In the dynamic landscape of the food and beverage fast-moving consumer goods (F&B FMCG) sector in Indonesia, the role of sales managers as leaders in fostering organizational innovativeness and enhancing firm performance is of paramount importance. This study addresses a notable research gap by investigating the leadership styles of sales managers within this context and their profound effects on organizational innovativeness and firm performance. Drawing from primary data collected through strutured questionnaires, this research evaluates the influence of two leadership styles, namely transformational leadership (TL) and transactional leadership (TRL), on organizational innovativeness and firm performance.
The findings reveal significant insight. Transformational leadership demonstrates a positive relationship with organizational innovativeness, affirming its role in inspiring innovation within large-sized F&D FMCG enterprise. Similarly, transactional leadership exhibits a substantial positive impact on organizational innovativeness, supporting the notion that effective transactional leadership strategies can enhance innovation in response to competitive challenges. Furthermore, the study underscores the pivotal role of organizational innovativeness in driving firm performance, with strong and statistically significant relationships observed.
However, a noteworthy paradox arises when examining the influence of leadership styles on firm performance. While transactional leadership significantly affects firm performance, it does so negatively. In light of these findings, organizations are encouraged to adopt a balanced approach to leadership, recognizing that transformational leadership fosters innovation and engagement, while transactional leadership's potentially counterproductive aspects need careful management. Investment in leadership development programs that equip leaders with the skills to inspire and empower teams is recommended for long-term success in the F&B FMCG sector in Indonesia.