Transformational and transactional leaderships, empowerment climate, and innovation performance: A multilevel analysis in the Chinese context

Abstract

Innovation through creativity is an important factor in the success and competitive advantage of organizations. Theory and research suggest that both leadership and organizational climate have important consequences for individual creativity. However, researchers have rarely considered the interactive effects of leadership and organizational climate. This study taking a “Substitute for Leadership” perspective, develops and tests the idea that empowerment climate affect the relationship between leadership and followers' creative performance. Data were collected from 93 teams, including 465 team members and 93 team supervisors, in a large multinational company based in China. Hierarchical linear modelling was used to examine the hypothesized cross-level model. As expected, transformational leadership and team empowerment climate were positively related to subordinates' creative performance and transactional leadership was negatively related to subordinates' creative performance. In addition, the relationship between leadership and subordinates' creative performance was moderated by team empowerment climate. The study resulted in the implication of several major variables for explaining individual creativity in the Chinese context.