Exploring the Relationships among Transformational Leadership, Organizational Culture and Product Innovation using PLS SEM
Product innovation refers to new products development and improvement of existing products. The importance of product innovation proliferated as the market grows and becomes more diversified. Among SMEs, product innovation is one of the most critical determinants for their survival, growth, and competitiveness. Nonetheless, product innovation among SMEs is still low, owning to various issues and challenges. This study attempts to focus the effect of transformational leadership and organizational culture on product innovation among 36 SMEs in Johor. A SEM PLS was used to validate the measurement model and develop the path modeling among variables studied. It is found that both transformational leadership and organizational culture are significantly related to product innovation. This finding substantiates previous findings and lends supports to the important roles of both constructs in SME's development.