Building Sustainable Competitive Advantage in Banking through Organizational Agility

Wiweko Probojakti (), Hamidah Nayati Utami, Arik Prasetya and Muhammad Faisal Riza
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Wiweko Probojakti: Faculty of Administrative Science, Brawijaya University, Malang 65145, Indonesia
Hamidah Nayati Utami: Faculty of Administrative Science, Brawijaya University, Malang 65145, Indonesia
Arik Prasetya: Faculty of Administrative Science, Brawijaya University, Malang 65145, Indonesia
Muhammad Faisal Riza: Faculty of Administrative Science, Brawijaya University, Malang 65145, Indonesia

Sustainability, 2024, vol. 16, issue 19, 1-15

Abstract: The fast development of technology in the banking sector has forced a basic review of organizational strategies and structures since banks want to keep ahead of the curve and satisfy the evolving needs of the digital era. This study examines the mediating role of organizational agility in the relationship between transformational leadership and digital transformation on sustainable competitive advantage in the banking sector. The research sample was drawn from a population consisting of head offices, branch offices, and sub-branch offices of regional banks in Indonesia, totaling 185 units. Based on 185 data points collected through surveys distributed to unit leaders, we used PLS-SEM analysis to test the proposed hypotheses. Empirical results indicate that transformational leadership and digital transformation have no significant effect on sustainable competitive advantage. However, organizational agility can significantly mediate this impact on sustainable competitive advantage. The findings underscore the importance of developing agility as an internal factor of organizations that plays a crucial role in achieving sustainable competitive advantage.

Keywords: transformational leadership; digital transformation; organizational agility; sustainable competitive advantage (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
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