Abstract:
In this ever-evolving era of digitalization and globalization, organizations are always
seeking ways to gain competitive advantage by brining innovation. Leaders in
organizations are vital in bringing innovation and engaging employees to their work to
increase productivity. Among other leadership styles, design leadership is one of novel
topic that focus to use innovation among team to gain competitive advantage. Noticing
this, this study investigates the relationship between design leadership (DL) and
organizational performance (OP) in Pakistani SMEs, focusing on the mediating role of
employee work engagement (EWE) and the moderating effect of emotional intelligence
(EI). Employing the Resource-Based View (RBV) theory, it explores how DL enhances
innovation and subsequently improves OP. The findings reveal a significant positive
impact of DL on OP. Additionally, the study highlights that leaders' innovative behavior
positively impacts various aspects of organizational performance, such as services,
processes, and products. This underscores the importance of DL as a strategic resource for
meeting customer needs and generating value. Despite its contributions, the study has
limitations. It focuses solely on Pakistani SMEs, suggesting the need for future research to
consider different countries to enhance generalizability. The use of a cross-sectional
method also indicates that a longitudinal survey could provide a deeper understanding of
how DL and innovation strategies influence OP over time. Furthermore, cultural context
and the inclusion of employees' perspectives could offer more comprehensive insights. The
study offers practical implications for SME leaders and policymakers. It provides empirical
evidence on utilizing DL to drive innovation and improve performance. By prioritizing DL
capabilities and fostering employee engagement, organizations can achieve superior
outcomes. The research also opens avenues for exploring how DL influences specific
x
dimensions of OP, such as sustainability and market competitiveness, particularly in
developing countrie
