The Effect of Transactional Leadership on Organizational Agility in Tourism and Hospitality Businesses: The Mediating Roles of Organizational Trust and Ambidexterity

Abstract

The tourism and hospitality industry is dynamic, so it demands agility to gain a competitive edge. This paper aims to examine the effect of transactional leadership on organizational agility in the tourism and hospitality industry. It also investigates the roles of organizational trust and ambidexterity as mediators by adopting the resource-based view (RBV). This study’s data are collected from the full-time employees working in category (A) travel agencies and five-star hotels operating in Egypt. The PLS-SEM approach was used to analyze 532 valid responses using WarpPLS 7.0. The findings showed that there is a positive relationship between transactional leadership and organizational agility, as well as positive relationships between transactional leadership with organizational trust and ambidexterity. Organizational trust and ambidexterity were also found to have positive relationships with organizational agility. Moreover, the findings revealed that organizational trust and ambidexterity play a mediating role between transactional leadership and organizational agility. According to the results, setting specific, measurable, achievable, relevant, and time-bound (SMART) goals is a key aspect of transactional leadership. Managers can collaborate with employees to set goals aligned with organizational agility, encouraging them to proactively identify and seize opportunities.

1. Introduction

In today’s fast-paced and ever-changing business environment, characterized by rapid technological advancements, unpredictable market conditions, and evolving customer expectations, organizational agility has emerged as a critical factor for long-term success [1]. It is no longer sufficient for companies to simply adapt to changes; they must also foster a culture that promotes continuous innovation and the capacity to respond effectively [2]. In this dynamic and constantly evolving environment, leadership effectiveness is paramount in shaping an organization’s agility, which refers to its capacity to effectively navigate challenges while staying aligned with its strategic direction [3,4]. Transactional leadership is a leadership style characterized by leaders who prioritize task completion, utilize rewards, and implement corrective measures [5]. Transactional leaders establish clear expectations, offer rewards for goal attainment, and administer corrective actions in response to failures [6]. Despite extensive research on transactional leadership across various contexts, there is still a lack of full understanding regarding its effects on organizational agility and the underlying mechanisms involved [7].

Trust plays a critical role in the relationship between leadership and organizational outcomes. It creates an environment of open communication, collaboration, and knowledge sharing, which are essential for fostering organizational agility. When employees trust their leaders, they are more likely to exhibit proactive behaviors, take calculated risks, and embrace change. This, in turn, enhances the organization’s ability to respond swiftly and effectively to evolving circumstances [8,9] and contributes to its long-term sustainability.

Open and honest communication, maintaining consistency, and demonstrating integrity are essential factors in building organizational trust, which serves as the foundation for successful relationships both within and outside an organization [10]. In the context of leadership, trust is not only an indicator of a leader’s credibility but also a significant driver of employee engagement and commitment. Exploring how transactional leadership affects organizational trust and, in turn, influences agility provides a more comprehensive understanding of the connection between leadership and agility [11].

Additionally, the concept of ambidexterity, which has strong foundations in organizational theory, pertains to an organization’s capacity to skillfully manage both the exploration of new opportunities and the exploitation of existing resources and capabilities [12]. Ambidexterity enables organizations to effectively leverage their current advantages while simultaneously pursuing new possibilities, serving as a fundamental underpinning for organizational agility. Sustaining this delicate equilibrium is particularly crucial in organizations where the need for innovation must be harmonized with the drive for operational excellence [13], thereby contributing to organizational sustainability.

Many studies have examined the influence of transactional leadership on organizational agility (e.g., [14,15]), organizational trust (e.g., [16]), and organizational ambidexterity (e.g., [17]). To the best of the researchers’ knowledge, no studies have attempted to investigate the mediating role of organizational trust and organizational ambidexterity in the link between transactional leadership and organizational agility. Important questions arise to bridge this gap in human resource management: can transactional leadership improve organizational agility? and how can organizational trust and organizational ambidexterity intervene in such a relationship between transactional leadership and organizational agility? Hence, the current study seeks to resolve these two questions by analyzing the relationship between transactional leadership and organizational agility, as well as the mediating impact of organizational trust and organizational ambidexterity. This study investigates the aforementioned questions in Egyptian travel agencies and hotels and seeks to contribute to the literature on tourism and hospitality, and HRM. Furthermore, these research findings have significant implications for the tourism and hospitality sector. By bridging this research gap, researchers can provide valuable insights into the combined impact of transactional leadership, organizational trust, and ambidexterity on organizational agility within the tourism and hospitality industry. Such knowledge can be used as a guide by industry leaders and managers to develop effective leadership strategies, strengthen employee trust, and cultivate ambidextrous practices that foster organizational agility. Ultimately, closing this research gap can contribute to the growth and success of tourism and hospitality businesses in a highly competitive and dynamic marketplace.

2. Literature Review and Hypotheses Development

2.1. Transactional Leadership

Transactional leadership is characterized by its emphasis on the transactional exchange between leaders and their followers. This leadership style revolves around a system of rewards and punishments, where leaders provide clear instructions, set performance expectations, and utilize contingent rewards to motivate and oversee their team members. The primary focus of transactional leadership is typically on maintaining stability, ensuring adherence to established procedures, and attaining short-term objectives [18]. Transactional leaders employ contingent rewards as a means of motivating their followers. They set explicit performance objectives and provide rewards or incentives when those objectives are met. These rewards may take the form of recognition, bonuses, promotions, or other tangible and intangible benefits. The purpose is to reinforce desired behaviors and performance [19]. Also, transactional leaders maintain a vigilant watch over their followers’ performance to detect any deviations from established standards. They promptly intervene and take corrective measures when problems or errors arise. This approach involves active management by exception, where leaders concentrate on identifying and resolving issues rather than actively seeking improvement or innovation. Additionally, transactional leaders provide explicit instructions and guidelines to their followers, ensuring that expectations, responsibilities, and performance criteria are communicated. This clarity establishes a structured work environment and minimizes ambiguity [20]. Transactional leadership can prove effective in specific circumstances, particularly when there is a demand for well-defined guidelines and prompt outcomes, or when followers necessitate close monitoring. It can be particularly advantageous in environments that place a strong emphasis on strict compliance and adherence to established protocols, such as manufacturing or safety-critical industries [18].

2.2. Resource-Based View (RBV)

The resource-based view (RBV) is a theoretical framework that highlights the significance of distinctive and valuable resources in attaining a competitive advantage [21]. Within the realm of organizational agility, RBV proposes that transactional leadership plays a role in allocating and utilizing resources to facilitate both exploratory and exploitative endeavors. Transactional leaders who adeptly allocate resources, foster innovation, and promote learning and development can enhance an organization’s agility [6]. RBV suggests that organizations possess distinct and valuable resources that can confer a competitive advantage. In the context of this study, transactional leadership is regarded as a resource that is within the organization’s control [22]. Transactional leaders who skillfully allocate resources, offer support, and facilitate the attainment of goals can enhance the organization’s agility. These transactional leadership behaviors can be viewed as unique and valuable resources that impact organizational agility [23].

RBV also acknowledges intangible resources, such as trust, as a potential source of competitive advantage. In the present study, organizational trust is proposed as a mediating factor between transactional leadership and organizational agility [24]. Trust can be viewed as a valuable resource that influences the organization’s capacity to adapt and respond to evolving circumstances. Transactional leaders who are perceived as equitable, transparent, and dependable can cultivate trust among employees, thereby positively impacting organizational agility through promoting open communication, collaboration, and a willingness to embrace change [25].

Furthermore, RBV underscores the significance of ambidexterity as a resource that contributes to organizational achievement. Ambidexterity encompasses the organization’s capacity to effectively balance exploration and exploitation [26]. In the context of this study, ambidexterity is proposed as an additional mediating factor between transactional leadership and organizational agility [27]. Transactional leaders who adeptly oversee resource management and decision-making processes and foster a culture that encourages both exploration and exploitation can enhance the organization’s ambidexterity. This ambidexterity, functioning as a resource, empowers the organization to effectively adapt to market changes, embrace innovation, and attain organizational agility [28].

RBV posits that the integration of distinctive and valuable resources, such as transactional leadership, organizational trust, and ambidexterity, can yield a sustainable competitive advantage [29]. In this study, organizational agility is regarded as a crucial outcome that contributes to the organization’s competitive advantage [30]. By investigating the mediating roles of organizational trust and ambidexterity, this study can offer valuable insights into how transactional leadership influences these resources, ultimately fostering improved organizational agility and a sustainable competitive advantage.

2.3. Transactional Leadership and Organizational Agility

Organizational agility pertains to the aptitude of an organization to adapt, respond, and flourish within an environment characterized by rapid change and uncertainty. It encompasses the organization’s capability to recognize and capitalize on opportunities, swiftly modify strategies and operations, and adeptly navigate challenges and disruptions [31]. Transactional leaders excel in communicating expectations, defining clear goals, and implementing performance-based rewards and consequences. These actions foster a structured and goal-oriented work environment, empowering organizations to promptly address changes and overcome challenges [32]. Transactional leaders commonly utilize rewards and incentives as motivational tools for employees. These rewards can be contingent upon performance, target achievement, or the demonstration of agile behaviors. By aligning rewards with agility-related outcomes, transactional leaders establish a motivational environment that stimulates employees to adapt, innovate, and swiftly respond to evolving circumstances [6]. Motivated employees are more inclined to showcase agility in their work, thereby enhancing overall organizational agility [33].

Similarly, transactional leaders can promote organizational agility by prioritizing employee development. Through initiatives such as training, coaching, and mentoring, these leaders enhance the skills, knowledge, and competencies of their employees. Such development efforts empower employees to be more adaptable, flexible, and equipped to navigate dynamic situations, thus bolstering organizational agility. Transactional leaders can identify individual development needs and align them with the organization’s agility requirements [34].

Transactional leaders prioritize performance monitoring and feedback. Through regular feedback sessions, employees are given the chance to evaluate their performance, identify areas that require improvement, and make necessary adjustments. This emphasis on continuous improvement aligns with the agile mindset of learning and adapting. Transactional leaders who offer constructive feedback and support the growth of their employees cultivate a culture of ongoing learning and enhancement, thereby bolstering organizational agility [35].

Transactional leadership, despite its focus on compliance and standardization, has the potential to offer flexibility within predefined boundaries. Transactional leaders can empower employees by granting them the autonomy to exercise judgment and take initiative within the established guidelines and procedures. This approach encourages employees to adapt and respond to challenges while upholding accountability and alignment with organizational objectives, thereby cultivating organizational agility [34].

The impact of transactional leadership on fostering organizational agility is susceptible to various contextual factors. Elements such as organizational size, industry dynamics, technological advancements, and external environmental uncertainties can shape the connection between transactional leadership and agility. Leaders must tailor their transactional leadership behaviors to the unique context and challenges encountered by the organization [6]. Moreover, studies have highlighted the impact of transactional leadership on cultivating a culture of continuous improvement. Through the establishment of high standards and a focus on goal achievement, transactional leaders motivate employees to explore innovative methods of enhancing processes and performance. This culture of refinement aligns with the principles of agility, which emphasize ongoing learning and adaptation as organizations continuously refine their approaches in response to evolving circumstances [36].

While it can be inferred that the primary leadership style within an organization may impact organizational agility, the existing literature lacks a clear understanding of the mechanisms and the extent of interdependence between these variables. On the other hand, some leadership researchers broadly acknowledge the influence on organizational flexibility and agility [14]. Akkaya and Tabak [35], as well as Ghadampour and Zandkarimi [15], have concluded that transactional leadership has a significant and positive effect on organizational agility. Hence, the following hypothesis is suggested:

H1.

Transactional leadership positively correlates with organizational agility.

2.4. Transactional Leadership and Organizational Trust

Organizational trust encompasses individuals’ belief and confidence in an organization and its members. It is rooted in the perception of reliability, honesty, fairness, and integrity displayed by the organization in its actions, decisions, and interactions. Trust serves as a critical element in establishing effective organizational relationships and plays a pivotal role in promoting cooperation, collaboration, and overall organizational achievement [37]. Transactional leadership, which is characterized by its emphasis on explicit expectations, rewards, and compliance, has the potential to impact the level of trust within an organization [38]. Transactional leadership behaviors, such as clarifying performance expectations and fulfilling promises of rewards, have a positive influence on trust. When leaders consistently follow through on their commitments and establish a fair and transparent environment, trust is nurtured among employees [39].

Transactional leaders who establish explicit guidelines, monitor performance, and offer performance-based rewards foster an environment of fairness and predictability. This consistency and fairness play a significant role in the development of trust, as employees perceive that their efforts will be acknowledged and rewarded [40]. One manner in which transactional leadership contributes to organizational trust is through its establishment of clear and consistent communication [25].

Transactional leaders are recognized for their unwavering and dependable conduct. They set explicit expectations, offer precise guidelines, and ensure that rewards are tied to the achievement of performance objectives. This consistency fosters a feeling of predictability and reliability, which are crucial for establishing trust among employees. When employees perceive that their leaders consistently exhibit reliability and dependability in their actions, they are more inclined to trust their intentions and decisions [41].

Although transactional leadership primarily emphasizes task-oriented behaviors, leaders can also establish trust through interpersonal relationships [42]. Transactional leaders who genuinely care about their employees’ well-being, offer support, and cultivate positive relationships contribute to the development of trust. Employees are more inclined to trust leaders who exhibit empathy, respect, and a genuine commitment to their growth and development [43]. Jung and Avolio [16] demonstrated the significant and positive relationship between transactional leadership and organizational trust. Similarly, transactional leadership affects trust positively according to Chiang and Wang [44]. Accordingly, the following hypothesis is proposed:

H2.

Transactional leadership positively correlates with organizational trust.

2.5. Organizational Trust and Organizational Agility

Within an organization, trust establishes a psychological safety net that empowers employees to take risks and embrace change [45]. When employees have trust in their leaders and colleagues, they feel more at ease expressing their viewpoints, proposing innovative ideas, and undertaking calculated risks. This sense of psychological safety fosters a culture of learning, experimentation, and adaptability, which are fundamental elements of organizational agility [46]. Furthermore, trust plays a crucial role in fostering a learning culture within organizations, which is vital for agility. When employees have trust in the organization, they believe that mistakes are viewed as opportunities for growth rather than reasons for blame. This belief encourages them to engage in experimentation, share knowledge, and contribute to continuous improvement. Trust promotes a culture of openness, feedback, and learning from failures, enabling the organization to adapt and innovate in a rapidly changing environment [47].

Significantly, trust within an organization plays a critical role in promoting knowledge sharing. When employees trust one another, they are more inclined to share their expertise, experiences, and best practices with their colleagues. This knowledge-sharing enhances the collective intelligence of the organization and facilitates the rapid dissemination of information and learning. By harnessing the collective knowledge of its members, the organization becomes more agile in acquiring and applying new knowledge to adapt to changing circumstances [48]. Similarly, Razmi and Mohamed Ghasemi [49] highlighted that organizational trust significantly and positively correlates with organizational agility. So, the following hypothesis is formulated:

H3.

Organizational trust positively correlates with organizational agility.

2.6. Organizational Trust as a Mediator

Organizational trust operates as a cognitive and emotional process that enables the translation of transactional leadership practices into employee perceptions of support, fairness, and dependability [50]. When employees have trust in their leaders, they are more inclined to interpret transactional leadership behaviors in a positive light, perceiving them as supportive, fair, and impactful. This positive interpretation and perception of leadership behavior contribute to elevated levels of organizational agility [51].

Moreover, trust within an organization plays a critical role in facilitating information flow, which is vital for organizational agility [52]. Transactional leaders who establish explicit expectations and reward performance foster an environment where employees feel safe to share information, express their ideas, and collaborate with others. The flow of information is greatly enhanced when there is a high level of trust between employees and leaders. Trust enables open and honest communication, reduces barriers to knowledge sharing, and encourages the exchange of information across organizational boundaries. This enhanced information flow facilitates prompt decision-making, effective problem-solving, and adaptability, ultimately strengthening organizational agility [53].

By setting clear performance expectations and recognizing accomplishments, transactional leaders cultivate trust and instill confidence in employees. When employees have trust in their leaders’ fairness and intentions, they are empowered to take ownership of their work, make decisions independently, and take proactive action. Trust reduces the necessity for excessive control and micromanagement, enabling employees to swiftly adapt to changing circumstances, seize opportunities, and contribute to the organization’s agility [34,54].

Trust within an organization helps alleviate resistance to change, which is a common hurdle in achieving agility [55]. When employees trust their leaders and the organization, they are more inclined to perceive changes as credible and advantageous, thereby reducing resistance. Transactional leadership, with its consistent communication and reward system, can cultivate trust in the organization’s intentions, making it easier for employees to embrace and adapt to changes [56]. Consequently, the following hypothesis is suggested:

H4.

Organizational trust mediates the link between transactional leadership and organizational agility.

2.7. Transactional Leadership and Organizational Ambidexterity

Organizational ambidexterity entails the skillful management and integration of two seemingly conflicting elements: exploration and exploitation. By effectively balancing these two aspects, organizations can readily adapt to evolving environments, capitalize on emerging opportunities, and maintain long-term success [57]. Organizational ambidexterity necessitates the simultaneous pursuit of innovation, experimentation, and adaptation (exploration) alongside maintaining efficiency, optimization, and stability in current operations (exploitation) [58].

Transactional leadership can contribute to the equilibrium between exploration and exploitation by establishing expectations and offering rewards for both [59]. Transactional leaders who define explicit performance expectations and recognize accomplishments foster an environment that appreciates both exploration and exploitation. By setting goals for both innovative and efficient performance, transactional leaders encourage employees to participate in exploratory activities while simultaneously emphasizing operational excellence. Striking a balance between exploration and exploitation is essential for organizational ambidexterity [60].

Transactional leaders contribute to resource allocation and support for both exploration and exploitation. By linking rewards to performance, transactional leaders can allocate resources to facilitate both innovative initiatives and operational efficiency [61]. This allocation of resources helps provide the necessary support and infrastructure for conducting exploration and exploitation activities within the organization. Additionally, transactional leaders can offer guidance, remove obstacles, and provide incentives to teams engaged in both exploratory and exploitative efforts, further fostering organizational ambidexterity [62]. Transactional leadership fosters a culture of performance that aligns with organizational ambidexterity [63]. Transactional leaders establish expectations for performance and reward outcomes based on performance metrics [54]. This cultivates a culture in which individuals and teams are motivated to achieve results in both exploratory and exploitative domains. Through an emphasis on performance and individual accountability, transactional leaders promote a culture that values and encourages ambidextrous behavior [61,63]. The findings of Rao-Nicholson et al. [17] depicted the significant and positive correlation between transactional leadership and organizational ambidexterity. Therefore, the following hypothesis is assumed:

H5.

Transactional leadership positively correlates with organizational ambidexterity.

2.8. Organizational Ambidexterity and Organizational Agility

Organizational ambidexterity enhances organizational agility by increasing resource flexibility. Ambidextrous organizations allocate resources to both exploratory and exploitative activities, allowing them to swiftly adapt to shifting market conditions [64]. Organizations that can smoothly allocate and reallocate resources between exploration and exploitation are better equipped to respond quickly to new opportunities or threats. By achieving a harmonious balance between exploration and exploitation, ambidextrous organizations strengthen their agility in resource allocation and utilization [65].

Importantly, organizational ambidexterity enhances organizational agility by enabling effective adaptation to dynamic environments. Exploration activities enable organizations to scan the external environment, identify emerging trends, and proactively pursue new opportunities [66]. Conversely, exploitation activities ensure that organizations can leverage their existing resources and capabilities to swiftly respond to changing market demands. Through the ongoing balance and integration of exploration and exploitation, ambidextrous organizations develop the capability to perceive and adapt to environmental changes, thereby amplifying their agility in turbulent and uncertain contexts [67].

Meanwhile, organizational ambidexterity fosters learning and the integration of knowledge, which are vital for organizational agility. Exploration allows organizations to acquire new knowledge and experiences, while exploitation enables organizations to refine and leverage existing knowledge. Ambidextrous organizations establish mechanisms to capture, share, and integrate knowledge from both exploration and exploitation activities. This learning and knowledge integration empowers organizations to adapt and innovate swiftly, bolstering their agility by tapping into a broader knowledge base [68]. Clauss et al. [69] revealed that there is a significant and positive link with organizational agility. Furthermore, Kumkale [70] reported that organizational ambidexterity positively affects organizational agility. So, the following hypothesis is proposed:

H6.

Organizational ambidexterity positively correlates with organizational agility.

2.9. Organizational Ambidexterity as a Mediator

Transactional leadership behaviors, such as clarifying role expectations and offering guidance, foster role clarity among employees. When employees have a precise comprehension of their roles, they can align their behaviors and efforts to effectively balance exploration and exploitation. This alignment is a crucial element of organizational ambidexterity [71]. Transactional leadership, driving organizational ambidexterity, empowers individuals and teams to contribute to both exploratory and exploitative activities, thereby enhancing organizational agility [72]. Also, transactional leadership places a strong emphasis on performance-based rewards and accountability. Through setting clear performance expectations and providing rewards for achieving desired outcomes, transactional leaders establish a culture that values and promotes ambidextrous behavior. This culture, rooted in performance, motivates employees to actively engage in both exploration and exploitation, thereby driving organizational ambidexterity. When employees are motivated to balance exploration and exploitation, the organization becomes more agile in responding to dynamic market conditions and evolving customer needs [73].

Transactional leadership places a strong emphasis on continuous improvement by closely monitoring performance and offering feedback. By fostering a culture of continuous improvement, transactional leaders motivate individuals and teams to learn from past experiences, adapt their approaches, and refine their performance. This commitment to ongoing improvement is essential for fostering organizational ambidexterity. As the organization continuously improves its ability to balance exploration and exploitation, it enhances its agility in addressing challenges and capitalizing on opportunities [74]. The organizational ambidexterity that arises from transactional leadership can serve as a mediating factor between this leadership style and organizational agility. Ambidextrous organizations possess the capability to swiftly respond to changes, seize new opportunities, and adapt to evolving market conditions [27]. By effectively balancing operational excellence and innovative practices, these organizations can navigate uncertainties with greater effectiveness, aligning with the concept of agility [72]. Hence, the following hypothesis is assumed:

H7.

Organizational ambidexterity mediates the link between transactional leadership and organizational agility.

The hypothesized research framework is presented in Figure 1 below.

3. Materials and Methods

3.1. Sampling and Data Collection

Data used to test the study model were collected from employees of Egypt’s category (A) travel agencies and five-star hotels between February and April 2023. Working in category (A) travel agencies or five-star hotels is challenging because they seek to give high-quality service to their customers at all times, and hence they invest in new concepts such as organizational agility and ambidexterity. Because of the geographical scope of this study and the dispersion of five-star hotels and travel agencies throughout Egypt, the convenience sample approach was used. According to the statistics of 2018 given by the ministry of tourism [75], Egypt has 158 5-star hotels and 2222 category (A) travel agencies. A total of 900 questionnaires were distributed to the organizations being investigated. A total of 532 valid forms were collected, which represents a 59.11% response rate, including 363 (68.2%) surveys from 30 five-star hotels and 169 (31.8%) from 50 category (A) travel agencies. Because the total number of personnel employed in Egypt’s category (A) travel agencies and five-star hotels are not reported in the official records, Cochran’s [76] sampling equation was used in this study. Cochran [76] suggested that when a population list is unavailable, a representative sample for the population equals 385 replies. As a consequence, the 532 valid responses collected were sufficient for the final analysis.

According to

Table 1. Participant’s profile (N = 532).

		Frequency	Percent
Gender	Male	430	80.8
	Female	102	19.2
Age	<30 years	206	38.7
	30: <40 years	258	48.5
	40: >50 years	68	12.8
Education	High schools/institute	86	16.2
	Bachelor	429	80.6
	Master/PhD	17	3.2
Experience	<2 years	98	18.4
	2 to 5 years	108	20.3
	6 to 10 years	89	16.7
	>10 years	237	44.5
Work organization	Hotels	363	68.2
	Travel agency	169	31.8

, there were 430 (80.8%) male participants and 102 (19.2%) female participants out of 532 participants in total. Also, 68 (12.8%) participants were between the ages of 40 and more than 50, 258 (48.5%) participants were between the ages of 30 and less than 40, and 206 (36.7%) participants were under the age of 30. Furthermore, 86 (16.2%) owned a high school or high institute certificate, while 429 (80.6%) had a bachelor’s degree and 17 (3.2%) had a master’s or PhD degree. Moreover, 237 (44.5%) had more than ten years of work experience, compared with 98 (18.4%) who had less than two years, 108 (20.3%) who had two to five years, and 89 (16.7%) who had six to ten years of work experience. In addition, 169 participants (31.8%) worked in category (A) travel agencies, compared with 363 participants (68.2%) who worked in five-star hotels.

3.2. Measures and Instrument Development

Transactional leadership was assessed using a 4-item scale of Alrowwad et al. [22]. Sample items included: “When I am unable to complete my work, my manager reprimands me” and “My manager gives me what I want to exchange for my hard work”. In addition, organizational agility was evaluated using a 4-item scale adapted from Melián-Alzola et al. [77]. For example, “The hotel/travel agency is an agile organization capable of adapting to changes” and “The hotel/travel agency can predict and identify changes”. Moreover, organizational ambidexterity was measured using a 3-item scale adapted from Trieu et al. [78]. For instance, “Our hotel/travel agency implements operational innovations that are difficult for other hotels/travel agencies to imitate” and “Our hotel/travel agency improves the efficiency of existing business operations”. Lastly, organizational trust was examined using a 9-item scale of Pearce et al. [79]. For example, “The personnel policies suggest that this hotel/travel agency has confidence in its employees” and “The performance appraisal system shows that this hotel/travel agency trusts its employees”. Appendix A lists all the scales’ items.

The self-administered questionnaire approach was used in this study. The original questionnaire was written in English. Then, to guarantee that the matching was accomplished, a back translation technique was used. The survey used in this study was divided into two parts. The first focused on the four latent variables investigated in this study, which are transactional leader, organizational agility, organizational trust, and organizational ambidexterity. There were 20 items in this section, all responses were graded on a 5-point Likert scale, “ranging from 1 for strongly disagrees to 5 for strongly agrees”. In the second section of the survey, employees were given five questions concerning their gender, age, education level, number of years of work experience, and work organization.

3.3. Common Method Bias

To address potential common method variance (CMV), a common concern in studies utilizing cross-sectional data collection methods, such as simultaneous surveys, the researchers conducted an assessment before further statistical analysis. The Harman single-factor test and principal component analysis (PCA) method were employed to investigate CMV in this study. The results of the CMV test indicated that no single dominant factor accounted for more than 50% of the total variation across the three variables. Consequently, CMV was determined to not be a significant issue in this study.

3.4. Data Analysis

PLS-SEM is a popular analytical technique in tourism and hospitality research [80]. As a result, the current study employed the PLS-SEM technique to analyze the study’s measurement and structural model, as well as to confirm the research hypotheses. WarpPLS software version 7.0 was used to analyze the data.

4. Results

4.1. Descriptive Statistics and Factor Loadings

Table 2. Descriptive statistics and factor loadings.

	Mean *	Standard Deviation	Item Loading	VIF
Transactional leadership (TL)	2.98	1.04	-
TL.1	2.91	1.11	0.567 **	1.699
TL.2	2.94	1.13	0.971 **	1.912
TL.3	2.99	1.37	0.871 **	2.385
TL.4	3.07	1.39	0.888 **	2.099
Organizational agility (OAg)	3.48	1.02	-
OAg.1	3.28	1.22	0.801 **	2.954
OAg.2	3.37	1.26	0.860 **	2.100
OAg.3	3.58	1.22	0.916 **	2.337
OAg.4	3.68	1.15	0.791 **	2.192
Organizational trust (OT)	3.42	0.98	-
OT.1	3.23	1.35	0.696 **	2.966
OT.2	3.41	1.30	0.649 **	2.803
OT.3	3.33	1.37	0.653 **	2.963
OT.4	3.38	1.25	0.813 **	2.128
OT.5	3.48	1.29	0.861 **	2.659
OT.6	3.59	1.25	0.763 **	2.887
OT.7	3.50	1.21	0.876 **	2.810
OT.8	3.40	1.20	0.824 **	2.775
OT.9	3.42	1.19	0.853 **	2.260
Organizational ambidexterity (OAm)	2.84	1.06	-
OAm.1	2.63	1.30	0.886 **	2.344
OAm.2	2.89	1.19	0.935 **	2.201
OAm.3	2.99	1.17	0.773 **	1.639

* Mean score; Low: “1.00 to 2.33, Average (Moderate): 2.34 to 3.66, High: 3.67 to 5.00”. ** p value < 0.05.

shows that factor loading was computed and that item loadings ranged from 0.567 to 0.971. According to Hair et al.’s [81] criterion, an item loading value larger than 0.5 can be considered acceptable. Table 2 also displays the mean scores of transactional leadership, organizational agility, organizational trust, and organizational ambidexterity as perceived by hotels and travel agency employees, which were (2.98 ± 1.04), (3.48 ± 1.02), (3.42 ± 0.98), and (2.84 ± 1.06), respectively. Variance inflation factors (VIFs) are generated for all latent variables in a model. The occurrence of a VIF greater than 3.3 is proposed as an indication of pathological collinearity, and also as an indication that a model may be contaminated by common method bias. Therefore, if all VIFs resulting from a full collinearity test are equal to or lower than 3.3, the model can be considered free of common method bias as recommended by Kock [82].

4.2. Reliability and Validity

Manley et al. [83] argued that Cronbach’s alpha and composite reliability for all variables are sufficient when all variables have a value higher than 0.7, as shown in

Table 3. Reliability and AVEs.

Construct/Items	Composite Reliability	Cronbach Alpha	Average Variance Extracted (AVE)	Full.Collin.VIF
Transactional leadership (TL)	0.897	0.846	0.685	2.316
Organizational agility (OAg)	0.907	0.863	0.710	2.127
Organizational trust (OT)	0.931	0.917	0.602	1.831
Organizational ambidexterity (OAm)	0.900	0.833	0.751	2.091

. Furthermore, it was discovered that AVE values larger than 0.5 existed, supporting the validity of the scales according to Hair et al.’s [80] criterion. Also, the Full Collinearity VIF results were all satisfactory.

A discriminant validity test was also carried out.

Table 4. Discriminant validity results.

	OAm	TL	OT	OAg
Organizational ambidexterity (OAm)	0.867	0.682	0.552	0.593
Transactional leadership (TL)	0.682	0.828	0.570	0.646
Organizational trust (OT)	0.552	0.570	0.776	0.622
Organizational agility (OAg)	0.593	0.646	0.622	0.842

shows that, for each variable, the AVE value is greater than the highest common value. According to Hair et al.’s [80] criterion, these results verify the research model’s reliability and validity.

Furthermore, HTMT for validity was examined (see

Table 5. HTMT for validity.

HTMT Ratios
	OAm	TL	OT	OAg
Organizational ambidexterity (OAm)
Transactional leadership (TL)	0.817 ***
Organizational trust (OT)	0.631 ***	0.646 ***
Organizational agility (OAg)	0.698 ***	0.756 ***	0.697 ***

*** p value < 0.001.

) illustrating that it is satisfactory as all values are <0.85.

4.3. Model Fit and Quality Indices for the Research Model

The model fit had been confirmed before testing the hypotheses. All the model fit and quality index findings comply with the standards, as outlined in Appendix B.

4.4. The Structural Model and Hypotheses Testing

To analyze the study’s structural model, path coefficient analysis (β), p-value, and R-square (R2) were used. The findings from hypotheses testing (Figure 2 and

Table 6. Mediation analysis (Bootstrapped Confidence Interval).

						Bootstrapped Confidence Interval
	Path a	Path b	Indirect Effect	SE	t-Value	95% LL	95% UL	Decision
H4	0.62	0.41	0.254	0.030	8.473	0.195	0.313	Mediation
H7	0.690	0.130	0.090	0.030	2.990	0.031	0.149	Mediation

) indicate that there is a positive relationship between transactional leadership with organizational agility (β = 0.39, p < 0.01), organizational trust (β = 0.62, p < 0.01), and organizational ambidexterity (β = 0.69, p < 0.01). This means that transactional leadership increases organizational agility, organizational trust, and organizational ambidexterity. Therefore, H1, H2, and H5 are supported. In addition, a positive relationship between organizational trust and organizational ambidexterity with organizational agility exists (β = 0.41, p < 0.01) and (β = 0.13, p < 0.01), respectively. This means that organizational trust and organizational ambidexterity increase organizational agility. Therefore, H3 and H6 are supported.

Additionally, Figure 2 shows that transactional leadership interpreted 38% of the variance in organizational trust (R2 = 0.38) and 47% of the variance in organizational ambidexterity (R2 = 0.47). Moreover, transactional leadership, organizational trust, and organizational ambidexterity explained 71% of the variance in organizational agility (R2 = 0.71).

Finally, indirect effect was examined to evaluate the mediating roles of organizational trust and organizational ambidexterity in the relationship between transactional leadership and organizational agility (see Table 6). For organizational trust, the “bootstrapping analysis” indicated that the indirect effect’s Std. β = 0.254 (0.620 × 0.410) was significant, with a t-value of 8.473. Furthermore, the indirect effect of 0.267, “95% Bootstrapped Confidence Interval”: (LL = 0.195, UL = 0.313), does not cross a zero in between, confirming mediation. As a result, the mediation effect of organizational trust in the relationship between transactional leadership and organizational agility may be considered statistically significant. As a result, H4 is supported.

In addition, for organizational ambidexterity, the “bootstrapping analysis” indicated that the indirect effect’s Std. β = 0.090 (0.690 × 0.130) was significant, with a t-value of 2.990. Furthermore, the indirect effect of 0.090, “95% Bootstrapped Confidence Interval”: (LL = 0.031, UL = 0.149), does not cross a zero in between, confirming mediation. As a result, the mediation effect of organizational ambidexterity in the relationship between transactional leadership and organizational agility may be considered statistically significant. As a result, H7 is supported.

5. Discussion

The purpose of the current study was to examine the effect of transactional leadership on organizational agility, taking into consideration the mediating roles of organizational trust and ambidexterity. The mean score of transactional leadership (2.98 ± 1.04) suggests that, on average, employees perceive transactional leadership behaviors to be moderately present in their organizations. Transactional leadership is characterized by setting clear expectations, using rewards and punishments, and emphasizing task-oriented performance. The moderate score indicates that there may be room for improvement in terms of transactional leadership practices within hotels and travel agencies. Also, the mean score of organizational agility (3.48 ± 1.02) indicates that employees perceive their organizations to possess a moderate level of agility. Organizational agility refers to an organization’s ability to respond quickly and effectively to changes in the market and customer demands. The moderate score suggests that there is some level of agility present but also highlights the potential for further enhancing agility within the industry. In addition, the mean score of organizational trust (3.42 ± 0.98) indicates that employees perceive a moderate level of trust within their organizations. Organizational trust is essential for fostering positive relationships, effective communication, and collaboration among employees. While the moderate score suggests a reasonable level of trust, there is still room for strengthening trust within hotels and travel agencies to enhance employee morale and organizational effectiveness. Moreover, the mean score of organizational ambidexterity (2.84 ± 1.06) suggests that employees perceive a relatively lower level of organizational ambidexterity. Organizational ambidexterity refers to an organization’s ability to balance and integrate exploration (innovation, adaptation) with exploitation (efficiency, optimization). The lower score indicates a potential need for organizations in the industry to foster a better balance between exploration and exploitation to stay competitive and responsive to market dynamics.

The findings confirm our first hypothesis that transactional leadership positively correlates with organizational agility. This finding is consistent with those of prior studies (e.g., [15,35]), which claimed that transactional leadership increases organizational agility. Transactional leadership influences the development of a culture of continual improvement. Transactional leaders inspire people to seek new approaches to improving procedures and performance by establishing high standards and focusing on goal attainment. This refining culture correlates with agility concepts, which emphasize continuing learning and adaptability as organizations continuously modify their processes in response to changing conditions [36]. The findings also confirm our second hypothesis that transactional leadership positively correlates with organizational trust. This finding is consistent with those of prior studies (e.g., [43,44]), which claimed that transactional leadership increases organizational trust. Transactional leadership can cultivate trust by fostering a sense of accountability and transparency. Through diligent performance monitoring and feedback provision, transactional leaders ensure that employees are responsible for their actions. This accountability, coupled with equitable and consistent rewards, establishes an environment where employees feel that their contributions are acknowledged and esteemed. Consequently, trust in both the leadership and the organization is fortified [54]. In addition, the findings confirm our third hypothesis that organizational trust positively correlates with organizational agility. This finding is consistent with those of the prior study of Razmi and Mohamed Ghasemi [49] who claimed that organizational trust increases organizational agility. Trust within an organization empowers employees by granting them autonomy and decision-making capabilities. When employees have trust in their leaders, they feel empowered to make decisions, take ownership of their work, and proactively tackle challenges. Trust enhances employee discretion and diminishes the necessity for rigid hierarchical control. This empowerment and autonomy enable employees to swiftly respond to evolving circumstances and make agile decisions [84]. Moreover, the findings confirm our fourth hypothesis that organizational trust mediates the link between transactional leadership and organizational agility. This finding is indirectly consistent with those of prior studies like that of Sharif and Scandura [56]. Transactional leadership behaviors that emphasize explicit expectations and rewards have the potential to foster a climate of trust that encourages risk-taking. When employees have trust in their leaders, they feel confident in taking calculated risks and are more inclined to explore new ideas and approaches. Trust diminishes the fear of failure and creates a supportive environment in which employees can venture outside their comfort zones, thereby contributing to organizational agility through innovative practices [34]. Furthermore, the findings confirm our fifth hypothesis that transactional leadership positively correlates with organizational ambidexterity. This finding is consistent with those of prior studies (e.g., [17,61,63]), which claimed that transactional leadership increases organizational ambidexterity. Transactional leadership is instrumental in facilitating goal alignment and coordination, which are crucial for organizational ambidexterity [59]. By clarifying expectations and providing rewards based on performance, transactional leaders aid in aligning individual and team goals with the organization’s objectives [85]. This alignment enables different units or teams within the organization to effectively coordinate their efforts, ensuring that exploration and exploitation activities complement one another. Through clear expectations and rewards, transactional leadership fosters a shared focus on attaining both innovation and efficiency [6,34]. Additionally, the findings confirm our sixth hypothesis that organizational ambidexterity positively correlates with organizational agility. This finding is consistent with those of prior studies of (e.g., [69,70]), which claimed that organizational ambidexterity increases organizational agility. In addition, organizational ambidexterity strengthens an organization’s innovation capability, which is a crucial component of agility. Exploration activities concentrate on generating new ideas, experimenting with novel approaches, and nurturing creativity. On the other hand, exploitation activities leverage existing knowledge, processes, and capabilities to optimize performance. By integrating both exploration and exploitation, ambidextrous organizations cultivate an innovative culture that empowers them to swiftly adapt and innovate in response to market changes [86]. Lastly, the findings confirm our seventh hypothesis that organizational ambidexterity mediates the link between transactional leadership and organizational agility. This finding is indirectly consistent with those of prior studies (e.g., [27,72]). A strong focus is placed on performance-based rewards and responsibility in transactional leadership. Transactional leaders create a culture that supports and promotes ambidextrous behavior by establishing clear performance goals and rewarding the achievement of desired results. This performance-driven culture encourages employees to actively participate in both exploration and exploitation, resulting in organizational ambidexterity. When staff are encouraged to strike a balance between exploration and exploitation, the organization becomes more adaptable in reacting to changing market circumstances [73], improving organizational agility.

6. Theoretical Implications

Studying the influence of transactional leadership on organizational agility within the tourism and hospitality industry, while considering how organizational trust and ambidexterity mediate this relationship, aligns with the principles of the Resource-Based View (RBV) theory. RBV theory aims to understand how an organization’s unique resources and capabilities contribute to its competitive advantage. It emphasizes the importance of identifying and efficiently allocating resources to create value [21,24]. The research examined how transactional leadership affects resource allocation for both exploitation activities (efficiency, routine tasks) and exploration endeavors (innovation, adaptability). Transactional leadership plays a role in shaping resource allocation decisions, which in turn impact the organization’s ability to effectively balance these two dimensions. RBV theory recognizes ambidexterity as a valuable resource, as highlighted by Prasad and Junni [6] and Qosasi et al. [30]. The research examined whether transactional leadership practices promote ambidexterity by encouraging the organization to maintain its core functions while exploring new opportunities. This study contributed to RBV’s understanding of how leadership practices influence the creation of resources that contribute to competitive advantage. It provided valuable insights into the impact of transactional leadership on the development and management of organizational trust, which is recognized as a strategic resource. RBV theory emphasizes the importance of dynamic capabilities, which refer to an organization’s ability to adapt and innovate in response to changing environments. This study explored organizational agility, which involves the ability to swiftly respond to shifts, aligning with RBV’s focus on dynamic capabilities. By investigating how transactional leadership influences agility, this study enhanced our understanding of how leadership practices enhance an organization’s adaptive capacity. While RBV primarily focuses on identifying and leveraging resources for competitive advantage, it may not explicitly address the mediating processes through which resources impact desired outcomes, as noted by Alrowwad et al. [22] and Yue et al. [25]. This study introduced organizational trust and ambidexterity as mediating factors that shed light on how transactional leadership influences organizational agility. By incorporating these mediating mechanisms, this study provided a more comprehensive understanding of the relationship between transactional leadership, organizational agility, and RBV theory.

7. Practical Implications

This study examining the impact of transactional leadership on organizational agility in the tourism and hospitality sector, with a focus on the mediating roles of organizational trust and ambidexterity, carries numerous practical implications for organizations operating within this industry.

This study underscores the importance of transactional leadership in fostering organizational agility. Transactional leaders can foster organizational agility by consistently communicating organizational goals, changes, and expectations. This helps employees understand the need for agility and keeps them informed about shifting market demands. Furthermore, transactional leaders can incentivize agility-related behaviors by linking rewards, such as bonuses or recognition, to adaptive and innovative actions. This motivates employees to proactively respond to change and seek opportunities for improvement. Transactional leaders can also collaborate with employees to set SMART goals that align with organizational agility. These goals can focus on speed, responsiveness, and adaptability to encourage agile behaviors.

Additionally, trusting employees with decision-making authority and autonomy enables them to respond quickly to emerging challenges or opportunities. This empowers employees to make agile decisions without constant supervision, fostering a culture of agility. In addition, building trust through open and transparent communication channels encourages employees to share their ideas, concerns, and suggestions. This promotes a collaborative environment that supports agility by valuing diverse perspectives and fostering innovation. Trust can be nurtured through supportive leadership behaviors, such as providing resources, guidance, and recognition. When employees feel supported, they are more likely to take risks, experiment, and adapt to changing circumstances.

Furthermore, organizations can establish flexible structures and processes that allow for both exploration and exploitation. This may involve creating cross-functional teams, dedicating resources to innovation initiatives, and implementing agile project management approaches. Likewise, promoting a culture of experimentation and learning allows employees to explore new ideas, technologies, and approaches. This enables organizations to balance the need for efficiency with the pursuit of innovation and adaptation. Tourism and hospitality organizations can cultivate ambidexterity by continuously seeking opportunities to improve existing processes and practices while simultaneously exploring new possibilities. This iterative approach encourages ongoing adaptation and agility. By integrating these practices into their leadership approach and organizational culture, managers can leverage transactional leadership, organizational trust, and ambidexterity to promote organizational agility. This, in turn, enables the tourism and hospitality industry to respond effectively to market trends, customer demands, and competitive challenges.

8. Limitations and Future Research

While this study examining the impact of transactional leadership on organizational agility in the tourism and hospitality sector, with the mediating influences of organizational trust and ambidexterity, offers valuable insights, it is crucial to recognize its limitations and pinpoint potential avenues for future research [87]. First, the study’s findings are context-specific to travel agencies and hotels, and their applicability to other industries is uncertain. Future research could investigate the relationship between transactional leadership, organizational agility, and mediating factors in diverse contexts and sectors (such as airlines and restaurants) to determine the generalizability of the findings. This enhances the external validity of the research and provides a more comprehensive understanding of the phenomenon. Also, this enables researchers to identify industry-specific variables, challenges, and opportunities that may influence the relationships under investigation and helps identify factors that facilitate or hinder the translation of transactional leadership behaviors into organizational agility.

Second, while this study examined organizational trust and ambidexterity as mediating factors in the connection between transactional leadership and organizational agility, it is important to acknowledge that other variables, such as organizational culture, employee motivation, or technological factors, may also serve as mediating or moderating factors. Future research could investigate additional variables that influence the relationship between transactional leadership and organizational agility, thereby contributing to a more comprehensive understanding of the underlying mechanisms.

Third, this study’s findings may be limited in terms of external validity due to potential geographical and sample restrictions. To enhance the generalizability of the findings and ensure their applicability to a broader range of tourism and hospitality businesses, future research could incorporate diverse samples from multiple locations. Fourth, organizational agility is a dynamic concept that necessitates ongoing adaptation and responsiveness to evolving circumstances. While this study may have examined organizational agility at a specific moment, there is potential for future research to investigate how transactional leadership, organizational trust, and ambidexterity influence agility over time and in diverse contexts. Longitudinal studies provide insights into the causal relationships and temporal dynamics between these variables. In addition, longitudinal research designs enable the identification of potential causal pathways and the exploration of temporal precedence, helping to establish the directionality and causal nature of the relationships.

Fifth, this study might have primarily concentrated on examining the relationships between transactional leadership, organizational trust, ambidexterity, and organizational agility at the individual level. However, it is crucial to recognize that organizations function at multiple levels, encompassing teams, departments, and the overall organizational structure. To gain a comprehensive understanding, future research could employ a multi-level analysis to explore how transactional leadership, trust, and ambidexterity operate and interact at various levels within the organizational hierarchy. By examining transactional leadership, trust, and ambidexterity at multiple levels within the organizational hierarchy (e.g., individual, team, department, organization), researchers can gain a more comprehensive understanding of how these factors operate and interact across different levels. This allows for a nuanced exploration of leadership dynamics and their implications for organizational agility. Multi-level analysis enables the identification of cross-level effects and influences. It helps uncover how transactional leadership behaviors, trust, and ambidexterity at one level (e.g., team level) may impact outcomes and behaviors at other levels (e.g., organizational level). This provides insights into the cascading effects of leadership behaviors and the mechanisms through which they influence organizational agility.

Sixth, while this study may have focused on investigating the direct connections between transactional leadership, organizational trust, ambidexterity, and organizational agility, future research could employ a comparative analysis approach. This approach would allow for a comparison of the effectiveness of transactional leadership with other leadership styles, such as transformational or servant leadership; transformational leadership has a multilayered influence on organizational learning, which leads to innovation [88]. Additionally, future research could explore how different combinations of leadership styles and trust-building strategies influence ambidexterity and organizational agility. Such a comparative analysis would provide valuable insights into the relative effectiveness and synergistic effects of various leadership approaches on ambidexterity and organizational agility. Seventh, the tourism and hospitality industry possesses distinctive characteristics, including seasonality, a customer service focus, and high employee turnover. To further our understanding, future research could investigate the interplay between these industry-specific factors and transactional leadership, trust, ambidexterity, and organizational agility. For instance, exploring how transactional leadership can effectively address the challenges stemming from seasonality or examining how trust-building strategies can mitigate the impact of high employee turnover on organizational agility. Such research would provide valuable insights into how these factors interact within the unique context of the tourism and hospitality industry.