How Leaders’ Intellectual Humility Drives Frugal Innovation: A Moderated Mediation Study of Pharmaceutical SMEs in Pakistan

Qandeel Anjum; M. Ali Asghar S andhu; Fauzia  Syed

doi:10.62270/jirms.v6i4.133

Authors

Qandeel Anjum Department of Business Administration, Faculty of Management Sciences, International Islamic University, Islamabad https://orcid.org/0009-0004-3163-306X
M. Ali Asghar S andhu Assistant Professor, Department of Business Administration, Faculty of Management Sciences, International Islamic University, Islamabad. https://orcid.org/0000-0002-8198-0738
Fauzia Syed Associate Professor, Department of Business Administration, Faculty of Management Sciences, International Islamic University, Islamabad https://orcid.org/0000-0003-2187-6506

DOI:

https://doi.org/10.62270/jirms.v6i4.133

Keywords:

Leaders Intellectual Humility (LIH), Strategic sustainable orientation (SSO), Relational embeddedness (RE), Frugal Innovation (FI), Upper Echelon Theory (UET)

Abstract

Purpose—In the face of contemporary challenges, the pursuit of sustainability has become imperative for SMEs of emerging economies. Despite the recent upsurge in attention to leaders’ humility, its subdomain, intellectual humility as a leadership psychological trait, has been less explored in sustainability research. Based on Upper Echelon Theory, this study aims to examine how and when leaders’ intellectual humility influences the adoption of frugal innovation by examining strategic sustainable orientation as a mediating mechanism and relational embeddedness as a boundary condition in SMEs of the pharmaceutical industry of Pakistan.

Study Design/Methodology/Approach—This study used a simple random sampling approach for data collection through time lagged design, with a one-month lag between each measurement point (three-time intervals) from 275 managers of SMEs working in the pharmaceutical sector. Moreover, PROCESS-macro by Hayes was used for testing the proposed hypothesis.

Findings—Our findings reveal a significant positive impact of leaders’ intellectual humility on frugal innovation. In addition, strategic sustainable orientation partially mediates the leader’s intellectual humility – frugal innovation relationship. Moreover, relational embeddedness moderates the relationship between leaders’ intellectual humility and strategic sustainable orientation and between leaders’ intellectual humility and frugal innovation through strategic sustainable orientation.

Theoretical and practical implications— This study is novel in introducing intellectual humility as a distinct cognitive leadership trait that shapes strategic sustainable orientation and frugal innovation within the Upper Echelons framework. This study offers context-specific insights from pharmaceutical SMEs in an emerging economy, thereby improving the relevance of humility-based leadership research for resource-constrained settings. Practically, this suggests nurturing intellectual humility in leadership development to foster sustainable outcomes.