Boosting Creativity with Transformational Leadership in Fuzzy Front-end Innovation Processes

Introduction An organization's success and survival depend on its capability to create new knowledge and innovations. Knowledge is an organization's most valuable resource because it embodies intangible assets, routines, and creative processes that are difficult to imitate. Different types of knowledge require distinct management methods and knowledge integration mechanisms (Birasnav, Rangnekar, & Dalpati, 2011; Miles, Miles, & Snow, 2000; Nonaka & Takeuchi, 1995; Poyhonen, 2006). Many current approaches to innovation hold the assumption that organizations are seldom capable of innovating independently and that an organization's internal capabilities are insufficient to cope with the challenges of the changing environment. The search for new product ideas, new forms of organization, and solutions to existing problems goes beyond the organization's boundaries in exploring available capacities in other organizations. What is common to the models of innovation is that they highlight the interactive character of the innovation process, suggesting that organizations rely heavily on their interaction with users, sup pliers, and a range of other organizations inside the innovation system (Chesbrough, 2003; Lettl, Herstatt, & Gemuenden, 2006; von Hippel, 1988). For example, von Hippel (1988) suggested using lead users and other stakeholders as external sources of innovation. These models further redefine the inbound-innovation-process by extending von Hippel's (1988) sources of innovation to include universities, suppliers and online communities (Christensen, Olesen, & Kjaer, 2005) or basically to any external expert (Bogers & West, 2010). The generation and implementation of significant new ideas, products, and processes may also originate from a single employee or the joint efforts of two or more employees who are not assigned to this task. Thus, these kinds of innovations indicate that innovations can emerge from shop floor workers and professionals or middle managers across the boundaries of existing departments and professions. The basic idea of employee-driven innovation rests on the assumption that employees have hidden abilities for innovation (Forssen, 2001), and that this potential can be made visible, recognizable, and exploitable to the benefit of both the organisation and its employees (Kesting & Ulhoi, 2010). The work environment, atmosphere, and trust are very important in order to get more effort from employees. Intrinsic motivation is arguably the most valuable aspect enhancing employees' creativity. Intrinsically motivated employees do their job well regardless of whether they are supervised or not; they have strong intrinsic motivators and have a passion for doing something for innovating (Felberg & DeMarco, 1992; Knight, 1987; Thomas & Velthouse, 1990). When people feel that the assignment itself is exciting and rewarding, they will share knowledge (Miles, Miles & Snow, 2005). Employees' feelings that the organization values their contribution and is interested in their wellbeing are positively related to their performance and organizational commitment (Joo, Yoon, & Jeung, 2012; McDonald & Makin, 2000; Paalanen & Hyypia, 2008; Tsui & Wu, 2005). Since innovation at the organizational level is a combination of collaboration, creative results, and achievements, investigating the effect of leadership and its influence on employees' contribution and creativity can be significant (Amabile, 1998; Gumusluoglu & Ilsev, 2009). The concept of transformational leadership (TL) has received much attention from researchers, particularly from the perspective of the employees and the organization's performance. Most of these studies are based on quantitative data or literature reviews. However, the effects of TL on employees' creativity and innovation in practice during organization development processes have received little attention (Birasnav et al. …