Strategic leadership and firm performance: The mediating role of ambidexterity in professional services small- and medium-sized enterprises

The role of strategic leadership is pivotal in determining a firm's direction and shaping its processes, competencies and performance. Strategic leadership also develops, deploys and reconfigures the firm's ambidextrous capabilities (such as innovativeness, competiveness and adaptability) that influence performance. Using responses from 315 UK small- and medium-sized accountancy firms, this study empirically investigates the extent to which the direct influence of strategic leadership on performance is mediated by the firm's ambidextrous orientation. With a variance accounted for of 57.78%, the results show that ambidexterity has a partial mediating effect on the relationship between strategic leadership and the performance of accountancy firms. Also, our findings show that the perception of environmental dynamism does not influence the ambidextrous orientation of these accountancy firms. In addition, increased firm's age does not necessarily lead to decreased performance resulting from inertia.