Social Exchange Theory: Supporting Frameworks for Innovation

Abstract

In their efforts to remain competitive, organizations are routinely faced with the challenge of adapting to changeable environments and ensuring employees possess the necessary skills to compete. However, businesses often must contend with forces, whether internally or externally generated, that tend to discourage or undermine innovation, leaving practitioners to question how their organizations may effectively and practically promote employee innovation in the face of countervailing forces. This article is intended to present social exchange theory as a ready tool for practitioners to assess the effectiveness of potential answers to that question. The question posed in this paper is how can social exchange theory be used to encourage employee innovation? By contrasting social exchange theory with principles of economics, this article aims to answer this question, providing practitioners not only a deeper understanding of theory but a means of evaluating the applicability of social exchange theory to proposed pro-innovation frameworks. In addition, by considering particular resources employers might offer their employees in exchange for innovative work behavior, this article also offers examples of how social exchange theory may be applied in practice to explain workplace behavior and, thereby, test proposed pro-innovation frameworks.