Facilitating the Malaysian Manufacturing Sector in Readiness for Industry 4.0: A Mediating Role of Organization Innovation

Abstract

The manufacturing sector of Malaysia is an essential part of its economic system. Malaysia holds a remarkable position in the global market through the exports of manufacturing products. However, this sector faces challenges such as organizations’ capability to innovate due to rapid technological and business environment changes in line with Industry 4.0. These challenges may prevent manufacturing firms from embracing Industry 4.0 and thrive in their businesses. Therefore, this research aims to identify the role of organizational practices such as Knowledge Oriented Leadership, Electronic Human Resource Management, and Decentralized Organization Structure in support of Organization Innovation to prepare manufacturing firms for Industry 4.0. A quantitative method was applied to 218 samples collected from Malaysian manufacturing firms. The results of this research are interesting for keen researchers and helpful for decision-makers and practitioners to successfully pave the way for Industry 4.0 implementation in manufacturing firms by developing innovation capabilities.