The influence of leadership styles and organization innovation on digital leadership capabilities towards construction firms

Abstract This study investigates the interactions among leadership capability (LCAP) and organization capability (OCAP) in the Malaysian construction industry, emphasizing the mediating role of digital mindset (DIND) and the moderating effect of digital technology capability (DCAP). Data from 341 managerial-level personnel were analysed through Partial Least Squares Structural Equation Modeling (PLS-SEM), indicating that strong leadership styles significantly enhance the organization’s innovation and digital mindset. The DIND mediates the relationship between LCAP and OCAP, confirming that enhanced digital leadership capabilities (DLCAP) are crucial for transforming leadership styles towards effective organization innovation. Furthermore, DCAP negatively moderates the relationship between LCAP and OCAP; the deficiency of automation demands to manage organizational management challenges effectively, but as future development. These findings extend digital literacy by integrating leaders and organizational innovation dimensions and offer practical insights for construction stakeholders striving to incorporate Construction Industry Competency Standard (CICS) practices through technological and digital advancement. This research enriches the disclosure on the synergy between technology and environmental innovation within the knowledge of DLCAP standards. It provides valuable perspectives for policymakers and construction leaders aiming to foster awareness, realization, and transformation of technologically adept constant innovation as a digital roadmap.