Unraveling the pathways to employee job performance: the nexus between empowering leadership, absorptive capacity and digital transformation

Purpose Digital transformation, characterized by the extensive adoption of the latest technologies, has emerged as a significant driver of employee performance. The study integrates leadership, technology and employee behavior to explain job performance in dynamic organizational contexts. The study specifically aims to examine the direct and mediated effects of digital transformation on employee job performance. The research model developed by the authors posits empowering leadership as a precursor to both digital transformation and job performance, with employee absorptive capacity (AC) serving as a mediator between empowering leadership and digital transformation. Design/methodology/approach A pool of 261 valid responses was collected from the employees serving in the Indian IT sector. Structural equation modeling was applied for the final analysis using the SMARTPLS 4 software. Findings Results indicate that empowering leadership positively influences digital transformation and employee job performance. Likewise, digital transformation significantly facilitates employee job performance in both ways directly and indirectly. Furthermore, employee AC stands out as a significant mediator between empowering leadership and digital transformation. Originality/value The current article unveils digital transformation as the black box in the context of empowering leadership, AC and job performance, which will surely serve as a base for future studies working on the different aspects of digital transformation. As per the authors’ best information, no published articles have considered digital transformation and AC as the mediating mechanisms between the aforementioned relationships.