What makes teams more innovative in small high-technology ventures? The role of leadership

Fostering team innovation has been considered as a major leadership function in high-technology ventures because they face intense competition in the market. In this research, we analysed the direct and indirect effects of transformational leadership on team innovation in small high technology ventures. A total of 24 team leaders and 133 employees from high tech industries in Iran participated in our study. Using structural equation modelling, we found that transformational leaders play a crucial role in enhancing team innovation, facilitating team trust and team communication quality. Nevertheless, transformational leadership was not related to team innovation directly. We also found that transformational leadership plays a facilitating role in improving trust and communication within a team. In the context of developing countries, this study provides empirical evidence of the prominent role of transformational leadership in encouraging team innovation by facilitating communication and trust among team members.