The mediating role of organizational agility in the relationship between digital leadership and organizational excellence in Saudi SMEs

Abstract

This study investigates the mediating role of organizational agility in the relationship between digital leadership and organizational excellence in Saudi small and medium-sized enterprises. The study was motivated by the growing importance of digital transformation and the increasing need for SMEs to strengthen their adaptability and competitive capacity within a rapidly changing business environment. A quantitative, deductive, and cross-sectional research design was adopted. Data were collected through a structured questionnaire from 352 managers, supervisors, department heads, team leaders, and decision-makers working in Saudi SMEs. The collected data were analyzed using Partial Least Squares Structural Equation Modeling to assess both the measurement model and the structural relationships among the study variables. The findings revealed that digital leadership has a significant positive effect on organizational agility and organizational excellence. The results also showed that organizational agility has a significant positive effect on organizational excellence. In addition, the indirect effect analysis confirmed that organizational agility mediates the relationship between digital leadership and organizational excellence. These findings indicate that digital leadership enhances organizational excellence not only directly, but also indirectly by strengthening the organization’s ability to respond flexibly and effectively to environmental and strategic change. The study contributes to the understanding of how digital leadership and organizational agility jointly support excellence in SMEs. It also offers practical insight for SME leaders seeking to improve organizational performance by combining digital capability with adaptive organizational processes.