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Innovation is often considered the lifeblood of any business but for firms in heavily regulated industries, a perception can arise that innovation is extremely difficult (if not impossible) to come by. In reality, this is rarely the case. Heavily regulated industries such as healthcare, finance and energy often see dramatic innovations that can lead to better outcomes for society at large….Continue reading…
By: Kate Vitasek
Source: Forbes
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Critics:
Innovation leadership has roots in path-goal theory and leader-member exchange theory. Certain elements within an organization are also needed for innovation leadership to succeed. Wolfe (1994), as cited by Sarros, Cooper, & Santora, (2008) has pointed out that one antecedent factor for innovation is organizational culture. Likewise, Isaksen, Laver, Ekvail & Britz (2001) concur that innovative endeavors fail without a supportive climate.
This antecedent of a supportive organizational culture/climate encompasses encouragement of creativity, autonomy, resources, and pressures. Additional foundational elements for innovation leadership include creative work, a creative workforce, and certain leader attributes. The basis of path-goal theory uses a similar view of leadership, in that it advocates different types of leadership (e.g., participative, supportive) behaviors, much like innovation leadership does.
However, it is contingent on employee and environmental factor to be effective. The idea of a single leader using different leadership behaviors originated in path-goal theory, and has been associated with the framework underlying innovation leadership, which also allows the creation of a work environment conducive to innovative thinking—which is the cognitive process of generating novel and useful ideas.
Creating this type of work environment through innovation leadership involves open leadership behaviors that resemble some leader behaviors proposed by Path-goal theoryfor example, upward influence and supportive/considerate behaviors. In innovation leadership, these behaviors encourage the creative team to generate as many novel ideas as possible and lead to evaluation and implementation of these ideas.
Leader-member exchange theory (LMX theory) is another one of the building blocks of innovation leadership. It follows the same idea as Path-goal theory and innovation leadership, that multiple leadership styles are necessary in managing multiple subordinates but takes it a step further. LMX involves adopting a unique leadership style for each employee. Past studies indicate that LMX theory has been shown to have an effect on innovation.
Studies have also shown that leader-member exchange relationships can predict significant organizational and attitudinal variables including higher job satisfaction and higher job performance. Basu and Green (1997) found that innovative behavior is related to the quality of the leader-member exchange where high quality exchanges include contributions from both the leader and the follower.
However, in a study by Jean Lee (2008), only the loyalty aspect of LMX (LMXL) was shown to be related to innovativeness. Leadership styles, transformational (positively related) and transactional (negatively related), were found to have an effect on innovativeness. Some studies have shown evidence of organizational culture as the mediator of the relationship between transformational leadership and organizational innovation and performance.
In other words, for transformational leadership to affect organizational innovation, an organization must have a strong innovative culture in addition to a leader with a transformational leadership style. Organizational culture refers to an organization’s deep structure, normative beliefs, and shared behavioral expectations. This culture is fairly constant and can influence interorganizational relations.
Climate refers to the way that individuals perceive the extent to which the organizational culture impacts them. To have a clear understanding of what innovation leadership involves, one must first understand the concept of innovation. Although there is some controversy over how it can be defined, through general consensus in the literature, it can be described as novel ideas of viable products that are put into operation.
It includes three different stages, which are all dynamic and iterative (constant):
- Idea Generation
- Evaluation
- Implementation
The two types of innovation include exploratory innovation, which involves generating brand new ideas, and value-added innovation, which involves modifying and improving ideas that already exist. Ideas generated must be useful to be considered innovative. Innovation should also not be confused with creativity, which is merely the generation of a novel idea that may not necessarily be put into operation though these words are sometimes used interchangeably in research literature when speaking about innovation leadership.
Innovation leadership is a complex concept, as there is no single explanation or formula for a leader to follow to increase innovation. As a result, innovation leadership encompasses a variety of different activities, actions, and behaviors that interact to produce an innovative outcome.
Innovation leadership is a philosophy and technique that combines different leadership styles to influence employees to produce creative ideas, products, and services. The key role in the practice of innovation leadership is the innovation leader. Dr. David Gliddon (2006) developed the competency model of innovation leaders and established the concept of innovation leadership at Penn State University.
As an approach to organization development, innovation leadership can support achievement of the mission or the vision of an organization or group. With new technologies and processes, it is necessary for organizations to think innovatively to ensure continued success and stay competitive to adapt to new changes, “The need for innovation in organizations has resulted in a new focus on the role of leaders in shaping the nature and success of creative efforts.” Without innovation leadership, organizations are likely to struggle.
This new call for innovation represents the shift from the 20th century, traditional view of organizational practices, which discouraged employee innovative behaviors, to the 21st-century view of valuing innovative thinking as a “potentially powerful influence on organizational performance.
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