The impact of leadership and relational quality on product innovation performance in the grocery retail environment

Von Hirschberg, Jeanne (2021-12)

Thesis (DAdmin)--Stellenbosch University, 2021.


ENGLISH SUMMARY : This research study investigated leadership, relationships and product innovation performance in a South African grocery retail milieu. The leadership aspect explored the degree to which leaders are transformative, followers employ self-leadership traits, and how this relates to product innovation performance. In terms of relationships, the study examined both internal team leader-follower relationship quality, and external team retailer-supplier relationship quality, and how both relate back to product innovation performance. Product innovation performance was measured according to commercial success in the form of end-consumer adoption and relevance. Achieving innovation performance is largely dependent on the knowledge workers responsible for developing the innovation. Therefore, ensuring the appropriate organisational conditions in order to increase the success rate of innovation remains a 21st-century challenge. The aim of this study was to gain insight into the contribution of leadership and relationships in enabling product innovation performance in a frenetic and predominantly transactional grocery retail environment. The basic design of the study involved both quantitative and qualitative data inputs. A primary partial least squares structural equation analysis model was followed, with secondary co-variance based structural equation model utilised as a confirmation, thus ensuring the relationships between the key concepts were confirmed through significant reliability measures. The quantitative data set was gleaned from a predominantly internal team member cohort, with a supplementary component gleaned from a strategic supplier sample. The qualitative data involved 60 interviews, 19 with strategic supplier team members, 21 with internal team members and 20 with independent innovation experts. The internal team and external supplier team interviews were anchored along seven innovation clusters - thus presenting both the supplier and retailer view on the same relationship. The innovation expert data set provided valuable insights in terms of how the findings were a contribution beyond organisation-specific context. It was found that transformational leaders play an essential role in supporting both internal and external team members. The cohesive role fulfilled by leaders that embodied transformational attributes: (1) inspired internal and external team members to perform in the absence of a fully functioning innovation ecosystem; (2) supported the navigation of product innovation projects from inception to completion despite the shortcomings in terms of structure, process and strategy; and (3) played a remedial role in neutralising the adverse effects of transactional leadership behaviours. One of the new academic contributions included the valuable role of leadership and relationship investments towards strategic supplier partners in the product innovation journey. This study has bolstered the case for greater supplier development in the quest to achieve product innovation performance. The findings of this study indicated that the cultivation of high-quality retailer-supplier exchange relationships is the greatest predictor of product innovation performance. These findings substantiate the need for organisations to apply greater support for suppliers in creating and communicating push innovation processes, providing knowledge exchange opportunities, co managing risk, and sharing of innovation strategies. The adaptation of the retailer-supplier exchange measurement instrument as a reliable way to measure the relationship quality between retailers and their customers, is a new contribution, and could be promising for future research. The overall value in supporting and promoting transformational leadership attributes will stand suppliers in good stead, especially when there are other organisational shortfalls. While leadership and relationships are able to remedy organisational shortcomings in order to achieve product innovation goals, this study has strengthened the business case for prioritising an optimised innovation ecosystem. The ideal innovation ecosystem involves a holistic innovation strategy as the blueprint to all internal and external role-players, organisational structures and processes to support the strategy, and a wholesome organisational culture that can balance transactional and transformational aspects.

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