Purpose – This study aims to analyze the effect of agile leadership and digital work integration on team performance, with psychological safety as a mediating variable. Methodology/approach – This study employs a quantitative approach with an explanatory research design. Data were collected through a structured questionnaire distributed via purposive sampling to work team members accustomed to digital work systems, and analyzed using Structural Equation Modeling based on Partial Least Squares (PLS-SEM). Findings – Agile leadership and digital work integration both have a positive and significant effect on psychological safety. Digital work integration and psychological safety have a significant direct effect on team performance, whereas agile leadership does not; its effect on team performance is fully indirect, mediated by psychological safety. Psychological safety also mediates the effect of digital work integration on team performance. Novelty/value – This study extends the agile leadership and digital transformation literature by testing an integrative team-level model in the Indonesian manufacturing sector, clarifying psychological safety as the key mechanism linking adaptive leadership and digital work integration to team performance.
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