1. Introduction
Organizations strive for survival, growth and profitability, look forward to that, and work hard to achieve their desired goals, with the many challenges facing economic and industrial establishments. Among the most important and most serious challenges facing enterprises in the twenty-first century is what has been called “globalization”, which has resulted in pressures, blocs, unions, open markets, unity of competition, in addition to the emergence of innovations and creativity for industrial and commercial facilities alike (
Kubartz 2009). Therefore, competitiveness in contemporary life requires a radical change and transformation in the way companies and institutions are managed to move from a strategy of crawling and freezing in front of the problems and challenges raised to a strategy of building capacity and devising practical non-traditional solutions and stimulating creativity, innovation, modernization and growth.
An organization is supposed to be competitive when it has a higher ability than other companies whose members work to compete, or reduce the impact of threats, and this competition comes from the organization’s ability to make use of its material or HR, which may relate to quality, technology, or innovation and development, availability of financial resources, ability to reduce cost, marketing efficiency, or possessing qualified human resources (
Adair 2010).
Any organization, institution or company must possess a distinct identity that reflects the basic features and qualities that distinguish it and give it privacy from other institutions. Some institutions may be similar in the elements and components of the physical environment, such as buildings, equipment, technology and other things, but they differ in their philosophy, culture and products, its human cadre, and this contributes to defining the identity of the organization and distinguishes it from others (
Erbe 2014;
Heavey and Simsek 2013). CE has been recognized as beneficial to bring positive organizational outcomes (
Kassa and Tsigu 2020).
Hence, it can be said that the empirical and theoretical understandings come together in order to bridge the gap by testing the mediated moderating effect of EE by leader’s supervision in the effects of CE on IP, in Tunisia in particular. Examining the mediating role of EE by leader’s supervision would add to our understanding about the nature of the relationship between CE and IP.
4. Theoretical Background
Academics and practitioners have accepted CE as a legitimate route towards increased levels of organizational performance (
Hornsby et al. 2009). Corporate entrepreneurship is said to be a useful strategy that all organizations should be able to adopt if they wish to pursue innovation and expansion (
Bani-Mustafa et al. 2021). It also represents an employee’s willingness and engagement towards achieving their entrepreneurial vision (
Do and Luu 2020).
Hornsby et al. (
2002) have outlined that positive perception about the internal factors of corporate entrepreneurship leads to numerous performance outcomes, including innovation performance. Moreover,
Nasution et al. (
2011) suggest that entrepreneurship and entrepreneurial climate within the organization are important in motivating employees to enhance productivity and bringing innovation to the business.
On the other hand,
Lukeš and Stephan (
2017) demonstrated the mediating role of perceived managerial support for supporting innovations in an organization. In other words, even if the organization supports innovation, this support does not function well when the support from middle managers is missing. Successful innovation requires new ideas to be put into practice and implemented, but there is a need for feedback from managers (
Santos et al. 2021).
Moreover, a lack of employee engagement has been evidenced to represent corporate-wide potential losses in creativity (
Gilson and Shalley 2004), productivity and corporate performance (
Harter et al. 2002). The results of González-Tejero and Molina’s work (
González-Tejero and Molina 2022) yielded a positive and direct link between the organization and the training of business leaders in programs of skills and competencies, as well as between the training and corporate entrepreneurship processes carried out in the organization.
4.1. Corporate Entrepreneurship (CE)
CE “refers to entrepreneurial activities [which] receive organizational sanction and resource commitments for the purpose of innovation results” (
Kuratko and Audretsch 2009, p. 55). Entrepreneurship is originally a French word, meaning a person who initiates or initiates the establishment of a business, and this was confirmed and indicated by most researchers that projects can flourish only in a society in which there is a spirit of entrepreneurship and love of self-employment (
Byrne et al. 2016).
The importance of entrepreneurship is attributed to the role it plays in improving productivity and encouraging economic growth. Therefore, the organization helps to create new businesses through product or process innovation, market development, and adoption of strategic innovation (
Tseng and Tseng 2019). It can be said that entrepreneurial processes can occur at the level of the organization, or at the level of the business unit, or the functional level, or the project, with the aim of improving the organization’s competitive position and improving current performance. Therefore, the entrepreneurial behavior is the behavior that defines the organization in a purposeful and continuous manner and forms the field of its operations by distinguishing and exploiting entrepreneurial opportunities directed towards innovation and creativity (
Hornsby et al. 2002;
Huang and Li 2017;
Miller and Friesen 1982). Entrepreneurially oriented firms are characterized by the following three well-known dimensions: (1) the firms must be innovative to explore new opportunities, (2) be proactive to market entry before rivals, and (3) be risk-taking to introduce new products.
4.2. Innovation
Innovation is the specific function of entrepreneurship. It is the means by which the entrepreneur either creates new wealth-producing resources or endows existing resources with enhanced potential for creating wealth (
Drucker 2002;
Medase 2020). It is about turning new ideas and imaginative ideas into reality. Effective use of this mental quality may produce the following outcomes: generating something completely new (this product may be rare, except in cases of high creativity), as well as consolidating or integrating a set of divergent and undifferentiated ideas in a new, unfamiliar way, finding new ideas for a product and finally, transferring existing and circulating ideas to other beneficiaries or new people (
Pitsis 2012).
Chaithanapat et al. (
2022) underlined the importance of innovation and how it influences firm performance. The positive influence of organizational innovation on organizational effectiveness is greater among individuals who embraced improvements rapidly than among those who did not (
Naveed et al. 2022).
Therefore, it can be said that innovation represents one of the most important foundations for achieving a competitive advantage in the long term. It is worth noting that innovation processes that have achieved success can achieve a major source of competitive advantages because they give the organization unique products that its competitors lack, allowing the imposition of high prices, especially if we consider that innovation processes that succeed in introducing new products contribute to building and strengthening competitive advantages, then innovative institutions today do not resort to innovation to only create these advantages, but also to dominate the industry and its leaders (
Yuan and Woodman 2010). Entrepreneurship and innovation are positively related to each other and interact to help an organization to flourish (
Jarrar and Smith 2014). They are complementary and a combination of the two is vital to organizational success and sustainability in today’s dynamic and changing environment (
Reihlen and Ringberg 2013).
4.3. Mediation of EE and Leader’s Supervision
When an employee perceives CE components, he/she is likely to feel engaged (
Umair et al. 2020).
Hewitt (
2015) reported that employee engagement led to competitiveness and achievement of performance targets.
Saks (
2006) suggests that when the employee becomes engaged to work, he/she has the feelings of control; hence, he/she will receive support and recognition from his/her organization.
Shuck and Reio (
2014) found that employee engagement results in better behaviors and outcomes.
Kassa and Raju (
2015) found a positive relationship between CE and EE.
Moreover,
Abu Shams et al. (
2017) found a positive relationship between EE and IP of the firms. Leadership helps in the implementation of strategy in a successful way (
Panagopoulos and Avlonitis 2010). Having had transformational leaders, companies are more likely to increase innovation (
Gumusluoglu and Ilsev 2009), as leaders help employees commit to the different strategic activities of their company when leaders act as a role model for encouraging their employees to follow their moral values and behaviors (
Podsakoff et al. 1996).
Leaders help their employees redefine their old problems, and solve old cases with innovative solutions (
Eisenbeiss et al. 2008). This constitutes the cooperative relationship between employees and helps them figure out innovative solutions (
Soyal 2020). The literature contradicts the mediating effect. For example,
Abu Shams et al. (
2017) reported that EE does not mediate the relationship between CE and IP (
Abu Shams et al. 2017).
Soyal (
2020) did not report a significant moderating effect of transformational leadership on the relationship between CE factors and IP. However,
Engelen et al. (
2012) found that transformational behaviors of leaders are a perquisite in order for the companies to implement entrepreneurial orientation to increase their performance.
11. Discussion
The aim is to investigate the mediated moderating effect of EE by leader’s supervision in the effects of CE on IP. The research results according to the research questions are summarized and discussed as follows.
The results indicated that corporate entrepreneurship and innovation performance are positively correlated (r = 0.35, p < 0.01). In addition, there is a positive correlation between leader’s supervision and innovation performance (r = 0.43, p < 0.01). Moreover, employee engagement and leader’s supervision are positively correlated (r = 0.49, p < 0.01). There is also a positive correlation between employee engagement and innovation performance (r = 0.36, p < 0.01).
When leader’s supervision is higher than the average and when CE increased by 1, IP is increased by 0.57, which is statistically significant (B = 0.57, p < 0.01). Through the analysis results of the moderating effect, it is confirmed that leader’s supervision was controlling the effect of CE on IP.
The interaction variables of corporate entrepreneurship and leader’s supervision significantly predicted employee engagement (β = 0.49, p < 0.01), and employee engagement has a significant direct effect on innovation performance (β = 0.49, p < 0.01).
It is found that the CE and IP were regulated by leader’s supervision. In the relationship between CE and IP, the moderating effect of leader’s supervision is found to be significant. This suggests that the effectiveness of CE in IP is determined by leader’s supervision. Both CE and IP are vital, as well as an issue that can be described as a decisive issue in case of any firm wishes to compete in a world economy that is viewed as competitive entrepreneurial one. This is in line with
Han and Park (
2017), who confirmed that CE plays an important role in the happening of IP, and
Hornsby et al. (
2002), who confirm that when the internal factors of CE are positively perceived, this will lead to numerous performance outcomes, including IP.
Secondly, the mediating effect of EE is significant in the relationship between CE and IP. In other words, corporate entrepreneurship is a valuable means for stimulating companies and increasing productivity, effectiveness and affectivity (
Varma 2013), that is, true CE success of any company depends on its employees being engaged in the firm’s work. This is reflective of employees’ ability to cope with the culture of a firm. These results are in line with previous studies (e.g.,
Janssen 2000) that when an employee perceives various work factors in his/her firm, this is likely to facilitate the prediction of IP. When employees find that management supports them, time is available for them to work, freedom to do their work is allowed, resources are available for entrepreneurial activities, their behaviors become innovative (
Pitt et al. 1996). In addition, this study suggests that there is a positive relationship between EE and CE. These results are in line with previous studies. For instance,
Kassa and Raju (
2015) reported that CEAI can be used to predict employee engagement. Engagement with work means employees feel joyful, enthusiastic, proud, and passionate and express contentment with the work (
Schaufeli et al. 2002). It has been concluded that there is a direct and positive relationship between CE and EE (
Kassa and Raju 2015). Employees who are engaged in work are likely to achieve good performance outcomes for any business, since they express active involvement in their work (
Reijseger et al. 2017). When an employee is provided with support from their management, given extra time, allowed to work at his/her own pace, given clear organizational boundaries, and rewarded for his/her creativity and innovation, this will lead to deep and extensive engagement in work, and enhancement of business performance (
Umair et al. 2020). Employees who receive healthy CE culture feel responsible to repay the business with engagement, which can lead to effective business performance (
Saks 2006).
When outcomes are innovative, individuals are motivated to engage in innovative behavior. This also encourages individuals to have a positive perspective towards their organization (
Tseng and Tseng 2019).
In Umair et al.’s study (2020), the environment was corporate entrepreneurial. Employees receive management support, time, work independence, clear organizational boundaries and rewards. As a result, they feel committed to their company and increased business performance. Employee innovative behavior is shaped by their leaders through support and encouragement during the creative process, as proposed by some researchers (e.g.,
Faraz et al. 2018;
Hansen and Pihl-Thingvad 2019;
Ismail and Mydin 2019).
It can be concluded that leader’s supervision moderates the relationship between CE environment and IP by affecting the employees’ motivation to be creative and innovative (
Bass 1999;
Kamatigam 2017;
Soyal 2020).