The Process of Visionary Leadership Increases Innovative Performance among IT Industry 4.0 for SMEs for Organizational Sustainability: Testing the Moderated Mediation Model

Abstract

In the era of the fourth industrial revolution, competition among IT industries is becoming increasingly fierce. If a company is weak in its competitive advantage, it can have a huge negative impact on its organizational sustainability and ultimately lead to organizational failure. In such a research background, we highlighted that employees’ innovative performance via creativity acts as an alternative lubricant to increase the sustainable competitive advantage and promote overall organizational sustainability. In particular, employees’ innovative performance has a great relationship with organizational culture and types of leadership. Hence, we focused on exploring the ways in which visionary leadership increases employees’ innovative performance, presenting and verifying a moderated mediation research model related to the innovative performance. To verify our research model, this study conducted a survey of 303 employees from the information technology (IT) industry of SMEs in China. According to the results, visionary leadership was found to have a positive influence on both psychological empowerment and employees’ innovative performance. In addition, psychological empowerment partially mediated the impact of visionary leadership on the innovation performance. Finally, the organizational learning culture moderated the effects of psychological empowerment and the innovation performance. Overall, this study contributes to revealing the process that leads to employees’ innovative performance and contributes to expanding the research field by verifying the moderated mediation model for a sustainable competitive advantage and organizational sustainability in IT Industry 4.0 for SMEs.

1. Introduction

Organizational innovation and innovative performance are regarded as the main variables that drive the sustainable competitive advantage and organizational sustainability. In the rapid development of Industry 4.0 technologies, companies must establish a data-driven organizational structure and digital cultural communication if they want to effectively improve their innovation capabilities and the overall sustainable performance of their organizations [1]. Organizations request an innovative performance, which is increased by leaders and subordinates’ competence. Innovation management in the modern business era is an integrated approach that brings together leadership, organizational culture, and change management to create an environment where innovation flourishes, change is effectively managed, and sustainability is a key focus [2]. It enables organizations to remain successful if they want to remain competitive in an increasingly complex and rapidly changing business environment. A leader who has positive leadership management with a clear direction for organizational development helps individuals and organizations achieve peak performance, plans for organizational sustainability, and shapes its vitality and competitive advantage to become essential to the success of the organization [3]. Amid the gradual recovery of China’s economy, the competitive pressure of enterprise development is increasing, and environmental severity presents opportunities and challenges for the development of enterprises. To realize better development and occupy more markets, visionary leadership, as a kind of positive leadership, is particularly important [4].

Visionary leadership occurs when a leader inspires members towards the same goal that will make the organization stronger and more competitive [5]. As China is a knowledge-based economy, visionary leadership is essential for business performance growth [6]. Innovation leverages knowledge management to have a critical influence on organizational sustainability through the key role it plays in an organization’s sustainability strategy [7]. According to previous research, communicating a visionary message of strategic goals in an organization leads to success, and positive descriptions of the vision by visionary leaders bring a positive impact on the innovative performance [8]. Therefore, this study predicts that visionary leadership positively predicts the innovative performance. Effective vision communication, which graphically and vividly depicts the organization’s deployment plans and objectives, can bring about a surge of corporate image and culture within employees, which, in turn, facilitates collaboration among employees and produces a high-quality performance [9,10].

This study explores the pathways through which visionary leadership influences innovative performances and identifies the factors that mediate the process by which visionary leadership affects the innovative performance for a sustainable competitive advantage and organizational sustainability in information technology (IT) Industry 4.0 for SMEs. Psychological empowerment relates to intrinsic work motivation in organizational behavior research, while creativity research shows the importance of intrinsic motivation as a factor influencing innovation [11]. Therefore, psychological empowerment, as a specific manifestation of intrinsic work motivation within an individual, is considered have an important mediating affect in revealing the mechanism of action of visionary leadership.

We argue that improved innovative performance results from a moderating role of employees’ psychological empowerment. Therefore, it is necessary to explore the variables that moderate this effect. Many factors influence performance, especially the organization, leadership, and employees. This study focuses on the organizational aspect, that is, organizational learning culture. We argue that organizational learning culture moderates the influence of media on psychological empowerment. The results of the prior research show that psychological empowerment positively affects organizational learning [12]. An organizational learning culture also provides a structure for the organization to effectively integrate employees’ competencies so that it can move forward through continuous learning and innovation [13]. Thus, leaders with vision motivate employees to achieve psychological empowerment, which ultimately promotes the innovative performance. In addition, psychological empowerment is predicted to give a more significant effect on the innovation performance in the context of organizational learning culture.

Derived from the above background, the contributions of this study are as follows. First, most prior research has focused on the impact of transformational leadership on the innovation performance; few studies have explored how visionary leadership can scale up aspects of innovative performance [14]. Transformational leadership incorporates the dimension of vision, so visionary leadership and transformational leadership have overlapping parts in the connotation of visionary communication; however, visionary leadership has a clearer structure and theoretical foundation than transformational leadership more broadly, and is the future of transformational leadership. Therefore, visionary communication as a core element of transformational leadership deserves further development [10]. To address this gap, our study focuses on visionary leadership and explores its positive consequences for organizations.

Second, in a recent two-year preliminary study, we discovered that the research explored and demonstrated the influence of visionary leadership on performance, for example, innovative behavior [15,16], leader supportiveness and innovative behavioral competencies [17], and organizational citizenship behavior [18], in relation to the studies in China, which focused on the role of visionary leadership on voice behavior [19,20], creativity [21,22], and followers’ relational energy [23]. According to these research trends and backgrounds, we focused on the effect of visionary leadership on innovation performance. In addition, the research is still lacking on measuring the relationship between visionary leadership and innovation performance in the current highly competitive IT industry. Based on such backgrounds, this study conducts empirical research targeting the Chinese IT industry, which differs from the measurement target of existing studies. Specifically, this study contributes to a deeper understanding of visionary leadership by filling the gap in the theory and measurement target of IT industries.

Third, this study explores the positive affect of visionary leadership on organizations in Chinese SMEs in the context of organizational culture with Chinese characteristics, and expands the scope of the research to measure mediating and moderating variables. Prior studies have centered on mediating effects [24] or on moderating effects [25]; meanwhile, the present study focuses on proposing and validating a moderated mediator model to expand the field of research. In view of this, this study introduces an organizational learning culture which has a moderate effect on the model framework to examine, in depth, the psychological mechanism of psychological empowerment affecting the innovation performance in the Chinese organizational environment, for the purpose of providing substantial evidence for managers to improve their innovation performance.

Overall, specifically, this study verifies the mediating influence of psychological empowerment during visionary leadership, increasing innovation performance. It also verifies the significance of the moderated mediation model by moderating the influence of organizational learning culture. This study examines how to improve employees’ innovative performance by focusing on visionary leadership while clarifying the importance of an innovative performance. We anticipate that employees contribute to an innovative performance through psychological empowerment. In addition, we predict the environmental factors of employee psychological empowerment to improve the innovative performance through the moderating effects of an organizational learning culture. Additionally, this study utilizes the moderated mediator model to extend research fields, which relates to a sustainable competitive advantage and organizational sustainability via an improved innovative performance and gives future directions for IT Industry 4.0 for SMEs.

2. Theoretical Background

2.1. Visionary Leadership and Psychological Empowerment

Visionary leadership is born within an organization when leaders generate new thinking and implement new management solutions so that employees will see a vision for the future and work to achieve it [26]. Prior research defines vision as the leader’s conceptualization and communication of a collective future image, while visionary leadership is the manager’s portrayal of the organization’s future image with the aim of persuading others to working for the long-term development of the organization [27]. This is a dynamic and interactive phenomenon rather than a one-way process. It consists of three parts: idea-vision, emotion, and action. In the idea phase, visionary leaders innovate by becoming familiar with strategies, building new ideas, and adding value to old programs. Then, in the vision stage, the leader creates a vision that forms a bridge between the thoughts and actions of the leader and followers through an emotional response. Finally, in the emotion and action phase, the specific needs of a particular stakeholder are appealed to at a particular time, and the leader and followers are engaged in creating a vision together [26]. Visionary leadership can integrate a personal vision with an organizational strategy and help persuade members that the solutions to problems they adopt are useful in their work and help create an organizational value [28]. Visionary leadership can determine the successful growth of an organization in a turbulent environment [29]. Prior research suggests that visionary leadership with high emotional expressiveness has a positive influence on organizational change [30], subordinate performance [31], employee creativity, and employee knowledge sharing [32]. Organizations with visionary leaders develop the quality of communication within their teams, promoting creativity and innovation at a higher level, and attain higher goals [33].

Psychological empowerment is a motivation comprised of four cognitions: meaning, competence, self-determination, and influence. It reflects the synthesis of the inner perceptions and experiences of the authorized individual. Meaning is an individual’s perception of the significance and value of a work or service experience; competence is a person’s belief in their ability to perform an activity skillfully; self-determination is an individual’s sense of choice in the occurrence of managerial actions; impact is extended to an individual affect’s strategic and operational outcome at work [34]. Psychological empowerment is the experience of a change in the psychological characteristics of an employee who perceives it as a positive motivational orientation that stimulates employee motivation and work potential [35]. Confronted with fierce competition in an ever-changing environment, psychological empowerment becomes an important asset as it puts the spotlight on proactive behaviors that can help reduce stress in the workplace [12]. Empowerment is one of the most efficient methods in promoting employee innovation within a transformational leadership framework [36]. Prior research indicates that psychological empowerment is positively related to a wide range of employee outcomes, including task performance, situational performance, organizational commitment, and negative influence turnover intention and employee stress [37]. The results of another study show that transformational leadership positively affects employee creativity through psychological empowerment [38].

Having communicated a clear vision to their followers, visionary leaders connect their employees’ day-to-day work to the leader’s vision so that they experience meaning in their work, which builds intrinsic motivation and increases psychological empowerment in their followers [39]. Visionary leaders inspire and support employees in their teams to achieve a clear and challenging vision, facilitating the building of psychological empowerment [40]. Visionary leaders are able to empower followers to participate in a shared vision and the leader’s decision making; employees are motivated by the goals communicated by the visionary leader, feel psychologically empowered, work hard, and ultimately find a future direction that matches the organization’s needs [41]. Leaders with vision help employees to communicate the importance of their work, communicate their vision, and make them believe in it. Therefore, employees feel a sense of ownership of their organization; thus, their psychological empowerment is enhanced [42]. In this way, visionary leadership is a positive factor promoting psychological empowerment. Therefore, based on previous theoretical studies, the hypothesis is as follows.

Hypothesis 1.

Visionary leadership positively influences subordinates’ psychological empowerment.

2.2. Visionary Leadership and Subordinates’ Innovative Performance

Innovation is any kind of successful change that contributes to improving organizational performance, whether at the national, regional, or firm level, and is an important basis for competition competitiveness and, therefore, of economic growth and sustainable development because of the importance of innovation in competitiveness. For organizations to succeed and outperform their rivals, they should know as much as possible about the sources of information to effectively use innovative ideas from these sources; in terms of knowledge from financial and human resources, knowledge can be exchanged between different organizations and ultimately contribute to their overall innovation performance [43]. The innovative performance is the overall output produced by organizational innovation-related processes or activities and is the smoothness of the functioning of an effective organization to effectively achieve the results of its members’ work [44]. Industries that need the driving force of IT need to continuously increased the speed of innovation, accelerate the spread of IT, and more investment in knowledge-based human capital will lead to higher innovation efficiency [45]. Therefore, compared with other industries, the more complex technological innovation activities in the IT industry require higher levels of knowledge and innovation ability among practitioners. Management researchers have recognized that organizations that integrate and expand existing capabilities and continually grow new ones will gain and maintain an advantage; in this case, innovative performance maintains a high level of competitiveness for the organization in a rapidly changing business environment [46,47]. According to prior research, psychological capital [48], knowledge-based dynamic capabilities [49], and organizational learning [50] have a positive influence on the innovative performance.

At the heart of visionary leadership is developing and convincingly communicating a vision. Visionary leaders can positively affect creativity and innovation and improve employees’ innovative performance by articulating a vision for their team members, thereby achieving a shared perception of a desired future state [33]. To promote sustainable growth, organizations need a clear vision and with ambitious goals, the implementation of a visionary leadership style in an organization can play a momentous part in the implementation of innovation, thus contributing to the sustainability of the organization [15]. In other words, visionary leadership establishes significant goals for the organization to achieve sustainable growth and empowers the organization to thrive in the long term through innovation. A visionary leader encourages and motivates employees to show openness and adaptability to change and, therefore, in this case, employees may adopt more change and innovation-related behaviors by floating new ideas to achieve the vision [22]. Visionary leaders can stimulate the innovative performance by providing a vision, building a shared understanding of the issues in the organization, facilitating and stimulating collaborative processes, and providing new ideas and diverse feedback and resources for the team [24]. Therefore, based on previous theoretical studies, the hypothesis is as follows.

Hypothesis 2.

Visionary leadership will positively influence subordinates’ innovative performance.

2.3. Psychological Empowerment and Subordinates’ Innovative Performance

A high degree of psychological empowerment helps to break down barriers and motivate employees to enhance their ability to implement creative work, thereby enhancing their innovative performance [51]. Empowerment approves employees to learn to take the initiative to complete and generate more ideas and creatively deal with challenges at work [52]. When employees have advanced psychological empowerment, they perceive their ability to implement ideas and thoughts as enhanced, and are more willing to look for new work techniques, methods, and ideas [53]. When employees are fully committed to their meaningful work, they are able to get as much information as possible from all sources, identify problems more fully, and generate novel solutions [54]. When employees maintain a sense of control over their work, it stimulates personal initiative and generates interest in their work, which leads to engaging in innovative behavior and enhancing their performance [55]. Psychological empowerment promotes the innovative performance of employees in organizations. Therefore, the hypothesis is as follows.

Hypothesis 3.

Subordinates’ psychological empowerment positively influences their’ innovative performance.

2.4. The Mediating Effect of Subordinate’s Psychological Empowerment

Visionary leadership is a positive factor as the vision motivates employees to establish goals, prompting the generation of the intrinsic motivation of subordinates, so that employees recognize the value and significance of their own work, giving them greater autonomy in the work of their role and influence. In this way, subordinates’ psychological empowerment is enhanced, actively encouraging them to challenge existing stereotypical thinking, stimulating imagination and creativity, and enhancing the innovative performance of employees [14]. By providing and articulating a desirable vision and mobilizing employees to achieve higher-level goals in the organization, visionary leaders have a higher psychological empowerment of followers in actively realizing their vision, believing that they can achieve the organizational innovative goals and increase their innovative performance [56]. Visionary leaders openly express their vision and ideas for the organization, stimulating employees to be more active in expressing innovative attitudes and engaging in innovative behaviors, and the psychological empowerment of employees as a state of being leads to more ideas and opportunities for employees to take their innovative ideas to the implementation stage, generating more of an innovative performance [12,57]. By linking organizational and individual goals through visionary encouragement, leaders create a positive attitude in employees toward their work and strengthen the employees’ sense of identity, which in turn encourages them to identify problems in their work and ultimately increases their level of innovative performance [58]. Based on the theoretical background, we argue that visionary leadership motivates employees through common organizational goals, which create psychological empowerment and the belief that employees can solve the problems they encounter in their work, generating more creative solutions and facilitating the innovative performance.

Hypothesis 4.

Subordinates’ psychological empowerment positively mediates the relationship between visionary leadership and subordinates’ innovative performance.

2.5. The Moderated Mediation Effects of Organizational Learning Culture

The learning organization operates within the organization, enabling all employees to expand their adaptive learning capabilities across traditional boundaries to create new solutions [59]. A learning culture inspires the ability to effect the integration of employee resources and provides a systematic approach to organizational progress for change through continuous learning [13]. An increasing number of organizational researchers recognize that an organization’s ability to learn will be the cornerstone for maintaining the sustainable competitiveness of individuals and organizations [60]. Theoretically, organizational learning culture is derived from the learning organization and is an important structure of organizational culture [61]. The concept emphasizes that organizations with an organizational learning culture first need to gather information, understand its meaning and values, and then translate it into actionable knowledge [62]. An organizational learning culture is important for increasing innovation; in other words, it maximizes the innovation capacity of a high-performing organization [63].

When an organization has a good organizational learning culture, it can correct organizational problems from the bottom-up and improve employees’ innovative performance through a range of innovative management activities [64]. Psychological empowerment is important in the work environment of employees; when organizations have a high degree of learning culture, the higher an employee’s commitment to learning, and the easier it is to acquire new knowledge, the greater their innovative performance [65]. Organizational learning cultures provide employees with more information resources, and employees with high levels of psychological empowerment are more confident in applying the resources to their work, achieve higher satisfaction and new problem-solving solutions, and create more of an innovative performance [66]. In complex and changing organizational environments, empowerment gives employees the right to make work-related decisions, which can improve their ability to take control of their work in a learning culture. The organization provides processes and action guidelines related to decision making and relevant information needed for decision making, which encourages employees to search for problem-solving skills and gives them the chances to acquire knowledge, which generates more solutions, enhances the ability to innovate, and increases employees’ innovative performance [67]. According to these arguments, in organizations with a strong organizational learning culture, employees have a wealth of new knowledge to support their innovative ideas. At the same time, employees with higher levels of psychological empowerment are aware of themselves as being able to come up with innovative concepts, which leads to an improved innovative performance. This process shows the interaction effect of organizational learning culture and psychological empowerment, which promotes high levels of innovative performance.

In addition, from an organizational learning perspective, the innovation performance is facilitated by tangible outputs generated through knowledge capabilities. Organizations encourage the importance of internal learning by actively encouraging employees to acquire market information, which in turn encourages new product development [68]. By describing the organization’s objectives and vision to employees, the leader makes their work meaningful, motivates them to work beyond their own interests, and provides a supportive learning environment to develop high levels of employee potential. This enables employees to stimulate their own creativity from different perspectives and contributes to employees’ innovative performance within the organization [69]. Visionary leadership inspires followers to pursue the organization’s objectives and shared vision, and motivates employees to suppose freely, which increases their psychological empowerment at work. In the learning atmosphere created by the organization, it facilitates the building of new skills and knowledge by individuals, encourages an exploratory mindset, delivers effective improvement solutions for the organization, and motivates employees to generate innovative performances [70]. Moreover, when an organization has a good learning culture, employees with high psychological empowerment will make efforts to absorb new knowledge and diffuse what they have learned; simultaneously, they carry out innovative learning, perceive and identify new technological opportunities, create new knowledge, and increase the innovative performance of employees in the organization [71]. Based on the theory, this study argues that a high level of organizational learning culture provides employees in SMEs with knowledge and experience and increases their work competence, which leads to higher psychological empowerment and innovation performances. Therefore, this study suggests that the mediating effect of psychological empowerment in visionary leadership affecting innovative performances is moderated by an organizational learning culture, and thus, this study proposes the moderated mediation model.

Hypothesis 5.

Organizational learning culture has a positive moderating effect on the relationship between subordinates’ psychological empowerment and innovative performance.

Hypothesis 6.

The mediating influence of psychological empowerment on the relationship between visionary leadership and subordinates’ innovative performance is positively moderated by perceived organizational learning culture.

All the hypotheses are presented in the conceptual model, as shown in Figure 1 below.

3. Methods

3.1. Data Collection

For empirical analyses of the research hypothesis that ‘visionary leadership affects innovation performance’, we pursued an online questionnaire survey among employees of SMEs in central and eastern China, and collected a total of 303 questionnaires. Most of the respondents were subordinates. The participants of this study were employees and they obtained permission to conduct the investigation. All participants were told that the project was for research purposes only, that participation was completely voluntary and anonymous, and that the data collected would be aggregated, making it impossible to identify the individual respondents.

Most of the enterprise types are in the IT industry, and the remaining small portion are in the education industry, information transmission industry, etc. SMEs are essential part of China’s national economy, and promoting the digital transformation of SMEs plays an important role in boosting economic growth and pushing the economy to achieve high level of development. Therefore, this study takes employees of Chinese SMEs as a data sample, selects the measurement table that most suits China’s national conditions, and focuses on how SMEs in the IT industry can realize innovation performance in the process of IT Industry 4.0.

3.2. Sample Characteristics

The sample size of the recovered questionnaires for analysis was 303 (95.3% response rate), after excluding invalid questionnaires. Regarding the gender of the respondents, there were 138 men (45.5%) and 165 women (54.5%). In terms of age, 13 (4.3%) were under the age of 20 years, 146 (48.2%) were between the ages of 20 and 29 years, 77 (25.4%) were between the ages of 30 and 39 years, 48 (15.8%) were between the ages of 40 and 49 years, 15 (5.0%) were between the ages of 50 and 59 years, and 4 (1.3%) were aged 60 years or older. In terms of educational level, 116 (38.3%) were from junior college or lower, 145 (47.8%) graduated from college, and 42 (13.9%) held a master’s degree or higher. On the classification of the duration of the term of office: 130 (42.9%) were less than 3 years old, 61 (20.1%) were between 3 and 5 years old, 25 (8.3%) were between 6 and 9 years old, and 87 (28.7%) were over 9 years old. The classification by industry was as follows: 47 (15.5%) in education, 11 (3.6%) in the medical field, 22 (7.3%) in the information transmission industry, 18 (5.9%) in the construction industry, 17 (5.6%) in the media industry, 24 (7.9%) in the retail industry, and 164 (54.2%) in the software and IT services industry. The characteristics of the respondents are presented in

Table 1. Data characteristics.

		Number of Respondents	Percentage of Respondents (%)
	Total respondents	303	100
Gender	Male	138	45.5
	Female	165	54.5
Age	Under 20	13	4.3
	20–29	146	48.2
	30–39	77	25.4
	40–49	48	15.8
	50–59	15	5.0
	60 and over	4	1.3
Education	Junior college or lower	116	38.3
	College	145	47.8
	Master’s degree or higher	42	13.9
Service Year	Less than 3	130	42.9
	3–5	61	20.1
	6–9	25	8.3
	Over 9	87	28.7
Industry	Education	47	15.5
	Medical	11	3.6
	Information Transmission	22	7.3
	Construction	18	5.9
	Media	17	5.6
	Retail	24	7.9
	Software and IT Services	164	54.2

.

3.3. Measurement

Visionary Leadership. Visionary leadership refers to clearly communicating an organization’s vision to employees and translating the organization’s vision into endogenous competencies that intrinsically promote employees and induce them to take responsibility for their work [28]. To measure visionary leadership in Chinese SMEs, we used Conger and Kanungo’s (1994) measurement scale [72]. The scale consists of 6 question items. Among the sample questions are, for example, “My boss has a clear idea of his future plans.” and “My boss constantly provides new ideas for the future of the company.”.

Psychological Empowerment. Psychological empowerment is defined as the psychological satisfaction that employees experience when they feel work is important and meaningful to the organization, that they are valued by the organization, and that working for the organization reflects their self-worth [73]. To measure psychological empowerment of Chinese SME members, we used a measurement scale consisting of 12 questions from Spreitzer (1995) [34]. Sample items included “The work I do is extremely important” and “I am confidently in my ability to do the work”.

Organizational Learning Culture. Organizational learning culture refers to the process of applying and creating knowledge through collective interaction and sharing within an organization’s social structure [64]. This study used the measurement items of Pantouvakis and Bouranta (2013) to measure organizational learning culture [74]. The scale consists of 7 question items. Among the sample questions are, for example, “In my company, my boss is constantly looking for opportunities to learn” and “In my company, employees are rewarded for learning”.

Innovative Performance. Innovative performance is defined as ability to create new value through access to specific resources [75]. We used Han’s (2006) scale to measure employees’ innovative performance [76]. The scale consists of 8 question items. Among the sample questions are, for example, “I will generate new ideas new ideas to improve the status quo” and “I will actively supporting innovative ideas”.

All measurement questionnaires used a 7-point Likert scale in which respondents were asked to give their level of agreement with each entry based on their organization, with 1 being strongly disagree and 7 strongly agree.

3.4. Data Analysis

Initial tests were conducted using SPSS 26 software, which analyzed missing data, outliers, normality, linear relationships, covariance, and homoscedasticity. Next, the internal consistency of each variable was assessed by calculating Cronbach’s alpha. Confirmatory factor analyses (CFA) were also realized using AMOS24 to validate the established constructs. In this study, SPSS Process Macro 3.4.1 was used to determine the direct, indirect, and mediating effects of the variables. Subsequently, the hypotheses were evaluated.

4. Results

4.1. Confirmatory Factor Analysis and Reliability Analysis

CFA is the process of using sample data to test whether a known structural model is consistent with the actual data situation [77]. According to previous studies, the assessment criteria for the model fit include the RMSEA, which is used as a measure of the mean residual correlation, and for whom values less than 0.05 indicate a very good model fit, and values between 0.05 and 0.08 indicate an acceptable model fit. In addition, a good model fit was also indicated when the values of IFI and CFI exceeded 0.9 [78,79]. In terms of the model fit, the absolute fit index was X²(p) = 1247.398(0.000), X²/df = 2.822, RMSEA = 0.078, IFI = 0.941, CFI = 0.941, and TLI = 0.930. Regarding the parsimony-corrected fit indices, the values were PGFI = 0.636 and PNFI = 0.746. Therefore, the model fit can be considered acceptable.

In this study, CR and AVE were measured for each variable to ensure the validity and reliability of the results. AVE was used for the internal consistency of the assessment variables, which was judged to be greater than 0.5. When the AVE value was higher, it indicated the stronger reliability and convergent validity of the variables [80]. In terms of the AVE, visionary leadership was 0.781, psychological empowerment was 0.617, an organizational learning culture was 0.753, and innovative performance was 0.778, all greater than 0.5. CR is the degree to which a combined variable shows consistency across the measurements, and in statistics, when the CR value is higher than 0.7, it suggests that the variable has good construct reliability [81]. Regarding the value of CR, visionary leadership was 0.940, psychological empowerment was 0.916, an organizational learning culture was 0.938, and innovative performance was 0.953, all greater than 0.7, ensuring convergent validity.

Alpha is a statistical measure of the internal consistency of a set of measurement instruments. [82]. The Cronbach’s alpha value reflects the extent to which all items in the scale measure the same construct and the inter-relationships between items. When the coefficient exceeds 0.7, it indicates that the scale has good reliability [83]. The reliability analysis results for each variable in this study were as follows: visionary leadership, 0.970; psychological empowerment, 0.957; an organizational learning culture, 0.965; and innovative performance, 0.971. All values are above 0.7, thereby ensuring confidence in each variable. All values are depicted in

Table 2. Results of Confirmatory Factor Analysis and Reliability Analysis.

Variables		Estimate	S.E.	C.R.	p	Standardized Regression Weights	AVE	C.R.	Cronbach’s Alpha
Visionary Leadership (A)	A6	1.081				0.871	0.781	0.940	0.970
	A5	1.121	0.033	32.535	***	0.923
	A4	1.063	0.036	31.006	***	0.949
	A3	0.954	0.037	28.752	***	0.884
	A2	0.969	0.043	21.924	***	0.838
	A1	1.081	0.046	21.053	***	0.832
Psychological Empowerment (B)	B1	1				0.833	0.617	0.916	0.957
	B2	1.019	0.042	24.271	***	0.832
	B3	1.01	0.044	22.736	***	0.848
	B4	0.992	0.05	19.956	***	0.801
	B5	0.986	0.046	21.406	***	0.814
	B6	0.88	0.052	16.811	***	0.754
	B7	1.06	0.049	21.8	***	0.833
	B8	1.036	0.055	18.861	***	0.781
	B9	1.047	0.052	20.004	***	0.797
	B10	1.022	0.061	16.677	***	0.748
	B11	1.039	0.069	15.005	***	0.691
	B12	1.049	0.072	14.489	***	0.675
Organizational Learning Culture (C)	C1	1				0.866	0.753	0.916	0.965
	C2	1.061	0.039	26.869	***	0.884
	C3	1.039	0.041	25.247	***	0.874
	C4	0.993	0.039	25.24	***	0.874
	C5	1.015	0.042	24.384	***	0.864
	C6	1.016	0.043	23.45	***	0.852
	C7	1.045	0.043	24.144	***	0.86
Innovative Performance (D)	D1	1				0.876	0.778	0.953	0.971
	D2	1.043	0.041	25.627	***	0.878
	D3	0.951	0.034	27.749	***	0.856
	D4	0.998	0.041	24.125	***	0.861
	D5	1.082	0.036	30.36	***	0.927
	D6	1.06	0.04	26.601	***	0.89
	D7	1.066	0.042	25.664	***	0.887
	D8	1.065	0.041	25.694	***	0.881
Model Fit Index	X2(p) = 1247.398(0.000), X²/df = 2.822, RMSEA = 0.078, IFI = 0.941, CFI = 0.941, TLI = 0.930, PGFI = 0.636, PNFI = 0.764

***: p < 0.001.

.

4.2. Descriptive Statistics and Correlation Analysis

Descriptive statistics are analyses that use calculated generalizations to characterize data. It mainly includes frequency analysis, an analysis of concentration trends, analysis of dispersion, and some basic statistical graphics [84]. The mean values for visionary leadership, psychological empowerment, an organizational learning culture, and innovative performance were 5.453, 5.349, 5.415, and 5.441. The SD for visionary leadership, psychological empowerment, an organizational learning culture, and innovative performance were 1.254, 1.123, 1.170, and 1.128. Correlation analysis is about measuring the degree of proximity of two variables in a survey [85]. The correlation analysis results showed that visionary leadership was positively correlated with psychological empowerment (r = 0.709, p < 0.001), an organizational learning culture (r = 0.823, p < 0.001), and innovative performance (r = 0.692, p < 0.001). Psychological empowerment was positively correlated with both an organizational learning culture (r = 0.826, p < 0.001) and innovative performance (r = 0.860, p < 0.001). There was a positive correlation between an organizational learning culture and innovative performance (r = 0.833, p < 0.001).

Table 3. Results of Descriptive Statistics and Correlation Analysis.

	Mean	S. D	Visionary Leadership	Psychological Empowerment	Organizational Learning Culture	Innovative Performance
Visionary Leadership	5.453	1.254	-
Psychological Empowerment	5.349	1.123	0.709 ***	-
Organizational Learning Culture	5.415	1.170	0.823 ***	0.826 ***	-
Innovative Performance	5.441	1.128	0.692 ***	00.860 ***	0.833 ***	-

***: p < 0.001.

shows the means, standard deviations, and correlation coefficients between the variables for all the study variables.

4.3. Path Analysis

Following Model 4 of SPSS PROCESS Macro 3.4.1., all analyzed variables were first standardized and included in the regression equation to examine the mediating effects of psychological empowerment in the visionary leadership role in innovative performance pathways. Visionary leadership had a positive influence on psychological empowerment (t = 17.446, p < 0.001), where Boot LLCI was 0.5630 and Boot ULCI was 0.7061, which did not contain 0; thus, Hypothesis 1 was supported. Visionary leadership had a positive effect on the innovative performance (t = 4.096, p < 0.001); Boot LLCI was 0.0779 and Boot ULCI was 0.2221, which did not contain 0, supporting Hypothesis 2. Psychological empowerment had positive effects on the innovative performance (t = 18.204, p < 0.001). Boot LLCI was found to be 0.6643 and Boot ULCI was found to be 0.8253, which did not contain 0; therefore, Hypothesis 3 was supported.

The mediation influence was validated using a bootstrapping analysis. Bootstrap 5000 tests used subordinates’ psychological empowerment as a mediating variable. Psychological empowerment (β = 0.4726, 95% confidence interval of [0.3763, 0.5757] which did not contain 0 between the upper and lower values, indicating the existence of a mediating effect, H4 was further verified. The results are summarized in

Table 4. Results of Path Analysis.

Path			Estimate	S.E.	t	p	LLCI	ULCI
Visionary Leadership	→	Psychological Empowerment	0.6346	0.0364	17.446	<0.001	0.5630	0.7061
Visionary Leadership	→	Innovative Performance	0.1500	0.0366	4.096	<0.001	0.0779	0.2221
Psychological Empowerment	→	Innovative Performance	0.7448	0.0409	18.204	<0.001	0.6643	0.8253
Indirect effect(s) of X on Y
Indirect Effect			Effect	Boot SE	Boot LLCI		Boot ULCI
Visionary Leadership → Psychological Empowerment → Innovative Performance			0.4726	0.0510	0.3763		0.5757

.

4.4. Moderating Role of Organizational Learning Culture

We analyzed the moderating influence of an organizational learning culture on the pathway of psychological empowerment affecting the innovative performance. In order to test the robustness of the moderating effect of the organizational learning culture, this study used the SPSS PROCESS Macro 3.4.1 Model 1 to conduct 5000 samples of Bootstrapping tests within the 95% confidence interval.

Table 5. The result of moderating effect of Organizational Learning Culture.

Variable	Estimate	Boot SE	t	p	Boot LLCI	Boot ULCI
Psychological Empowerment (A)	0.5207	0.0483	10.785	<0.001	0.4257	0.6157
Organizational Learning Culture (B)	0.3977	0.0467	8.519	<0.001	0.3058	0.4896
Interaction (A × B)	0.0557	0.0247	2.251	<0.05	0.0070	0.1044

provides the results of the analysis for Hypothesis 5. The moderating influence of the organizational learning culture was statistically significant (estimate = 0.3977, p < 0.01). Moreover, the results of the Bootstrapping test for 5000 samples showed that the moderating influence of the organizational learning culture was significant with a 95% confidence interval of (CI: [0.0070–0.1044]) and did not contain zero. Therefore, Hypothesis 5 is supported. Figure 2 presents a graph of the moderating influence of the organizational learning culture.

4.5. Moderated Mediation Effect of Organizational Learning Culture

This study examined the moderating influence of organizational learning culture on the role of mediation. To test the magnitude and direction of the moderated mediating effect, which means the change in the mediating effect depending on the level of the moderating variable, the statistical significance was tested using the bootstrapping method with PROCESS Macro 3.4.1 model 14. The results of the analysis of Hypothesis 6 are presented in

Table 6. Results of Moderated Mediation Test of Digital capability.

Dependent Variable: Innovative Performance
Moderator	Level	Conditional Indirect Effect	Boot SE	Boot LLCI	Boot ULCI
Organizational Learning Culture	−1 SD (−1.1703)	0.2901	0.0616	0.1661	0.4019
	M	0.3321	0.0706	0.1925	0.4594
	+1 SD (1.1703)	0.3741	0.0859	0.2085	0.5295
Index of moderated mediation
	Index		Boot SE	Boot LLCI	Boot ULCI
	0.0359		0.0211	−0.0059	0.0753

. The perceived organizational learning culture mean value (M), +1 SD, and −1 SD at 95% confidence intervals are shown. It is generally accepted that the difference between the mediation effect at these two values is tested by taking ±1 standard deviation as the higher and lower values of the moderating variable, and the mediation effect being moderated regarded as significant if this difference does not include zero in the 95% confidence interval. The adjusted parameter is 0.0359, Boot SE is 0.0211, Boot LLCI is −0.0059, and Boot ULCI is 0.0753, all of which contain zero. Therefore, Hypothesis 6 is rejected.

5. Discussion

This study investigates Chinese SMEs that promote sustainable development in the process of Information Technology Industry 4.0. Through the development of visionary leadership, the path planning for generating an innovative performance by members in the IT industry is evident. By motivating members, visionary leadership generates psychological empowerment and promotes innovative performances under the influence of the organization learning culture, bringing a sustainable performance to the organization. Therefore, research on visionary leadership in organizations is necessary.

Based on social exchange theory, visionary leadership contributes to innovation performance. Similarly, psychological empowerment and an organizational learning culture are key to promoting an innovative performance. A visionary leadership style increases employee confidence by describing the vision and gives employees the psychological empowerment to achieve organizational goals and change. It also creates an organizational learning environment that develops the value of learning and a culture that enables members to grasp the opportunity to learn new knowledge, bringing a new opportunity to scale up innovative performances.

The findings suggest that visionary leadership plays a positive role in the scale-up innovative performance and organizational sustainability. This is because organizational members in SMEs understand the positive impact of visionary leadership to improve their innovation performance. Therefore, this study can provide various strategic options within organizations to deepen managers and members’ understanding of the visionary leadership style and organizational learning culture and provide insights for organizations.

5.1. Theoretical Implications

First, the results of this study found that visionary leadership has a positive influence on subordinates’ psychological empowerment. Hypothesis 1 was supported. Assumption 1 was supported. This corresponded with the findings of Makhrus et al. (2022) [86]. The visionary leadership style plays an important role in the development of an organization and the motivation of its members [10]. Therefore, this study concludes that visionary leaders can provide appropriate guidance and assistance to employees based on visionary goals of organization, develop a sense of mission, help employees find meaning in work, and increase their psychological empowerment.

Second, visionary leadership positively influences the innovative performance of employees within an organization. Hypothesis 2 was supported. Corresponding with the findings of Li et al. (2023) [21], visionary leadership is conducive for creativity and innovative performance through employees’ perceived organizational support for them. Visionary leaders inspire employees to reach their best in enhancing their innovative performance by creating a supportive environment, ensuring that the organization’s vision is understood, and providing guidance and strong support for their actions [28]. Thus, visionary leaders, with a vision of the organization’s future, can provide employees with the resources, support, and good working environment needed to do their jobs, thereby enabling them to successfully complete their tasks and improve the overall level of their innovative performance.

Third, this study’s conclusion that psychological empowerment positively affects innovative performance is consistent with the findings of Li and Huang (2014), Wang and Chu (2018), Fan (2020), Jing and Bai (2021), and Gao and Huang (2022) [87,88,89,90,91]. Hypothesis 3 was supported. We argue that when the employees’ level of psychological empowerment is higher, their innovative performance is higher. With the in-depth development of intrinsic motivation theory, psychological empowerment, as one psychological mechanism influencing the behavior of organizational members, has become a factor that cannot be ignored when organizations improve their innovative performance and implement value creation strategies [88]. Organizations can use empowerment to encourage employees to stimulate their intrinsic motivation, increase their level of psychological empowerment, influence their positive behaviors at work, and fundamentally improve their innovative performance.

Fourth, psychological empowerment mediates positive pathways through which visionary leadership influences employees’ innovative performance. Hypothesis 4 was supported. Visionary leaders can inspire employees to generate a state of psychological empowerment by expressing the organization’s vision, which, in turn, generates innovative performances. Employees who experience psychological empowerment feel more empowered and are able to impact their work and organization in more meaningful ways [92]. Prior research has shown that transformational leadership has a positive influence on psychological empowerment, and transformational leaders positively promote innovative behavior through psychological empowerment [36]. Our findings are similar to those of prior studies. We consider that visionary leadership creates a sufficiently good workplace climate to keep employees optimistic about the prospects of the organization, which in turn enables them to scale-up their level of psychological empowerment and ultimately improve their innovative performance.

Finally, while the moderating influence of an organizational learning culture on psychological empowerment was not significant in the pathway of visionary leadership affecting the innovative performance, higher levels of an organizational learning culture did significantly enhance the influence of psychological empowerment on the innovative performance. Therefore, hypothesis 5 is supported, but hypothesis 6 is rejected. The results of the study showed that the organizational learning culture significantly enhanced the relationship between the employees’ psychological empowerment and competence [93], which includes the ability to generate an innovative performance. Our findings are similar to those of prior studies. In an organizational environment with a high level of organizational learning, employees who are psychologically empowered develop a willingness to reap new knowledge when faced with challenges and opportunities for self-development [94]. Therefore, in a culture of organizational learning, employees’ psychological empowerment as a positive internal perception can have a positive influence on their innovative behaviors and, thus, produce higher levels of innovative performances.

The main contribution is to present relationships and insights between variables based on previous research on visionary leadership, psychological empowerment, an organizational learning culture, and an innovative performance. Therefore, the results have important implications for future research on the effect of the leadership style on subordinates’ innovative performance.

5.2. Practical Implications

First, the vision is the basis for the development of the strategic goals of the company. It is the enterprise’s vision of the future of the grand strategic blueprint, and leaders should be inspired by the vision to improve the sense of meaning of the work of the staff, to stimulate the staff’s intrinsic motivation to work and continuously learn how to solve task problems in new ways, considering the task and usefulness of the solution [28]. Visionary leaders should be trained within Chinese SME organizations. Leaders should grow their ability to create a vision that is aligned with strategic goals at the organizational level and communicate it to their subordinates in team meetings so that the members’ goals are the same as the organization’s vision, thereby contributing to the organization.

Second, in the context of innovation-driven quality development, it is becoming increasingly important to promote employees’ work autonomy and stimulate their psychological empowerment [95]. Leaders can enhance the employees’ level of psychological empowerment by affording space for decision making, valuing their opinions and suggestions, and supporting their rapid growth at work and in other behaviors. This approach enhances employees’ work engagement, raises their sense of self-worth, and deepens their sense of belonging to the organization. Employee psychological empowerment is mainly influenced by the organization, leadership, and work environment. Through the expression of organizational vision, leaders can positively influence and motivate employees, enhance their psychological empowerment, and stimulate their work potential, thereby generating a better performance in the organization.

Thirdly, enterprises should establish a good organizational learning environment to facilitating knowledge sharing among employees and thus enhance the ability to sustain innovation [96]. Leaders should establish an optimal independent learning mechanism within the organization, create a learning culture, effectively stimulate employees’ interest in learning, break the learning boundaries between departments within the organization, and promote the circulation of knowledge within the organization. In this way, organizations can actively build a learning culture and create favorable conditions for employees to exercise their learning orientation, which means they will be capable of continuously acquiring new knowledge and lays the foundation for improved innovative performances.

Finally, many prior studies have highlighted the importance of innovation [97,98], and that the pursuit of innovation by organizations can maintain their competitive advantage and sustainability amid great challenges [97]. When SMEs have a high level of innovative performance, they not only contribute to the improvement of their knowledge management capabilities, but also play a positive role in increasing the benefits and competitiveness of their organizations [99]. The organization can clarify innovation-related indexes in the assessment system; give fair evaluation and rewards to employees’ innovative performances; motivate employees to spontaneously create a positive innovation atmosphere; and carry out employee training, sharing sessions, lectures, and other activities to jointly promote the construction of an innovation atmosphere.

5.3. Limitations and Future Research

There are still some limitations in this study due to objective conditions. This study only considered the influence of a single leadership style, visionary leadership, on subordinates’ innovative performance. In fact, in management practice, multiple leadership styles may co-exist, but the extent to which they are used varies from one situation to another. Therefore, the effects of multiple styles on subordinates’ innovative performance can be considered in subsequent studies, and these leadership styles can be compared to explore the most central elements that affect innovative performances.

Second, this study explored the mediating influence of psychological empowerment on the mechanism of visionary leadership influencing innovative performances. The learning orientation of employees in Chinese SMEs was examined as a mediating variable in Wang and Zhou (2015) [28]; other mediating variables should be examined in future research.

Third, this study used an organizational learning culture as a moderating variable between psychological empowerment and an innovative performance. However, other moderating variables related to organizations should be investigated. In the case of organizations, the role of such variables as organizational support and trust is also important. Future research could also explore the effects of other moderating variables to further improve research on innovative performances.

Fourth, this study focused on improving employees’ innovative performance. Innovation performance can be categorized in R&D strategies as the product innovation performance [100], administrative innovation performance, and technological innovation performance [101]. It would be worthwhile to investigate the methods and various types of improvements in these types of innovative performance in future research.

A sustainable competitive advantage is critical to the long-term resilience of SMEs [102]. According to a prior study by Amoako (2019), a sustainable competitive advantage is acquired through effective leadership in the organization and the implementation of strategies that affect the environmental vitality of the organization [103]. Furthermore, the ability of organizations to maintain a competitive advantage depends on the implementation of high levels of innovation [104]. Prior studies have shown that in SMEs, an organizational innovation culture has a significant impact on the sustainable competitive advantage [105]. In addition, organizational sustainability is the creative outcome of coherent thinking on economic, social, and ecological issues [106], with implications for extensive HR practices. Organizational learning, as a tool for changing the direction of an organization, is a key element in the effective implementation of sustainable organizational development [107]. Therefore, it is worthwhile to continue to investigate whether visionary leadership and an organizational learning culture of organizations in SMEs further affects the organizational sustainable competitive advantage and organizational sustainability through an enhanced innovation performance in a backward-looking study that builds on the theoretical model of this study.

All four variables were evaluated by employees, and this study considered that the problem of CMB was found to exist, and homoscedastic errors existed. The results of the first factor analysis exceeded 50% of the total explained variance; therefore, the results were considered to have a common method bias problem [108]. Therefore, future research should separate the respondents, asking members questions about the leadership of members and questions about member behavior or the attitudes of leaders.

6. Conclusions

The results of this study demonstrate that visionary leadership is critical for SMEs such as those in the IT industry in China and provide solid evidence that visionary leadership improves the innovation performance. The findings also suggest that visionary leadership brings innovation and sustainable change to organizations by fostering psychological empowerment among employees and demonstrate the correlation between these constructs. The results of this study indicate that the mediating effect of psychological empowerment on the relationship between visionary leadership and an innovative performance is significant. In addition, the moderating effect of an organizational learning culture was verified; we discovered that the level of an organizational learning culture positively moderates the effect of employee psychological empowerment on the innovation performance.

With the development of digitalization, not only the IT industry, but also Chinese SMEs are facing major challenges. Addressing these challenges requires multiple efforts from organizational management and members. In this sense, this study highlights the critical role of visionary leadership in addressing these challenges. Through visionary leadership’s facilitation of members’ psychological empowerment, and the creation of an organizational learning culture environment, this study provides a dynamic framework for improving the innovation performance and overcoming these challenges as an effective way to drive organizational sustainability and achieve success in the pursuit of excellence in Chinese SMEs in the IT industry.