Previous studies have generally posited that idea rejection negatively impacts innovation performance, however, few have explored the potential positive effects. From a novel perspective grounded in incubation theory, this research investigated whether, how, and when idea rejection could be translated into employee creativity. Six studies were conducted: a questionnaire survey (Study 1a) and five simulated situational experiments (Studies 1b, 1c, 1d, 2, and 3). In Study 1a, we collected samples from various industry backgrounds, including manufacturing, high-tech companies, internet-related companies, and modern service industries, to verify whether idea rejection could be translated into employee creativity. Studies 1b, 1c, and 1d further validated the findings of Study 1a in distinct fields—new home and kitchen products, technology, and scientific research—through simulated situational experiments. Studies 2 and 3 selected new home and kitchen products as representative experimental situations and used simulated situational experiments to explore the mechanisms and boundary conditions through which idea rejection translates into employee creativity. The results revealed that idea rejection could be translated into employee creativity. This translation was mediated by both problem restructuring and the activation of new knowledge. Furthermore, servant leadership positively moderated the relationship between idea rejection and the activation of new knowledge, thereby strengthening the mediating role of the latter. However, servant leadership did not moderate the relationship between idea rejection and problem restructuring, nor did it enhance the mediating role of problem restructuring. These findings opened the “black box” of how idea rejection is translated into employee creativity, expanded the research on the effects of idea rejection, and provided a reference for organizational innovation management practices.
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