amabile (1996)

suggested that an innovative organizational climate

promotes team support, which in turn promotes

innovation. Scott & Bruce (1994) and Xie et al.

(2007) argued that an innovative culture within an

organization has a positive impact on performance in

new tasks. The latter's empirical study found that a

good innovation culture can improve the business

quality and innovation level of the organization,

which in turn can help firms to better improve their

performance level. Leadership behavior is another

important factor in influencing innovation

performance. Scott (2011) supported this view by

showing that innovative leadership behaviors are

believed to promote an innovative and creative

climate in the organization, which, in turn, improves

employees' innovation ability. Wang (2021) points

out that when individual employees have a higher

degree of forgetfulness, it is more conducive to digital

transformation to promote organizational innovation

performance through dynamic capabilities.

KMIS 2024 - 16th International Conference on Knowledge Management and Information Systems

296

In a VUCA environment filled with turbulence,

disruption and uncertainty, start-ups are actively

implementing change and innovation to cope with

various changes, but encountering many difficulties

and resistance in the process. These dilemmas of

change and innovation have received increasing

attention in management practices and theoretical

studies, and have become the focus of attention for

academics, researchers and managers. However, the

current empirical research is still in a relatively

imperfect stage, the existing research is not deep and

systematic enough, and scholars and practitioners

need to further integrate the research on

transformational leadership and innovation

performance. Meanwhile, scholars need to further

integrate research on organizational change and

innovation behavior and consider how to enhance

transformational leadership in the spirit of

organizational improvisation to promote innovation

in startups; on the other hand, practitioners consider

how to systematically introduce the theory of

enhancing transformational leadership into the

process of organizational improvisation. Overall, the

relationship between organizational improvisation,

transformational leadership, and innovation

performance of start-ups in VUCA environments

does not seem to have been systematically studied in

academia.

To sum up, there are still certain black holes and

deficiencies in the academic research on the related

concepts, for example, the lack of integrated research

on the relationship between organizational

improvisation, transformational leadership and

innovation performance, and the failure to organically

combine the VUCA environment with organizational

change and innovation management. Based on this,

this paper will focus on the relationship between

organizational improvisation, transformational

leadership and innovation performance, and explore

the mechanism of organizational improvisation and

transformational leadership on the new performance

of start-ups under the VUCA environment.

3 THEORETICAL MODEL AND

RESEARCH

HYPOTHESISSECTION

HEADINGS

3.1 Theoretical Model

In the VUCA environment, it brings great impact to

the survival, competition and development of start-

ups. Faced with the coupling effect of external

environment complexity and organizational

complexity, it is especially important to create a

diversified and inclusive internal environment to

properly handle the crisis and turn it into a driving

force for development. Responding quickly and

ruling with dynamics is even more crucial for leaders

of start-ups to lead their organizations to success.

Based on dynamic capability theory, when an

organization has the ability to react quickly to the

internal and external environment, its core

competitiveness will be greatly enhanced. In addition,

practice has shown that in the face of new challenges

and threats, the effectiveness of traditional response

strategies is greatly reduced and may even fail.

A review of the literature on leadership and team

performance suggests that leadership behaviors are a

key factor in team innovation performance and that

the right leadership behaviors can maximize team

innovation performance. Bass describes

transformational leaders as “leaders who make

subordinates aware of the importance and

responsibility of the tasks they undertake by making

them leaders whose needs are met, and who also

create a greater vision for their subordinates,

encourage and support them to go beyond

themselves, adopt new ideas and approaches,

creatively solve new challenges and problems, and

create an atmosphere of mutual support and

harmonious innovation within the organization to

promote organizational innovation” (Bass, 1985).

Therefore, transformational leadership style is

important for accelerating organizational

innovativeness and improving organizational

innovation performance.

Based on the above review of the literature and

related theories, this paper argues that organizational

improvisation and transformational leadership may

interact to produce influencing factors on innovation

performance of start-ups, while the relationship

between the two and innovation performance of start-

ups may be mediated by the VUCA environment,

therefore, the paper proposes the following

theoretical model, as shown in Fig 1.

3.2 Theoretical Model

3.2.1 Organizational Improvisation and

Innovation Performance of Start-Ups

Organizational improvisation as a "time pressure" and

"environmental uncertainty" triggered by the ability to

respond quickly to unexpected events has a strong

immediate, spontaneous, creative characteristics,

How Organizational Improvisational, Transformational Leadership Styles Impact Innovation Performance of Start-Up Companies in VUCA

Environments

297

Figure 1: Conceptual model.

through the current problem facing the specificity of a

timely response, and The existing resources are

successfully integrated and utilized to avoid missed

opportunities and problem complications. Based on

the view of flexible human resource management and

technological variability, Shan et al. (2021) pointed

out that in an uncertain environment, technology-

based firms use improvisation capabilities to enhance

technology commercialization by efficiently

integrating existing resources, thus positively

influencing organizational innovation performance.

Xiang (2021) confirmed a strong positive influence

between organizational improvisational capabilities

and innovation performance using the supportive

incubation environment and environmental dynamics

as moderating variables. Based on the moderating role

of improvisational skills, Chen (2013) investigated the

relationship between time-based competition and

organizational performance and found that

improvisational skills deepened the organization's

understanding of time-based competitive cognition

through rapid and immediate innovation responses,

and the study found that improvisational skills

effectively contributed to organizational innovation

performance.

Based on this, this paper proposes the following

research hypothesis: H1, H1a, H1b, as shown in Table

3.2.2 Transformational Leadership and

Innovation Performance of Start-Up

Firms

In general, organizational development is influenced

by the entrepreneurial leadership style,i.e., the leader's

vision, wisdom and motivation to innovate affect the

organization's performance indicators; therefore,

innovation performance is closely related to the

entrepreneur's values and beliefs, i.e., innovation

performance is influenced by the entrepreneurial

leadership style. Transformational leaders, on the

other hand, tend to actively cultivate their own

innovation consciousness and capabilities, inspire

organizational members through their own images,

attitudes, beliefs and behaviors, correct employees'

work attitudes, build employees' collective cognition

and perceptions of the organization, help promote

mutual cognition among members, and guide the

organization to accomplish innovative tasks, which is

a key factor in improving organizational innovation

performance. Numerous studies have shown that

transformational leaders have an impact on

organizational innovation performance by influencing

to increase the creativity of their subordinates. For

example, Nguyen (2022) showed that there is a

significant correlation between transformational

leadership and employee creativity. Shafi et al. (2020)

stated that transformational leadership has a

significant positive effect on employee creativity

through idealizing influence, intellectual stimulation

and motivational motivation. Zhang & Wang (2020)

showed that transformational leaders improve

organizational innovation performance by increasing

their own work engagement. Rong et al. (2018) stated

that CEO transformational leadership style has a

significant positive impact on organizational

innovation performance.

Based on the above analysis, the following

hypotheses are proposed in this study: H2, H2a, H2b,

H2c, H2d, as shown in Table 1.

3.2.3 Interactive Effects of Organizational

Improvisation and Transformational

Leadership on Innovation

Performance of Start-up Firms

By collating the existing literature in English and

Chinese, there is a gap in the current research on the

interaction between the two. However, based on the

existing research by scholars, it is not difficult to find

that both organizational improvisation and

transformational leadership have a reinforcing effect

on each other to positively influence organizational

innovation performance.

From the perspective of organizational

improvisation, when an organization has the ability to

react quickly to the internal and external

environment, its core competitiveness will be greatly

enhanced. In addition, the organization or its

members must meet challenges with new

organizational strategies through the exercise of

individual creativity and improvisation, and take

advantage of market opportunities to creatively solve

KMIS 2024 - 16th International Conference on Knowledge Management and Information Systems

298

problems, which also indirectly enhances the

innovation capability of the whole organization. The

transformational leader supports and facilitates the

rapid growth of employees by providing them with

personalized guidance, making them aware of their

self-worth, and developing their ability to improve

their self-leadership.

From the perspective of transformational leaders,

the creative thinking, immediate responsiveness of

organizational members is greatly enhanced when

their behavior is unrestrained and maximizes their

ability to improvise, which will help transformational

leaders, through their personal charisma, build trust

with employees, motivate them, and prompt them to

further creatively solve new challenges and problems,

creating in the organization a mutually supportive and

harmonious innovation climate within the

organization to achieve better organizational

innovation performance. It is evident that

organizational improvisation positively reinforces the

role of transformational leaders on organizational

innovation performance.

In summary of the analysis, the following

hypothesis is proposed in this study: H3, as shown in

Table 1.

3.2.4 Moderating Effect of VUCA

In the VUCA environment, various characteristics

have brought a huge impact on the survival,

competition and development of the company. Facing

the coupling effect of external environmental

complexity and organizational complexity, it is

especially important to create a diverse and inclusive

internal environment to properly handle the crisis and

turn it into a driving force for development. Krupp &

Schoemaker (2014), Bennett& Lemoine (2014), and

Livingston (2014) have each made Troise et al. (2022)

and others presuppose that organizational agility - the

ability to quickly anticipate or respond to external

changes - premised on digital technology capabilities,

relational capabilities, and innovation capabilities, is

essential in today's environment characterized by

technological advancement and digitization as the

hallmark of today's turbulent VUCA environment is

critical to survive and compete. In addition to this,

due to the rapidly changing domestic and

international environment, start-up leaders must meet

challenges with fresh organizational strategies and

take advantage of market opportunities to creatively

solve problems through the exercise of personal

creativity and improvisation. Khan et al. (2021)

showed that under the VUCA environment,

knowledge workers enter the workplace more often,

so leader-member exchange and leader identification

play a mediating role between authentic leadership

and employees' innovative work behaviors, and states

that by building strong relationships with employees,

managers can motivate employees to pursue

innovative work behaviors.

Therefore, the following research hypotheses are

proposed in this paper: H4, H5, as shown in Table 1.

Table 1: Research hypothesis.

4 STUDY DESIGN

4.1 Data Collection

AKumar & Das (2020) point out that enterprises that

are active and founded within 8 years are new.

Domestic scholars such as Cheng, Song-Song et al.

(2019) and Zhang (2018) also generally define

enterprises that have been established for less than 8

years as start-ups. Therefore, this study defines the

investigated start-up enterprises as those whose

enterprise age is less than or equal to 8 years.

In this study, 396 official questionnaires were

distributed by telephone and email to the middle and

senior management of a start-up enterprise in an

industrial development zone in Chengdu, Sichuan

Province (China) through the introduction of

acquaintances, and 308 valid questionnaires were

obtained after excluding invalid questionnaires such

as incomplete completion or enterprises not meeting

the conditions. From the viewpoint of the sample

itself, the survey targets are widely distributed,

covering manufacturing, service, information

transmission, new energy materials, etc. From the

How Organizational Improvisational, Transformational Leadership Styles Impact Innovation Performance of Start-Up Companies in VUCA

Environments

299

viewpoint of the enterprise characteristics, 38

questionnaires were distributed to state-owned

enterprises, 130 to private enterprises, 102 to foreign-

funded enterprises, and 38 to other enterprises. 42.5%

of businesses with 100 or more employees, 32.5%

with 51-100 employees, 10.7% with 21-50 employees

and 14.3% with less than 20 employees.

4.2 Questionnaire Design

The reliability test of the scales often uses Cronbach's

α coefficient. In this paper, the reliability of each

variable scale was analyzed using SPSS 27.0, and the

results showed that the reliability values of each scale

of organizational improvisation, transformational

leadership, VUCA, and innovation performance were

0.952, 0.983, 0.940, and 0.904, respectively. The total

reliability value was 0.975, thus indicating a high

quality of reliability of the study data.

The validity tests were divided into exploratory

factor analysis and validation factor analysis. In the

exploratory factor analysis, KMO and Bartlett's

spherical tests were conducted for the scales of

organizational improvisation, transformational

leadership, VUCA, and innovation performance, and

the results showed that the KMO of all variables was

greater than 0. 8, and the factor loadings of each

measurement question item were greater than 0. 6,

indicating good structural validity of the scales, as

shown in Table 1. Validation factor analysis was

conducted for each variable and the model fit was

tested by indicators, in which the value of chi-square

degrees of freedom was 1.143, which was less than 3,

the value of RMSEA was 0.022, which was less than

0.10, the value of RMR was 0.050, which was less

than 0.08, and the values of CFI, GFI, NFI, and TLI

were all greater than 0.9, indicating that the absolute

and value-added fitness of the model was better.

5 EMPIRICAL STUDY

5.1 Results of the Regression Ana

As can be seen from the table 2, in model M0, the

adjusted R ² is 0.004, indicating that the explained

variance of firm age and firm size on individual

innovation performance is 0.4%, and after adding the

intention creation variable in model M1, the adjusted

from R ² increases to 0.144, and the regression

coefficient P = 0.377 of virtue draping on the

innovation performance of new start-up firms in

model M1 is significant at the P = 0.001 level It

indicates that intention creation is significantly and

Table 2: Table of regression analysis (independent variable

is organizational improvisation).

positively related to innovation performance of start-

ups, and hypothesis H1a holds; after adding

immediate response variable in model M2, the

adjusted R²is 0.131, which has significantly improved

the explanatory strength of innovation performance of

start-ups compared with the basic model M0, and the

regression coefficient of immediate response on

innovation performance of start-ups P= 0.360, which

is significant at the P = 0.001 level. It indicates that

immediate response is significantly and positively

related to innovation performance of start-ups, and

hypothesis H2b holds; the addition of personalized

care in model M3 increases the moderated R²to 0.137

and the regression coefficient on innovation

performance is 0.370 (p=0.001), indicating that using

available resources is significantly and positively

related to innovation performance, and hypothesis

H2c holds.

5.2 Results of Regression Analysis of

Transformational Leadership and

Innovation Performance

From the table 3, it can be seen that after adding the

virtue pendant variable in model M1, the adjusted

from R²increases from 0.004 in M0 to 0.213, and the

regression coefficient P = 0.459 of virtue pendant on

innovation performance of start-up firms in model

M1 is significant at the 0.001 level, indicating that

virtue pendant positively affects innovation

performance of start-up firms, and hypothesis H2a

holds; after adding the vision incentive variable in

model M2, the adjusted from R²variable in model

M2, the adjusted R²is 0.186, which has significantly

improved the explanatory strength of innovation

performance of start-ups compared with the basic

model M0, and the regression coefficient P = 0.428

for vision incentive innovation performance of start-

ups

significant

the

0.001

level,

indicating

that

KMIS 2024 - 16th International Conference on Knowledge Management and Information Systems

300

Table 3: Results of regression analysis of transformational

leadership and innovation performance).

vision incentive positively affects innovation

performance of start-ups, and the hypothesis H2b

holds; adding personalized care in model M3, the

adjusted R ² increases to 0.188 and the regression

coefficient on innovation performance is 0.431

(p=0.001), indicating that personalized care is

significantly and positively related to innovation

performance, and hypothesis H2c holds; after adding

leadership charisma in model M4, the adjusted R²is

0.201 and the regression coefficient on innovation

performance is 0.445 (p=0.001), indicating that

leadership charisma and innovation performance also

show a significant positive correlation, and the

hypothesis H2d holds.

5.3 Results of Interaction Effect

Analysis

From the table 4, we can see that the adjusted R²

values are 0.004,0.151,0.246,0.271, i.e., the model can

explain 0.4%,15.1%,24.6%,27.1% of the variance,

i.e., the model fits well; this paper constructs model

M0 as the regression equation with the control

variable as the independent variable, model M1 as the

regression equation with the introduction of the

independent variable organizational improvisation,

and M2 is the regression equation with the

introduction of the independent variable change-

oriented leadership, and M3 is the product term with

the introduction of organizational improvisation and

change-oriented leadership. According to the table 4,

the regression coefficient of M1 independent variable

organizational

improvisation

0.386

(p <

0.001),

Table 4: Test table of the relationship between

organizational improvisation, transformational leadership

and innovation performance.

based on the results of this analysis, it can be

concluded that organizational improvisation

positively affects organizational innovation

performance, i.e., the hypothesis H1 of this study is

verified. the regression coefficient of M2 independent

variable transformational leadership is 0.493 (p <

0.001), which indicates that transformational

leadership positively affects organizational

innovation performance, i.e., the hypothesis H1 of

this study is verified. The regression coefficient of

M3 product term was 1.407 (p < 0.001), and the

hypothesis H3 of this study was supported.

5.4 Results of Analysis of Moderating

Effects

To reduce the problem of non-essential

multicollinearity in the regression analysis, this study

decentered the independent variable Organizational

Improvisation and Transformational Leadership and

the moderating variable VUCA Environment (mean

center) before constructing the interaction terms, and

then calculated the product of the independent and

moderating variables after decentering and

constructed interaction term 1 and interaction term 2,

respectively. From the table 5, we can see that the

adjusted R2 values are 0.004, 0.248, 0.271, 0.304,

0.315, i.e. the model can explain 4%, 24.8%, 27.1%,

30.4%, 31.5% of the variance, i.e. the model fit is

good; model M0 is constructed as the regression

equation with the control variable as the independent

variable, model M1 is the regression equation with the

introduction of the independent variable Organization

improvisation and the regression equation of equation

the

moderating

variable

VUCA

environment,

How Organizational Improvisational, Transformational Leadership Styles Impact Innovation Performance of Start-Up Companies in VUCA

Environments

301

Table 5: Table of tests for moderating effects.

is the regression equation of the interaction term 1

after the introduction of the independent variable

organizational improvisation, the moderating

variable VUCA environment, and decentering, model

M3 is the regression equation of the introduction of

the independent variable transformational leadership

and the moderating variable VUCA environment, and

M4 is the regression equation of the interaction term

2 after the introduction of the independent variable

organizational improvisation, the moderating

variable VUCA environment, and decentering .

According to the above table, the regression

coefficient of interaction term M2 is 0.172 (p <

0.001), and based on the results of this analysis, it can

be concluded that VUCA environment reinforces the

positive effect of organizational improvisation on

innovation performance, thus supporting this paper's

research hypothesis H4. The regression coefficient of

interaction 2 in the M4 model is 0.141 (p < 0.01),thus

being able to support this paper's research hypothesis

H5, thus it can be concluded that the VUCA

environment positively moderates the positive effect

of transformational leadership on innovation

performance.

6 CONCLUSION

Firstly, Organizational improvisation can positively

affect the innovation performance of start-ups: if an

organization facing uncertain environmental

conditions and time pressures can efficiently

coordinate internal and external organizational

resources based on integrating and reconfiguring

existing resources, react quickly and effectively, and

dare to break the rules and respond to unpredictable

environmental changes in innovative ways and

means, it can take advantage of the business

opportunities brought by environmental changes and

create new competitive advantages and thus improve

the innovation performance of the firm, which is

consistent with the study of Cunha &Vera (2005) .

Secondly, transformational leaders can positively

influence the performance of start-ups:

transformational leaders tend to actively develop their

own innovative awareness and capabilities, inspire

organizational members through their own images,

attitudes, beliefs and behaviors, correct employees'

work attitudes, build employees' collective

perceptions and ideas about the organization, help

promote mutual perceptions among members, and

guide the organization to accomplish innovative tasks,

which is a key factor in improving organizational

innovative performance A key factor in improving

organizational innovation performance.

Thirdly, Organizational improvisation and

transformational leadership can positively interact to

influence the innovation performance of start-ups:

transformational leaders create the conditions for

organizational improvisation through personal

leadership charisma, thereby gaining the trust of

employees while they strive to create a harmonious,

supportive, innovative and entrepreneurial culture

within the organization that promotes change and

innovation.

Fourthly, the VUCA environment plays a

significant moderating role between organizational

improvisation and innovation performance of start-

ups: the more volatile, uncertain, complex and

ambiguous the competitive environment is, the

greater the role of organizational improvisation on

innovation performance of start-ups, which proves

that the volatility of the environment is one of the

necessary conditions for organizational improvisation.

The degree of VUCA in the environment is an

external factor that is difficult for the organization to

control, but by improving the dynamic capabilities of

the organization, the organization can take advantage

of market opportunities, creatively solve challenges,

and improve the innovative performance of start-ups.

Fifthly, the VUCA environment plays a

significant moderating role between transformational

leadership and innovation performance of start-ups:

the more volatile, uncertain, complex and ambiguous

the competitive environment in which a company is

operating, the greater the role of transformational

leadership on innovation performance of start-ups.

KMIS 2024 - 16th International Conference on Knowledge Management and Information Systems

302

7 DISCUSSION

7.1 Theoretical Significance

Firstly, we explore the role relationship and evolution

mechanism between transformational leadership style

and innovation performance from the perspectives of

management, leadership, organizational behavior,

and innovation performance of start-ups, and explore

the effective path and influencing factors to enhance

the innovation performance of start-ups under the

perspective of organizational improvisation from the

perspective of transformational leadership style.

Secondly, the concept of organizational

improvisation is still in its infancy in China, and most

of the qualitative studies on the relationship between

organizational improvisation and performance have

been conducted. In addition to this, the current

research mainly focuses on organizational

performance and competitive advantage, and few

scholars have conducted research on the impact of

organizational improvisation on the innovation

performance of start-ups.

Thirdly, because start-ups are less able to

withstand risks compared to mature firms, start-ups

usually face problems such as fierce market

competition and difficulty in predicting current

market demand (Li & Cao, 2021), and with the further

intensification of the VUCA environment, start-ups

face even more serious competitive pressures and

threats to their resources

7.2 Research Limitations and Future

Directions

Firstly, due to objective reasons in terms of time and

funding, the sample of this study is mainly from

Southwest China, while the degree of environmental

turbulence and the organisations themselves exist in

different countries and regions with large

characteristics. In addition, the industries in this study

include both high-tech and traditional industries, and

whether or not there are large differences caused by

different industries may all affect the generalizability

of the study's findings. One of the directions for future

research is to conduct comparative studies by industry

as well as by region.

Secondly, the questionnaire research method

mainly used in this study, the scales are scoring mode,

some employees may have concerns when it comes to

the leader and the company performance related

questions, which can not fully reflect the objective

facts of the enterprise, with the limitations of first-

hand data, and at the same time, the indexof the

organization's innovation performance is also

subjective measurement, which inevitably causes the

bias of the research data. Future research can combine

rooted theory with questionnaire research, thus

making up for the shortcomings in this area.

Third, the data obtained in this study were only

static cross-sectional data, which were analyzed to

explore the relationship between the independent and

dependent variables, without longitudinal data

collection and dynamic tracking analysis. In order to

obtain more accurate research results, future research

needs to conduct longitudinal studies with specific

time spans, as well as case studies exploring deeper

associations between variables, in order to reduce

errors arising from single cross-sectional data with a

multi-faceted, cross-level research approach.

7.3 Management Suggestions for

Practice

Firstly, this study confirms that innovation

performance of start-ups is positively and positively

influenced by transformational leadership. Therefore,

organizations can determine whether existing leaders

need transformational leadership training by

analyzing the different needs of team leaders, develop

training programs based on their needs and change

behaviors in practice after training, create scenarios

conducive to transformational leadership traits, and

strengthen the effectiveness of the training by

recognizing and rewarding transformational

leadership behaviors.

Secondly, using modern Internet technology and

other means, the company can effectively simulate

and practice the difficulties and blows it may face,

and require the employees of the new venture to make

timely responses, and shorten the response time each

time through repeated training, thus putting forward

more requirements for improving the improvisation

ability of the company's employees.

Thirdly, new start-ups should detach themselves

from the previous independent perspective of

transformational leadership and organizational

improvisation, and pay attention to the positive

effects generated by the integration of the two, and

give full play to the complementary advantages of the

two in the VUCA environment. At the same time, this

paper finds that the impact of both on the innovation

performance of start-ups is moderated by VUCA, and

the role of both has a strong correlation with the

turbulent environment in which the enterprise is

located. At the same time, it is necessary to focus on

the cultivation of innovation ability, break the

inherent routine, avoid the rigidity of the

How Organizational Improvisational, Transformational Leadership Styles Impact Innovation Performance of Start-Up Companies in VUCA

Environments

303

organization, and maintain the creativity of the

organization.

REFERENCES

Bass, B. M. (1985). Leadership and Performance beyond

Expectations. The Academy of Management Review,

Chen, C. (2013). The impact of time-based competition on

organizational performance from a cognitive

perspective (Master's thesis, Northeast University of

Finance and Economics).

Chowdhury, M. M. H., & Quaddus, M. (2017). Supply

chain resilience:

Conceptualization and scale development using dynamic

capability theory. International Journal of Production

Economics, 188, 185–204.

Crossan, M. M., Vieira da Cunha, J., Cunha, M. P. E., &

Vera, D. (2002). Time and Organizational

Improvisation. SSRN Electronic Journal.

Fultz, A. E. F., & Hmieleski, K. M. (2021). The art of

discovering and exploiting unexpected opportunities:

The roles of organizational improvisation and

serendipity in new venture performance. Journal of

Business Venturing, 36(4), 106121.

Leybourne, S., & Sadler-Smith, E. (2006). The role of

intuition and improvisation in project management.

International Journal of Project Management, 24(6),

483–492.

Li, J.S., & Zhao, S.M. (2021)Orientation and path of human

resource management model innovation in the VUCA

era - focusing on the "three pillars" model. Journal of

Jianghai (05), 90-96.

The NTL Handbook of Organization Development and

Change: Principles, Practices, and Perspectives: Second

Edition,2014,76(6):659-672.

Mach, M., Ferreira, A. I., & Abrantes, A. C. M. (2021).

Transformational Leadership and Team Performance in

Sports Teams: A Conditional Indirect Model. Applied

Psychology, 71(2).

Ng, T. W. H. (2017). Transformational leadership and

performance outcomes: Analyses of multiple mediation

pathways. The Leadership Quarterly, 28(3), 385–417.

Nguyen, T. P. L., Nguyen, T. T., Duong, C. D., & Doan, X.

H. (2022). The effects of transformational leadership on

employee creativity in Vietnam telecommunications

enterprises. Management Decision, 60(3), 837–857.

Nielsen, K., & Daniels, K. (2012). Does shared and

differentiated transformational leadership predict

followers' working conditions and well-being?.

Leadership Quarterly, 23(3), 383-397.

Rong, P. F., Su, Y., & Wang, X. L. (2018). CEO leadership

style, TMT behavioral integration and firm innovation

performance. Xuehai (01), 196-206.

Scott, S. G., & Bruce, R. A. (1994, October 1). Creating

innovative behavior among R&D professionals: the

moderating effect of leadership on the relationship

between problem-solving style and innovation. IEEE

Xplore.

Shafi, M., Zoya, Lei, Z., Song, X., & Sarker, M. N. I.

(2020). The effects of transformational leadership on

employee creativity: Moderating role of intrinsic

motivation. Asia Pacific Management Review, 25(3).

ScienceDirect.

Shan, B. A., Pu, Y., Yan, S., & Liang, B. M. (2021). A study

on the impact of improvisational ability on the

performance of technology-based new ventures under

uncertainty. Journal of Management (07), 1032-1039

Stanescu, D. F., Zbuchea, A., & Pinzaru, F. (2020).

Transformational leadership and innovative work

behaviour: the mediating role of psychological

empowerment. Kybernetes.

Tang, Y., & Zhou, P. (2017). And so on and so forth:

Corporate improvisation strategy in a dynamic

environment. Tsinghua Management Review (05), 84-

Troise, C., Corvello, V., Ghobadian, A., & O’Regan, N.

(2022). How can SMEs successfully navigate VUCA

environment: The role of agility in the digital

transformation era. Technological Forecasting and

Social Change,2022, 174, 121227.

Wang, C. (2021). Research on the Role Mechanism of

Digital Transformation on Corporate Innovation

Performance. Contemporary Economic Management

(03), 34-42.

Weick, K. E. (1993). The Collapse of Sensemaking in

Organizations: The Mann Gulch Disaster.

Administrative Science Quarterly, 38(4), 628.

Xiang, Y. Y. (2021). The impact of resource patchwork and

organizational improvisation on innovation

performance of start-up firms (Master's thesis,

Chongqing University of Technology and Business).

Zhang, J., &Wang, G. H. (2020). Analysis of the impact

mechanism of transformational leadership on team

innovation performance. Enterpris Economics (09), 37-

43.

Zhang, X. E., & Zhang, K. (2018). The impact of

entrepreneurial orientation on the performance of

newly created social enterprises - The mediating role of

resource collocation and the moderating role of

regulation. Science and Technology Progress and

Countermeasures (09), 91-99

KMIS 2024 - 16th International Conference on Knowledge Management and Information Systems

304