Inclusive Leadership and Team Innovation: Harnessing Failure as a Catalyst for New-Generation Workforce Performance

Abstract: Organizations increasingly depend on diverse, innovation-driven teams to maintain competitive advantage, yet traditional leadership approaches often struggle to unlock the creative potential of new-generation employees. This study examines how inclusive leadership influences team innovation performance through the mechanism of team learning from failures, with team career calling serving as a critical boundary condition. Drawing on Team Regulation Theory and analyzing data from 400 employees across 77 teams using a three-wave design, we demonstrate that inclusive leadership significantly enhances team innovation performance by fostering environments where failures become learning opportunities rather than sources of blame. This relationship is particularly pronounced in teams with high career calling, where members' intrinsic motivation and sense of purpose amplify their receptivity to inclusive leadership practices. Our findings reveal that inclusive leadership increases team innovation performance both directly and indirectly through team learning from failures, with this mediated pathway strengthening substantially when team career calling is elevated. These results illuminate how bottom-up, relationship-centered leadership can transform setbacks into springboards for innovation, offering practical guidance for organizations seeking to maximize the innovative capacity of their increasingly diverse and purpose-driven workforce.

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