Rethinking of firm innovation capability: Examining the moderating role of leadership ability on a new business model

Abstract

‘Market-driving’ is a concept for changing the composition, behavior, and/or roles of different players in a specific market. Market-driving firms shape the future course of a market and could influence the other firms in the market, customer preferences, and business relationships and even redesign the value proposition for a certain segment of customers. Leadership ability helps to achieve better firm performance through market-driving competency. Although there are a few studies in these areas, there are only limited studies that investigate the role of leadership ability and market-driving competency in influencing the marketing and financial performance of a firm. Under such circumstances, the aim of this study is to rethink the firm innovation capability and propose a new business model from the B2B Market-driving competency and leadership ability perspectives. The proposed business model is derived from the theories of the resource-based view (RBV) and dynamic capability view (DCV). CB-SEM technique is used to test the model with 412 responses from B2B firms. The new business model is supported by the firm's internal capabilities and leadership style. The study also finds branding, relationship marketing, and innovation capabilities as antecedents of market-driving competency with leadership style being an important moderator to improving market-driving competency and firm performance.