Leading towards creativity and innovation: a study of small and medium enterprises (SMEs) in Australia
Creators: name: Khalili, Ashkan
Publisher: name: RMIT University
Year: 2024

description: To stay competitive, small to medium enterprises (SMEs) need to focus on employees’ creativity and innovative behaviour. Of all the predictors of these behaviours, leadership behaviour seems to be one of the most influential in nurturing and enhancing subordinates’ creative and innovative behaviours in the workplace. Many researchers have found that creativity and innovation are influenced by contextual and personal variables. The purpose of this thesis is to examine the relationship between SME leadership behaviour, employees’ creativity and innovative behaviour, individuals’ perceptions of a supportive climate for innovation, employees’ personal initiative, and individuals’ emotional intelligence in SMEs in Australia. The thesis develops a research model to test the direct influence of SME leadership behaviour on employees’ creativity and innovative behaviour. A set of mediation analyses examines the intervening role of contextual (individuals’ perceptions of a supportive climate for innovation) and personal (employees’ personal initiative) factors in the relationship between SME leadership behaviour and employees’ creativity and innovative behaviour. The moderating role of individuals’ emotional intelligence, a personal factor, on the relationship between leaders’ behaviour and employees’ creativity and innovative behaviour add to the developed research model.<br><br>A new theory-based measure of SME leadership behaviour is developed and validated. The new theory-based measure represents managerial behaviour towards creativity and innovative behaviour, and provides a comprehensive and complex construct that embraces the complexity of the innovation process since it consists of two separate stages: creativity, and then innovative behaviour.<br><br>The newly developed and validated instrument for measuring SME leadership behaviour, together with the existing survey instrument for other variables, were employed in the quantitative approach to collect data from 514 founders, owners, managers and employees from SMEs in Australia. The psychometric properties of the instrument underwent rigorous testing, including exploratory and confirmatory factor analysis. Structural equation modelling (SEM) using path analysis was employed to examine relationships between the variables.<br><br>The results show that leadership behaviour has a positive and significant influence on employees’ creativity and innovative behaviour in SMEs in Australia. The newly developed leadership behaviour construct is found to be an important factor enabling employees’ creativity and innovative behaviour, as perceived by the respondents. Employees’ personal initiative and individuals’ perceptions of a supportive climate for innovation are found to only partially mediate the association between leadership behaviour and both employees’ creativity and followers’ innovative behaviour in SMEs in Australia. Although individuals’ emotional intelligence is discovered to moderate the relationship between leaders’ behaviour and their employees’ creativity, it is not found to have any moderating effect on the association between leadership behaviour and employees’ innovative behaviour in SMEs in Australia. The results suggest that besides practising the components of the leadership behaviour construct developed here (supporting and stimulating creativity and innovation, providing and motivating vision, and providing individual support), people in management positions in SMEs need to focus on developing employees’ personal initiative, enhancing everyone’s perceptions of working in a climate that supports innovation, and promoting individuals’ (leaders’ and non-leaders’) emotional intelligence.