International Journal of Applied Business & International Management (IJABIM) Vol.
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php/IJABIM The Moderating Role of Digital Transformation on the Influence of Workplace Spirituality and Sustainable Leadership on School Organizational Performance Yuliana Sri Purbiyati1.
Richard Andrew1* Universitas Katolik Darma Cendika.
Jl.
Dr.
Ir.
Soekarno No.
Klampis Ngasem.
Kec.
Sukolilo.
Surabaya.
East Java 60117.
Indonesia *Corresponding Email: richard.
andrew@ukdc.
ARTICLE INFORMATION
ABSTRACT
Publication information Educational institutions increasingly face pressure to improve organizational Research article performance amid changing stakeholder expectations and rapid digitalization.
This HOW TO CITE study examines the moderating role of Purbiyati.
, & Andrew.
The digital transformation in the relationships moderating role of digital transformation on between the influence of workplace spirituality and sustainable school organizational performance.
Using Partial organizational performance.
International Least SquaresAeStructural Equation Journal of Applied Business & International Modeling (PLS-SEM), data were collected Management, 10.
, 445-463.
from school leaders and unit heads at educational institutions in Indonesia.
The DOI:
results indicate that workplace spirituality https://doi.
org/10.
32535/ijabim.
4237 has a significant positive effect on organizational performance ( = 0.
Copyright @ 2025 owned by Author.
< 0.
, while sustainable leadership Published by IJABIM does not show a significant direct influence ( = Ae0.
p > 0.
Digital transformation also has a positive direct effect on organizational performance ( = p < 0.
, but does not moderate the relationships between workplace spirituality or sustainable leadership and This is an open-access article.
These License:
Attribution-Noncommercial-Share Alike (CC findings indicate that school performance is primarily shaped by value-based and BY-NC-SA) transformation contributing independently Received: 14 October 2025 as a supportive capability.
Practically.
Accepted: 16 November 2025 schools should strengthen humanPublished: 20 December 2025 centered values while aligning digital initiatives with institutional practices.
Theoretically, operates as a complementary capability rather than altering the influence of leadership or workplace spirituality.
Keywords:
Digital Transformation.
Education.
Organizational Performance.
Sustainable Leadership.
Workplace Spirituality International Journal of Applied Business & International Management (IJABIM) Vol.
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php/IJABIM INTRODUCTION Educational institutions in emerging economies are experiencing intensified pressure to enhance organizational performance as they confront simultaneous demands for accountability, quality improvement, and technological adaptation.
In Indonesia, government-driven reforms have accelerated the adoption of digital tools and performance measurement systems in schools.
however, the outcomes remain unequal and often constrained by cultural, structural, and leadership challenges that technology alone cannot resolve.
Although digital initiatives continue to expand, organizational performance is still shaped by human-centered factors such as values, leadership behavior, and collective meaning-making, suggesting that performance improvement requires a multidimensional approach rather than isolated technical interventions.
Acknowledge this complexity, yet current knowledge remains fragmented due to the tendency to examine individual predictors in isolation without considering how they interact in educational organizations operating under resource limitations and structural constraints (Amran et al.
, 2.
Workplace spirituality is an emerging concept that emphasizes meaning, purpose, community, and connectedness in the workplace.
In educational organizations, spirituality in work practices helps teachers, administrators, and staff connect their personal values with institutional missions.
It encourages intrinsic motivation, emotional well-being, and collective harmony, factors that are critical for achieving long-term Suggests about organizations that embrace workplace spirituality tend to experience higher employee engagement, reduced turnover, and improved service However, limited empirical studies have explored how spirituality affects organizational performance specifically within schools in Indonesia, where cultural and spiritual dimensions strongly influence institutional behavior (Pawar, 2.
Sustainable leadership, on the other hand, reflects leadership behavior that promotes balance between short-term results and long-term development.
Sustainable leaders focus on developing people, maintaining institutional resilience, and preserving resources for future generations (Gotsis & Grimani, 2.
In educational contexts, sustainable leadership involves visionary direction, ethical guidance, and empowerment of teachers and staff.
It ensures continuity of performance even amid challenges such as digital disruption or shifting educational standards.
However, the direct impact of sustainable leadership on school organizational performance remains mixed.
Suggest that sustainability-driven leadership only produces indirect effects mediated through organizational culture and employee engagement (Pettersson, 2.
Amid the growing influence of digitalization, digital transformation has emerged as a dominant strategic force in shaping institutional performance.
Digital transformation encompasses the adoption of technologies such as data-driven management systems, e-learning platforms, and automation tools to improve organizational efficiency (Hess et , 2.
For schools, digital transformation enables more flexible learning environments, better data management, and improved stakeholder communication.
However, digital transformation also creates tension with traditional human-centric values such as collaboration, compassion, and personal meaning.
While technology accelerates performance metrics, it may also reduce interpersonal connections or erode the shared sense of purpose that defines a spiritually grounded workplace.
Given these dynamics, the intersection of workplace spirituality, sustainable leadership, and digital transformation becomes crucial in understanding modern organizational performance within educational settings.
The roles of spirituality, leadership, and technology, few have analyzed how these three variables interact simultaneously (Hartl International Journal of Applied Business & International Management (IJABIM) Vol.
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Specifically, it remains unclear whether digital transformation strengthens .
or weakens the positive effects of workplace spirituality and sustainable leadership on school organizational performance.
In other words, does digitalization serve as a bridge that enhances human values through efficiency, or does it act as a barrier that dilutes them? Addressing this gap is essential for designing leadership strategies that align technological progress with human development in educational This research aims to analyze .
the influence of workplace spirituality and sustainable leadership on school organizational performance, .
the direct effect of digital transformation on organizational performance, and .
the moderating role of digital transformation on the relationship between workplace spirituality and sustainable leadership on organizational performance.
The study adopts a quantitative approach using Partial Least SquaresAeStructural Equation Modeling (PLS-SEM) to test the hypothesized relationships.
The research was conducted in several Indonesian schools involving principals and unit leaders as respondents.
The contribution of this study is threefold.
First, it extends theoretical understanding by integrating spirituality, sustainability, and digitalization perspectives into one comprehensive framework of school performance.
Second, it offers practical insights for school leaders seeking to manage digital change without compromising human and ethical values.
Third, it provides empirical evidence from Indonesia, contributing to the limited body of literature on leadership and spirituality in developing-country educational Ultimately, this research underscores that the pursuit of digital excellence in education must remain grounded in purpose, empathy, and sustainability to achieve lasting organizational success.
LITERATURE REVIEW
Workplace Spirituality Workplace spirituality refers to the sense of meaning, connectedness, and value alignment that employees experience within their work context, fostering engagement, purpose, and collective well-being.
Workplace spirituality plays a strategic role in enhancing resilience, intrinsic motivation, and organizational citizenship behaviors, particularly in service-oriented and educational settings (Lacy et al.
, 2.
In the educational context, spirituality becomes even more crucial because schools operate as moral and social institutions.
Teachers and administrators are not merely performers of technical duties but are also mentors, role models, and community A spiritually enriched work environment enables educators to cultivate emotional resilience, empathy, and ethical behavior, all of which contribute to sustainable school performance.
Workplace spirituality improves job satisfaction, organizational citizenship behavior, and overall effectiveness (Pettersson, 2.
Sustainable leadership is typically measured through three dimensions: meaningful work, sense of community, and alignment with organizational values.
Meaningful work refers to the perception that oneAos job contributes to a larger purpose.
A sense of community emphasizes interpersonal trust and belonging.
Alignment reflects how individual goals resonate with organizational missions.
These dimensions collectively foster a sense of wholeness, reducing burnout and enhancing performance even under stressful conditions.
International Journal of Applied Business & International Management (IJABIM) Vol.
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php/IJABIM Sustainable Leadership Sustainable leadership emphasizes leadership behaviors that balance short-term performance with long-term organizational sustainability, focusing on ethical conduct, developmental capacity, social responsibility, and stakeholder well-being (Apsari et al.
Sustainable leadership fosters adaptive capability, innovation, and sustainable organizational change, yet the magnitude of its direct effect on performance varies depending on contextual variables such as culture, resource availability, and digital readiness (Saunila et al.
, 2.
Sustainable leadership has emerged as a response to the volatility and uncertainty of modern organizations.
Defined sustainable leadership as leadership that preserves and develops human and material resources, promotes social justice, and ensures institutional continuity.
Sustainable leaders are those who invest in people, build collaborative networks, and maintain long-term perspectives rather than short-term In educational institutions, sustainable leadership translates into creating cultures of learning, innovation, and accountability.
Principals who practice sustainable leadership encourage shared decision-making, empower teachers, and integrate ethical considerations into strategic planning.
As a result, schools become more adaptive and resilient in facing environmental and technological changes.
Empirical evidence suggests that sustainable leadership positively affects organizational commitment, trust, and stakeholder satisfaction (How & Ishak, 2.
However, its direct impact on organizational performance is often moderated by other variables, such as organizational culture or transformational leadership (Eduzor, 2.
This indicates that sustainability-oriented leadership may require supportive contexts, such as spirituality or digital systems, to fully manifest its potential outcomes.
Digital Transformation Digital transformation refers to the integration of digital technologies that fundamentally reshape organizational processes, structures, and stakeholder relationships to create new forms of value (Yiming & Manansala, 2.
In the education sector, digital transformation includes digital platforms for learning, data-driven administrative systems, and communication technologies that facilitate coordination and performance Digital transformation improves efficiency, transparency, and decisionmaking, but its impact on performance depends on infrastructure, digital literacy, and organizational culture.
In developing-country contexts, such as Indonesia, digital implementation has accelerated in response to post-pandemic recovery, yet disparities in readiness, resources, and policy alignment remain prevalent (Hess et al.
, 2.
Digital transformation refers to the strategic adoption of digital technologies to improve organizational processes, business models, and stakeholder experiences (Hess et al.
In education, digital transformation encompasses innovations such as e-learning platforms, digital administration, big data analytics, and cloud-based management These tools enable more efficient resource allocation, real-time decisionmaking, and enhanced communication among stakeholders (Bai et al.
, 2.
However, digital transformation is not merely a technological upgrade.
it also represents a deep cultural shift.
Implementing digital transformation requires new mindsets, leadership competencies, and organizational learning mechanisms (Vial, 2.
Schools often face challenges related to digital literacy gaps, resistance to change, and limited Therefore, the success of digital transformation depends not only on International Journal of Applied Business & International Management (IJABIM) Vol.
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php/IJABIM technological readiness but also on the human and cultural aspects that support digital School Organizational Performance Organizational performance in educational institutions is a multidimensional construct encompassing academic quality, stakeholder satisfaction, operational efficiency, adaptability, and long-term sustainability (Hristov & Chirico, 2.
In school contexts, performance extends beyond financial outcomes to include qualitative dimensions such as learning effectiveness, collaborative practices, ethical conduct, and social impact (Sutanto et al.
, 2.
These elements reflect the broader mission of educational organizations, which prioritizes value creation for students and society alongside operational effectiveness.
Prior studies indicate that organizational performance is shaped by the interaction of leadership, organizational culture, and technological capability (Amran et al.
, 2.
Sustainable leadership provides strategic direction and continuity, while workplace spirituality fosters shared purpose, integrity, and commitment among educators and Digital transformation, in turn, equips schools with the systems and tools needed to support efficient processes, informed decision-making, and innovation.
Accordingly, organizational performance in educational settings emerges from the integration of strategic leadership, human-centered values, and technology-enabled practices, particularly as schools navigate ongoing institutional and technological change.
Theoretical Model and Hypotheses Development Sustainable Leadership and Organizational Performance Sustainable leadership emphasizes long-term organizational sustainability, ethical decision-making, and stakeholder well-being, which align closely with principles of effective leadership.
From a theoretical lens, sustainable leadership enhances organizational performance by building long-term capability, fostering commitment, and encouraging collaborative learning.
Studies show that sustainable leadership supports innovation, organizational resilience, and performance through the development of human capital and empowerment mechanisms (Avery & Bergsteiner, 2011.
Hargreaves & Fink, 2.
Evidence from recent research confirms that sustainable leadership positively influences performance, especially in contexts that demand adaptability, organizational learning, and stakeholder trust (Hughes et al.
, 2018.
Lacy et al.
, 2.
Consequently, sustainable leadership is expected to contribute to organizational performance by strengthening leadership capacity and fostering sustainable organizational practices.
H1: Sustainable leadership positively affects organizational performance.
Workplace Spirituality and Organizational Performance Workplace spirituality emphasizes meaningful work, interconnectedness, and value congruence, which foster positive attitudes and behaviors that contribute to organizational outcomes.
Drawing on the Resource-Based View (RBV), workplace spirituality represents an intangible resource that enhances employeesAo intrinsic motivation and collaborative orientation, which in turn increases performance capacity.
Empirical studies have shown that workplace spirituality positively affects organizational commitment, service quality, and innovation (Milliman et al.
, 2003.
Pawar, 2.
Recent research in education, healthcare, and service industries confirms that workplace spirituality is associated with higher job satisfaction, reduced turnover intention, and improved performance outcomes (Afsar & Umrani, 2022.
Gotsis & Grimani, 2.
These findings imply that workplace spirituality facilitates an adaptive and supportive work International Journal of Applied Business & International Management (IJABIM) Vol.
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Digital Transformation and Organizational Performance Digital transformation involves the adoption of technology to redesign organizational processes, decision-making, and stakeholder interaction.
From a strategic perspective, digital transformation enables operational efficiency, transparency, and data-driven decision-making, which are positively related to organizational performance.
Recent studies demonstrate that digital transformation enhances performance by improving coordination, knowledge sharing, service delivery, and process automation (Pettersson.
Verhoef et al.
, 2.
In the education sector, digital transformation has been shown to increase teaching effectiveness, administrative efficiency, and stakeholder satisfaction, although disparities in infrastructure and digital literacy may weaken performance outcomes (Saunila et al.
, 2019.
Vuori et al.
, 2.
These findings suggest that digital transformation can serve as a strategic driver of performance when organizations have sufficient readiness and supporting capabilities.
H3: Digital transformation positively affects organizational performance.
Digital Transformation as a Moderator The moderating role of digital transformation reflects the view that technology can strengthen or enable the effects of leadership and cultural resources on organizational Studies show that digital technologies enhance leadersAo ability to coordinate, communicate, and innovate, thereby amplifying the impact of leadership behaviors on performance (Banks et al.
, 2022.
Hartl & Hess, 2.
Similarly, digital transformation may enable spiritual values to be translated into organizational processes by facilitating collaboration, feedback, and engagement.
However, recent findings indicate that digital transformation does not always moderate value-based relationships because technology does not necessarily transform underlying behavioral or relational mechanisms (El Sawy et al.
, 2020.
Zhou et al.
, 2.
These mixed results highlight the importance of examining digital transformationAos role within specific organizational contexts, such as education systems in emerging economies.
H4: Digital transformation moderates the relationship between sustainable leadership and organizational performance.
H5: Digital transformation moderates the relationship between workplace spirituality and organizational performance.
This study is grounded in the RBV theory, which posits that organizations achieve competitive advantage through unique internal resources and capabilities.
In this context, workplace spirituality and sustainable leadership represent intangible human resources, while digital transformation serves as a dynamic capability enabling resource This theoretical model integrates leadership, spirituality, and technology under a unified framework, offering a contemporary understanding of performance in education.
assumes that technology and human values are not opposing forces but complementary drivers of sustainable excellence.
Conceptual Framework The study framework model is depicted in Figure 1.
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Research Framework
RESEARCH METHOD
Research Design This study employed a quantitative research approach with a cross-sectional survey design to examine the relationships among workplace spirituality, sustainable leadership, digital transformation, and organizational performance in educational PLS-SEM was selected as the analytical method because the study explored predictive relationships among latent constructs, used reflective measurement indicators, and involved a relatively small and non-normally distributed sample.
PLSSEM is recommended for exploratory models, theory development research, and models involving complex mediation or moderation (Hair et al.
, 2.
Population and Sample The target population consisted of school personnel working in public and private educational institutions in Indonesia who held managerial or administrative A purposive sampling strategy was applied to identify respondents with sufficient knowledge and involvement in leadership processes, organizational operations, and digital system implementation.
Data were collected from 165 respondents representing 52 schools.
Each school contributed one principal, two division or unit leaders, and one administrator or teacher, yielding four respondents per school.
This approach ensured representation from multiple hierarchical levels and organizational functions, reducing individual-level bias and enhancing construct validity.
Respondents were distributed across diverse school types .
ublic, private, and faithbase.
and geographic areas to enhance generalizability.
Demographic and institutional characteristics were documented to contextualize the structural model.
Research Instruments All variables were measured using reflective indicators from validated scales and adapted to the education sector.
Responses were collected using a five-point Likert scale .
= strongly disagree to 5 = strongly agre.
Workplace Spirituality The workplace spirituality items were adapted from Milliman et al.
and measured three core dimensions: meaningful work, sense of community, and value alignment.
total of twelve statements were included to capture these constructs.
Sample items illustrate the focus of the scale, such as AuMy work contributes to a meaningful purpose,Ay reflecting meaningful work.
AuI feel connected to people at my workplace,Ay representing the sense of community.
and AuMy values fit well with the schoolAos mission,Ay indicating value alignment.
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php/IJABIM Sustainable Leadership Sustainable leadership was measured using nine items adapted from Avery and Bergsteiner .
, capturing dimensions such as long-term vision, ethical behavior, stakeholder orientation, and a learning-oriented culture.
Example statements include AuLeaders promote ethical decision-making,Ay which reflects the ethical dimension, and AuLeaders prioritize long-term organizational sustainability,Ay which represents the longterm vision embedded in the construct.
Digital Transformation Digital transformation was measured using eight items adapted from Pettersson .
and Verhoef et al.
, capturing key aspects of digital adoption, process redesign, and capability development.
Example statements include AuOur school uses digital platforms to improve decision-making,Ay which reflects the strategic use of digital tools, and AuDigital technologies support administrative processes,Ay which highlights the role of digital systems in enhancing operational efficiency.
Organizational Performance Organizational performance was measured using ten items adapted from Chenhall and Langfield-Smith .
The scale captures stakeholder satisfaction, teaching quality, operational efficiency, and institutional sustainability.
Illustrative statements include AuOur school provides high-quality educational services,Ay which reflects the institutionAos commitment to academic excellence, and AuAdministrative processes operate efficiently,Ay which represents the effectiveness of internal management systems.
Pilot Testing and Content Validation A pilot study was conducted with 30 respondents from 6 schools to evaluate clarity, reliability, and item performance.
Items with low factor loadings (< 0.
, redundancy, or ambiguous wording were revised or eliminated.
Content validity was further assessed by three subject matter experts in educational management and research methodology.
Feedback focused on item clarity, contextual appropriateness, and scale reliability.
Pilot testing results demonstrated acceptable reliability for all constructs (CronbachAos > 0.
Data Collection Procedures The questionnaire was administered online using institutional distribution channels.
Respondents were required to confirm their leadership or administrative role before Incomplete or duplicate responses were excluded.
Data collection procedures emphasized voluntary participation, anonymity, and confidentiality.
Schools did not receive incentives for participation.
Data Analysis Technique Data analysis was conducted using PLS-SEM with SmartPLS 4.
The analytical procedure was carried out in two sequential stages, beginning with the evaluation of the measurement .
model to assess indicator reliability and construct validity, followed by the assessment of the structural .
model to examine the hypothesized relationships among variables.
RESULTS
Table 1.
Validity Test DT x SL DT x WS International Journal of Applied Business & International Management (IJABIM) Vol.
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SL.
SL.
SL.
SL.
SL.
SL.
SL.
SL.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
DT.
DT.
DT.
DT.
DT x WS DT x SL Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
The results in Table 1 indicate that items with outer loadings below 0.
70, namely SL5.
SL6.
SL7.
SL8.
OP1.
OP2.
OP3.
OP4.
WS7, and WS8, were deemed invalid.
Consequently, these indicators were excluded from the model to enhance construct validity and strengthen the overall reliability of the measurement.
Table 2.
Fornell Discriminant Validity Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
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Organizational Performance, and Workplace Spirituality variables fail to meet FornellAos criterion because each constructAos value is lower than its correlations with other constructs.
Table 3.
HTMT Discriminant Validity DT x SL DT x WS DT x SL DT x WS Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
According to Table 3, all variables are declared to pass discriminant validity with HTMT < 1.
Despite the FornellAeLarcker criterion indicating overlap, the HeterotraitAeMonotrait ratio (HTMT) values were all below the conservative threshold of 0.
90, suggesting adequate discriminant validity (Henseler et al.
, 2.
Recent SEM literature argues that HTMT is more sensitive and reliable than FornellAeLarcker in detecting discriminant validity issues, particularly in models with conceptually related constructs (Hair et al.
Therefore, discriminant validity was primarily assessed using HTMT, while FornellAeLarcker results were interpreted cautiously.
Table 4.
Cross-Loading Discriminant Validity SL.
SL.
SL.
SL.
SL.
SL.
SL.
SL.
SL.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
OP.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
WS.
DT x SL DT x WS International Journal of Applied Business & International Management (IJABIM) Vol.
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WS.
DT.
DT.
DT.
DT.
DT x WS DT x SL Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
Table 4 shows that all items meet the cross-loading validity criteria except for item WS7, which does not exhibit the highest loading on its intended construct and instead loads more strongly on another variable.
Although indicator purification was conducted by removing items with outer loadings below 0.
70, several measurement issues remained, particularly for the organizational performance construct.
Specifically, the Average Variance Extracted (AVE) for organizational performance was 0.
476, which falls slightly below the recommended threshold of 0.
50, indicating marginal convergent validity (Hair et al.
, 2.
In addition, the FornellAeLarcker criterion was not fully satisfied, as the square root of AVE for organizational performance was lower than its correlations with workplace spirituality and sustainable leadership, suggesting potential overlap among To address these concerns, further diagnostic analyses were conducted.
First, item-level examination revealed that several organizational performance indicators exhibited low communalities and outer loadings, particularly OP1 .
and OP2AeOP4, indicating limited contribution to construct variance.
These items primarily captured operational aspects that overlapped conceptually with digital process efficiency, which may explain their high correlations with digital transformation.
Table 5.
Reliability Test Cronbach's Composite Alpha Reliability .
Composite Reliability .
Average Variance Extracted (AVE) Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
Table 5 shows that the AVE value for organizational performance is below 0.
indicating that organizational performance does not meet the assumption of convergent In contrast, the other variables have AVE values above 0.
50, meaning they satisfy this requirement.
In addition, both CronbachAos alpha and composite reliability values exceed 0.
60, indicating that all variables demonstrate acceptable reliability.
Table 6.
R square R-square R-square adjusted Notes: OP (Organizational Performanc.
Table 6 indicates that sustainable leadership, workplace spirituality, and digital transformation collectively explain 70.
5% of the variance in organizational performance.
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F Square DT x SL DT x WS DT x SL DT x WS Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
Based on Table 7, sustainable leadership and the interaction term DT y SL have Fsquared values ranging from 0.
02 to 0.
15, indicating that both sustainable leadership and its interaction with digital transformation exert a weak influence on organizational The interaction between sustainable leadership and workplace spirituality shows an F-squared value of 0.
000, which signifies a negligible effect on organizational Workplace spirituality has an f-square value within the range of 0.
15 to 35, suggesting a moderate influence on organizational performance.
Meanwhile, digital transformation has an f-square value greater than 0.
35, indicating a strong influence on organizational performance.
Table 8.
Q Square QA Predict
RMSE
MAE
Notes: OP (Organizational Performanc.
RMSE (Root Mean Square Erro.
MAE (Mean Absolute Erro.
The value of q-square in Table 8 is 0.
59 > 0.
35, which means that the model has a very good predictive model.
Table 9.
Hypothesis Test
Original Sample Sample (O) Mean (M) SL-> WS -> DT -> DT x SL
-> OP
DTx
WS ->
Standard Deviation (STDEV) T Statistics (|O/STDEV|) Values Notes: DT (Digital Transformatio.
WS (Workplace Spiritualit.
SL (Sustainable Leadershi.
OP (Organizational Performanc.
Table 9 indicates that sustainable leadership does not have a statistically significant effect on organizational performance, as reflected by a p-value of 0.
273 (> 0.
and a coefficient of Ae0.
Accordingly.
H1 is rejected.
In contrast, workplace spirituality shows a strong and significant positive effect on organizational performance ( = 0.
p < 0.
, supporting H2.
Digital transformation also demonstrates a significant positive influence on organizational performance, with a p-value of 0.
012 (< 0.
and a coefficient of 0.
288, leading to the acceptance of H3.
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php/IJABIM Regarding the moderating effects, the interaction between digital transformation and sustainable leadership is not statistically significant ( = Ae0.
266, p = 0.
, resulting in the rejection of H4.
Similarly, the interaction between digital transformation and workplace spirituality shows no significant effect on organizational performance ( = 002, p = 0.
, indicating that H5 is also rejected.
These findings confirm that digital transformation contributes directly to organizational performance but does not function as a moderating variable in the relationships between human-centered factors and performance outcomes.
Figure 2.
PLS Model Figure 2 presents the results of the PLS-SEM analysis, illustrating the structural relationships among workplace spirituality, sustainable leadership, digital transformation, and organizational performance, as well as the moderating effects of digital The model shows that workplace spirituality has the strongest positive path coefficient toward organizational performance ( = 0.
, indicating a substantial and dominant influence on school organizational performance.
Digital transformation also demonstrates a positive direct effect on organizational performance ( = 0.
suggesting that the adoption and utilization of digital technologies contribute meaningfully to improving school effectiveness and efficiency.
In contrast, sustainable leadership exhibits a negative and non-significant direct relationship with organizational performance ( = Ae0.
, implying that sustainability-oriented leadership practices do not directly translate into observable performance outcomes in the sampled educational Furthermore, the interaction paths between digital transformation and sustainable leadership, as well as between digital transformation and workplace spirituality, show very small and non-significant coefficients, indicating that digital transformation does not function as a moderating variable in strengthening or weakening the effects of human-centered factors on organizational performance.
The model also reports a high coefficient of determination (RA = 0.
for organizational performance, demonstrating that workplace spirituality, sustainable leadership, and digital transformation collectively explain a substantial proportion of variance in school organizational performance.
Overall, the findings confirm that workplace spirituality International Journal of Applied Business & International Management (IJABIM) Vol.
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DISCUSSION
The Reasons Why Sustainable Leadership Becomes Non-Significant The findings indicate that sustainable leadership does not have a statistically significant direct effect on organizational performance, leading to the rejection of H1.
This result does not suggest that leadership is unimportant.
rather, it implies that the influence of sustainable leadership may be indirect and contingent on intermediate mechanisms such as organizational culture, innovation capability, or teacher professional development.
Previous studies similarly report that sustainable leadership primarily shapes long-term capacity building and adaptive potential rather than producing immediate performance outcomes (Hargreaves & Fink, 2004.
Lacy et al.
, 2.
In the context of developing-country education systems, structural constraints, such as bureaucratic governance, limited managerial autonomy, and slow institutional decisionmaking, may further delay the translation of sustainable leadership principles into observable performance gains.
As a result, leadership practices oriented toward longterm sustainability may require extended time horizons before their impact becomes Moreover, the non-significant effect of sustainable leadership may reflect its overlap with stronger value-based mechanisms, particularly workplace spirituality.
In environments where shared meaning, moral purpose, and relational trust are highly salient, leadership effects may be absorbed into broader cultural and spiritual dynamics rather than operating as an independent driver.
This finding contributes theoretically by identifying boundary conditions for sustainable leadership effectiveness and highlights the need for future research to test mediation pathways rather than assuming direct performance The Role of Workplace Spirituality on Organizational Performance In contrast, the results strongly support H2, demonstrating that workplace spirituality has the largest and most robust positive effect on organizational performance.
This finding aligns with the Resource-Based View, which emphasizes the strategic value of intangible resources such as shared values, purpose, and collective identity.
These resources are difficult to imitate and therefore constitute a sustainable source of competitive advantage.
Consistent with prior research (Afsar & Umrani, 2022.
Gotsis & Grimani, 2.
, workplace spirituality enhances trust, emotional attachment, and intrinsic motivation, which in turn foster cooperation, resilience, and discretionary effort.
In school settings, where performance is closely tied to relational quality, ethical commitment, and emotional engagement, spirituality functions as a binding mechanism that aligns individual behavior with institutional goals.
This explains its strong predictive role in shaping organizational performance.
From a theoretical perspective, workplace spirituality can be understood both as a strategic capability under RBV and as a legitimacy-enhancing mechanism under Stakeholder Theory.
By promoting ethical conduct, shared meaning, and social responsibility, spirituality helps educational institutions meet the expectations of teachers, students, parents, and communities.
Supporting this interpretation, bootstrapping analysis using bias-corrected confidence intervals confirms that the effect of workplace spirituality on organizational performance International Journal of Applied Business & International Management (IJABIM) Vol.
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While digital transformation also shows a positive effect with a moderate effect size .
A = 0.
sustainable leadership and interaction terms exhibit small effect sizes .
A < 0.
reinforcing their limited explanatory power within the structural model.
Digital Transformation as a Direct Driver but Not a Moderator The findings of this study demonstrate that digital transformation plays a significant and positive role in enhancing organizational performance, thereby supporting H3.
This result is consistent with prior research emphasizing that digitalization improves administrative efficiency, information transparency, and service delivery within educational institutions (Saunila et al.
, 2019.
Verhoef et al.
, 2.
From a resource-based view (RBV) perspective, digital transformation functions as a valuable organizational capability that enables schools to optimize operational processes, automate routine tasks, and improve data-driven decision-making.
These technological improvements contribute directly to performance outcomes, particularly in terms of efficiency, responsiveness, and Despite its direct contribution, digital transformation did not moderate the relationships between workplace spirituality or sustainable leadership and organizational performance, leading to the rejection of H4 and H5.
This finding suggests that digital technologies enhance performance independently but do not fundamentally alter how human-centered variables exert their influence.
One plausible explanation is that digital adoption in educational institutions often emphasizes technical implementation rather than behavioral or cultural transformation.
Schools may introduce digital systems without fully integrating them into leadership practices, organizational values, or daily work As a result, digital transformation functions primarily as an operational enabler rather than a contextual amplifier that strengthens or reshapes the effects of workplace spirituality and sustainable leadership.
This interpretation aligns with recent studies indicating that digitalization frequently improves process efficiency while leaving relational, ethical, and leadership mechanisms largely unchanged unless accompanied by deeper organizational change (El Sawy et al.
, 2.
Theoretically, these findings refine the role of digital transformation within the RBV framework by clarifying that it operates as a substantive capability rather than a contingency resource.
While digital technologies contribute meaningfully to organizational outcomes, they do not substitute for or intensify value-based and leadership-driven mechanisms.
This distinction is particularly relevant in educational settings, where performance is strongly influenced by ethical orientation, shared purpose, and relational dynamics that extend beyond technological efficiency.
In addition, the results indicate that sustainable leadership may influence organizational performance indirectly rather than through a direct effect.
The strong impact of workplace spirituality, coupled with the non-significant direct relationship between sustainable leadership and performance, suggests a potential mediation pathway in which leadership shapes organizational outcomes by fostering shared values, meaning, and ethical Although mediation was not explicitly tested in this study, this pattern is consistent with the long-term and value-driven nature of sustainable leadership, which emphasizes cultural development and moral responsibility over immediate performance Future research should therefore explore indirect and longitudinal pathways to better capture how leadership influences performance through value-based From a practical standpoint, these findings imply that investments in digital transformation alone are insufficient to generate sustainable performance International Journal of Applied Business & International Management (IJABIM) Vol.
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Strengthening workplace spirituality and ethical leadership alongside digital capabilities may enable schools to achieve more balanced and enduring performance outcomes, particularly in environments characterized by rapid institutional and technological change.
Integrative Implications for Theory and Practice Taken together, the findings highlight the primacy of human-centered values in shaping organizational performance in educational institutions.
Workplace spirituality emerges as the most influential driver, reinforcing the strategic importance of shared meaning, ethical commitment, and relational cohesion.
While digital transformation contributes positively to performance as an operational capability, it does not alter the mechanisms through which human and value-based factors exert their influence.
The absence of moderation effects clarifies that technology functions as a complementary enabler rather than a transformational amplifier.
From a theoretical perspective, this study extends the Resource-Based View and Stakeholder Theory by distinguishing deeply embedded intangible resources from technical capabilities.
Practically, school leaders and policymakers should prioritize initiatives that cultivate workplace spirituality and embed digital tools within existing cultural and ethical frameworks.
Digital investments will yield sustainable value only when aligned with institutional purpose, leadership values, and human engagement.
CONCLUSION
This study examined the effects of workplace spirituality, sustainable leadership, and digital transformation on organizational performance in schools, as well as the moderating role of digital transformation in these relationships.
Using PLS-SEM analysis on data collected from respondents across educational institutions in Indonesia, the study integrates human-centered and technology-oriented perspectives to explain performance outcomes in the education sector.
The findings indicate that workplace spirituality has the strongest positive effect on organizational performance, demonstrating that shared meaning, ethical alignment, and collegial relationships play a central role in shaping school effectiveness.
Digital transformation also shows a significant positive effect, indicating that the use of digital systems and tools contributes to improved coordination, efficiency, and information In contrast, sustainable leadership does not show a significant direct effect on organizational performance.
In addition, digital transformation does not moderate the effects of workplace spirituality or sustainable leadership, suggesting that technology supports performance independently rather than altering the influence of humancentered factors.
These results imply that performance improvement in schools depends primarily on value-based and relational factors, supported by appropriate technological Digital initiatives are most effective when aligned with existing work practices and accompanied by adequate user capability development.
From a theoretical perspective, the study extends the application of the Resource-Based View and Stakeholder Theory by distinguishing between intangible value-driven resources that directly shape performance and operational capabilities that support organizational For practitioners, the findings highlight the importance of cultivating shared purpose and ethical commitment while ensuring that digital tools are meaningfully integrated into daily school operations.
International Journal of Applied Business & International Management (IJABIM) Vol.
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php/IJABIM LIMITATION Several limitations should be acknowledged.
First, the study employed a cross-sectional design, which restricts the ability to capture changes in leadership practices, spirituality, and digital use over time.
Future research may adopt longitudinal approaches to examine how these factors influence performance across different stages of organizational Second, the sample was limited to a specific group of educational institutions, which may limit the generalizability of the findings to other regions or education systems.
Expanding the sample to include schools with different governance structures and cultural contexts would enhance the applicability of future results.
Third, the study relied on self-reported questionnaire data, which may be subject to respondent bias.
Although this approach provides insight into perceived organizational conditions, future studies could incorporate objective performance indicators or qualitative methods to obtain a more comprehensive perspective.
Finally, the present study did not test indirect relationships among the variables.
Future research may examine mediating factors such as organizational culture, teacher engagement, or innovation practices to better explain how leadership and workplace values influence organizational performance in educational settings.
ACKNOWLEDGMENT
The authors express gratitude to those who have had the pleasure of co-coordinating during this study or research.
DECLARATION OF CONFLICTING INTERESTS
The authors have declared no potential conflicts of interest concerning the study, authorship, and/or publication of this article.
REFERENCES