Leadership styles and organisational innovation in Vietnam: does employee creativity matter?

Nhat Tan Nguyen, Lai Wan Hooi and Mohan V. Avvari

International Journal of Productivity and Performance Management, 2021, vol. 72, issue 2, 331-360

Abstract: Purpose - This paper aims to look into the role of transformational leadership and transactional leadership as predictors of employee creativity and organisational innovation. Employee creativity is examined as a potential mediator in the leadership styles–organisational innovation relationships. Design/methodology/approach - A cross-sectional, quantitative design was adopted and structural equation modelling (SEM) techniques were used to analyse data collected from 369 employees working in 39 public coffee enterprises in Vietnam. Findings - Transformational leadership and transactional leadership were significant predictors of employee creativity and organisational innovation. Specifically, transformational leadership was instrumental to employee creativity and organisational innovation while transactional leadership was detrimental to these two variables. Additionally, employee creativity partially mediated the relationships between the two leadership styles and organisational innovation. Practical implications - Results of this study benefit the management of organisations and policy makers by providing an insight of which leadership style will effectively suit public enterprises to promote employee creativity and foster organisational innovation. Originality/value - While there is a lack of studies investigating organisational innovation in organisational methods and that the interrelationships between leadership styles, employee creativity and organisational innovation are not fully understood, this study pioneers in examining relationships between leadership styles and organisational innovation that is being mediated by employee creativity. Figuring out that organisational innovation is more likely to be fostered by the positive influence of leadership behaviours and the improvement of employee creativity, in particular, the significant role of employee creativity represents important contributions of the current study.

Keywords: Leadership; Transformational leadership; Transactional leadership; Employee creativity; Organisational innovation (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:ijppmp:ijppm-10-2020-0563

DOI: 10.1108/IJPPM-10-2020-0563

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