1. Home
  2. Vol 4, No 1 (2023)
  3. Esamah

Agile Leadership and Digital Transformation in Savings Cooperative Limited: Impact on Sustainable Performance Amidst COVID-19

Abdulhadee Esamah, Somnuk Aujirapongpan, Neeranat K. Rakangthong, Narinthon Imjai

Abstract


Savings Cooperative Limited in Thailand is a financial institution that operates under strict legal regulations and self-imposed limitations to mitigate potential risks arising from its business activities. During the COVID-19 pandemic, the adoption of agile leadership within the organization becomes crucial in reducing inertia and facilitating the digital transformation process, leading to sustainable financial and non-financial performance. This research aims to investigate the direct and indirect effects of agile leadership and organizational inertia on sustainable financial and non-financial performance, with digital information playing a significant role.The study comprised 100 managers or deputies from Savings Cooperative Limited in Thailand, selected through purposeful sampling to meet specific criteria. Data collection involved a questionnaire based on concepts and theories, administered via email, phone, and mail. Subsequently, the collected data underwent analysis using structural equation modelling (SEM) to yield results. The findings of this study demonstrate a positive relationship between agile leadership and digital transformation, as well as sustainable financial and non-financial performance. Furthermore, organizational inertia was found to have a negative impact on digital transformation. However, the relationships between other variables were not statistically significant. These results contribute to a better understanding of the definition of agile leadership, highlighting its inability to eliminate the influence of external factors such as legal constraints. Therefore, it is recommended that authorities responsible for enforcing laws consider providing leniency during crisis conditions, allowing Savings Cooperative Limited to employ agile leadership in practical ways. Any leaders within Savings Cooperative Limited in Thailand aiming to implement digital transformation and achieve success should prioritize the selection of agile leadership based on these findings.

 

Doi: 10.28991/HEF-2023-04-01-04

Full Text: PDF


Keywords


Agile Leadership; Organizational Inertia; Digital Transformation; Financial Performance; Non-Financial Performance; Sustainable Performance; Savings Cooperative.

References


Worley, C. G., & Jules, C. (2020). COVID-19’s Uncomfortable Revelations about Agile and Sustainable Organizations in a VUCA World. The Journal of Applied Behavioral Science, 56(3), 279–283. doi:10.1177/0021886320936263.

Cascio, J. (2020). Facing the Age of Chaos. Medium, San Francisco, United States. Available online: https://medium.com/@cascio/facing-the-age-of-chaos-b00687b1f51d (accessed on January 2023).

Fitzgerald, M., Kruschwitz, N., Bonnet, D., & Welch, M. (2014). Embracing digital technology: A new strategic imperative. MIT SLOAN management review, 55(2), 1.

Chen, H., & Tian, Z. (2022). Environmental uncertainty, resource orchestration and digital transformation: A fuzzy-set QCA approach. Journal of Business Research, 139, 184–193. doi:10.1016/j.jbusres.2021.09.048.

Zhai, H., Yang, M., & Chan, K. C. (2022). Does digital transformation enhance a firm’s performance? Evidence from China. Technology in Society, 68. doi:10.1016/j.techsoc.2021.101841.

Kraus, S., Jones, P., Kailer, N., Weinmann, A., Chaparro-Banegas, N., & Roig-Tierno, N. (2021). Digital Transformation: An Overview of the Current State of the Art of Research. SAGE Open, 11(3). doi:10.1177/21582440211047576.

Songkajorn, Y., Aujirapongpan, S., Jiraphanumes, K., & Pattanasing, K. (2022). Organizational Strategic Intuition for High Performance: The Role of Knowledge-Based Dynamic Capabilities and Digital Transformation. Journal of Open Innovation: Technology, Market, and Complexity, 8(3), 117. doi:10.3390/joitmc8030117.

Zhen, J., Cao, C., Qiu, H., & Xie, Z. (2021). Impact of organizational inertia on organizational agility: the role of IT ambidexterity. Information Technology and Management, 22(1), 53–65. doi:10.1007/s10799-021-00324-w.

AlKayid, K., Selem, K. M., Shehata, A. E., & Tan, C. C. (2022). Leader vision, organizational inertia and service hotel employee creativity: Role of knowledge-donating. Current Psychology, 42(4), 3382–3394. doi:10.1007/s12144-022-02743-6.

Rakthai, T., Aujirapongpan, S., & Suanpong, K. (2019). Innovative capacity and the performance of businesses incubated in university incubator units: Empirical study from universities in Thailand. Journal of Open Innovation: Technology, Market, and Complexity, 5(2), 33. doi:10.3390/JOITMC5020033.

Ciruela-Lorenzo, A. M., Del-Aguila-Obra, A. R., Padilla-Meléndez, A., & Plaza-Angulo, J. J. (2020). Digitalization of agri-cooperatives in the smart agriculture context. Proposal of a digital diagnosis tool. Sustainability (Switzerland), 12(4), 1325. doi:10.3390/su12041325.

Nath, S., & Arrawatia, R. (2022). Trade-offs or synergies? Hybridity and sustainable performance of dairy cooperatives in India. World Development, 154. doi:10.1016/j.worlddev.2022.105862.

Northouse, P. G. (2021). Leadership: Theory and practice. SAGE Publications, Thousand Oaks, United States.

Kent, B. Beedle, M., van Bennekum, A., Cockburn, A., Cunningham, W., Fowler, M., Grenning, J., Highsmith, J., …, Thomas, D. (2001). Manifesto for Agile Software Development. Available online: https://agilemanifesto.org/ (accessed on Feb. 2023).

Limaj, E., & Bernroider, E. W. N. (2022). A taxonomy of scaling agility. The Journal of Strategic Information Systems, 31(3), 101721. doi:10.1016/j.jsis.2022.101721.

Joiner, B., & Josephs, S. (2007). Developing agile leaders. Industrial and Commercial Training, 39(1), 35–42. doi:10.1108/00197850710721381.

Joiner, W. B., & Josephs, S. A. (2006). Leadership agility: Five levels of mastery for anticipating and initiating change. John Wiley & Sons, Hoboken, United States.

Hayward, S. (2021). The agile leader: How to create an agile business in the digital age. Kogan Page Publishers, London, United Kingdom.

Parker, D. W., Holesgrove, M., & Pathak, R. (2015). Improving productivity with self-organised teams and agile leadership. International Journal of Productivity and Performance Management, 64(1), 112–128. doi:10.1108/IJPPM-10-2013-0178.

Akkaya, B., Panait, M., Apostu, S. A., & Kaya, Y. (2022). Agile Leadership and Perceived Career Success: The Mediating Role of Job Embeddedness. International Journal of Environmental Research and Public Health, 19(8). doi:10.3390/ijerph19084834.

Adhiatma, A., Fachrunnisa, O., Nurhidayati, & Rahayu, T. (2022). Creating digital ecosystem for small and medium enterprises: the role of dynamic capability, agile leadership and change readiness. Journal of Science and Technology Policy Management. doi:10.1108/JSTPM-12-2020-0171.

Hayward, S. (2015). Connected leadership: How to build a more agile, customer-driven business. Pearson, London, United Kingdom.

Akkaya, B., & Sever, E. (2022). Agile Leadership and Organization Performance in the Perspective of VUCA. Advances in Logistics, Operations, and Management Science, 213–228, IGI Global, Hershey, United States. doi:10.4018/978-1-6684-3894-7.ch010.

Gkintoni, E., Halkiopoulos, C., & Antonopoulou, H. (2022). Neuroleadership as an Asset in Educational Settings: An Overview. Emerging Science Journal, 6 (4), 893–904. doi:10.28991.ESJ-2022-06-04-016.

Hooi, L. W., & Tan, N. N. (2021). Agile Leadership and Bootlegging Behavior: Does Leadership Coping Dynamics Matter?. Agile Coping in the Digital Workplace. Springer, Cham, Switzerland. doi:10.1007/978-3-030-70228-1_10.

Şahin, S., & Alp, F. (2020). Agile Leadership Model in Health Care: Organizational and Individual Antecedents and Outcomes. Agile Business Leadership Methods for Industry 4.0, 47–68, Emerald Publishing Limited, Bingley, United Kingdom. doi:10.1108/978-1-80043-380-920201004.

Heidrich, O., Kamara, J., Maltese, S., Re Cecconi, F., & Dejaco, M. C. (2017). A critical review of the developments in building adaptability. International Journal of Building Pathology and Adaptation, 35(4), 284–303. doi:10.1108/IJBPA-03-2017-0018.

Robbins, S. P. & Judge, T.A. (2016) Organizational Behavior (17th Ed.). Pearson Education Limited, Upper Saddle River, United States.

Pardo Del Val, M., & Martínez Fuentes, C. (2003). Resistance to change: a literature review and empirical study. Management Decision, 41(2), 148–155. doi:10.1108/00251740310457597.

Daviy, A., & Shakina, E. (2021). Excess momentum or excess inertia: Do companies adopt technologies at the right time?. European Research on Management and Business Economics, 27(3). doi:10.1016/j.iedeen.2021.100174.

Zantvoort, B. (2015). On Inertia: Resistance to Change in Individuals, Institutions and The Development of Knowledge. Cosmos & History, 11(1), 342-360.

Schwarz, G. M., Yang, K.-P., Chou, C., & Chiu, Y.-J. (2018). A classification of structural inertia: Variations in structural response. Asia Pacific Journal of Management, 37(1), 33–63. doi:10.1007/s10490-018-9588-6.

Näslund, L., & Pemer, F. (2012). The appropriated language: Dominant stories as a source of organizational inertia. Human Relations, 65(1), 89–110. doi:10.1177/0018726711424322.

Godkin, L., & Allcorn, S. (2008). Overcoming organizational inertia: A tripartite model for achieving strategic organizational change. The Journal of Applied Business and Economics, 8(1), 82–94.

Gilbert, C. G. (2005). Unbundling the structure of inertia: Resource versus routine rigidity. Academy of Management Journal, 48(5), 741–763. doi:10.5465/AMJ.2005.18803920.

Hannan, M. T., & Freeman, J. (1984). Structural Inertia and Organizational Change. American Sociological Review, 49(2), 149. doi:10.2307/2095567.

Omidvar, O., Safavi, M., & Glaser, V. L. (2023). Algorithmic Routines and Dynamic Inertia: How Organizations Avoid Adapting to Changes in the Environment. Journal of Management Studies, 60(2), 313–345. doi:10.1111/joms.12819.

Kudesia, R. S. (2017). Organizational Sensemaking. Oxford Research Encyclopedia of Psychology, 1-39. doi:10.1093/acrefore/9780190236557.013.78.

Hasnawi, H. H. Al, & Abbas, A. A. (2020). Workplace Ostracism as a Mediating Variable in the Relationship between Paradoxical Leader Behaviours and Organizational Inertia. Organizacija, 53(2), 165–181. doi:10.2478/orga-2020-0011.

Ozawa, K. (2023). Organisational inertia and the dynamics of multiple organisational routines. Knowledge Management Research & Practice, 21(3), 667–676. doi:10.1080/14778238.2021.1983481.

Wessel, L., Baiyere, A., Ologeanu-Taddei, R., Cha, J., & Blegind Jensen, T. (2021). Unpacking the Difference between Digital Transformation and IT-Enabled Organizational Transformation. Journal of the Association for Information Systems, 22(1), 102–129. doi:10.17705/1jais.00655.

Pattanasing, K., Aujirapongpan, S., Dowpiset, K., Chanthawong, A., Jiraphanumes, K., & Hareebin, Y. (2022). Dynamic Knowledge Management Capabilities: An Approach to High-Performance Organization. HighTech and Innovation Journal, 3(3), 243-251. doi:10.28991/HIJ-2022-03-03-01.

Kraus, S., Durst, S., Ferreira, J. J., Veiga, P., Kailer, N., & Weinmann, A. (2022). Digital transformation in business and management research: An overview of the current status quo. International Journal of Information Management, 63, 1-18. doi:10.1016/j.ijinfomgt.2021.102466.

Gurbaxani, V., & Dunkle, D. (2019). Gearing up for successful digital transformation. MIS Quarterly Executive, 18(3), 209–220. doi:10.17705/2msqe.00017.

Kuratko, D. F., Fisher, G., & Audretsch, D. B. (2021). Unraveling the entrepreneurial mindset. Small Business Economics, 57(4), 1681–1691. doi:10.1007/s11187-020-00372-6.

Larsen, I. B. (2022). Fostering an entrepreneurial mindset: A typology for aligning instructional strategies with three dominant entrepreneurial mindset conceptualizations. Industry and Higher Education, 36(3), 236–251. doi:10.1177/09504222211038212.

Morris, M. H., & Tucker, R. (2023). The entrepreneurial mindset and poverty. Journal of Small Business Management, 61(1), 102–131. doi:10.1080/00472778.2021.1890096.

Solberg, E., Traavik, L. E. M., & Wong, S. I. (2020). Digital Mindsets: Recognizing and Leveraging Individual Beliefs for Digital Transformation. California Management Review, 62(4), 105–124. doi:10.1177/0008125620931839.

Liu, Y., Xu, S., & Zhang, B. (2020). Thriving at Work: How a Paradox Mindset Influences Innovative Work Behavior. THR Journal of Applied Behavioral Science, 56(3), 347–366. doi:10.1177/0021886319888267.

Miron-Spektor, E., Ingram, A., Keller, J., Smith, W. K., & Lewis, M. W. (2018). Microfoundations of organizational paradox: The problem is how we think about the problem. Academy of Management Journal, 61(1), 26–45. doi:10.5465/amj.2016.0594.

Tondolo, V. A. G., D’Agostini, M., Camargo, M. E., Tondolo, R. da R. P., Souza, J. de L., & Longaray, A. A. (2020). Sustainable operations practices and sustainable performance: relationships and moderators. International Journal of Productivity and Performance Management, 70(7), 1865–1888. doi:10.1108/ijppm-12-2019-0552.

Permatasari, A., Dhewanto, W., & Dellyana, D. (2023). The role of traditional knowledge-based dynamic capabilities to improve the sustainable performance of weaving craft in Indonesia. Journal of Enterprising Communities, 17(3), 664–683. doi:10.1108/JEC-11-2021-0156.

Jiraphanumes, K., Aujirapongpan, S., & Songkajorn, Y. (2023). Influence of diagnostic and dynamic capabilities on frugal innovation development: An empirical study of the Thai auto parts industry. Asia Pacific Management Review, 28(2), 229–239. doi:10.1016/j.apmrv.2022.10.001.

Acosta-Prado, J. C., & Tafur-Mendoza, A. A. (2022). Examining the mediating role of dynamic capabilities in the relationship between information and communication technologies and sustainable performance. VINE Journal of Information and Knowledge Management Systems. doi:10.1108/VJIKMS-10-2021-0257.

Afum, E., Issau, K., Agyabeng-Mensah, Y., Baah, C., Dacosta, E., Essandoh, E., & Agyenim Boateng, E. (2023). The missing links of sustainable supply chain management and green radical product innovation between sustainable entrepreneurship orientation and sustainability performance. Journal of Engineering, Design and Technology, 21(1), 167–187. doi:10.1108/JEDT-05-2021-0267.

Belhadi, A., Kamble, S., Gunasekaran, A., & Mani, V. (2021). Analyzing the mediating role of organizational ambidexterity and digital business transformation on industry 4.0 capabilities and sustainable supply chain performance. Supply Chain Management: An International Journal, 27(6), 696–711. doi:10.1108/scm-04-2021-0152.

Larbi-Siaw, O., Xuhua, H., Owusu, E., Owusu-Agyeman, A., Fulgence, B. E., & Frimpong, S. A. (2022). Eco-innovation, sustainable business performance and market turbulence moderation in emerging economies. Technology in Society, 68, 101899. doi:10.1016/j.techsoc.2022.101899.

Marcis, J., Bortoluzzi, S. C., de Lima, E. P., & da Costa, S. E. G. (2019). Sustainability performance evaluation of agricultural cooperatives’ operations: a systemic review of the literature. Environment, Development and Sustainability, 21(3), 1111–1126. doi:10.1007/s10668-018-0095-1.

Ruangkanjanases, A., Hariguna, T., & Abdillah, W. (2022). Assessing Supply Chain Management Ambidexterity, Integration of Knowledge Management Use and User Satisfaction. Journal of Human, Earth, and Future, 3(3), 361-376. doi:10.28991/HEF-2022-03-03-08.

Fiore, M., Galati, A., Gołębiewski, J., & Drejerska, N. (2020). Stakeholders’ involvement in establishing sustainable business models. British Food Journal, 122(5), 1671–1691. doi:10.1108/BFJ-04-2019-0263.

Otache, I., Echukwu, I. J., Umar, K., Yunusa, A., & Audu, S. (2022). Internal factors affecting the performance of employee-based savings and credit cooperatives: evidence from Nigeria. Journal of Enterprising Communities: People and Places in the Global Economy, 1-17. doi:10.1108/jec-03-2022-0046.

Zhong, Z., Jia, F., Long, W., & Chen, K. Z. (2022). Risk sharing, benefit distribution and cooperation longevity: sustainable development of dairy farmer cooperatives in China. International Journal of Agricultural Sustainability, 20(5), 982–997. doi:10.1080/14735903.2022.2041229.

Basterretxea, I., Charterina, J., & Landeta, J. (2019). Coopetition and innovation. Lessons from worker cooperatives in the Spanish machine tool industry. Journal of Business and Industrial Marketing, 34(6), 1223–1235. doi:10.1108/JBIM-01-2018-0015.

Henderikx, M., & Stoffers, J. (2022). An Exploratory Literature Study into Digital Transformation and Leadership: Toward Future-Proof Middle Managers. Sustainability (Switzerland), 14(2). doi:10.3390/su14020687.

Sow, M., & Aborbie, S. (2018). Impact of Leadership on Digital Transformation. Business and Economic Research, 8(3), 139. doi:10.5296/ber.v8i3.13368.

AlNuaimi, B. K., Kumar Singh, S., Ren, S., Budhwar, P., & Vorobyev, D. (2022). Mastering digital transformation: The nexus between leadership, agility, and digital strategy. Journal of Business Research, 145, 636–648. doi:10.1016/j.jbusres.2022.03.038.

Guo, L., & Xu, L. (2021). The effects of digital transformation on firm performance: evidence from China’s manufacturing sector. Sustainability (Switzerland), 13(22). doi:10.3390/su132212844.

Teng, X., Wu, Z., & Yang, F. (2022). Research on the Relationship between Digital Transformation and Performance of SMEs. Sustainability (Switzerland), 14(10). doi:10.3390/su14106012.

Kongrode, J., Aujirapongpan, S., & Ru-Zhue, J. (2023). Exploring the impact of dynamic talent management capability on competitive performance: The mediating roles of dynamic marketing capability of startups. Journal of Competitiveness, 15(1), 113–130. doi:10.7441/joc.2023.01.07.

Khaw, T. Y., Teoh, A. P., Abdul Khalid, S. N., & Letchmunan, S. (2022). The impact of digital leadership on sustainable performance: a systematic literature review. Journal of Management Development, 41(9/10), 514–534. doi:10.1108/jmd-03-2022-0070.

Kafetzopoulos, D., & Gotzamani, K. (2022). The effect of talent management and leadership styles on firms’ sustainable performance. European Business Review, 34(6), 837–857. doi:10.1108/EBR-07-2021-0148.

Hongdiyanto, C., Widyarini, L. A., & Yusup, A. K. (2022). The Effect of Organizational Inertia and Customer Orientation with Incremental Innovation as the Mediating Variable towards Organizational Performance. Journal Entrepreneur Dan Entrepreneurship, 11(1), 1–14. doi:10.37715/jee.v11i1.1954.

Teofilus, T., Ardyan, E., Sutrisno, T. F. C. W., Sabar, S., & Sutanto, V. (2022). Managing Organizational Inertia: Indonesian Family Business Perspective. Frontiers in Psychology, 13. doi:10.3389/fpsyg.2022.839266.

Cooperative Promotion Department. (2023). Annual Statistics of Cooperatives, Agricultural groups and Vocational group in Thailand: 31 December 2022. Cooperative Promotion Department, Ministry of Agriculture and Cooperative, Bangkok, Thailand. Available online: https://app1.cpd.go.th/annual-statistics-of-cooperatives-31122565/#p=1 (accessed on January 2023).

Yurdugül, H. (2008). Minimum sample size for Cronbach’s coefficient alpha: a Monte-Carlo study. Hacettepe Üniversitesi Eğitim Fakültesi Dergisi, 35(35), 1-9.

Nunnally, J. C., & Bernstein, I. H. (1994). Psychometric theory (3rd Ed.). McGraw-Hill, New York, United States.

Hur, J. Y., Cho, W., Lee, G., & Bickerton, S. H. (2019). The “Smart Work” Myth: How Bureaucratic Inertia and Workplace Culture Stymied Digital Transformation in the Relocation of South Korea’s Capital. Asian Studies Review, 43(4), 691–709. doi:10.1080/10357823.2019.1663786.

Vial, G. (2019). Understanding digital transformation: A review and a research agenda. Journal of Strategic Information Systems, 28(2), 118–144. doi:10.1016/j.jsis.2019.01.003.

Chen, C. A. (2014). Revisiting organizational age, inertia, and adaptability. Journal of Organizational Change Management, 27(2), 251–272. doi:10.1108/JOCM-10-2012-0166.

Hannan, M. T., & Freeman, J. (1977). The Population Ecology of Organizations. American Journal of Sociology, 82(5), 929–964. doi:10.1086/226424.

Chanatup, S., Aujirapongpan, S., & Ritkaew, S. (2020). The influence of corporate governance mechanism on the integrated financial reporting and investment risk of Thai listed companies. Entrepreneurship and Sustainability Issues, 7(4), 2818–2831. doi:10.9770/jesi.2020.7.4(16).


Full Text: PDF

DOI: 10.28991/HEF-2023-04-01-04

Refbacks

  • There are currently no refbacks.


Copyright (c) 2023 Abdulhadee Esamah, Somnuk Aujirapongpan, Neeranat Kaewprasert Rakangthong