Examining the Impact of Transformational Leadership on Innovation Management in Engineering Firms: A Refined Test of the Mediating Role of Team Engagement

Abstract

This study examines whether transformational leadership influences innovation management directly and whether team engagement carries part of that influence in engineering and related firms. Using a quantitative cross-sectional design, the study analyzed 350 valid survey responses after the removal of one incomplete case. Transformational leadership was measured with the Global Transformational Leadership Scale, team engagement with the UWES-9, and innovation management with innovation-related items adapted from prior research. A post hoc item-level diagnostic review showed that one reverse-worded innovation item (IM5) performed weakly and reduced the internal consistency of the innovation construct. After removing IM5, Cronbach’s alpha for innovation management improved from .683 to .760, while the substantive pattern of results remained stable. Transformational leadership positively predicted innovation management (β = .504, p < .001) and team engagement (β = .408, p < .001). Team engagement also positively predicted innovation management (β = .472, p < .001). Mediation analysis further indicated a significant partial indirect effect (β = .130, 95% CI [.076, .191]). The findings suggest that innovation management in engineering firms depends not only on leadership directly but also on the energy, commitment, and involvement that teams bring to their work.