A Conceptual Framework on the Role of Leadership Empowerment in Creating Employees’ Creativity in
Entrepreneurial Firms
Hu Youxuan1,2*, Salmah Topimin3
1 PhD Candidate, Faculty of Business, Economics and Accountancy, Universiti Malaysia Sabah, Kota Kinabalu, Malaysia
2 Baise University, Baise, Guangxi, China
3 Entrepreneurship Research and Development Centre (ERDEC), Universiti Malaysia Sabah, Kota Kinabalu, Malaysia
*Corresponding Author: [email protected]
Accepted: 15 December 2020 | Published: 28 December 2020
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Abstract: Creativity has always being acknowledged in the entrepreneurship literature as a crucial element that differentiates entrepreneurs from non-entrepreneurs. By being creative, it means that entrepreneurs will have the ability to create something new and innovative which can give a good financial return to their business and gain competitive advantage over their competitors. As such, it becomes the main concern of entrepreneurs to inculcate creativity within their entrepreneurial firms. Although creativity is too elusive and could be difficult to be managed, entrepreneurs as leaders of their firms can influence the creation of creativity among their employees. It is believed that a leader of an organization acts as a catalyst who creates and manages an environment that can encourage and stimulate creativity of employees.
Within the theory of leadership, it is acknowledged that empowering leadership is relevant in influencing employees’ creativity. Thus, this paper intends to critically analyze relevant literature and proposes a conceptual framework on leadership empowerment and its influence on employees’ creativity.
Keywords: Leadership empowerment, Employees’ creativity, Entrepreneurial firms ___________________________________________________________________________
1. Introduction
Creativity has always being acknowledged in entrepreneurship as a crucial driven force. It refers to the novel and practical thoughts, ideas or concepts that are significant for people in achieving goals of a particular task (Amabile, 2005; Anderson et al., 2014). Creativity as a research subject can be investigated either from an individual, group or organizational perspective. In general, a creative employee has the ability to create novel and valuable things or ideas such as new products, services, manufacturing and working methods, management processes and management models (Amabile, 1988; George & Zhou, 2001). It is argued that the survival of organizations and the ability to innovate and to increase efficiency in the competitive business environment are much being influenced by the creativity of their employees (Shalley & Zhou, 2004; Wang et al., 2010). The influence of creativity becomes crucial for entrepreneurial firms. With the development of the knowledge economy and the increase uncertainty of the external environment, a self-management team and platform- oriented organization structure can be seen as realistic needs for entrepreneurial firms which are commonly known for their innovative products or services. Within this context, the leaders
of entrepreneurial firms are expected to enhance employees’ self-management and self- leadership abilities by empowering them. The concept of empowering leadership is characterized by the idea of power sharing between leaders and their subordinates and the concept has attracted widespread attention in theory and practice (Dong, Liao, Chuang & Zhou, 2015; Hao & Long, 2018; Hill & Bartol, 2016).
The early research on creativity is mainly focused on the characteristics of an individual (e.g.
Amabile, 1983; 1988) particularly which relates to the cognitive abilities such as intelligence (Sternberg, 1988). The cognitive approach in understanding the creative ability of individuals focuses on the processing mechanism of creative thinking, hoping to find some cognitive processing and methods that can lead to problems solving effectively and efficiently (Liu &
Shi, 2009). The cognitive approach has led to an argument that only a few people might have the creative ability. As such, it is suggested that personal characteristics is not sufficient to explain the creative ability of individuals and the environment in which the individuals is belong to, is significant in explaining their creative behavior (Liu & Shi, 2009). Among the environmental aspects that have been discussed in the early research as influencing the creative ability of employees in organizations are the level of complexity and challenge of work (Oldham & Cummings,1996), the organizational climate (Scott & Bruce,1994), the organization’s evaluation system (Shalley & Perry-Smith, 2001) and the types of direct leadership practiced (Tierney et al. 1999). In later years, research on creativity of employees has found that employees’ creativity will be influenced by a specific organizational setting. For example, it is argued that a high-tech environment and the climate dimension of an organization have a significant influence in determining the support and autonomy for creative performance among its employees (Huntera, Bedella & Mumforda, 2007; Lapierre & Giroux, 2003). Within this context, it is highlighted that leadership support is significant in influencing employees’
creativity (Amabile et al., 2004; Rice, 2006) particularly in relation to the practice of empowering leadership (Harris et al. 2014). In this respect, it is believed that the leadership style practiced by the leaders of entrepreneurial firms will influence the organizational environment that encourage the creativity of employees.
Therefore, this paper proposes a conceptual framework that highlights the roles of leadership empowerment in creating employees’ creativity in entrepreneurial firms. The subsequent section discusses the literature review on employees’ creativity, empowering leadership as well as structural and psychological empowerment. This is followed by a discussion on the research methodology that will be adopted and ends with a proposed conceptual framework on the role of leadership empowerment in creating employees’ creativity in entrepreneurial firms.
2. Literature review
2.1 Employees’ creativity
Amabile (1988) defined creativity as the production of novel and useful ideas. In fact, the term production can be used to describe both a process and an outcome (Shalley & Zhou, 2008).
Based on an English dictionary, production refers to the process of producing. Accordingly, creativity should be described separately in the process- and outcome-based approach. Based on the process-based approach, the generation of a creative idea involves (1) problem identification, (2) information searching and encoding, and (3) idea and alternative generation (Amabile, 1983; Zhang & Bartol, 2010) as well as evaluation of ideas or alternatives (e.g.
Montag et al., 2012). Drawing on Amabile’s (1988) conceptualization of creativity, a number of scholars define creativity from the outcome perspective (e.g. Oldham & Cummings, 1996;
Shalley & Gilson, 2004; Zhou & George, 2001). For example, Wang Lei (2015: 1690) argue
that “if creativity is regarded as a result, creativity can refer to novel and practical products, or services produced by an individual or by a group of individuals working together”. Therefore, there is a significantly different focal concern between the process-and the outcome-based approach in understanding about employees’ creativity. More specifically, employees’
creativity that is discussed from the process-based perspective focuses on the behaviors of employees at different phases of creative idea generation, whereas the outcome-based perspective gives more concentration on the importance of the novelty and usefulness of the final outcome (such as ideas, practices, and products). Along these lines, Montag et al. (2012) named the two approaches as a creative performance behaviors and creative outcome effectiveness.
By debating the concept of employees’ creativity from two approaches, it is believed that more appropriate tools can be chosen to measure or evaluate employees’ creativity for different job types. However, in existing research, researchers tend to use measurement tools that do not match the perspective of the study (Zhang Gang and Li Huihui, 2020). For instance, Deng Mulan (2018) views employee creativity based on the outcomes such as a new idea concerning products, services, work methods, and organization structure, but used Zhou & George’s process-based approach, thus causing the lack of reliability issue (Scales, 2001). Furthermore, it is argued that employee’s creativity is influenced by various factors (Montag et al., 2012).
Therefore, future research on employees’ creativity should establish a clear distinction between the process- and the outcome-based approach in order to obtain fruitful findings in relation to the factors that influence employees’ creativity.
2.2 Empowering leadership
Researchers on the area of a creative aspect have been calling for more understanding of leadership approach in addressing the fundamental issue of creativity (Zhang & Bartol, 2010).
Within the theory of leadership, it is acknowledged that empowering leadership is relevant in influencing employees’ creativity as it focuses on sharing power with subordinates, thereby enhancing employees’ work motivation and exerting more efforts in the workplace. In fact, empowering leadership have been empirically supported as highly associated with creativity (e.g. Harris et al. 2014; Zhang & Bartol, 2010)
It is believed that empowering leadership helps in obtaining high participation in decision making, conveying confidence to achieve high performance, and removing bureaucratic constraints (Ahearne, et al., 2005; Zhang & Bartol, 2010). The core element of empowering leadership is the delegation of authority to employees so that they can make work-related decisions more independently and efficiently (Jung et al., 2003, Zhang & Bartol, 2010). Such empowerment implies that the empowering leaders have confidence on the competency of their employee, which is more likely to boost employees’ belief in their own ability to make positive and creative contributions to the organization (Conger & Kanungo, 1988). Despite many studies agree on the significant influence of empowering leadership on employees’ creativity, yet, recent research has found that the effectiveness of empowering leadership has not been fully supported and could bring negative impact to an organisation (Ahearne et al., 2005; Wang
& Sun, 2019), for instance, Lee et al.(2017) assert that when the leader’s empowerment behavior was interpreted by employees as an excessive delegation, employees believe that they were empowered by too much work which was not of interest or value to the leader. In this respect, efforts to empower employees also can be viewed as laissez faire leadership (Wong &
Giessner, 2018) which can cause the possibility of employees to reduce their commitment in performing tasks and undermining the potential of creativity. In addition, previous research on the effectiveness of empowering leadership shows some mixed results. For example, it is
argued that empowering leadership is more beneficial for employees with low level of knowledge and experience (Ahearne et al., 2005) whereas other research shows otherwise (Hersey & Blanchard, 1982). Therefore, we are curious about the answers of why the efforts to empower employees do not always achieve its intended effect and even can be harmful to an organisation. As such, in order to foster employees’ creativity, it is noteworthy to think more about the issues of whom, when, how and to what extent to empower. Therefore, empowering leadership should take full consideration to the object, timing, method, and scope of empowerment, rather than a one-size-fits-all empowerment approach (Forrester, 2000).
2.3 Structural empowerment
The existing literature argues that the impact of empowering leadership on the employees’
behavior is mainly implemented in two approaches, namely, structural empowerment and psychological empowerment (Srivastava, 2006). It is believed that structural empowerment emphasizes on sharing or transferring of formal power between leaders and subordinates in an organization (Liu & Shi, 2009). In organization management, structural empowerment involves a series of activities including establishing working team autonomously, encouraging employees to express themselves freely, fostering employees to participate in decision-making, sharing information and resources with employees (Leach et al.,2003; Arnold, Arad, Rhoades
& Drasgow, 2000; Liu & Shi, 2009). Such empowerment is more likely to provide employees with necessary opportunities, information, resources, and support in the implementation of their works (Kanter, 1993). According to Kanter (1993), when employees can get empowerment support, they will be more capable and confident in making decisions. In order to enable making more viable decision, the empowered employees place more efforts in overcoming ambiguities that are associated with creative idea generation. In contrast, if there is lack of the empowerment support, employees will feel powerless.
In addition, it is believed that a sound institutional system in organization is a crucial precondition for smoothly implementing structural empowerment. Prasad & Eylon (2001) highlight that the success of empowerment is dependent on the institutional system, involving all or most employees at all levels of an organisation. In addition, the extent to which employees are empowered will also be influenced by factors such as the availability of information, support and resources needed to implement works, opportunities for sustainable development and organic organization structure (Kanter, 1993). Therefore, structural empowerment relates to the availability of a sound and well-functioning institutional system that helps to encourage employees to explore diverse creative alternatives before choosing the best creative solution for a particular situation (Amabile et al., 1996; Zhang & Bartol, 2010). However, since structural empowerment emphasizes on the delegation of authority to subordinates, it is always being viewed as a top-down arrangement and being discussed from leaders’ standpoint.
However, empowering leadership also can be viewed as a dyadic relationship between a leader and an individual employee (Zhang & Bartol, 2010). In addition, it is argued that the individual’s psychological experience is more significant than his behavior in determining the anticipated impact of empowerment (Spreitzer, 1992). Meaning that empowerment leadership should also capture the view of employees.
2.4 Psychological empowerment
Conger & Kanungo (1988) regard empowerment as a motivation construct and define empowerment as an enabling process that enhanced employees’ feeling of self-efficacy.
Accordingly, self-efficacy is seen as the psychological result of empowered employees, and leaders’ empowerment behaviors are expected to heighten feeling of employees’ self-efficacy through the identification of conditions that foster powerlessness and the change from formal
to informal organisational practices in providing efficacy information (Conger & Kanungo, 1988; Zhang & Bartol, 2010). In addition, early research has shown empowerment as a mental state or experienced cognitive synthesis of individuals, which was embodied in four cognitive dimensions, namely meaning, competence, choice and impact (Conger & Kanungo, 1988;
Thomas & Velthouse, 1990). Accordingly, Thomas and Velthouse (1990) argue that whether employees feel empowered or not, it will be depending on their cognitive evaluation of the work task in those four cognitive dimensions. Drawing upon Conger & Kanungo’s (1988) and Thomas & Velthouse’s (1990) conception of empowerment, Spreitzer (1995) defines empowerment as a psychological state perceived by employees which engaged in four cognitive dimensions, including meaning, competence, self-determination and impact.
A number of studies have investigated that empowering leadership has an impact on employees’ creativity through psychological empowerment as a mediating mechanism (e.g.
Feng & Guo, 2011; Sun & Lv, 2016; Zhang & Bartol, 2010; Zhang & Sims, 2005). Within this context, intrinsic motivation has always being mentioned and it is regarded as the most powerful influencing factor on employees’ creativity (Amabile, 1988; 1996). However, it is argued that an intrinsic motivation is necessary but it is not a sufficient condition for creative outcome (Zhang & Bartol, 2010). In addition, it should also be highlighted that psychological empowerment is not a static cross-context construct, it changes according to the employees’
cognition in a specific work situation. In this sense, the experience of an individual’s psychological empowerment varies according to the change of work situation (Gong Zhenxing, Zhang Jian, 2015; Liu & Shi, 2009).
2.5 Proposed conceptual framework on the role of leadership empowerment in creating employees’ creativity in entrepreneurial firms
Existing studies have shown that empowering leadership has a positive impact on employees’
creativity. Leadership empowerment behaviors such as emphasis of the meaning of work, involving employees in decision-making, conveying confidence in performance, and providing job autonomy to weaken the constraints of bureaucracy (Ahearne et al., 2005; Zhang & Bartol, 2010) enable employees to obtain the information and resources needed for work, as well as sufficient opportunity and support from leaders, which is conducive to enhancing employees’
self-efficacy and actively exploring innovative ideas, thereby enhancing employees’ creativity (Sun & Lv, 2016).
The foregoing research on empowering leadership is mainly carried out from the perspectives of structural empowerment and psychological empowerment. Related research has verified the significance of structural empowerment in improving the efficiency of organization and management, and has proposed some measures to improve structural empowerment, such as changing the organizational structure, improving communication channels, and engaging in participative decision-making and work with autonomy (e.g. Zhang & Bartol, 2010). The advocates of structural empowerment assumes that the institutional empowerment and the leadership empowerment will have a direct impact on the behavior and attitude of employees and can promote employees to achieve the goals expected by the organization. However, Argiris (1998) argues that empowerment is sometimes like “the emperor’s new outfit”. On one hand, people publicly admire it, but on the other hand they wonder why it is difficult to have an anticipated effect in practice. Surprisingly, the same is true for structural empowerment. For example, some scholars believe that there is no significant relationship or the negligible impact between participation in decision-making and performance. In this respect, a widely-accepted explanation is that structural empowerment only considers the impact of the environment on individual behavior, while ignores the impact of individual cognition on his or her own
behavior (Liu & Shi, 2009). Therefore, some scholars (e.g. Conger & Kanungo, 1988) have proposed to pay more attention to employees’ psychological experience of empowerment, which opens up a research perspective on psychological empowerment. In relation to psychological empowerment, Spreitzer’s (1995) concept of four dimensions greatly enriches the theory of leadership empowerment and provides people with the evaluation criteria of psychological empowerment. Furthermore, it is worth noting that the integrated perspective of combining the structural and psychological empowerment has been considered in researching empowering leadership (Tang Guiyao et al., 2012).
This paper highlights the influence of empowering leadership on employees’ creativity from the perspectives of structural empowerment and psychological empowerment. However, previous research about structural empowerment focuses more on the empowerment behavior of leaders and less concentration is given on the institutional environment of empowerment. In addition, with regards to psychological empowerment, existing studies have more concentrated on understanding the importance, influential factors and outcome variables of psychological empowerment, but little has been studied about how to improve employees’ psychological empowerment. In this respect, based on the reviewed literature, this paper acknowledges the need to adopt the integrated perspective in researching empowering leadership. In addition, the theory of empowering leadership is mainly originated from the Western context. Since empowerment can be influenced by specific contextual factors, there is a need to extend the empowerment knowledge into the non-Western context. Using China as a research context, a conceptual framework on the role of leadership empowerment in creating employees’ creativity is developed and illustrated in Figure 1 below.
Figure 1: Proposed conceptual framework on the role of leadership empowerment in creating employees’ creativity in entrepreneurial firms
3. Research methodology
The research methodology of this study is mainly conducted by case study approach. It is believed that case study has become one of the most important research approaches in contemporary social science because it can grasp the richness of phenomena and provide a solid description of the phenomenon (Weick, 2007; Tsui et al., 2007). Since leadership empowerment is affected by a variety of contextual factors, the use of case study to study the impact of leadership empowerment in creating employees’ creativity in entrepreneurial firms in the Chinese context will be conducive to gain a deeper understanding of local unique phenomena and propose a local theory with more internal and external validity. Within this approach, in-depth interviews with different level of employees are adopted, as well as
Empowering Leadership
Structural empowerment
⚫ Opportunity
⚫ Information
⚫ Resource
⚫ support
Psychological empowerment
⚫ Meaning
⚫ Competence
⚫ Self-determination
⚫ impact
Employees’ Creativity
observation of the organisations which have a high level of employee’s creativity.
4. Conclusion
This paper sorts out the relevant literature on empowering leadership and employees’ creativity and clarifies that empowering leadership can directly affect employees’ creativity. At the same time, it is necessary to pay attention to the boundary conditions of their effects, and even consider the negative impact of empowering leadership. Existing research mainly analyzes the mechanisms and driving path of empowering leadership influencing employees’ creativity from the perspectives of structural empowerment and psychological empowerment. From the perspective of psychological empowerment, empowering leadership can stimulate employees’
intrinsic motivation by positively influencing their psychological empowerment. Strong motivation is more likely to motivate employees to work with great concentration and solve problems creatively, thus enhancing their creativity. It is known that the structural empowerment highlights the empowerment practice in the institutional context, which fosters employees’ sense of organizational responsibility and sense of belonging. Relatively, psychological empowerment concerns about employees’ psychological cognition of empowerment, stimulating employees’ intrinsic motivation, thus improving employees’
creativity. Accordingly, the research on employees’ creativity based on integrated perspectives has deepened our understanding of the basic problem of “whether and how empowering leadership affects employees’ creativity”. Acknowledging the importance of contextual influence on the concept of empowering leadership, it is expected that the investigation of employees’ creativity in the context of China through the utilization of the integrated perspective- structural empowerment and psychological empowerment, will not only help to enrich the theoretical framework in this research field, but also help to guide the practice of empowerment leadership in different context.
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