International Journal of Banking, Risk and Insurance

1. Neway Habtemariam Muktar – Addis Ababa University School Of Commerce, Ethiopia.

2. Mulugeta Gebremedhin Kassie – Addis Ababa University School Of Commerce, Ethiopia.

Received
17-Dec-2022
Accepted
-
Published
17-Dec-2022
Abstract
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This study examines how leader-member exchange relates to innovative performance through work engagement. Further, the study examines the moderated mediating role of job characteristics and workload for the positive indirect relationship between LMX and employee innovative performance via work engagement. The conceptual model is based on a literature review and social exchange theory (Blau, 1964). This explains that the quality of LMX is likely to improve employee engagement and, in return, innovative performance when there are motivational job characteristics and less stressful job demand workload. Three mechanisms have been proposed here to collect data from 529 employees. EQS 6.2 were used for psychometric analysis. Hayes’s (2018) PROCESS-macro was used to examine the moderating role of job characteristics and workload and mediating role of work engagement in the link of LMX - innovative performance. The result revealed that work engagement mediated the relationship between LMX and innovative performance. The mediated relationship interacted with job characteristics and workload to influence innovative employee performance in such a way that when the level of motivational job characteristics is high and low, workload engagement had a positive relationship with innovative performance. This paper has practical implications for HR practice. It provides practitioners, mainly work that requires innovation, with suggestions on designing work considering job characteristics and workload and placing stress-management intervention programs that enhance positive emotional states to increase engagement and innovative performance.
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