Adaptive Entrepreneurial Leadership and Innovative Behavior in Madura Grocery Store MSMEs

Abstract

Aims: This study aims to test five hypotheses focusing on the role of Adaptive Entrepreneurial Leadership in encouraging Employee Innovative Behavior. Specifically, it examines the direct effects on Employee Innovative Behavior and Psychological Empowerment, the effect of Psychological Empowerment on innovative behavior, its mediating role, and the moderating role of Socio-Cultural Adaptability. Study Design: This study uses a quantitative approach with an explanatory research method to test causal relationships among variables. Place and Duration of Study: The research was conducted on Madurese ethnic grocery store MSMEs in Malang City. Methodology: Data were collected from 101 MSME owners and analyzed using structural model testing to assess direct, mediating, and moderating effects. Results: Results indicate that adaptive entrepreneurial leadership significantly influences employee innovative behavior and psychological empowerment. Psychological empowerment affects innovative behavior and partially mediates this relationship. Socio-cultural adaptability moderates the link, strengthening the impact of adaptive entrepreneurial leadership on innovative behavior MSMEs. Conclusion: Employee innovative behavior in MSMEs is shaped by the synergy between adaptive leadership, psychological empowerment, and socio-cultural adaptability. Future research is recommended to employ longitudinal or mixed-method designs and to examine broader MSME contexts to enhance the generalizability of these findings.