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Vol. 3, Issue 1, 2016
Creativity and Leadership in Organizations: A Literature Review
Jiajun Guo
University of Connecticut
E-mail address: jiajun.guo@uconn.edu
A R T I C L E I N F O A B S T R A C T
Keywords:
Creativity
Leadership
Organizations
Despite the importance to researchers and organizations
of how creativity contributes to effective leadership and how
leadership contributes to group and organizational creativity,
our knowledge regarding this interrelationship remains large-
ly limited. A review of the literature based on both theoretical
grounds and empirical evidence reveals that studies examin-
ing the intersection between creativity and leadership in or-
ganizations are divergent in terms of how they conceptualize
this relationship. A multi-level framework is used to synthe-
size the knowledge in both creativity and leadership disci-
plines, with multiple themes having been found at each level
of the framework.
INTRODUCTION
In this rapidly changing and increasingly complex world, leadership faces multiple chal-
lenges to its traditional roles. Creativity has become a critical concern for most organiza-
tions to survive this uneasiness and uncertainty (Mumford, Hunter, Eubanks, Bedell,
& Murphy, 2007). At the same time, it has received a great deal of attention recently
in both creativity and leadership research (George, 2008; Mumford, Zaccaro, Harding,
Jacobs, & Fleishman, 2000; Mumford, Scott, Gaddis, & Strange, 2002; Mumford, Connel-
ly, & Gaddis, 2003; Mumford & Connelly, 1991; Rickards & Moger, 2006; Shalley & Gil-
son, 2004; Sternberg, Kaufman, & Pretz, 2004; Williams & Foti, 2011).
One leading force that draws the fields of creativity and leadership together
is change and the complex problems brought about by change (Puccio, Mance, & Mur-
dock, 2011). Some researchers think that creativity is a critical factor in effective leader-
ship that enables an organization or institution to solve ill-defined problems (Mumford
& Connelly, 1991), to respond to opportunities (Shalley & Gilson, 2004), and thereby,
ISSN: 2354-0036
DOI: 10.1515/ctra-2016-0010
Article history:
Received 18 Febuary 2016
Received in revised form 14 May 2016
Accepted 15 May 2016
Theories – Research – Applications
Richard Gonzales
University of Connecticut
E-mail address: richard.gonzales@uconn.edu
Anna E. Dilley
University of Connecticut
E-mail address: anna.dilley@uconn.edu
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to maintain a competitive advantage (Reiter-Palmon, 2004) in a world full of uncertainty.
Another key force comes from the intersection of creativity and leadership inside
individuals that emphasizes development. In the process of leadership development, the
ability to think creatively is a critical skill people develop (McCauley, Moxley, & Van Vel-
sor, 1998). Creative people decide to be creative, and they show a creative attitude to-
ward leadership. Creative people exhibit a variety of characteristics that represent deci-
sions or ways of making creative decisions (Sternberg, 2002). They are confident that
their insights are more likely to be effective in dealing with certain issues, and their solu-
tions may be more appropriate under certain circumstances (Gardner, 1995). This willing-
ness to challenge, along with their talents, makes them stand out as leaders.
Therefore, a new type of leadership – creative leadership – is foregrounded. There
have been some discussions about the nature of creative leadership. Puccio et al. (2011)
defined it as “the ability to deliberately engage one's imagination to define and guide
a group toward a novel goal - a direction that is new for the group.” Similarly, Basadur
(2004) stated that creative leadership means “leading people through a common process
or method of finding and defining problems, solving them, and implementing the new so-
lutions.” Given the complexity of both creativity and leadership, some researchers have
begun to describe different kinds of creative leadership. Viewing it as a confluence
of skills and dispositions, Sternberg and his colleagues (2004) identified several types
of creative leadership using his propulsion theory, including Replication, Redefinition, For-
ward Incrementation, Advanced Forward Incrementation, Redirection, Reconstruction,
Reinitiation, and Synthesis. Mumford et al. (2002) proposed a tripartite model - Idea Gen-
eration, Idea Structuring, and Idea Promotion - to discuss the jobs of creative leadership.
In their view the nature of creative leadership, involving generating new ideas, setting
guidance and output expectations, and gathering support for creative work, is complex
and sometimes even contradictory.
In sum, the literature about creative leadership has shown the crucial role of creativi-
ty in facilitating effective leadership. Research connecting creativity and leadership is ex-
tremely rich and varied. However, most studies either focus on only one subset of charac-
teristics or lack empirical evidence to identify important variables and the relationships
among them. The purpose of this review therefore is to identify important variables and
themes for future development of more comprehensive theories. In order to summarize
what we know about creative leadership and suggest how we can learn about what we
don't know, we use a multi-level framework to aid in the interpretation of previous literature.
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A FRAMEWORK
The framework we are going to use to synthesize the literature contains three levels – in-
tra-personal, inter-personal, and organizational. In fact, there have been numerous stud-
ies discussing creativity or creative leadership in the organizational context, and many
of them employed the three level-of-analysis approach (Drazin, Glynn, & Kazanjian,
1999; George, 2008; Hunter & Cushenbery, 2011; Mumford et al., 2002). Combining
these studies and Weick’s (1995) sense-making perspective with empirical evidence that
we will discuss in the following sections, we conclude that the three level-of-analysis ap-
proach offers us a comprehensive perspective on creative leadership issues.
In this framework, the intra-personal level concerns individual thoughts, feelings,
abilities, knowledge, and intentions. Three related themes have been found in the existing
literature; they are creative problem solving, creative disposition and knowledge. At the
inter-personal level, thoughts, feelings and knowledge are merged into conversations dur-
ing which interaction emerges. With this in mind, we found that there are three relevant
themes at the second level; they are creative climate, leader-member exchange (LMX)
and empowerment, and transformational leadership. At the organizational level, interac-
tions shift from relative autonomy to relative control and from relative independence
to relative interdependence. Not only do people from inside and outside try to make
sense of organizations and their leadership, but organizations themselves, under some
form of leadership, also try to make sense of their environment. However, this level does
not have substantial empirical support in the literature. In a relative paucity of empirical
studies, the most salient themes are how leadership can deal with turbulent environments
and how organizations interact with each other through leadership activities.
THE "GREAT MAN" PERSPECTIVE – INTRAPERSONAL FACTORS
In explaining the factors involved either in the nature of leadership or in the emergence
of creative ideas and its products, the intrapersonal aspect has been, and still is, one
of the main focuses in theories and models. In the intersection between the leadership
and creativity fields, at least three themes emerge, and they are creative problem solving,
creative disposition and knowledge.
Creative Problem Solving
Leaders are always faced with complex and dynamic problems in organizational contexts,
such as environmental change, subsystem differences and the diversity of human beings
(Mumford et al., 2000). To solve these problems, creative problem solving skills associat-
ed with identification of key problems, generation of creative ideas, evaluation of ideas
and construction of an implementation plan are needed (Runco & Chand, 1994). Among
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these skills, generation and evaluation of creative ideas might be the two most important,
and most frequently studied, cognitive skills. One reason is that these two skills are easy
to measure, given the fact that divergent thinking tests are the most popular measures
of creativity (Kaufman, Plucker, & Baer, 2008). Another reason is that these skills are
more markedly influenced by prior experience and interactions (Mumford et al., 2000),
making them easy for trainers to use.
Divergent thinking skills. Guilford (1963), who made great contributions to the field
of creativity, proposed a multi-dimensional model of intellect, called the Structure of Intel-
lect (SOI), that classified mental abilities by operation performed, content used to perform
the operation, and type of product produced. The most far-reaching impact of SOI was
the distinction between two types of operation, convergent thinking and divergent thinking
(Clapham, 2011). Psychologists have developed many divergent thinking tests following
Guilford's proposal. Essentially four kinds of variables, fluency (the number of responses),
originality (the uniqueness of responses), flexibility (the number of categories of respons-
es) and elaboration (the extension of ideas within a specific category of responses) were
frequently measured (Kaufman et al., 2008).
Studies have suggested that divergent thinking skills are important for leaders. Us-
ing divergent thinking measures as predictors, such as the Consequences Test
(Mumford, Marks, Connelly, Zaccaro, & Johnson, 1998; Vincent, Decker, & Mumford,
2002; Zaccaro, Mumford, Connelly, Marks, & Gilbert, 2000), and the Brainstorming and
Similarities tasks (Scratchley & Hakstian, 2001), researchers have consistently found
a positive relationship between leadership performance and divergent thinking skills. Evi-
dence that supports this positive effect of creativity on leadership performance usually
comes from two sources: performance in leadership-related tasks (e.g. problem solving)
and leadership achievements (e.g. awards and promotions). Both Mumford et al.'s (1998)
and Vincent et al.'s (2002) studies, using military officers as participants, found that diver-
gent thinking contributed to creative problem solving even when intelligence and exper-
tise were taken into consideration. When applying divergent thinking measures to busi-
ness settings, Scratchley and Hakstian (2001) found a similar relationship between diver-
gent thinking score and creative-managerial criteria. Therefore, some field experiments
have been conducted to see if practice-oriented training could make an improvement in
leadership-related divergent thinking skills (Basadur, Wakabayashi, & Takai, 1992; Basa-
dur, Pringle, & Kirkland, 2002). However, in these training programs, there seemed to be
another cognitive skill apart from divergent thinking that was also trained: leaders were
not only encouraged to view the problems in various ways, but they were also asked to
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apply the skills to real-world problems which requires another type of creative problem
solving skill – evaluative thinking.
Evaluative thinking skills/Convergent thinking skills. Evaluation activities, such
as interpretation of environmental events, evaluating credibility of information, forecasts
evaluation, and evaluating plans, are known to be critical parts of leadership roles
(Mumford et al., 2003; Mumford et al., 2007). However, the evaluative component of the
creative process is often overlooked in creativity research. This might be due to the fact
that in popular notions, evaluation, sometimes known as convergent thinking, has always
been regarded as the obstacle to creative thoughts, especially divergent thinking.
But in recent years, researchers have come to realize that it is as important as other com-
ponents of creativity (Basadur, 1995; Halpern, 2003; Runco & Chand, 1994; Wakefield,
2003). On the one hand, it is impractical for people to pursue every creative idea.
Too much divergent thinking without effective screening and control in facing real-world
problems can cause many troubles such as reckless change (Cropley, 2006), risks and
waste of time. On the other hand, generative and evaluative thinking are not as distinctive
as people think. Some theories already incorporate evaluative thinking into the creative
component, such as Sternberg’s (1988) tripartite model of creative thinking. A neural
model proposed by Iyer and her colleagues (2009) also suggested that evaluative feed-
back is one of the critical factors that modulates the dynamics of idea generation
in the human mind.
Studies have found that in leadership, better or more creative solutions can be ob-
tained when people provided appropriate criticism or evaluations. But the standard
of "good" evaluation may vary according to the nature of the problem and ideas, as well
as the context in which it is to be implemented (Gibson & Mumford, 2013; Lonergan,
Scott, & Mumford, 2004). The compensatory approach is a type of evaluation technique
often used by people who come up with better plans: generative, or innovative criteria be-
ing applied to less original ideas; implementation efficiency, or operating criteria being ap-
plied to more original ideas (Lonergan et al., 2004). After appraising the criticism provided
in a leadership task, Gibson and Mumford (2013) found that more creative solutions were
obtained when people provided deep, specific and useful criticism. But the results also
showed that if the problem was too complicated, it might inhibit effective evaluation.
This is when experience, or knowledge, comes into play. No one would deny the im-
portant role of knowledge in linking creativity and convergent thinking, because
it is knowledge that provides the bases for evaluating the merits of events, plans and solu-
tions. Even divergent thinking is largely influenced by past experience and prior knowledge.
In the next section, we will discuss the role of knowledge in creative leadership.
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Knowledge
There are basically two views of the relationship between knowledge and creativity- the
"tension" view and the "foundation" view (Weisberg, 1999). Tension holds that there is a
need for creativity to go beyond the limits of knowledge in order to make true achieve-
ment. Whereas the foundation view holds that a large amount of domain-specific
knowledge or practice is necessary for the development of the skills that underlie creative
accomplishment. Both views have merit and both have limitations. It is argued that
knowledge or experience may have both a facilitating and an inhibiting effect on creativi-
ty, depending on a set of other variables such as cognitive styles, domain of interest, lev-
els of knowledge, and application (Cropley, 2006; Martinsen, 1995; Mumford & Gus-
tafson, 1988). But overall, knowledge is thought to be necessary for most creative en-
deavours, especially for great achievements. And one of the most popular ideas in crea-
tivity research is the "ten year rule": a person needs at least 10 years for mastering the
knowledge and skills necessary for expert creativity (Cropley, 2006).
In leadership research, knowledge has also been regarded as a necessity in shap-
ing effective leaders and giving them powers. A leader without much specific knowledge
regarding their organization and its environment may easily fail to lead his/her followers
toward success. Leaders sometimes need detailed information that can help them deal
with specific situations. For example, although school administrators don't have to teach
classes, they still have to have a solid mastery of how certain subjects are learned and
taught so that they can provide instructional leadership in schools (Stein & Nelson, 2003).
Besides, knowledge and skills associated with forecasting and planning, crisis manage-
ment and decision making can be totally different across levels of leadership and types
of organizations (Egbu, 1999).
Although knowledge has been given a prominent place in creativity by many creativ-
ity researchers (Cropley, 2006), there is a paucity of empirical studies on the relationship
between knowledge and leaders' creative performance. Grønhaug and Haukedal (1995)
found that expert managers, who had more experience and knowledge, were more spe-
cific and action-oriented in innovative tasks so they were able to make sense of the stra-
tegic stimulus-situations, to recognize the problems, and to come up with better solutions
in creative tasks. In two studies mentioned previously, both Vincent et al. (2002) and Zac-
caro et al. (2000) not only found a positive effect of divergent thinking, but they also found
that knowledge, or expertise, contributed to military leaders' creative problem solving.
However, further examination showed that the knowledge variables in these studies
did not capture the complexity of leadership knowledge. As Antes and Schuelke (2011)
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have argued, there are three types of knowledge that need to be acquired by creative
leaders: technical/domain knowledge, organizational knowledge, and field/industry
knowledge. But the knowledge variables in these studies are either too general
(experience vs. novice) or too narrow (only some generic knowledge of leadership func-
tions). Therefore, further research needs to be done to examine the impact of knowledge
on a leader's creative endeavour.
Disposition
In the words of Eysenck (1997), "Theories of creativity march on two legs, which are usu-
ally treated separately by theorists." One is concerned with the creative process such
as divergent thinking and problem solving; the other is concerned with the kind of individ-
uals whose most salient characteristic is their uniqueness and individuality, namely, crea-
tive persons. Many people, including some psychologists, also believe that this unique-
ness could differentiate leaders from other individuals, which leads to the trait theory
of leadership (Judge, Bono, Ilies, & Gerhardt, 2002). Creativity has been identified as one
of those traits that were best correlates of effective leadership. However, we would like
to argue that ‘personality’ or ‘trait’ are not the best terms for our understanding of creative
leadership. Instead, ‘disposition’ would be more appropriate because it emphasizes not
only the structure consisting of a characteristic set of cognitive, affective and behavioural
strategies, but also dynamics that are generated when individuals encounter or construct
situations (Mischel & Shoda, 1995). In this sense, once individuals learn new ways
of thinking, feeling and behaving, these new elements can enter in and thus be part
of their dispositions. Among the studies linking creative disposition to effective leadership
there are mainly three lines of research: emotional intelligence, openness to experience,
and tolerance of ambiguity.
Emotional intelligence. Emotional intelligence (EI) is defined as the ability to effectively
reason about emotions and use emotions to aid cognitive processes and decision making
(Zhou & George, 2003). Although it is a type of intelligence or ability, EI can also be re-
garded as emotion-related dispositions or personality traits (Petrides, Pita, & Kokkinaki,
2007; Rego, Sousa, Pina, Correia, & Saur-Amaral, 2007). Increasing numbers of studies
have shown that emotional intelligence is a core variable that affects leadership perfor-
mance such as followers' job satisfaction and extra-role behaviour (Wong & Law, 2002),
the ability to achieve results and build working relationships (Rosete & Ciarrochi, 2005)
and a lot of other elements of leader effectiveness (George, 2000; Kerr, Garvin, Heaton,
& Boyle, 2006). Emotional intelligence can have a positive effect on creativity as well. In-
dividuals with positive mood and good feelings are more creative (Isen & Daubman,
1984; Murray, Sujan, Hirt, & Sujan, 1990).
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This leads to the natural conclusion that higher leader emotional intelligence can result
in higher workplace creativity, which has been supported by several studies. From a theo-
retical point of view, Zhou and George (2003) suggested that creative activities are affect-
laden. Therefore, leaders' emotional intelligence plays an important role in developing the
creativity climate in organizations. Rego et al. (2007) found that managers' emotional in-
telligence was positively related to their followers' creativity. Using the same EI measure
as in Rego et al.'s (2007) study, Castro and his colleagues (2012) found a similar effect
of leaders' emotional intelligence on subordinates' creativity, regardless of the climate.
Openness. Openness to experience, including intellectual curiosity, aesthetic sensitivity,
liberal values and emotional differentiation is thought to be one of the five basic dimen-
sions of personality in the Big-Five theory (McCrae & John, 1992). Research has sug-
gested that creativity is particularly related to the personality domain of openness (Feist,
1998; McCrae, 1987). For example, a 45-year longitudinal study found that openness
was most related to personality traits "motivations toward creative and intuitive" and
"motivations toward the ideational" as well as the life course variable of creativity that in-
cludes artistic interest and achievement, and creative products (Soldz & Vaillant, 1999).
In leadership research, many studies have been conducted to examine the relation-
ship between leadership and the big-five factors. And there are several great reviews
of this topic as well (Bono & Judge, 2004; Judge et al., 2002; Zhao & Seibert, 2006).
Therefore, we don’t intend to discuss in detail how openness can affect leadership perfor-
mance (for such a discussion, please see Judge et al., 2002; Bono & Judge, 2004; Zhao
& Seibert, 2006). The major takeaway from these reviews is that openness appears to be
related to general leadership criteria, but it fails to be a single predictor after the effects
of the other four factors are removed. This might be due to the high level of inter-
correlations among these five factors.
While most studies have investigated how openness is related to leadership perfor-
mance, few examined the creative aspect of the performance. This somehow explains
why openness was found not to be the strongest correlate with leadership, since not all
leadership activities involve creativity. But if creativity becomes valued in leadership jobs,
then openness perhaps will stand out. For example Scratchley and Hakstian (2001), who
found a positive impact of divergent thinking, also found a strong link between openness
and managerial creativity. Besides, Zhao and Seibert (2006) found that entrepreneurs
scored higher on openness than did managers, indicating that leaders at different levels
or positions may exhibit different creative personality.
Tolerance for ambiguity. Ambiguity has been regarded as a situation occurring routinely
in everyday life. For example, vagueness of words, uncertainty, multiple interpretations,
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contradictory views and probability can be present under various conditions. People who
have tolerance for ambiguity tend to have the capacity to embrace uncertainty, complexi-
ty and be more adaptive and more flexible in dealing with real-world problems (Kajs
& McCollum, 2009). Tolerance for ambiguity (TFA) has been found to be significantly and
positively correlated with creativity (Tegano, 1990; Zenasni, Besancon, & Lubart, 2008).
Recently, leadership researchers have also noticed the importance of TFA and have be-
gun to examine how it would affect leadership, especially in the field of educational lead-
ership (Kajs & McCollum, 2009; Kajs & McCollum, 2010; Williams, 2006) and entrepre-
neurship (Begley & Boyd, 1987; Dollinger & Saxton, 1995; Teoh & Foo, 1997). Some
popular measures of TFA in leadership studies include a 16-item Scale of Tolerance-
Intolerance of Ambiguity developed by Budner (1962), the Measure of Ambiguity Toler-
ance (MAT-50) developed by Norton (1975), and the MacDonald AT-20 Ambiguity Toler-
ance Scale (Teoh & Foo, 1997).
In research concerning entrepreneurship, studies have shown that higher tolerance
for ambiguity can help leaders cope with role stress (Teoh & Foo, 1997) and get a higher
return on assets (ROA) (Begley & Boyd, 1987). But a "threshold effect" was found, sug-
gesting that excessive tolerance for ambiguity may lead to dysfunctions and potential
risks (Begley & Boyd, 1987). For example, in a study of forming alliance, Dollinger and
Saxton (1995) found that entrepreneurs with high TFA tended to engage an alliance even
if the target firm's reputation was mixed or negative.
In studies of educational leadership, however, few direct links between TFA and
leadership performance could be found in the literature. What researchers have found
concerned either leadership style or other characteristics such as experience and age.
For example, Kajs and McCollum's (2010) study revealed that TFA was lower for the old-
er, more experienced leaders, while higher levels of TFA were found among the younger,
inexperienced school leaders. Chen (2003) found that a task-oriented principal is less tol-
erant towards ambiguity while an interpersonal relationship-oriented principal shows
a greater measure of tolerance for ambiguity. Williams (2006) stated that principals who
are comfortable with ambiguity tend to adopt a conceptual decision-making style so they
can mobilize teacher participation and provide supports, which is potentially good for on-
going school reform.
LEADERSHIP AS A SOCIAL CONSTRUCT – INTERPERSONAL RELATIONSHIP
So far, this article has discussed how individual-level traits and skills matter to creative
leadership, with less attention paid to its social consequences. In this section, however,
more attention will be directed to the social aspects of creative leadership, with an imme-
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diate distinction made between leader and leadership development. As Day (2000)
has argued, the emphasis on leader development is typically on individual-based abilities,
skills and knowledge associated with formal and traditional leadership roles. But in the
case of leadership development, the emphasis is more on building networked relation-
ships among individuals that enhance cooperation and resource exchange in creating
organizational value (Bouty, 2000; Tsai & Ghoshal, 1998). In this sense, development
of creative leadership should not only be focused on developing knowledge, thinking
skills or dispositions, but also on developing positive relationships that facilitate both indi-
vidual-level and team-level creativity. In fact, in the previous sections this article has al-
ready mentioned several intrapersonal factors that are associated with the social aspect
of leadership, such as emotional intelligence and tolerance for ambiguity. But here lead-
ers' specific cognitions, traits or behaviours are no longer central to our discussion. What
matters are interactions.
Creative Climate
As a matter of fact, the topic of creative climate is not new in organizational and leader-
ship research. Organizations may create an atmosphere in which creativity and innova-
tion are either fostered or stifled (Mathisen & Einarsen, 2004). There are certainly many
determinants of a creative climate in teams or groups, for example, tasks at hand, motiva-
tion (Amabile, 1983; Amabile, 1997), organizational policies, short-term and long-term
goals, human and financial resources, technology (Ekvall & Ryhammar, 1999), and lead-
er support (Amabile, Schatzel, Moneta, & Kramer, 2004; Amabile, Schatzel, Moneta,
& Kramer, 2006; Hennessey & Amabile, 2010). We believe that leadership plays a central
role in making all these determinants function. Furthermore, this kind of leadership would
not just include specific behaviours or attitudes of leaders, but creative climate is by itself
a type of leadership endeavour that integrates all the creative factors.
As a global evaluation of group/team creativity, creative climate has been found
to be a strong predictor of creative outcomes. There are plenty of empirical studies
as well as reviews on this topic. For example, in an organizational analysis conducted
in a chemical company, Ekvall (1987) found that the innovative divisions differ considera-
bly from the positional divisions in several climate dimensions as measured by the Crea-
tive Climate Questionnaire (CCQ). Using the KEYS scale (Amabile, Conti, Coon, Lazen-
by, & Herron, 1996) as a measure of climate, another study conducted in the forest prod-
uct industry found that climate for innovation can improve organizational efficiencies
(Hansen & Crespell, 2008). A study conducted in the Norwegian public postal service
showed that climate for team creativity, as measured by the Team Climate Inventory
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(TCI), was significantly correlated with customers' satisfaction (Mathisen, Einarsen, Jør-
stad, & Brønnick, 2004). Using the Work Environment Inventory (WEI) developed by Am-
abile and Gryskiewicz (1989), Couger (1996) found that employees in information system
(IS) companies tended to perceive the environment for creativity to be inadequate, and
this was associated with low productivity and high workload pressure.
Leadership Style – Transformational Leadership
Another popular framework of organizational leadership that has emerged during the past
few decades has been the transactional – transformational distinction (Gerstner & Day,
1997; Gumusluoglu & Ilsev, 2009). Transformational leadership, as a type of leadership
style, is defined primarily in terms of leaders’ relationship with followers and how leaders
should adjust their behaviours to achieve effectiveness (Gerstner & Day, 1997; Yukl,
1999). Because transformational leadership focuses on interactions, especially followers’
contributions to the interactions, rather than leaders’ personal traits, we place our discus-
sion of leadership style under the interpersonal category of our three-level framework de-
spite it sounding like a personal attribute. In fact, interaction is the focus of both transac-
tional and transformational leadership, but transformational leaders do more than just set-
ting up simple exchange and agreement (e.g. rewards and promotion). They also address
followers’ sense of self-worth to engage the followers, to motivate them to overcome chal-
lenges so that together they can achieve great results. There are at least four dimensions
of transformational leadership, including inspirational motivation, intellectual stimulation,
individualized consideration and idealized influence (Bass, 1996; Judge & Piccolo, 2004).
There have been a number of studies showing that transformational leadership con-
tributes to followers’ creativity, and the evidence supporting this positive relationship has
come from different corners of the world, such as Korea (Shin & Zhou, 2003), Taiwan
(Gong, Huang, & Farh, 2009), Turkey (Gumusluoglu & Ilsev, 2009), the United Arab Emir-
ates (Politis, 2004) and the United States (Wang & Rode, 2010). This is good news
for both researchers and practitioners. Nonetheless, a closer examination of the results
in these studies revealed that this relationship may not be as simple as people might
have thought. Although most studies have shown that transformational leadership has
a positive effect on followers’ creativity, it is mediated by variables such as followers’ in-
trinsic motivation (Shin & Zhou, 2003), sense of flow (Sosik, Kahai, & Avolio, 1998), self-
efficacy (Gong et al., 2009; Shin & Zhou, 2007) and organizational climate (Ekvall & Ry-
hammar, 1998), other studies found that the effects may vary. Specifically, it has been
found that transformational leadership has no effect on employees’ flexibility of thinking,
one of the four components of divergent thinking assessment, in anonymous conditions
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(Sosik et al., 1998). Besides, when cash rewards are involved and tasks changed, more
original solutions may be produced under transactional leadership than under transforma-
tional (Kahai, Sosik, & Avolio, 2003). Wang and Rode (2010) also claimed that they could
not find a direct effect of transformational leadership on employee creativity. Instead,
a three-way interaction was identified in their study, showing that the moderating influ-
ence of creative climate in the “leadership style – follower creativity” relationship is contin-
gent on other moderators such as followers’ identification with the leader. This finding
demonstrates the fact that followers’ characteristics also have an influence on their rela-
tionships with leaders as well as their creative performance, which will be further dis-
cussed in the next section.
Leader-Member Exchange and Empowering leadership
In the investigations of creative climate and transformational leadership, some research-
ers have found that what leads to creative outcomes not only includes leader variables
and contextual variables but also follower or member variables (Oldham & Cummings,
1996; Pirola-Merlo & Mann, 2004). Many investigations have largely focused on a single
leadership perspective and thus ignore the interactions between potential creators and
their operating context (Tierney, Farmer, & Graen, 1999). Furthermore, there are dynam-
ics embedded in the interactions between leaders and followers (Avolio, 2007), which
is sometimes called leader-member exchange (LMX). Another concept related to LMX
is empowering leadership. Although they appear to be different constructs, LMX seems
to be one of the most important determinants that serve as the necessary antecedents
of empowerment (Liden, Wayne, & Sparrowe, 2000). Therefore, in this section, we seek
to discuss the relationship between creativity and LMX as well as empowering leadership.
Essentially, LMX researchers adopted a three-domain perspective, including leader, fol-
lower and relationship, based on which the theory of LMX was built (Graen & Uhl-Bien,
1995). LMX theories use the relationship-based approach to leadership, claiming that ef-
fective leadership processes occur when leaders and their followers develop mature
"partnerships" and thus benefit from these relationships (Graen & Uhl-Bien, 1991). The
quality of this relationship can potentially lead to employee creativity in many ways
(Tierney et al., 1999). In a study conducted in a chemical company, Tierney et al. (1999)
detected a rather complicated interactive effect between leaders and employees. Specifi-
cally, when employees with high intrinsic motivation worked with a supervisor with similar
motivation, creative performance was enhanced; but employees with low motivation who
were assigned to high motivation supervisors produced lower creative output. In addition,
employees with different innovative cognitive styles may also respond differently to LMX,
Guo, J., Gonzales, R., Dilley, A.E. Creativity and Leadership in Organizations: A Literature Review
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according to Tierney et al. (1999). Since most personal characteristics of employees are
relatively stable, these results suggest that the creative success of a team or a pro-
gramme not only lies in the hands of its leader, but is also largely determined by its mem-
bers. Further support for this view came from the studies of Oldham and Cummings
(1996) and Janssen and Van Yperen (2004). Using a measure of personal characteristics
associated with creative achievement, Oldham and Cummings (1996) found that the most
creative outcomes were produced by employees with appropriate characteristics doing
challenging jobs in a supportive environment. In another study, Janssen and Van Yperen
(2004) investigated the influence of employees from a goal orientation perspective, show-
ing that employees with stronger mastery orientation are more effective in terms of in-role
job performance and innovative job performance because they tend to establish higher-
quality exchange with their supervisors.
Along the same lines, psychological empowerment has also been found to be posi-
tively correlated to followers’ creativity outcomes. Zhang and Bartol (2010) showed that
empowering leadership could affect psychological empowerment, which in turn influences
both employees’ intrinsic motivation and their creative process engagement. Moreover,
leader-member exchange (LMX) also promotes psychological empowerment, which fur-
ther enhances followers' creativity. In a study conducted at three Chinese manufacturing
companies, Pan, Sun and Chow (2012) demonstrated that psychological empowerment
and felt obligation fully mediated the relationship between LMX and employee creativity.
However, it is worth noting that this mediated effect of LMX worked differently in different
work-unit structures, which reflects the dynamic and complex nature of leader-follower
interactions.
CREATIVITY AS VIEWED FROM AN ORGANIZATIONAL PERSPECTIVE
While many researchers have realized the importance of individual creativity and team
creativity in organizations, few have paid attention to the complexity of their external envi-
ronment. There are different levels of teams and groups within an organization and each
one of them has its own unique set of creativity characteristics. Besides, the environment
or balance around organizations is changing fast, with innovative knowledge easily
learned by other organizations and thus it is easily lost to competitors (Brown & Duguid,
2001; Teece, Pisano, & Shuen, 1997). However, some have argued that the primary role
of an organization is not knowledge creation but knowledge application (Grant, 1996).
In that sense, in order to keep creative and competitive, organization leadership should
focus on both the organization's internal coordination and its external applications.
To do that, we have to view the organization as an entity which needs help in competing
Creativity. Theories – Research – Applications 3(1) 2016
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with other similar organizations and surviving a changing market and environment. But
few empirical studies have been conducted to examine organizational creativity as a col-
lective phenomenon, which requires studying creativity in ongoing organizations. This is
also the result of a complex context making organizational creativity difficult to interpret
from the point of view of any single factor.
Turbulent Environments and Strategic Planning
It is argued that today's organizations are linked with other organizations and the environ-
ment, so that the critical leadership focus of a firm is shifting from organizing internal sys-
tems to organizing semi-open processes. Achrol (1991) called these processes
"boundary spanning" processes, which means that organizations need to have a system
with a high degree of boundary permeability to the environment and partners so that they
can maximize flexibility in order to be successful in a dynamic world. To achieve
"boundary-spanning" status, innovativeness and market intelligence are regarded as the
two most important assets of organizations. Drog and her colleagues (2008) found that
innovativeness (but not market intelligence) directly predicts the success of a new prod-
uct when turbulence is high, whereas market intelligence (but not innovativeness) pre-
dicts new product success in low turbulence. It is also suggested that organization lead-
ers should get strategy right first, and then get structure right.
This leads us naturally to the topic of strategic planning. However, research has
shown that planning has a limited impact on organizational creativity and innovation
(Brown & Eisenhardt, 1997; Grant, 2003). Hunter and his colleagues (2011) claimed that
innovation does not follow a prescribed path so that successfully planning for creativity
and innovation is a complex, dynamic, resource-intensive activity. Therefore, most plan-
ning activities tend to inhibit creative production. But he also argued that planning from
a process perspective might help organizations embrace the flexibility necessary for a dy-
namic environment. This raises the question of what kind of strategies or planning are
good for organizational creativity. It has been found that strategic planning for innovation
must be flexible as well as intensively monitored (Hunter, Cassidy, & Ligon, 2011; Song,
Im, van der Bij, & Song, 2011). But it may differ across organizations. For example, large
organizations may benefit more from strategic planning than small ones, because they
have more resources and projects to balance out the risks. From the perspective of or-
ganizational learning theory, appropriate planning could also lead to product innovation.
More specifically, there are two kinds of new product development in business, namely,
exploitation that focuses on existing competences, or exploration that focuses on new
competences they have not yet developed. Studies have suggested that companies em-
Guo, J., Gonzales, R., Dilley, A.E. Creativity and Leadership in Organizations: A Literature Review
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ploying a strategy that can systematically balance between exploration and exploitation
could keep producing innovations in a changing environment (Berghman, 2012; Dan-
neels, 2002).
Acquisitions, Divestitures and Alliance
Acquisitions and divestitures are regarded as a type of long-term strategic leadership ac-
tivity (Hitt, Keats, Harback, & Nixon, 1994), which is related to entrepreneurship. It is ex-
pected that through these activities organizations can increase productivity and quality,
improve efficiency, increase innovation and market share, and secure a position of mar-
ket leadership. However, research has suggested that such activities fail to achieve these
goals (Hitt et al., 1994; Hitt, Hoskisson, Johnson, & Moesel, 1996). Contrary to the com-
mon belief, these activities tend to harm organizations in different ways, including inhibit-
ing overall creativity and innovation. In a study involving a large number of organizations,
Hitt et al. (1994) found that only 7 percent of them experienced increased innovation. Hitt
et al. (1996) also found that firms involved in acquisitions and divestitures tend to empha-
size financial controls and deemphasize strategic controls, which hampers organizational
innovation. Although these firms may seek to look for external innovation through these
activities, they only produce short-term benefits.
However, from a knowledge base perspective, researchers have found that this
is not always the case. Ahuja and Katila (2001) stated that acquisition involving techno-
logical components may introduce a positive impact on organizational creativity. Specifi-
cally, they found that the relatedness of acquiring knowledge and acquired knowledge
has a non-monotonic influence on the innovation: innovation products will increase with
increasing relatedness, but they will begin to decrease once the relatedness reaches
a certain level. The U-shape relationship between the amount of acquired knowledge and
innovative output reflects the complexity of the effects brought about by large changes
of this kind.
Perhaps forming an alliance is a better strategy given its relatively lower costs and
higher benefits (Brown & Eisenhardt, 1997), especially in highly uncertain situations
(Eisenhardt & Schoonhoven, 1996). A study conducted in the biotechnology industry,
where the knowledge base is more complex and sources of expertise are widely dis-
persed, found that inter-organizational collaborations could foster innovation in the whole
community (Powell, Koput, & Smith-Doerr, 1996). In other high-tech industries, it was
found that large companies with alliance partners performed better than those who lacked
partners as measured by innovative rates (Stuart, 2000). There are more examples
of such evidence supporting the positive impact of forming alliances. Although there are
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few empirical studies conducted in settings other than business companies, it is clear that
other types of organizations such as universities or research institutions are using the
same strategies to boost creativity and innovation.
CONCLUSIONS
This paper has taken a broad look at the intersection between creativity and leadership
scholarship. Our study identifies important variables that can facilitate creative leadership
in individuals, groups, teams and organizations. The identification can help practitioners,
such as executives, administrators, managers and entrepreneurs, understand and thus
invest in the development of creative leadership.
Several limitations of this study need to be noted. First, although we tried to cover
a variety of topics related to creativity and leadership, the subjectivity involved in the se-
lection of search queries, databases and topics might still be considered a limitation
of this review. For example, while transformational leadership and LMX have been dis-
cussed, we chose not to discuss issues such as relational leadership. We made such
a decision to avoid too much overlap between variables, but that does not mean other
issues are not important.
Second, our intent is not to develop a theory of creative leadership but to provide
a systematic review for future theory development. To do so, we covered a vast body
of literature and chose to limit the depth of our reviews of each specific area. For exam-
ple, almost every empirical study involves some form of assessment or measurement,
from a creative thinking test to climate ratings and employee interviews, and to product
indices. A closer look at these assessment tools reveals that almost each one of them has
its own measurement problems related to reliability and validity. Although we mentioned
some frequently used measures, these issues were not elaborated upon in this paper.
Therefore, we encourage readers interested in creative leadership to delve deeper
and go far beyond the coverage of this paper. We believe our discussion may offer a val-
uable overview and a seed bibliography for further research.
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Creativity. Theories – Research – Applications 3(1) 2016
Corresponding author at: Jiajun Guo, University of Connecticut, Unit 3064, 249 Glen-
brook Road, Storrs, CT 06269
E-mail: jiajun.guo@uconn.edu
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