Islamic Institution Management: How Transformational Leadership Affects Employee Creativity and Its Implications on Entrepreneurial Behaviour
The author would like to thank the Head of Universitas Muhammadiyah Makassar and State Islamic University of Sultan Amai Gorontalo for their financial support for the publication of this article. The Head of Islamic Financial Institutions in Indonesia for providing facilities for data collection of this research.
There is still a research gap that highlights how transformational leadership indirectly influences entrepreneurial behaviour through employee creativity. Thus, this study not only narrows the gap in academic literature but also makes a real contribution to the practice of leadership and organizational management. Transformational leadership, which emphasizes its main characteristics (such as inspiring and motivating employees, encouraging innovation, and increasing commitment), provides a better context for employees and organizations. Therefore, this study aims to analyse and prove the effect of transformational leadership on entrepreneurial behaviour through employee creativity, the effect of transformational leadership on employee creativity and entrepreneurial behaviour. Data collection was conducted by distributing questionnaires to 110 employees working in the Islamic financial institution sector located in Gorontalo Province, Indonesia. The collected data were analysed using AMOS 23 to obtain information on CFA values, model fit evaluation, path analysis, and mediation tests with bootstrapping. The results of the study found that transformational leadership has a significant effect on entrepreneurial behaviour through employee creativity. Conversely, it does not have a direct effect on entrepreneurial behaviour. Creativity has a direct effect on entrepreneurial behaviour. Research implications, theoretically, strengthen and expand the theory of transformational leadership, present new contributions to the literature by including creativity as a key variable, and open new opportunities for subsequent studies that explore other mediating variables in the relationship between transformational leadership and entrepreneurial behaviour. Practically, for HR management, it is necessary to organize training and coaching programs to equip leaders with transformational skills; it is necessary to implement a performance evaluation system that includes indicators of creativity and innovation; it is necessary to encourage intrapreneurship programs; it is necessary for organizations to create a work culture that supports creativity and innovation. The originality of the study lies in the integration of new mediating variables, comprehensive analysis methods, and dual contributions to management theory and practice in encouraging creativity, innovation and entrepreneurial behaviour in the organizational environment.
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