Effect of Leadership Styles on Employees’ Innovative Behaviour: The Mediating Role of Employees’ Creativity

Abstract

This study investigates the effect of transactional and transformational leadership styles on employees’ innovative behaviour. It also seeks to examine the mediating role of employees’ creativity in translating different leadership styles into employees’ innovative behaviour. Sample of the study consisted of 325 bank employees and their supervisors. Model validation and hypothesis testing was done using structural equation modelling. Findings of the study suggest that transactional leadership style positively influence employees’ innovative behaviour directly. Transformational leadership style effects employees’ innovative behaviour through employees’ creativity. The study shows successful mediating role of employees’ creativity between two leadership styles and innovative behaviour. The study implications and future directions are discussed towards the end.

Keywords: Leadership style, transactional leadership, transformational leadership, innovative behaviour, creativity.