Al-Kharaj: Journal of Islamic Economic and Business
Vol. 8 No. 2 (2026): All articles in this issue include authors from 3 countries of origin (Indonesi

The Effect of Transformational Leadership on Organizational Creativity: The Mediating Role of Innovation Culture in Public Sector Organizations

Muh Irpan (Mataram University)
Siti Nurmayanti (University of Mataram)
Lalu Hamdani Husnan (University of Mataram)



Article Info

Publish Date
25 May 2026

Abstract

This study examines the influence of transformational leadership on organizational creativity with innovation culture as a mediating variable among employees of the Land Transportation Management Center (BPTD) Class II, West Nusa Tenggara Province, Indonesia. Employing a quantitative causal research design, data were collected from 176 respondents selected through proportional stratified random sampling from a population of 312 employees. Partial Least Squares Structural Equation Modeling (PLS-SEM) via SmartPLS was used for data analysis. The results demonstrate that: (1) transformational leadership exerts a significant positive direct effect on organizational creativity (β = 0.221, p = 0.003); (2) transformational leadership significantly and positively influences innovation culture (β = 0.862, p = 0.000); (3) innovation culture significantly and positively affects organizational creativity (β = 0.681, p = 0.000); and (4) innovation culture partially mediates the relationship between transformational leadership and organizational creativity (indirect effect = 0.587, p = 0.000). These findings reveal that transformational leadership enhances organizational creativity not only directly but also indirectly through the cultivation of an innovation-oriented organizational culture. This study contributes to the public sector management literature by empirically demonstrating the critical mediating role of innovation culture in translating transformational leadership behaviors into creative organizational outcomes within a bureaucratic government institution.

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Journal Info

Abbrev

alkharaj

Publisher

Subject

Economics, Econometrics & Finance

Description

Al-Kharaj, Journal of Islamic Economic and Business is peer-reviewed journal published by program studi ekonomi syariah , Institut Agama Islam Negeri (IAIN) Palopo. Al-Kharaj focus on the research of Islamic Economic and Business. The aims of this journal is to explore and develop economic related ...