Journal of Engineering and Technology Management 68 (2023) 101750

Contents lists available at ScienceDirect

Journal of Engineering and

Technology Management
journal homepage: www.elsevier.com/locate/jengtecman

Linking innovation, empowerment to facilitate project

performance: A mediated moderation model
Junwei Zheng a, Yu Gu b, Hongtao Xie c, Guangdong Wu d, *
a
School of Public Policy and Administration, Nanchang University, Nanchang, China
b
School of Business and Management, Jilin University, Jilin, China
c
Faculty of Management and Economics, Kunming University of Science and Technology, Kunming, China
d
School of Public Policy and Administration, Chongqing University, Chongqing, China

A R T I C L E I N F O A B S T R A C T

Keywords: Existing literature on construction innovation has not achieved an in-depth understanding of how
Construction innovation and under which conditions individuals engage in creative activities to facilitate project task
Empowering leadership performance. In this study, 286 matched data sets between project members and leaders/su­
Innovative behavior
pervisors, were collected and examined using a mediated moderation model. Drawing from the
Leader-member exchange
conservation of resources theory, individuals’ innovative behaviors and leaders’ empowerment
Project performance
Mediated moderation strategies were found to positively affect project performance. Leader-member exchange (LMX)
both moderates and augments the relationship between innovative behavior and project perfor­
mance. Further, LMX mediates the moderation effect of empowering leadership and enhances the
innovation process. The results of this study offer guidance on how project practitioners can
facilitate project performance by motivating innovation in construction projects through
empowering strategies and relationship development. This research extends and enriches the
current understanding of the processes linking innovative behavior and project performance by
identifying the mediating moderation mechanism of empowering leadership and LMX.

1. Introduction

Innovation is regarded as a critical capability for developing enterprise competence as well as for achieving competitive advantage
and sustainability (Zhang et al., 2020). Innovation has the potential to reduce uncertainty and mitigate cost overbudget and schedule
overrun risks for engineering management, especially for megaproject management (Zhang et al., 2021). Innovation in construction
projects (i.e., construction innovation) refers to a new product, process, service, or system that induces a substantial change and creates
value for construction firms, the natural environment, or society (Sergeeva and Zanello, 2018). Compared with the manufacturing or
service industry, investment and research activities of construction innovation are limited by its one-off and temporary nature. In­
novations in construction projects are highly risky and have low fault tolerance as innovation failure may result in time and budget loss
of projects (Gil et al., 2012; Sergeeva and Zanello, 2018).
The nature and tensions associated with construction innovation have been identified, and innovation remains one of the key
components for improving the performance of construction enterprises and the project sector as a whole (Ernstsen et al., 2021;

* Correspondence to: School of Public Policy and Administration, Chongqing University, 174 Shazheng Street, Shapingba District, Chongqing
400044, China.
E-mail address: gd198410@163.com (G. Wu).

https://doi.org/10.1016/j.jengtecman.2023.101750
Received 13 December 2021; Received in revised form 11 January 2023; Accepted 3 May 2023
Available online 9 May 2023
0923-4748/© 2023 Elsevier B.V. All rights reserved.
J. Zheng et al. Journal of Engineering and Technology Management 68 (2023) 101750

Gambatese and Hallowell, 2011). Examples of well-known cases are the application of advanced technologies such as building in­
formation modelling (BIM), virtual reality (VR), and the Internet of Things (IoT). The adoption and implementation of such digital
technologies can effectively deliver construction products and services, and potentially enhance competitive advantages for con­
struction companies (Lavikka et al., 2018). Thus, in this regard, the empirical literature has extended the research on the antecedents
and promotion of construction innovation by specifying enablers such as champions (Chen et al., 2021; Ernstsen et al., 2021), lead­
ership (Liu and Chan, 2017), project teams (Zhang et al., 2021), as well as the diffusion and impact of innovation. This was achieved
either by employing a resource perspective (Afraz et al., 2021) or a systems perspective (Park et al., 2004; Zhang et al., 2020).
While existing research has advanced the current understanding of the process of construction innovation, significant concerns
have been raised regarding different drivers and enablers of construction innovation, as well as the mechanisms underlying innovation
at the project, firm, and industry levels. Further, scholars have also explored factors contributing to an improvement of project per­
formance, including human resource-related factors (e.g., competence (Zhu et al., 2021) or leadership (Lai et al., 2018)), project
stakeholder-related factors (e.g., conflict (Jia et al., 2021) or conflict relationship management (Naji et al., 2022)), and organizational
factors (e.g., culture (Lin et al., 2022)). However, the relationship and mechanism between innovation and project performance have
received little attention, despite the identified promoting role of innovation. Thus, relatively little is known about how innovation
promotes performance, particularly the conditions under which innovation can be used to predict project performance. Further
empirical research is needed to deepen the knowledge of the processes with which innovation facilitates project performance.
In the present study, a resource-based model is developed to better understand the relationship between innovative behavior and
project performance. The conditions that potentially catalyze or inhibit this process are explored based on the conservation of re­
sources (COR) theory. Innovative behavior is used to describe the innovation of project members in construction projects, because the
research and development activities involved in projects generally depend more on the innovative behaviors of individuals. This
exploration is based on the premise that project members’ innovative behavior plays a critical role in facilitating project performance.
The first purpose of this study is to offer insight into the conditions required for promoting innovation. Although individuals with
creative ideas tend to be highly productive, a matching environment is necessary to support their ideas and actions. However, the
currently applied focus on the role of environmental factors in enhancing innovation in individuals is limited. To overcome this
limitation, the moderating role of empowering leadership is examined in this study. This paper focuses on the variable of empowering
leadership because leadership has been defined as one of the important enablers and drivers for construction innovation (Ozorhon and
Oral, 2017). Moreover, empowering leadership has the capacity to increase followers’ involvement in decision-making and facilitate
their ability to respond to technological change and innovation requirements (Audenaert et al., 2017). For example, leadership is
critical for stimulating the adoption and implementation of BIM (Papadonikolaki, 2018) and empowering both users and stakeholders
in decision-making and application processes (Poirier et al., 2015). According to COR theory, the primary perspective that individuals
strive to gain and protect their resources depends on resources that are available and support the demands and expectations in the
workplace (Halbesleben et al., 2014). Consequently, this paper proposes that empowering leadership acts as an environmental
resource that can offer resources (e.g., autonomy, power, and decision-making support) project members need to cope with the de­
mands of construction innovation and project goals. Thus, empowering leadership compensates for the resource depletion caused by
the generation and implementation of innovation.
The second purpose of this study is to explore how leader-member exchange (LMX) mediates the combined roles of empowering
leadership and innovative behavior as predictors of project performance. This paper focuses on LMX because the leader-subordinate
relationship significantly impacts employees’ job outcomes (Schermuly et al., 2013), and LMX can be regarded as a job resource that
heightens empowerment perceptions and efforts in followers (Lorinkova and Perry, 2017). COR theory states that individuals who
enjoy resource investments shape the environment by providing returns for those investments (Wheeler et al., 2013). This paper
proposes that project members who experience high levels of empowering leadership may actively invest their efforts into innovation
activities and the construction process through LMX to better meet managers’ expectations and job demands. The inclusion of LMX as
an additional moderator (which transmits the positive impact of empowering leadership) enables a better understanding of how
empowering leadership functions and how it helps project members facilitate innovation. The model hypothesized in this study is
depicted in Fig. 1.
This study makes three contributions to the extant literature. First, from the COR perspective, an integrative explanation is pro­
vided for when and how the behavioral dimension of innovation enhances the performance of construction projects. Based on the

Fig. 1. Conceptual Model.

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principles of resource conservation and investment, both leader empowerment and high-quality exchange relationships with leaders
provide instrumental support for innovation and project performance. Second, this study contributes to explorations of construction
innovation by examining contextual boundaries. In addition to prior studies on influencing factors or the innovation diffusion model,
this study demonstrates that empowering leadership and LMX play an environmental role as the conditions that facilitate the effect of
innovation on performance. Third, this research contributes to the empowerment and LMX literature by offering empirical evidence for
the process underlying the empowering leadership-LMX relationship. Current literature focuses on a leader’s role or leader empow­
erment, while the underlying mechanism of construction innovation empowerment has not been examined in depth. This identifies the
underlying process of empowering leadership for construction innovation by highlighting the role of LMX as a mediator.

2. Theoretical background and hypotheses development

2.1. Conservation of resources theory

COR theory suggests that individuals attempt to accumulate, protect, and conserve their existing valued resources, and acquire new
valuable resources (Halbesleben et al., 2014; Hobfoll, 1989). Valued resources can have various forms, such as energy resources (e.g.,
time), constructive resources (e.g., rewards), social support, and personal resources (e.g., emotional intelligence and self-efficacy)
(Halbesleben et al., 2014). COR theory theorizes that individuals have a limited number of resources, which they must conserve
and extend to achieve preset goals in the workplace (Harris et al., 2011). Thus, two resource processes are relevant: resource con­
servation and resource acquisition.
In this study, the characteristics of construction projects, such as work overload, long working hours, high stress, and challenges
caused by difficulties (Liu and Low, 2011; Turner et al., 2008), are all-consuming personal resources. Based on the COR perspective,
innovation in construction can be understood as a resource investment approach for the implementation of projects to protect against
resource losses and gain new resources. Innovation, however, is a high-risk investment that requires individuals to be resourceful or
have sufficient psychological resources (Tierney and Farmer, 2002); it also requires a conducive environment and supporting lead­
ership (Zhang and Bartol, 2010). Thus, investing in psychological resources (e.g., social support) and relational resources (e.g., guanxi)
is beneficial for achieving desired goals (Blustein, 2011; Halbesleben, 2006). In the Chinese workplace, employees can utilize such
resources through their guanxi network and the authority of leaders (Farh et al., 1998; Li et al., 2017). Chinese-based research has
indicated that interpersonal interactions and relational connections might favor individual promotion and performance improvement
(Ren and Chadee, 2017). Thus, this study focuses on empowerment from empowering leadership and high quality LMX as valuable
resources and resource replenishments. From the perspective of “resource revenue”, this focus suggests that in the innovation process,
employees who possess high empowerment and have good relationships with their supervisors are more able to gain psychological
resources to further promote a positive performance outcome. Hence, it is reasonable and feasible to establish and examine the study
model using COR theory and data collected in China.

2.2. Innovative behavior and project performance

Innovative behavior refers to the generation, development, and implementation of novel and useful ideas in an organization (Baer,
2012; Jada et al., 2019). Individuals that show innovative behavior are inclined to learn and collect information with the goal to create
new ideas, solve difficult problems, and improve existing approaches, thereby promoting task performance (Amabile et al., 2005). Both
the willingness and motivation to learn are essential for job performance (Walumbwa et al., 2009). Learning stimulates employees to
obtain the skills and knowledge necessary for task execution (McGrath, 2001). Creative activities and processes are crucial enablers
that facilitate individual and team performance (Amabile, 1996; Gilson, 2008; Gong et al., 2009).
Regarding project innovation, the employed creative activities and innovative behaviors of project members include generating
new ideas around technologies or processes, transferring knowledge, solving technical problems, and implementing change (Gam­
batese and Hallowell, 2011). Employees’ creative behaviors, such as seeking novel approaches and engaging in innovative activities,
lead to higher project performance (Gilson et al., 2005). Furthermore, because of difficulties (e.g., knowledge-sharing and lack of
skilled personnel (Davis et al., 2016), construction innovation can be understood as a challenge stressor that enhances both the
motivation and performance of employees (Lepine et al., 2005). Moreover, according to COR theory (Hobfoll et al., 2018), the con­
struction process experiences losses of different resources (e.g., money, time, and equipment). Innovative activities and behaviors are
an indirect investment of resources; for instance, enhancing creative motivation and developing skills are innovative activities and
behaviors. These activities and behaviors help to reduce resource losses, recover from losses, and gain innovation-supportive resources
(Hobfoll et al., 2018). In this paper, the relationships between project members’ innovative behaviors and task performance are
examined. The following hypothesis is proposed:
Hypothesis 1. Project members’ innovative behavior positively affects project performance.

2.3. Empowering leadership and leader-member exchange

Project managers generally mitigate project risks and achieve project goals via traditional project management approaches such as
planning, control, providing clear guidance, and reporting (Napier et al., 2009). Such approaches may constrain the generation and
implementation of innovation because the flexible structure and necessary support could help individuals to cope with the challenging

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demands of technological innovation. This induces a sense of control over performed tasks in employees. Empowering leadership
represents one approach that emphasizes leader behaviors that can support followers in dealing with demands as well as facilitating
their sense of control (Windeler et al., 2017). Empowering leadership refers to leader behaviors that share power with followers
(Vecchio et al., 2010), promote individual motivation to work autonomously, and inform others through modeling and guidance
(Amundsen and Martinsen, 2014). In the construction context, empowerment involves the assignment of appropriate responsibilities
and the facilitation of followers’ self-efficacy and decision-making authority to affect behaviors and outcomes (Kim and Rhee, 2020;
Price et al., 2004). For example, empowering leadership styles decrease the necessity for rework (Love et al., 2016) and enhance
employee job performance (Kim and Rhee, 2020). Thus, empowering leadership is well suited for construction innovation, which
involves considerable challenges and uncertainty, because it provides flexibility (e.g., via decision-making participation), support (e.
g., via power sharing), and motivation (e.g., via confidence expression) (Zhang and Bartol, 2010; Zhang and Zhou, 2014). Therefore,
an empowering leadership style may well be beneficial for facilitating innovation and strengthening project performance.
LMX refers to the quality of dyadic relationships between leaders and their subordinates, which are developed in the social ex­
change process (Graen and Uhl-Bien, 1995). A high-quality LMX relationship indicates that subordinates or members can easily receive
access to support, job-related resources, and a positive performance assessment by their leaders (Thomas and Lankau, 2009). From the
COR perspective (Hobfoll et al., 2018), a high-quality LMX relationship provides accumulated and protected resources for individuals.
Exchange indicates that valued resources, which include communication and support, are shared between leaders and subordinates,
thus helping employees to perform tasks and accomplish goals (Harris et al., 2011). LMX is different from leadership style, as it
functions as an approach to social problem-solving (Narayanaswamy et al., 2013), and provides an interpretation framework for
management (Audenaert et al., 2019). Thus, individuals perceive high-quality LMX as a resourceful and supportive tool and are
therefore willing to transfer and implement their ideas with the goal of improving performance.
LMX depends on the principle of reciprocity, which is similar to trust in leadership (Lee et al., 2018). Because leaders or supervisors
can influence employees (Dulebohn et al., 2012), these are encouraged to reciprocate by engaging in tasks when they perceive
empowerment from leaders who express trust, respect, and confidence in the abilities of employees (Chow, 2018; Gutermann et al.,
2017). As such, LMX can be a mediator between leader behaviors and employee outcomes (Hassan et al., 2013). Specifically,
empowering leader behaviors could help to develop confidence in employees’ skills (Lee et al., 2018) and foster a resourceful and
supportive environment of respect and trust (Kim et al., 2018) in the abilities of employees to perform tasks satisfactorily and achieve
project goals. Empowering leader behavior leads to the emergence of high-quality relationships between leaders and members as LMX,
where project members positively evaluate leaders. This leads to the second hypothesis:
Hypothesis 2. Empowering leadership positively contributes to LMX in projects.

2.4. Promoting project outcomes via distinct resources

From the resource investment perspective of COR, individuals invest resources to obtain new resources and to protect existing
resources, thus they are better able to recover from resource loss (Hobfoll, 2011). Based on this theoretical logic, empowering lead­
ership is proposed to be an important environmental resource that encourages project members to invest their resources into dealing
with challenging situations and complex problems in construction projects. Specifically, empowering leadership behaviors (e.g.,
providing developmental feedback, coaching, and guidance) cultivate and provide employees with the work-related resources they
need to achieve specific goals (Kim et al., 2018). These resources motivate employees’ personal growth and learning, thus driving them
to gain additional resources, and further stimulating them to engage in tasks and achieve positive work outcomes (Schaufeli et al.,
2009). Such leadership behaviors can foster goal clarity and motivate project members to focus more carefully on their tasks and goals
(Kearney et al., 2019). Regarding challenging tasks and difficult issues in construction projects, an empowering leadership style can act
as a catalyst to encourage creative thinking and exploration, as well as help to cope with task uncertainty to achieve task accom­
plishment (Windeler et al., 2017). Hence, combined with the motivation and behaviors of innovative project members, the resourceful
environment provided by empowering leadership could exert a positive effect that is positively related to project performance.
Therefore, further hypotheses are proposed as follows:
Hypothesis 3a. : Empowering leadership increases the relationship between innovative behavior and project performance; this
relationship becomes more positive under a more empowering leadership style.
In addition to directly affecting project processes and creative activities, project members establish relationships with project
managers or their immediate supervisors in hierarchical structures. The upper level will likely influence the lower level (Graen et al.,
1972). If project leaders or managers build good relationships with project members and represent role models, members in this
hierarchy are increasingly and effectively engaged in the process and creative activities of a project (Balogun and Johnson, 2004;
Lorinkova and Perry, 2017). Previous studies provided evidence that supervisors influence employee outcomes in different ways,
depending on the conditions of the exchange (Erdogan and Enders, 2007; Tangirala et al., 2007). Moreover, building on COR theory,
LMX represents job resources leaders grant as benefits to employees (Lorinkova and Perry, 2017). These resources stimulate the efforts
of lower-level members of the hierarchy, leading to more positive attitudes and behaviors (Gutermann et al., 2017). Individuals in
high-quality LMX relationships are more likely to perceive support and perform tasks in an innovative manner (Aryee et al., 2012).
Project members who received certain resources because of high levels of LMX are more likely to apply these resources to facilitate
effective innovation in projects, which leads to Hypothesis 3b:
Hypothesis 3b. : LMX augments the relationship between innovative behavior and project performance, so that this relationship is

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more positive under higher LMX.

Thus far, it was hypothesized that project members’ innovative behavior positively affects project performance (Hypothesis 1) and
that empowering leadership positively contributes to LMX in projects (Hypothesis 2). Two moderation hypotheses have also been
proposed, i.e., empowering leadership increases the relationship between innovative behavior and project performance (Hypothesis
3a) and LMX augments the relationship between innovative behavior and project performance (Hypothesis 3b). By extension, a
mediated moderation model (see Fig. 1) is proposed that considers Hypotheses 1, 2, 3a, and 3b (Edwards and Lambert, 2007; Liu et al.,
2012). This model identifies LMX as the pivotal mechanism that transmits the moderating effect of empowering leadership into the
relationship between innovative behavior and project performance. Thus, the following hypothesis is proposed:
Hypothesis 4. The mechanism of LMX explains the moderating effect of empowering leadership on the relationship between
innovative behavior and project performance.

3. Method

3.1. Sample and procedures

First, a questionnaire was designed, and a pilot survey was conducted after which the questionnaire was revised and confirmed by
16 experts, including professionals and scholars of construction management who are experienced in construction innovation. Ac­
cording to the results of this pilot survey, the questionnaire was revised, including the translation or expression of items. Second, an
anonymous survey was disseminated via a web-based survey platform (www.wjx.cn) and email. About 500 project professionals and
general project members were recruited as respondents from an alumnus network. The target respondents work in construction firms
or real estate firms where they hold positions such as contractor, owner, designer, or consultant in construction projects. Sample
diversity enhanced external validity. Third, each respondent received an invitation web link or email to fill out the survey, which
assessed individual innovative behavior, empowering leadership, and the quality of the relationship with the direct superior or su­
pervisor. Next, the invitation link or email was sent to the direct superior and respondents, asking whether they were willing to ask
their direct superior or supervisor to rate their performance in completed or current projects. All respondents were informed that
anonymity would be ensured and the codes in the questionnaire would only be used to match the assessments of superiors and project
members.
In total, 373 respondents completed the survey and the self-reports, and 300 superiors completed the project performance
assessment. After removing datasets where leader-subordinate responses could not be matched and where answers between different
items in the responses of project members were identical, a total of 286 valid datasets were obtained, representing an effective response
rate of 57.2 % for project members. The demographic information of the valid sample for project members is shown in Table 1. Of the
final and valid sample of project members, 131 (45.8 %) participants were female and 155 (54.2 %) were male. A total of 243 re­
spondents (85.0 %) possessed a bachelor’s degree. Most respondents were aged between 31 and 40 years (114, 39.9 %). About half of
the project members worked in a project team consisting of 10–20 people (150, 52.4 %). Half of the project members worked in
construction enterprises as contractors, subcontractors, or designers (149, 52.1 %), and half worked for real estate companies as
owners, consultants, or facility managers (137, 47.9 %).

3.2. Measures

The back-translation procedure was used to convert the original measures in English into Chinese (Brislin, 1980). The Chinese
version was sent to project members and their immediate supervisors and managers.

Table 1
Demographic distribution of sample data for project members (N = 286).
Demographic Category Number Percentage
characteristic

Gender Male 155 54.2

Female 131 45.8
Age 18–25 37 12.9
26–30 102 35.7
31–40 114 39.9
41 and above 33 11.5
Education level High school and below 1 0.3
University (including junior college and bachelor) 243 85.0
Master and above 42 14.7
Project team scale < 10 people 46 16.1
10–20 people 150 52.4
> 20 people 90 31.5
Firm type Construction enterprises (including contractors, subcontractors, designer, suppliers of materials/ 149 52.1
euqipments, etc.)
Real estate enterprises (including owners, consultants, facility management, etc) 137 47.9

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J. Zheng et al. Journal of Engineering and Technology Management 68 (2023) 101750

Innovative behavior was assessed via a 6-item scale developed by Scott and Bruce (1994) that was later adopted by Shin et al.
(2017). Participants reported their innovative behavior on a 5-point Likert scale from 1 (not at all characteristic) to 5 (very charac­
teristic). An example statement is “I will promote and champion ideas to others”. The alpha coefficient of this measure was 0.734.
Empowering leadership was assessed via a 10-item scale developed by Vecchio et al. (2010). This tool allowed participants to rate
their project managers’ leadership behaviors on a 5-point Likert scale from 1 (extremely disagree) to 5 (extremely agree). An example
statement is “My project manager or supervisor urges me to think of problems as opportunities rather than obstacles”. The alpha
coefficient of this scale was 0.797.
LMX was assessed via a 7-item scale originally developed by Scandura and Graen (1984) and adopted by Hassan et al. (2013).
Participants rated the quality of their relationships with their immediate supervisor or manager using five anchored response choices.
An example question is “How would you characterize your working relationship with your project manager or supervisor?”. The
reliability coefficient for this scale was 0.777.
Project performance was assessed via seven items drawn from Thompson et al. (2007), and adopted by Sirisomboonsuk et al.
(2018). The respondents’ supervisors or managers rated project task outcomes using a 5-point Likert scale from 1 (extremely low) to 5
(extremely high). An example question project leaders or managers were asked is “Compared with previous projects, how do you rate
your most recently completed project rate on adherence to budgets?” The alpha coefficient of this measure was 0.747.
Control variables were the project member’s gender (0 = “female” and 1 = “male”), age level (1 = “18–25′′ , 2 = “26–30′′ , 3 =
“31–40′′ , 4 = “41–50′′ , and 5 = “51 and above”), educational level (1 = “high school and below”, 2 = “university”, and 3 = “post­
graduates and above”), size of the project team (1 = less than 10 people, 2 = 10–20 people, and 3 = more than 20 people), and firm
type (1 = construction enterprises and 2 = real estate enterprises).

3.3. Analytic strategy

This study followed a two-step procedure, which includes the assessment of the measurement model and the testing of hypotheses
(Hair et al., 2010). First, preliminary analyses were conducted before testing hypotheses, including reliability and validity tests.
Cronbach’s alpha and composite reliability (CR) were used to gauge the reliability of focal variables to indicate internal consistency.
Internal consistency refers to the degree of interrelatedness among distinct items of constructs (Cortina, 1993; Green et al., 1977). The
recommended Cronbach’s alpha and CR are 0.70 (Bonett and Wright, 2015; Cortina, 1993), and CR values are generally larger than
alpha coefficient values (Peterson and Kim, 2013). The validity test involves convergent validity and discriminant validity to assess the
quality of the measurement model (Hair Jr. et al., 2020). Convergent validity assesses the average variance among multi-items or
indicators of a construct, and discriminant validity measures the distinctiveness of constructs compared with variance in a construct
(Hair et al., 2010; Hair Jr. et al., 2020). Convergent validity of each construct was examined using the average variance extracted
(AVE), which should be 0.50 or larger (Hair Jr. et al., 2020). Discriminant validity was assessed when the square root value of AVE
exceeded inter-correlation coefficients.
Further, in this study, the methods of Harman’s one-factor test and confirmatory factor analysis (CFA) were also applied to measure
discriminant validity and examine potential issues with common method variance (CMV). Specifically, when exploratory factor
analysis (EFA) suggests that one factor accounts for more than 50 % of the variance, Harman’s one-factor test represents a potential
issue of CMV (Fuller et al., 2016; Podsakoff, 2003). Goodness-of-fit indices are used to demonstrate the model fit in the examination of
CFA (Benitez et al., 2020). These indices include comparative fit index (CFI), Tucker-Lewis index (TLI), root mean squared error of
approximation (RMSEA), and standardized mean squared residual (SRMR) (Brown, 2006; Ployhart and Oswald, 2004). Cut-off values
indicating good fit were 0.90 for CFI and TLI (0.80 may also be acceptable in certain conditions), 0.08 for SRMR, and 0.05 for RMSEA,
as recommended by Hu and Bentler (1999) and endorsed by Brown (2006).
The hypotheses of main direct effects and moderation (i.e., Hypotheses 1, 2, 3a, and 3b) were tested through regression analysis
using SPSS (version 26.0). Regarding moderation effects (i.e., Hypotheses 3a and 3b), the product of the interaction between inde­
pendent variable and moderators is generated, e.g., innovative behavior × empowering leadership. Then, while the independent
variable and moderators are controlled, moderation effects are represented by the significant effect of the interaction term on the
dependent variable (Baron and Kenny, 1986). The issue of multicollinearity was tested using the variance inflation factor (VIF): if VIF
> 5, the estimation of regression analysis may be poor because of multicollinearity (Katrutsa and Strijov, 2017; Paul and Das, 2015).
The hypothesized mediated moderation effect (i.e., Hypothesis 4) can be defined as a “mono-level Type II mediated moderation effect”
(Liu et al., 2012). This identifies the condition under which the mediator (i.e., LMX) serves as a proxy for the original moderator (i.e.,
empowering leadership) to alter the association between independent and dependent variables (i.e., innovative behavior and project
performance). The bootstrapping method, as proposed by Edwards and Lambert (2007) and Liu et al. (2012), was used to test the
mediated moderation effect and confidence intervals (CIs) following Preacher et al. (2010). The bootstrapping approach was con­
ducted in MPLUS (version 7.04) and obtained 95 % CIs of the products of regression coefficients for empowering leadership predicting
LMX, and the interaction term between innovative behavior and LMX predicting project performance (Muthén and Muthén, 2012).

4. Results

4.1. Preliminary analysis

First, Harman’s one-factor analysis showed that more than one factor was extracted. The first factor explained 26.43 % (<50 %) of
the total variance, suggesting that CMV is not a potentially serious issue in this study. Then, CFA was conducted to measure the

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construct validity of the studied variables. Table 2 presents the comparison between the hypothesized four-factor model (i.e.,
empowering leadership, LMX, innovative behavior, and project performance) and alternative factor models. The results indicate that
the four-factor model achieved a better fit than alternative models. The increased values of χ2/df, the decreased values of TLI and CFI,
and the increased values of SRMR and RMSEA indicated that the tested alternative models achieved poorer fit than the hypothesized
four-factor model. The CFA results also indicated good discriminant validity.
Second, Table 3 shows descriptive statistics, providing means, standard deviations, and intercorrelations of studied variables, as
well as Cronbach’s alpha coefficients, CR values, and the square root values of AVE. The reliability measures of the studied variables
(including Cronbach’s alpha and CR) reached the recommended levels of 0.70, indicating good internal consistency. AVE values also
exceeded the recommended cut-off of 0.50, demonstrating good convergent validity. The square root values of AVE for studied var­
iables exceeded the correlation coefficients, indicating good discriminant validity. Overall, the results of the measurement model
assessment and descriptive statistics provide satisfying empirical support for reliability, convergent, and discriminant validity
assessments.

4.2. Testing main and moderation effects

Table 4 presents the regression coefficients for each regression model. The VIF values of independent variable and moderators are
all lower than 2 (Model 4 in Table 4, VIFIB = 1.541; VIFLMX = 1.598; VIFEL = 1.499), suggesting that the regression estimation is not
influenced by multicollinearity. Innovative behavior is positively associated with project performance (β = 0.236, p < 0.001), sup­
porting Hypothesis 1. Empowering leadership is also positively associated with the quality of exchange between project members and
managers (β = 0.510, p < 0.001), supporting Hypothesis 2.
The moderation hypotheses were tested by adding two interaction terms within innovation behavior, empowering leadership, and
LMX into Models 5 and 6 in the regression model. The results are shown in Table 4. The two interaction terms emerged from the
product of corresponding two-centered independent variables. However, the interaction between empowering leadership and inno­
vation behavior does not significantly predict project performance (β = − 0.027, p > 0.05), which means that Hypothesis 3a is not
supported. The interaction between innovation behavior and LMX is positive and significantly predicts project performance
(β = 0.169, p < 0.01).
Fig. 2 demonstrates this interaction, following the work of Aiken and West (1991). The findings suggest that the positive rela­
tionship between innovation behavior and project performance is stronger when the quality of exchange between project members and
managers is better compared to when the quality of their relationship is poor. This supports Hypothesis 3b. Under a high level of LMX
(i.e., one standard deviation above the mean), innovation behavior is positively associated with project performance (β = 0.349,
p < 0.001). The relationship is also positive and significant at low LMX (β = 0.297, p < 0.001).

4.3. Testing mediated moderation effect

Table 5 presents the estimated product coefficient and the 95 % bootstrap CIs for the product coefficient. The bootstrap CIs (0.126,
p < 0.05, 95 % CI [0.017, 0.254]) support the mediated moderation hypothesis. LMX significantly mediates the moderating effect of
empowering leadership on the relationship between innovation behavior and project performance. Specifically, the conditional and
indirect effect across high and low levels of LMX is significant (Δγ = 0.285, p < 0.05, 95 % CI = [0.033, 0.550]), supporting Hypothesis
4. Fig. 3 illustrates the mediated moderating effect of LMX, innovation behavior, empowering leadership, and control variables.

5. Discussion

5.1. Findings

In this study, the conditions under which the innovative behavior of project members facilitates project performance were
examined. From a COR perspective, this study addresses two key research questions: First, an in-depth explanation of situations where
innovative behavior predicts project performance is presented by assessing the impacts of leader empowerment and the quality of
leader-member relationships. Second, the positive underlying process of empowering leadership for developing LMX is illustrated and
identified as an approach for improving project innovation.
Three main findings emerged from this study. First, informed by COR theory (Hobfoll et al., 2018), in this study, it was assumed

Table 2
The Results of confirmatory factor analysis.
Models χ2 /df CFI TLI SRMR RMSEA

Four-factor model: IB, EL, LMX, PP 1.609 0.901 0.887 0.046 0.050
Three-factor model: IB, EL+LMX, PP 2.371 0.764 0.745 0.066 0.069
Two-factor model: IB+PP, EL+LMX 2.507 0.739 0.719 0.067 0.073
One factor model: IB+EL+LMX+PP 2.647 0.714 0.693 0.069 0.076

Note. N = 286. CFI = Comparative fit index. TLI = Tucker-Lewis index. SRMR = Standardized mean squared residual. RMSEA = Root mean squared
error of approximation. IB = Innovative behavior, EL = Empowering leadership; LMX = Leader-member exchange, PP = Project performance.

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 J. Zheng et al.
Table 3
Means, standard deviation, reliabilities and correlations among study variables.
Variables Mean SD Cronbach α CR AVE 1 2 3 4 5 6 7 8 9

1. Gender 0.542 0.499 – – – –

2. Age 2.500 0.861 – – – 0.037 –
3. Education 2.143 0.361 – – – 0.035 0.073 –
4. Project team scale 2.154 0.673 0.085 0.139* -0.004
8

– – – –
5. Firm type 1.479 0.500 – – – -0.200** 0.012 -0.012 -0.011 – –
6. Innovative behavior 3.734 0.586 0.734 0.867 0.522 0.087 -0.053 -0.112 -0.014 -0.018 (0.722)
7. Leader-member exchange 3.460 0.638 0.777 0.879 0.511 0.057 0.032 -0.011 -0.066 0.071 0.522*** (0.715)
8. Empowering leadership 3.840 0.576 0.797 0.914 0.514 0.130* -0.005 -0.033 0.030 -0.016 0.481*** 0.509*** (0.717)
9. Project performance 3.734 0.574 0.747 0.875 0.500 0.017 -0.068 -0.084 -0.025 0.023 0.554*** 0.661*** 0.489*** (0.707)

Journal of Engineering and Technology Management 68 (2023) 101750

Note. N = 286. CR = composite reliability. The values of the squared root of average variance extracted (AVE) are in parentheses in the diagonal. *p < 0.05; ***p < 0.001.
J. Zheng et al. Journal of Engineering and Technology Management 68 (2023) 101750

Table 4
Regression models for predicting LMX and project performance.
Leader-member exchange Project performance

Variables Model 1 Model 2 Model 3 Model 4 Model 5 Model 6

Control variables
Gender 0.080 0.009 0.030 -0.050 -0.050 -0.044
Age 0.040 0.045 -0.061 -0.068 -0.066 -0.061
Education -0.016 0.003 -0.080 -0.041 -0.038 -0.038
Project team scale -0.077 -0.088 -0.019 0.019 0.020 0.032
Firm type 0.086 0.063 0.029 -0.018 -0.019 -0.018
Main effects
Innovative behavior 0.236*** 0.234*** 0.249***
Empowering leadership 0.510*** 0.139** 0.137** 0.127*
Leader-member exchange 0.474*** 0.473*** 0.477***
Interactions
Innovative behavior × Empowering leadership -0.027 -0.135*
Innovative behavior × Leader-member exchange 0.169**
R2 0.017 0.272 0.013 0.518 0.519 0.535
Δ R2 0.254*** 0.505*** 0.001 0.017**
F 0.980 17.344*** 0.711 37.202*** 33.044*** 31.668***

Note. N = 286. The standard coefficients are reported. *p < 0.05; **p < 0.01; ***p < 0.001.

Fig. 2. Interactive effect of innovative behavior and LMX on Project performance.

Table 5
Bootstrap CIs for the hypothesized mediated moderation effects.
Testing the mediated moderation hypothesis Innovative behavior → Project performance
Coefficients SE 95 % LLCI 95 % ULCI
LMX × Innovative behavior (BMX→Y) 0.223* 0.102 0.026 0.431
Empowering leadership → Leader-member exchange (BW→M) 0.564*** 0.095 0.391 0.766
Mediated moderation effect (BW→MBMX→Y) 0.126* 0.061 0.017 0.254
Moderator: Leader-member exchange Conditional indirect effects SE 95 % LLCI 95 % ULCI
Low level (− 1 SD) 0.645*** 0.098 0.463 0.849
High level (+1 SD) 0.930*** 0.183 0.574 1.289
Difference 0.285* 0.131 0.033 0.550

Note. BMX→Y refers to the regression coefficient for the interaction between the predictor (i.e., X, innovative behavior) and the mediator (i.e., M, LMX)
in predicting the dependent variable (i.e., Y, project performance). BW→M refers to the regression coefficient for the moderator (i.e., W, empowering
leadership) in predicting the mediator (i.e., M, LMX). BW→MBMX→Y refers to product coefficient that represents the hypothesized mediated moderation
effect. SD = standard deviation. SE = standard error. LLCI = lower level confidence interval; ULCI = upper level confidence interval. Bootstrap
= 2000. * p < 0.05; ** p < 0.01; *** p < 0.001

that innovation positively contributes to project performance because of the investment of resources and the recovery of resource
losses in the construction process. Consistent with the findings, the assumption that the innovative behavior of project members
contributes to project performance is examined. Innovation not only reflects the challenges and requirements of construction projects

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J. Zheng et al. Journal of Engineering and Technology Management 68 (2023) 101750

Fig. 3. Mediated moderation test results Note. The dashed line represents insignificant, the solid line represents significant.
*p < 0.05; ***p < 0.001.

(Lepine et al., 2005), but it also significantly impacts project performance (Dulaimi et al., 2005; Gilson et al., 2005). This provides
empirical evidence that innovation can be beneficial for construction projects.
Second, considering the role of leadership, empowering leadership is positively related to project performance. Contrary to
expectation, the moderation results do not suggest that empowering leadership strengthens the relationship between innovative
behavior and project performance. One possible explanation for this lack of significance of the moderation effect is that an empow­
erment process exists in the project context (Yu et al., 2018). Rather than directly exerting the effect, this empowerment may play a
role through the empowerment process, which is similar to the interaction between the project manager and project members (Yu
et al., 2018). Another possible explanation is the potential impact of project characteristics. Specifically, temporary project settings
may affect the perception of empowerment in project members (Tuuli, 2018). Different organizational structures, contract arrange­
ments, or procurement modes generate distinct power structures, resulting in varying empowerment perceptions (Fellows et al., 2003).
The positive role of empowering leadership may therefore rely on project settings. Future research could consider project charac­
teristics to explain the empowerment process.
Third, consistent with this reasoning, the data corroborate the mediating effect of LMX. The mediated moderation effect through
LMX is significant for both leader empowerment and innovative individuals in projects. Empowering managers can induce feelings of
confidence, trust, and responsibility in project members (Gutermann et al., 2017; Sharman and Kirkman, 2015). The mediation of LMX
indicates this empowerment process, demonstrating that if project managers provide project members with autonomy and delegation,
the result will be high-quality interactions that strengthen the role of innovation in construction. Further, as the project team setting
was generally characterized by a high power distance (Fellows et al., 2003) and the data were collected in a collectivistic country (i.e.,
China), reciprocity and respect may be more significant and prevalent in such a vertical-collectivistic culture (Rockstuhl et al., 2012),
where collective interest is pursued, and project role responsibility is fulfilled. Future research could therefore explore the effects of
LMX by comparing cultural differences in project settings.

5.2. Theoretical implications

First, this study enriches previous findings that linked construction innovation with positive outcomes such as competitive
advantage (Afraz et al., 2021), and the literature on COR theory such as the study of innovation management and project governance
(Wang et al., 2022). Drawing from the principles of COR theory (Hobfoll et al., 2018), individuals who have a pool of resources
available (e.g., creative ideas and empowerment from leaders) are more likely to invest resources to protect against resource loss. The
findings of the present study provide evidence that empowering leadership and high-quality LMX help to accumulate resources by
providing instrumental support for innovative individuals to promote project performance. Further, innovative behavior can be un­
derstood as extra-role behavior or organizational citizenship behavior that not only serves as a risky depletion of current resources in
projects (Fuller et al., 2007), but also as a potential approach to gain new resources (Detert and Burris, 2007). The present study
demonstrated a rationale on how individuals can transmit innovation to performance outcomes.
Second, in this study, the contextual boundaries for the impact of innovative behavior on project performance are examined
concerning empowerment perception and the exchange relationship. The findings extend prior research on construction innovation
that predominantly focused on factors of construction innovation (Ozorhon and Oral, 2017) or construction innovation networks
(Zhang et al., 2020). This extension demonstrates that empowerment and a good leader-member relationship are important envi­
ronmental resources and conditions that facilitate the effect of construction innovation. This study suggests that empowering lead­
ership and LMX are intervention measures that motivate project members to transfer innovation into implementation, thus increasing
project performance. This research offers a broader insight and a better understanding of how innovation inspires project performance.
Moreover, this study contributes to the resource revenue or resource investment tenet of COR theory regarding the relevance of context
using a country-specific example (e.g., China). Although innovative behavior, empowering leadership, and LMX are western-based
concepts, this research acknowledges the roles of empowerment and the leader-subordinate relationship, which are typically valu­
able resources in the Chinese context. The findings provide empirical support for the perspective that “resource investment” (e.g.,

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innovation) is a complex process that could be motivated by both psychological resources and relational resources (Halbesleben et al.,
2014), and this process is contingent on contextual factors (Ren and Chadee, 2017).
Third, the results provide empirical evidence on the potential mechanisms of the relationship between empowering leadership and
LMX (Cheong et al., 2019). Further, the presented evidence contributes to the empowerment and LMX literature by identifying the
underlying empowerment process through the interaction between leaders and members. The findings provide empirical evidence
corroborating the key role of empowering leadership as a requisite condition for promoting LMX. This is in line with prior research
suggesting the positive relationship between empowering leadership and LMX (Kwan et al., 2022). As empowering leadership signals
trust and fosters high-quality LMX (Lee et al., 2018), LMX can be understood as a job resource (e.g., affective-based trust in leaders)
facilitating work engagement and performance (Breevaart et al., 2015; Gutermann et al., 2017). As such, this study highlights the
active role of the actions of both the project manager and members and the leader-member interaction to better understand the
relationship between innovation and performance outcomes.

5.3. Practical implications

The findings provide guidance for project managers or leaders and members in construction projects on how to transfer innovation
and enhance performance. In response to the uncertainty in innovation and goal constraints in projects, project managers could adopt
an empowering leadership style, i.e., by implementing power sharing, autonomy support, and participative decision-making. Leaders
can provide autonomy for highly innovative project members to foster an empowering climate and a learning culture that facilitates
employee capabilities. In response to the particularly challenging times of COVID-19, leadership also requires changes partly from
direct feedback and sharing as well as from mentoring and coaching (Kirchner et al., 2021). An empowering and learning culture that
adopts advanced technology may be beneficial for the promotion of organizational resilience to cope with emerging uncertainty and
complexity in projects (Wang et al., 2022).
Additionally, high-quality exchange relationships between project managers and members can foster trust and creative motivation,
thus facilitating project performance. Although empowering leadership positively impacts project innovation, leaders or managers are
often inclined to specifically empower individuals with whom they share high-quality exchange relationships. Project managers must
become more aware of authentic and creative members in their teams and focus on nurturing their trust and relationship. Further,
project completion is directly associated with interaction among managers and members in construction tasks (Araya, 2021). During
construction and innovation activities, the degree of leader-member exchange should be enhanced to let members who perform tasks
well experience safety and trust, especially in the difficult times of COVID-19 (Azeez et al., 2019).

5.4. Limitations and future research

Two limitations constrain this study. First, the rating of LMX relied on data provided by project members. The perception or
evaluation of project managers or supervisors regarding exchange relationships may differ from that of followers. Future studies
should therefore consider the LMX differentiation as variability in LMX (Henderson et al., 2009) to further enrich the construction
innovation literature. Second, while this study used empowering leadership and LMX as moderators or boundary conditions for
construction innovation, other moderators or mediators for internal mechanisms may exist, such as culture and team structure
(Blindenbach-Driessen and Ende, 2006; Lloyd-walker et al., 2014). Additionally, although the results of CFA and Harman’s
single-factor analysis indicate that CMV is not a serious concern in this study, CMV cannot be fully ignored (Podsakoff, 2003). Future
studies should therefore apply multi-source or multi-time point data to reduce or avoid CMV issues. Moreover, the data were collected
in construction projects located in China. Although variables representing Chinese-related phenomena were selected, future research
could also extend the generalization of the findings to other sectors and cultural contexts through comparisons of different projects (e.
g., software projects) or cross-cultural comparisons.

6. Conclusion

The results of this study extend our understanding of how and under which conditions individual innovative behavior affects
project performance by exploring the moderating effect of empowering leadership and the mediated moderation effect of LMX.
Innovative behavior and empowering leadership are positively related to project performance. The relationship between innovative
behavior and project performance varies based on the quality of LMX relationships. The moderation impact of empowering leadership
is effectively imposed on LMX mediation. The results of this study elucidate the underlying influencing mechanism of construction
innovation, highlighting the effect of project leadership with different approaches (e.g., empowerment and interpersonal relationship
development) on innovation in construction projects.

Funding

This research is supported by the National Natural Science Foundation of China (Grant Nos. 72161021, 72162026, and 71972018).

Conflict of interest

The authors have declared that no conflict of interest exists.

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Data Availability

Data will be made available on request.

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