Navigating Leadership Dynamics: A Study of Innovative Work Behavior in Malaysian Organization

Innovative work behaviour (IWB) is increasingly recognized as a crucial element for enhancing organizational performance in Malaysian workplaces, particularly in the public sector. This study explores how transformational leadership, transactional leadership, and psychological empowerment relate to innovative work behaviour (IWB) in Malaysian organisations. This study used a quantitative online questionnaire survey and distributed it to collect data from 280 employees in Perbadanan Kemajuan Negeri Selangor (PKNS). Partial Least Square – Structural Equation Modelling (PLS-SEM) statistical technique was employed to analyse the questionnaire survey data collected using Smart-PLS 3.0. The findings show that transformational leadership has significant impacts on IWB, however, there are negative effects for transactional leadership. Psychological empowerment, the interface between transformational and transactional leadership, plays a vital role in facilitating IWB. The study emphasises the significance of cultivating a culture of innovation in Malaysian businesses through the use of transformational leadership styles and the empowerment of employees. The results have significant effects on the enhancement of leadership skills and the formulation of organisational plans within the framework of Industry 4.0.