Linking Digital Leadership and Firm Performance: The Mediating Role of Digital Transformation

Abstract

Purpose: This conceptual study aims to explore the mechanisms through which digital leadership influences firm performance, emphasizing the mediating role of digital transformation. Design/methodology/approach: A systematic synthesis of recent literature on digital leadership, digital transformation, and firm performance was conducted. Drawing upon dynamic capabilities theory, transformational leadership theory, and socio-technical systems theory. Findings: The proposed framework suggests that digital leadership positively influences digital transformation by fostering innovation culture, organizational agility, and strategic alignment. Digital transformation, in turn, positively affects firm performance through enhanced operational efficiency, customer engagement, and innovation capacity. Research limitations/implications: As a conceptual inquiry, this study does not include empirical testing. Future research should validate the proposed framework using quantitative methods. Practical implications: Organizations should invest in developing digital leadership competencies, align transformation strategies with business goals, and cultivate a culture that promotes innovation and employee engagement. Originality/value: This study advances the understanding of how digital leadership drives firm performance by establishing digital transformation as a mediating mechanism.