Leadership style and organizational innovativeness drive motor carriers toward sustained performance Robert E. Overstreet, Joe B. Hanna, Terry A. Byrd, Casey G. Cegielski and Benjamin T. Hazen Department of Aviation and Supply Chain Management, Auburn University, Auburn, Alabama, USA Abstract Purpose – The purpose of this study is to examine the complex relationships between transformational leadership, organizational innovativeness, and motor carrier performance. Design/methodology/approach – A covariance-based structural equation model was developed, tested and validated to explain the effect of leadership style and innovativeness on motor carrier performance. The authors’ hypotheses were tested using responses from 158 North American motor carriers. Findings – The results support a direct as well as an indirect positive relationship between transformational leadership and organizational performance. Through the theoretical lens of dynamic capabilities theory, the results indicate that leaders motivate organizational change based on their own idiosyncrasies and perceptions of the environment. Research limitations/implications – This research was limited by its focus on the motor carrier industry and may limit the generalizability of the findings. While the sample of motor carriers was selected at random, the individuals within each of the organizations were purposively selected based on their positions. Practical implications – The results indicate that the proactive leader who makes calculated changes is likely to chart a course towards enhanced organizational innovativeness and performance that may provide the firm with a sustained competitive advantage. Originality/value – This is one of the few works investigating leadership style and innovativeness in the motor carrier industry. Keywords Supply chain management, Dynamic capabilities, Transformational leadership, Organizational innovativeness, Organizational performance, Transportation, Survey methods, Structural equation modeling Paper type Research paper Introduction Of the challenges faced by senior leaders today, managing change is perhaps one of the most critical to the success of the organization (e.g. Fawcett et al., 2009; Graetz, 2000; Voola et al., 2004). Research suggests that leadership style is one of the most important factors with respect to an organization’s capacity to innovate and adapt to change (e.g. Eisenbeiss et al., 2008; Jung et al., 2003; Mitchell and Boyle, 2009) and is time and again shown to have a significant positive relationship with organizational performance (e.g. Garcı ´a Morales et al., 2008; Jung et al., 2010; Thomas, 1988; Wang et al., 2010). Indeed, leadership style appears to have both a direct, immediate relationship as well as an indirect, sustained relationship with organizational success. Yet, questions remain regarding precisely how leadership drives performance (Jing and Avery, 2008). The current issue and full text archive of this journal is available at www.emeraldinsight.com/0957-4093.htm Received 7 December 2012 Revised 8 March 2013 Accepted 14 April 2013 The International Journal of Logistics Management Vol. 24 No. 2, 2013 pp. 247-270 r Emerald Group Publishing Limited 0957-4093 DOI 10.1108/IJLM-12-2012-0141 247 Leadership style Downloaded by Wright Patterson AFB AFIT At 05:24 21 January 2015 (PT)