Does strategy implementation mediate the relationship between strategic leadership, knowledge sharing, collective organizational engagement and innovation performance? Evidence from the Tunisian banking sector

This study examines the mediating role of strategy implementation in the relationships among strategic leadership, knowledge sharing, collective organizational engagement, and innovation performance in Tunisian banks. The Tunisian banking sector is undergoing significant transformation driven by regulatory reforms, digitalization, and financial inclusion initiatives promoted by the Central Bank of Tunisia. In this context, banks are required to strengthen their innovation capabilities while adapting their strategic and operational practices. A quantitative research design was adopted, and data were collected from 119 managers and senior executives representing ten major Tunisian banks. Structural equation modeling (SEM) using AMOS was employed to test the proposed relationships. The findings indicate that strategic leadership, collective organizational engagement, and knowledge sharing positively influence strategy implementation. Furthermore, strategy implementation significantly enhances innovation performance and fully mediates the effects of the three antecedent variables on innovation outcomes. These results highlight the importance of effective strategy execution as a critical mechanism through which managerial capabilities and organizational resources are translated into innovation performance. The study contributes to the literature by extending Upper Echelons Theory and demonstrating the pivotal role of strategy implementation in highly regulated environments. The findings also provide practical insights for bank managers and policymakers seeking to improve innovation performance through effective strategic execution.