Turning digital transformation into innovation: the roles of data-driven decision-making and innovation leadership in Vietnamese universities

Purpose Drawing on the dynamic capabilities framework, contingency theory of decision-making and upper echelons theory, this study proposes and tests a dual moderated mediation model that explains how innovation leadership (IL) moderates the relationships between digital transformation (DT) and data-driven decision-making (DDDM) and between DDDM and innovation in universities. Specifically, the study clarifies how DDDM functions as a mechanism through which DT is translated into innovation performance. Design/methodology/approach This study employs partial least squares structural equation modeling to test the proposed model and its hypotheses using survey data from 108 universities in Vietnam. Findings The findings show that (1) DDDM fully mediates the relationship between DT and innovation, indicating that DT does not directly lead to innovation unless it is implemented through DDDM processes, and (2) IL positively moderates the sequential effect of DT, DDDM and innovation. Practical implications The findings suggest that universities should move beyond investing in digital technologies alone and should instead strengthen DDDM and IL. Doing so will enable universities to turn digital resources into product and process innovations, such as new courses and research projects, and to enhance staff capabilities, resource allocation and incentive systems. Originality/value This study contributes to the DT and innovation management literature by clarifying how DT leads to innovation through DDDM as a managerial and behavioral decision process and by identifying IL as a critical boundary condition shaping this transformation.