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Studying the enabling ability of transactive memory systems on

the relationship between team proactivity and team creativity

MSc. Business Administration

Strategy Track

Nick Meulenbroek, 6069878 Supervisor: Pepijn van Neerijnen

University of Amsterdam, Amsterdam Business School Version: Final

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Statement of originality

This document is written by student Nick Meulenbroek, who declares to take full responsibility for the contents of this document.

I declare that the text and the work presented in this document is original and that no sources other than mentioned in the text and its references have been used creating it.

The faculty of Economics and Business is responsible for solely for the supervision of completion of the work, not for the contents.

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Abstract

This research was conducted in order to reveal the team dynamic processes which enable the relationship between team proactivity and team creativity. The research was built up

following the Input-Mediator-Output principal, where team proactivity was the input, transactive memory system was the mediator and team creativity was the output. Data was acquired by having students perform a business strategy game, where they had to make real-life decisions concerning the organization that they were virtually managing. Findings suggest that TMS has a significant mediating role on the relationship between proactive personality and team creativity. This implies that transactive memory systems have an enabling role on the relationship between team proactivity and team creativity – without a TMS the effect would be (partially) absent. The paper has two main theoretical contributions. The first is that this opens up new possibilities for personality trait antecedents for TMS. The latter has been under examined, since the focus was mostly on demographical traits. The second is that this adds a whole new dimension to the current discussion about whether teams should be efficient or creative. This paper gives a proper substantiation for the combination of the two, which has never been researched before. This way, teams could become even more effective than when pursuing only one of the two.

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Inhoudsopgave

Statement of originality... 2

Abstract ... 3

1. Introduction ... 6

2. Literature Review... 12

2.1 Organizational teams and creativity... 12

2.2 Team composition: proactive personality ... 14

2.3 Transactive Memory Systems (TMS) ... 17

3. Methodology ... 25

3.1 Research Design... 26

3.2 Sample... 27

3.3 Variables ... 28

3.6 Control variables ... 29

3.7 Testing for mediation ... 30

3.8 Data preparation ... 30

3.8.1 Missing values ... 30

3.8.2 Reliability and validity analysis ... 32

3.8.3 Computing scale means ... 33

4. Results ... 34

4.1 Regression analysis ... 34

4.2 Testing for mediation ... 37

5. Discussion ... 39

5.1 Findings... 39

5.2 Practical implications ... 41

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5.2.2 Stimulating the development of a TMS ... 42

5.4 Limitations and Future Research ... 44

6. Conclusion ... 46

7. References ... 47

8. Appendix ... 52

1: List of items for the variables ... 52

2: Rotated Component Matrices ... 56

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1. Introduction

Especially nowadays, creativity plays an important part in challenging dynamic markets and achieving a (temporal) competitive advantage (Kim, Hon, and Lee, 2010; Gong et al., 2012; Proctor, 1991) and therefore might be one of the most interesting aspects of organizational teams. Work has become increasingly interdependent, and therefore teams are used within organizations to get things done more effectively, because they are said to increase capability, flexibility and responsiveness (Berry, 2011; Barczak, Lassk, and Mulki, 2010). Team creativity is defined as the creation of valuable, useful new products, services, ideas, procedures, or processes by individuals working together in a complex social system (Sung and Choi, 2012; Woodman, Sawyer, and Griffin, 1993). This means that team creativity is the accumulation of team member creativity, given that they collaborate accordingly (Barczak et al., 2010; Gong et al., 2012). The need for change, which is accelerating rapidly according to Martins and Terblanche (2003), makes innovation and therefore creativity necessary (“innovation is the successful implementation of creative ideas” - Nayak and Argawal (2011)). Without an appropriate response to change, in the sense of being innovative and creative or dealing with the change internally, organizations will not survive within rapidly changing markets (Martins and Terblanche, 2003). Therefore being or becoming creative has become more important than ever before and will provide organizations greater opportunities and greater chances of survival (Kim, Hon, and Crant, 2009; Woodman et al., 1993; Kim, Hon, and Lee, 2010).

An emergent trend amongst organizations is that they demand more and more from their employees. For one reason this is because managers cannot anticipate all situational contingencies and are insufficiently able to specify what they expect from employees, behavior-wise (Kim, Hon, and Crant, 2009). Not only do managers aspire improved

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Team composition: Team Proactivity

Information processing: Transactive Memory Systems

(mediator)

Team Behavioral outcome: Team Creativity their part in these aspirations, because a different combination of various traits could result in very different outcomes, like team creativity for instance.

It is known that certain personality traits do affect creativity (Oldham and Cummings, 1996; Lin et al., 2012). What is missing in this relationship is the explanation of which team dynamic processes cause these personality traits to affect team creativity. As Pirola-Merlo and Mann (2004) state, team creativity is not just the additive outcome of the combination of individual creativity of team members. Individual creativity is certainly important, but the interactions between team members and team processes play a big part in the conversion of individual creativity into team creativity. This way, information processing interactions, like knowledge sharing, and discussing and criticizing ideas, stimulate individual creativity and team creativity (Pirola-Merlo and Mann, 2004). Therefore, within the current literature, information processing is the missing link in describing how certain personality traits affect team creativity. Little is known about how personality traits influence the way information is handled within teams. In order to fill this gap, this study will look at information processing as a mediating variable on the relationship between personality traits and team creativity:

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Taking into account this conceptual model, the next research question will be leading through this research: To what extent do transactive memory systems enable teams with high proactivity levels to become more creative?

If teams seek creative outputs, collaboration and trust must exist within the team (Barczak, Lassk, and Mulki, 2010; Gong et al., 2012), but also the possession of information is a well-known source for creativity (Amabile, 1998). Not only the possession of information, but the use of this information is of critical importance, because collaboration requires just that. By collaborating and therefore coordinating and sharing information with one-another (processing the information), teams can enhance their creativity (Gong et al., 2012; Amabile, 1998). An effective way of information processing within teams is through a Transactive Memory System (TMS), where team members remember from whom to get the information they need and vice versa (Wegner et al., 1985; Akgun et al., 2006; Gino et al., 2010; Guchait, Hamilton, and Hua, 2014; Hollingshead, 1998; Lewis, 2003; Peltokorpi, 2008; Ren and Argote, 2011). This way of knowledge sharing is very efficacious, since not every team member is obliged to remember all the information needed to complete a task, but can rely on the specialties of their other team members (Wegner et al., 1985). Multiple studies have found that transactive memory systems lead to behavioral and performance outcomes like team learning, effectiveness, efficiency, member satisfaction, reflectivity, and team creativity (Ren and Argote, 2011; Lewis, 2003; Michinov et al., 2008; Gino et al., 2010; Liang, Moreland, and Argote, 1995; Austin, 2003; Faraj and Sproull, 2000). But not so many have focused on trait antecedents for transactive memory systems. Hence, little is known about which personality traits affect transactive memory systems. In order to fill this gap, this relationship must be researched, which is why this study will focus on TMS as the method for information sharing.

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Whilst proactivity has been found to have a contribution in the frequency in which team members exchange information, it has not been directly linked with the development of transactive memory systems (Ren and Argote, 2011). In fact, the effect of hardly any personality trait on TMS has been studied before, because the majority of researchers focused on demographical traits (Pearsall and Ellis, 2006; Ren and Argote, 2011). By researching this relationship, a second study on the effect of personality traits on TMS will be disclosed, possibly enabling more researchers to follow up these initiatives. This is important because knowing which personality traits enhance the development of transactive memory systems will allow organizations to compose their teams based on how the development of transactive memory systems flourishes the most. Since TMS is found to be positively related to team performance outcomes and behavioral outcomes, extra stimulation in the composition of teams could benefit team performance. Also, ultimately, if enough researchers follow up on this research by studying whether more personality traits have effect on the development of TMS, a framework could be developed showing which combination of personality traits within teams are the most effective in creating a TMS.

Innovation and creativity, in contrast to TMS, are found to be outcomes of proactivity in multiple studies (Kim, Hon, and Crant, 2009; Kim, Hon, and Lee, 2010; Gong et al., 2012). Unresolved questions are though, how does proactivity within teams lead to better team creativity? How do proactive individuals within teams get to collaborate effectively? And how does proactive personality diversity relate to team creativity? This paper will try to find answers to these questions because they will show how team proactivity results in team creativity, which remains unclear in the present literature. This is important because it will enable organizations to not only base their selection methods on certain personality traits like proactivity, they can also change and improve the work environment or relationships between

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team-members for example, if this makes that the proactive individuals flourish even more. By doing so, they would ultimately stimulate team creativity.

Since proactive individuals tend to engage more often in information sharing activities (in order to acquire resources), it is most likely that TMS plays a mediating role in the relationship between proactivity and team creativity. This is, because a TMS actually enables these individuals to acquire the information they seek. If a TMS were to be absent, they might not find this information which could mean that they do not become more creative, since creative ideas stem from information resources. Another reason to think of TMS as the mediating variable between proactivity and creativity, is because it enables team members to develop their own specialty. It might be the case that a team member reaches out to another team member because his/her specialty is needed to solve a problem. If this specialized team member cannot provide the information needed to solve the problem, the fact that they discussed the problem might give the initiator new insights in ways to solve the problem differently (Sung and Choi, 2012). Therefore the creativity of the team will improve.

Both the links between TMS and creativity, and proactivity and creativity have been researched and positive relationships were found (Kim, Hon, and Crant, 2009; Emmons, 1989; Gino et al., 2010). But, if this paper succeeds in showing that transactive memory systems play a mediating role within the relationship between team proactivity and team creativity, the process of how the relationship between team proactivity and team creativity is established will be (partly) explained. By studying TMS as a mediator in this relationship, new insights could be found that will help us further understand how certain personality traits develop into positive team outcomes. This is important because by knowing what the underlying process encompasses, it enables new ways to approach the stimulation of these traits. In the end this could help organizations to further develop their creative cultures and

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improve performance. This contribution both adds to the team creativity literature, as to the proactivity literature, because no study before in either field has ever researched the effect of personality traits on team outcomes by inserting a mediating variable. If the results are to be positive, this study would open up a new area of research, where not only effects of traits on team outcomes will be studied, but the reason these effects take place at first will be studied. This will reveal the enabling process of the before mentioned relationships between personality traits and team behavioral outputs, giving organizations a more precise ‘guideline’ on what conditions to create for teams with certain personality traits.

Another contribution lies in the fact that this paper will also focus on the diversity of proactive personality within teams. As said, innovative team performance is greatly dependent on the quality of collaboration (Hoegl and Gemuenden, 2001). One can imagine that if certain traits annoy team members and therefore the cohesion deteriorates, that the quality of collaboration will drop. Also, if one member contributes more to the team than others, this could lead to irritations. The latter is especially the case with diverse teams consisting of both proactive members and non-proactive members, because a proactive attitude, according to Campbell (2000), implies an individual’s high involvement and commitment, independent contribution, initiative and a well-developed sense of responsibility. So if the non-proactive members lack these characteristics, the proactive members could become irritated which will have a negative effect on the collaboration and team creativity.

In the next section a literature review will be given, setting forth and explaining the fields of interest, like team composition, TMS and team creativity. After that, the methodology of the study will be explained. In this part the research design and way of data collection will be discussed. Following will be the results section, outlaying what statistical

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evidence is found on the subject. Next, are the discussion and conclusion section of the paper, covering the limitations, managerial implications, generalizability and future research suggestions.

2. Literature Review

In this section, an overview will be given of the literature regarding organizational teams, team creativity, team composition and transactive memory systems. Based on this review and the gaps discussed in chapter 1, the hypotheses will be formed.

2.1 Organizational teams and creativity

An organizational team is a group of people with a complementary set of skills required to complete a task, job or project. Alper, Tjosvold, and Law (2000) state that teams are popular means used worldwide to improve quality, reduce costs and develop new products to help organizations cope with a highly competitive marketplace. Staples and Zhao (2006) describe teams as a way in which organizations combine various skills, talents and perspectives of a group of individuals to achieve corporate goals. The reason that organizations use teams to reach their goals is because decisions made by teams tend to outperform decisions made by individuals (Hill, 1982). Also, teams are said to increase capability, responsiveness, efficiency and flexibility (Berry, 2011).

There exist multiple ways in which a team can express its performance, of which team creativity falls within the team performance behavior category since it is a way of thinking, and not so much an outcome itself (Ren and Argote, 2011). There is a remarkable amount of consensus on the definition of creativity in former studies. All definitions are based on

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states that creativity implies employees suggesting products, ideas or procedures that then can be implemented by the organization. Oldham and Cummings (1996) embraced two additional criteria to the term idea creation: ideas have to be novel or original, and they have to be relevant and/or useful for the organization in order for the organization to benefit from creativity. Rego et al. (2007) confirm the latter criterion, which does not imply that irrelevant ideas could not be creative, just not useful to the firm.

By improving creativity, beneficial outcomes like competitive advantages for example, are a possibility, leading to better organizational performance (Nayak and Argawal, 2011; Oldham and Cummings, 1996). This is, because as Danneels (2002) explains, innovation and creativity leads to the renewal of competences within the organization. This allows for change and adaptation which in turn increases the chances of survival and creates a competitive advantage towards organizations who don’t possess these ‘dynamic capabilities’. Creating a competitive advantage is important for firms in order to outperform their competitors. Especially in highly dynamic markets this is the case, because they have to react quickly to possible opportunities and threats in order to survive (Nayak and Argawal, 2011; Danneels, 2002). Because of these lucrative outcomes, it is very interesting to see how creative behavior can be stimulated. Most previous research has therefore focused on contextual or organizational factors affecting creativity, like the number of members in a team, trust, collaborative culture (Barczak, Lassk, and Mulki, 2010), direct task experience (Gino et al., 2010), activation of gender fault lines (Pearsall, Ellis, and Evans 2008), and also job and/or task complexity and supervisory style (Oldham and Cummings, 1996; Chae, Seo, and Lee, 2015; Coelho, Augusto, and Lages, 2011; Dong Liu, Hui Liao, and Loi, 2012).

Less research has been done on personality characteristics. Oldham and Cummings (1996) used the creativity personality scale (CPS) firstly introduced by Gough (1979) to

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determine whether or not people could be labeled creative. Gough (1979) researched the link between creativity and 30 traits, of which, 18 were positively linked, and 12 were negatively linked to creativity. A creativity score could be calculated by adding a point when a person possesses one of the positive traits, and vice versa. The traits which had proved positive relationships with creativity were: capability, cleverness, confidence, egotistical, humorous, informality, individualistic, insightful, intelligence, interests wide, inventiveness, originality, reflectiveness, resourceful, self-confident, sexy, snobbish, and unconventional (Oldham and Cummings 1996).

But, personality traits themselves do not turn into team creativity immediately. Personality traits can have their effects on individual creativity, which, through interactions amongst other members and team processes, are very important in converting the individual creativity into team creativity. For this reason, it is likely to think that the relationship between personality traits and team creativity is mediated by one or more of these interactions. This present study will focus on transactive memory systems as the mediator, coming from the knowledge sharing category. Hardly any research has been done in order to see what effects personality traits have on transactive memory systems (Ren and Argote, 2011), but certain traits are likely to stimulate knowledge sharing. One of these traits is team member proactivity, which will be further explained in the next section.

2.2 Team composition: proactive personality

Team composition describes how teams are built up based on either member demographics, competences or personality traits (Ren and Argote, 2011). The composition of teams can have big influences on processes within teams and ultimately on outcomes and performance (Mathieu et al. 2008). This paper will further investigate what effect the level of proactivity

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within a team has on TMS as a mediator and in the end team creativity as an outcome variable.

Proactivity, as mentioned above, finds itself assigned to the personality traits category. Campbell (2000) states that proactive behavior consists of five core characteristics. These are: (1) strong job- or task performance, (2) displaying competence, skill, trustworthiness and leadership, (3) organizationally oriented and committed to its goals; responsibility for unit success, (4) show initiative, independent judgement, engagement, and willingness to speak up, (5) personal integrity. Proactive people use these core characteristics to show initiative and shape organizational change (Bateman and Crant 1993). Kim, H. Y. Hon, and Crant (2009) state that proactive individuals identify opportunities, act on them, show initiative and carry on until change occurs. Because proactive people actively initiate change and look for better and more efficient ways to do things (Kim, Hon, and Crant, 2009), it is likely that these people are creative solution seekers. Another reason why proactive people are more creative is because they show more personal initiative, resulting in more (idea relevant) communication (Binnewies, Ohly, and Sonnentag, 2007). This communication leads to more shared knowledge which can be regarded as a useful resource for working on a creative solution (Binnewies et al., 2007). Also, Seibert, Crant, and Kraimer (1999) showed that proactive people attempt to increase their career prospects, meaning that they are constantly seeking for new ways for improvements and come up with ideas for better firm performance, which is a characteristic of creative solution seeking. Hence, the link with creativity can easily be made – the former arguments plead for a positive correlation between team proactivity and team creativity, which lead to the next hypothesis:

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As one can imagine, within teams more is not always better. Especially with proactive personalities this could be the case. As Hoegl and Gemuenden, (2001) state, it is teamwork which can be considered as a crucial factor to success and the quality of the teamwork decides the rate of success. If there are too many proactive individuals, situations may occur in which they would irritate each other, or become obstacles by hindering each other, deteriorating the quality of teamwork and possibly precluding the team’s creativity. Hoegl and Gemuenden (2001) continue by describing six underlying facets of teamwork quality: communication, coordination, balance of member contributions, mutual support, effort, and cohesion. Teams with highest teamwork quality engage in all six facets. Their results show that teams with better teamwork quality scores find themselves to be more innovative and creative. So when team members knowingly or unknowingly don’t engage in one or more of the facets, it deteriorates the teamwork quality and negatively affects the team’s creativity.

In contrast to the situation where too many proactive people in a team might worsen the teamwork quality, there are several reasons why diversity of proactive people in a team might be bad news for the teamwork quality and creativity. For one, proactive individuals might get annoyed by the passive and reactive attitude non-proactive individuals hold. This might be because they feel they contribute more to the team because of their active attitude (Hoegl and Gemuenden, 2001). There is something to say for the unlikelihood of passive team members contributing to team proactive performance, because these members are less likely to come forward with ideas and prefer to react to situations rather than to precede and outpace these situations (Williams, Parker, and Turner, 2010). These factors could in turn lead to the implementation of lesser useful ideas within the team and therefore hinder the creative performance of the team.

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Also, proactive people tend to show more personal initiative resulting in a more frequent activity of communication (Binnewies, Ohly, and Sonnentag, 2007). When a team is more diverse in terms of proactivity, it means some of the members are not considered proactive and will engage in fewer communication activities. In this case, because communication is one of the teamwork quality facets, the teamwork quality score will be negatively affected (Hoegl and Gemuenden, 2001). As said, this will also negatively affect team creativity. The fact that strong task/job performance is a core characteristic of proactive personality preludes another reason why team member proactivity diversity has a negative effect on the team creativity. When other team members perform very well within teams, other team members tend to believe that their ideas are dispensable, leading to a reduction in amount of ideas communicated (Paulus, 2000). Another social inhibition factor, which is comparable to the latter, is social anxiety, where team members are afraid to come forth with their ideas because of possible reactions of the better performing or more active team members (Paulus, 2000). The latter and former phenomena are less likely to occur when team members are less diverse in the matter of proactivity.

For the abovementioned reasons I will also be checking whether diversity or homogeneity regarding proactive personalities within teams leads to better team creativity. This can be done by not aggregating the mean values of individuals, but the SD values into the team construct of proactive personality. This leads to the next hypothesis:

H1b: Proactive personality homogeneity will be positively related to team creativity.

2.3 Transactive Memory Systems (TMS)

No matter how organizational teams are composed, in the end all teams have to accomplish goals. By collaborating, coordinating and communicating, teams can reach their goals and

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benefit more than the sum of all individual performances (Mathieu et al., 2008; Peltokorpi, 2008). In order to reach their goals, groups or teams have to possess a certain amount of knowledge. However, this does not mean that each group member has to possess all the information that is needed. When every team member has their own specialty and the combination of these specialties is enough to achieve the goals, teams can sufficiently do so. The only requirement then is that group members have to know whom to address when seeking the right information, or as Mathieu et al. (2008) like to call it the “collective awareness of who knows what”. This way of knowledge sharing is called a transactive memory system, and has been firstly introduced by Wegner, Giuliano, and Hertel (1985). Because of this division of knowledge, group members encounter less cognitive workload, resulting in a more efficient working environment within the team (Hollingshead and Brandon, 2003). Transactive memory systems consist of three dimensions: specialization, coordination and credibility. Credibility refers to the amount of trust team members have on other team members’ cognitive ability to contribute, specialization refers to the recognition of distributed expertise, and coordination refers to the ability of team members to work together efficiently (Pearsall and Ellis, 2006).

According to Peltokorpi (2008), transactive memory systems consist of two types of memory: the internal memory and the external memory. The internal memory simply storages all the information a team member has to offer itself. External memory signifies the storage of what the team members collectively know about the knowledge of one-another (Peltokorpi, 2008). When team members have reached their limits on a certain part of their internal memory, they use their external memory to remember who to go to in order to achieve the additional information. Limitations in this internal memory led to the development of TMS in the first place and the division of cognitive labor results in an

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2003). In turn, increased information processing will lead to better team performance (Dollinger, 1984; Hollingshead and Brandon, 2003) .

In order for a TMS to develop and stay viable, a few conditions must hold (Peltokorpi, 2008). Firstly, team members need to be cognitively interdependent, meaning they have to rely on each other, they have to be motivated to share information, and they have to interact with each other. Secondly, they have to agree on the expertise distribution. Thirdly, tasks should be complicated enough in order for group members to collaborate. Lastly, teams should be relatively stable because alterations of team members lead to possible disruptions of the TMS.

Ren & Argote (2011) created an integrative framework showing what the antecedents of TMS are, and what kind of effects it has on team outcome. They split up the antecedents into three categories: team member attributes (demographics, competences and personality traits), team-level inputs (shared experience, member familiarity, training etc) and organizational inputs (geographic distributions, acute stress). In this paper we are interested in the team member attributes, since the focus will be on proactive personality (personality trait). Only two researches have focused on personality traits as an antecedent of TMS. First, Pearsall and Ellis (2006) found that assertiveness is positively related to the development of transactive memory systems. Second, Guchait, Hamilton, and Hua (2014) found that conscientiousness is positively related to transactive memory systems, but failed to find a positive relationship between agreeableness and transactive memory systems.

Ren and Argote (2011) stress that personality traits are likely to affect the ease with which members communicate and exchange information (main characteristics of proactive individuals), which makes it important to further research this area and add to the existing personality trait literature. Also, it could be very interesting to know what personalities to

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look for in people when composing a team in order to maximize efficacy. Further research in this area could improve this selection process.

Proactive individuals, as stated in paragraph 2.2, tend to search for new ways and ideas to work more efficiently or effectively. Since the term ‘new’ requires additional information, these individuals could benefit a lot from a transactive memory system within their working team: If another team member already possesses the ‘new’ information needed for that innovative idea, it is much more efficient to ask that team member (specialization) about it and work together (coordination) rather than to obtain the information by himself. For this reason it is likely that proactive individuals will improve the development of transactive memory systems, since they will benefit from it. Also, two of the core characteristics of proactive personality, according to Campbell (2000), are strong job/task performance, and displaying competence, skill and trustworthiness. These characteristics are expected to contribute to the credibility dimension of TMS. If one shows skill, competence and trustworthiness, it is easier for other team members to find one credible. The same goes for job or task performance.

Another aspect of proactivity which is likely to stimulate the development of transactive memory systems is the fact that these individuals tend to communicate more (Binnewies, Ohly, and Sonnentag, 2007). Without communication, transactive memory systems are just memory systems because none of the information will be shared (Hollingshead and Brandon, 2003). Communication enhances several aspects of transactive memory systems. For one, by engaging in communication activities, it is easier for team members to assess where the specialties of other team members lie (Hollingshead and Brandon, 2003). This more accurate way of determining members’ specialties not only enhances the specialization dimension of transactive memory systems, but also the credibility

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dimension, because individuals can determine themselves where other members’ expertise lie, resulting in the fact that their trust in other members’ expertise will be higher and other members gain credibility (Hollingshead and Brandon, 2003). Lastly, communication enables information sharing which is one of the conditions for the viability of transactive memory systems (Peltokorpi, 2008). So, by being proactive and engaging in more communication activities, it is quite clear that a transactive memory system will be developed with more ease, and the information pool contained in the memory system will hold more information, enhancing the use of the transactive memory system (Hollingshead and Brandon, 2003). Based on the latter and former arguments, I hypothesize the following:

H2: Team proactivity has a positive effect on the transactive memory system within a

team or group

Just as with the creativity issue (diversity vs. homogeneity), it could also be that too many proactive personalities within a team hinder the development of a transactive memory system. Some arguments can even be used for both situations, since they are based on the teamwork quality framework introduced by Hoegl and Gemuenden (2001). Teamwork quality is not only the inducement for better team creativity, high teamwork quality leads to team members’ satisfaction with their work situation and provides an opportunity for team members to acquire and share knowledge (Hoegl and Gemuenden, 2001). Needless to say, knowledge sharing is the fundament of a transactive memory system, so by improving teamwork quality, knowledge sharing will be enhanced. But when teamwork quality deteriorates or vanishes, a transactive memory system may fail to develop or when already present, might break down. For example, when too many proactive individuals are combined in a team, and because of their active attitude and machismo behavior, for some reason

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conflict arises, it could severely reduce the collaboration within the team, in turn affecting the coordination aspect of TMS (which is also a facet of the teamwork quality framework).

On the other hand, as argued before, some of the core characteristics of proactive personality (strong job/task performance, displaying competence, skill, trustworthiness and leadership) can have a big (positive) influence on the credibility and coordination dimensions of TMS. When proactive team members are surrounded by other proactive team members and because of their strong job/task performance their expertise is seen as worthy and credible, it could very much enhance the TMS because members will have a lower threshold to approach one another in order to acquire their information. Also, because of their leadership skills, division of expertise, and active attitude, the coordination aspect of TMS will not be neglected and function efficiently.

A duplicable argument, in regards to the creativity issue, is the one involving the matter of member contribution: in a team setting where proactivity diversity is the case, proactive individuals might get annoyed by the lack of activity from their non-proactive team members. They might find themselves contributing more to the group process because of their active attitude, which could turn out to be disastrous for the collaboration within the team. Without collaboration, a TMS is doomed to fail because coordination and information sharing both require collaboration within the team. Therefore it would seem that proactive personality homogeneity would work out better, since they would all foster an active attitude and contribute to group work and processes.

Another factor in favor of homogeneity regarding proactive personality, involves communication. As has become clear in the above paragraphs, proactive individuals communicate more frequently enabling information sharing, specialty assessment, and a

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memory system. If there were to be proactive personality diversity, the non-proactive team members will communicate less frequently, hindering the abovementioned factors and therefore also the TMS. So, If proactive team members are able to avoid conflict, it would seem that the positive characteristics of proactive individuals would rather improve the transactive memory system. Hence, the next hypothesis:

H2b: Proactive personality homogeneity is positively related to the transactive

memory system of a team.

The consequences TMS has on group outcome are divided into three groups: team performance behaviors (learning, creativity, reflectivity), team performance outcomes (effectiveness, efficiency), and member affective outcome (team satisfaction) (Mathieu et al. 2008). Within the team performance behavior section, no direct effect between TMS and team creativity has been studied. Gino et al. (2010) did study the combination of TMS and team creativity, but they perceived TMS to be a mediator between task experience and creativity. Ren and Argote (2011) stress the fact that so little research has been performed on the relationship between TMS and creativity, and claim that this would “open up new avenues in creativity research”. This is, because it is assumed that teams either are creative or efficient, but if there exists a link between TMS and creativity, these two could be combined in an approach towards team effectiveness. Both creativity and efficiency are linked with team effectiveness, but their underlying mechanism is merely antithetical (Gilson et al., 2005). Where creativity involves enhancing variance to optimize fit between team efforts and outcomes, efficiency aims to minimize variance to ensure consistency (Gilson et al., 2005). In this case, the combination of consistency and creativity could actually work when an efficient way of knowledge sharing (TMS) leads to a greater information pool amongst members possibly improving team creativity.

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Peltokorpi (2008), states that TMS can improve team creativity when complementary information of group members is combined in novel ways. Furthermore, Amabile (1998) states that the foundation of transactive memory systems, information sharing and collaboration, support all three components of creativity (expertise, creative thinking skills, and motivation). Basically, TMS is actually a division of knowledge (members recall each other’s expertise to gain information). Because of the TMS, this knowledge pool is greater and deeper because team members collaborate, communicate and are able to develop their own expertise (Amabile, 1998). Also, since coordination is one of the three constructs TMS is built of, a TMS allows this greater information pool to be coordinated properly. This way, team members can use this information in novel and creative ways, improving team creativity. Based upon above argumentation, the next hypothesis will be tested:

H3: Team TMS has a positive influence on team creativity

In addition to the expectations of TMS and team proactivity having an effect on team creativity, I also expect TMS to have a (partially) mediating role on the relationship between team proactivity and team creativity. For one, this is because TMS enables proactive individuals to actually acquire the information they ought to seek. Proactive individuals do tend to engage more in information sharing activities, but it is the transactive memory system that enables them to do so efficiently. So without the presence of a transactive memory system, proactive team members will have a harder time sharing information, belittling the information pool, and ultimately hindering team creative outputs (Peltokorpi, 2008). Because the transactive memory systems enables the relationship between team proactivity and team creativity, one can speak of a mediating effect. Another factor which is enabled by a transactive memory system lies behind the division of knowledge. With a TMS present, not every member has to know everything one another knows, but can specialize and further

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deepen their knowledge base. Because of this specialization, team members have to communicate with each other in order to acquire certain information from another expertise. Even if the effort of knowledge acquirement does not result in immediate results, by communicating with other team members and viewing problems from different angles, the initiator could come to new insights and might be able to overcome problems in different ways than one was used to before (Sung and Choi, 2012). For these arguments, a TMS enables team creative performance of teams consisting of proactive members. Hence, the next hypothesis:

H4: TMS has a mediating role on the effect of team proactivity on team creativity

As argued for hypotheses 1b and 2b, proactive personality homogeneity within teams leads to a better transactive memory system. This is because collaboration, communication and information sharing will not be hindered due to the possible irritations in diverse teams. This better functioning TMS in homogenous teams, in combination with the arguments for why TMS is hypothesized as a mediator (hypothesis 4), leads to the final hypothesis:

H4b: TMS has a mediating role on the effect of proactive personality homogeneity on team

creativity

3. Methodology

This part will outlay the methods used to obtain data. In order to assess the proposed conceptual model, and to test whether any results are significant, the behavioural patterns of students performing a business strategy game are to be observed. Next will be a description of the mentioned game, followed by a description of the sample and the variables included in

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the conceptual model. The data had to be prepared in order to run tests. The last section will outline how that has been done.

3.1 Research Design

The business strategy game (BSG) is an experiential simulation which is known to have several advantages (Chen et al. 2010). First, this kind of simulation provides complete and transparent information about the actions of all participants. This gives the opportunity to not only measure all highly observable actions, but all moves by all participants, allowing for a greater amount of data (Chen et al. 2010). Second, simulations allow for measuring confounding variables, sharpening and isolating the actions of interest. Therefore, simulations offer measurement, comparability and control advantages (Chen et al. 2010). In order to complete the database, a survey was held parallel to the BSG, measuring all sorts of variables, like personality characteristics (individual level constructs; e.g. proactivity, learning style, motivation, skills), and team-level constructs like TMS, trust, communication reflexivity, creativity. These surveys were held on five different measurement points (waves) within the 9 week period, in which students had to fill in the questionnaires.

The business strategy game is a way of examining decision making of in this case students in the context of project-teams performing complex strategic tasks. It is set up in a nine week time span, in which teams of students, consisting of either four or five members, have to manage and lead a company in a set industry. Based on their decisions, performance is being measured in either their market share, earnings per share, return on equity, etc. Every week is supposed to represent a year’s life of their company, so the teams of students lead their organization for a period of nine years. The results are expected to be trustworthy since the BSG offers a realistic decision making process and the results count as a matter of 40%

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students take this seriously. The goal of each group is to outperform other student teams who lead competitive organizations in the same industry. Important to know, is that these teams of students can react to choices other teams make; it is a dynamic game in which the students define the rules by making choices.

During the weeks (company years) students get to make decisions about real-life matters as corporate social responsibility, company financials (including exchange rate impacts, shipping etc.), distribution channels, raw material supplies (what materials to use, against what costs), manufacturing process, human resource management, marketing and sales (advertising budget ; online and offline; celebrity endorsement), and other strategically relevant decisions. This big variety of decisions allows the game to come close to real-life situations where close observations of competitors and quick reaction to their actions are necessary to not fall behind. Every week, a performance report is provided showing what the company developments are in terms of market share, brand image, stock price variations, eps, roe.

3.2 Sample

The sample is formed by 566 mostly Dutch students. Not all of them participated through the whole process, so the sample size I will use for calculations will be reduced. As said, students had to form groups of four or five students (selectively, not randomly), resulting in a total amount of 117 teams. After the reduction, which will be illustrated later on, there are 112 teams left, together consisting of 495 students. On average, these students were 18.5 years old, ranging from 17 to 26 years old. Most of the participants (64.15%) were male, where the other 35.85% were female.

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3.3 Variables

All variables used in this research are measured through the questionnaires, which had to be filled in during 5 measurement points. I used variables from wave 5 only because the independent variable team proactivity was only measured in wave 5, making this research a cross-sectional study. All the variables are measured by confronting the students with scales that together form constructs. These constructs are divided in several items (questions) and are all measured on an individual level. In order to form team level constructs, the mean of these items per team was calculated.

Team creativity, the dependent variable, was measured by a 6-item scale (alpha =

.79), as performed by Gilson and Shalley (2004). This scale gives more insight into the propensity with which team members approach problems in a more creative way. Team Proactivity (α=0.74), as the independent variable, was used within this research in order to

see how teams are composed and whether this composition influences the other variables. Team proactivity is measured by a 7-item construct, based on Bateman and Crant's (1993) scale, measuring whether or not team members have the propensity to engage in proactive behaviour. The second order construct TMS was measured using a 15-item scale. Here, TMS is assumed to be reflected by three sub-dimensions, knowingly specialization (α=0.90), coordination (α=0.68) and credibility (α=0.88) (Lewis, 2003). Every construct consists of 5 items. Together, the mean of these three constructs will represent TMS as a whole, measuring in what sense team members remember who to go to for certain information. TMS will be studied as a mediator between proactivity and team creativity.

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3.6 Control variables

In order to rule out the possibility of alternate explanations for significant results, I used six control variables: The big five (openness (α=0.23), conscientiousness (α=0.05), extraversion (α=0.87), agreeableness (α=0.77) and neuroticism (emotional stability; α=0.59)) and prior relationships (α=0.83). Since they will be used as control variables, this means that I will examine whether or not the big five and/or prior relationships give any explanation of the results of the regression models. If this would be the case, it may be that not proactive personality, but one of my control variables is delivering me the desired results, which I want to rule out.

Because the teams are not formed randomly, the composition of teams will be influenced by the fact that some students might know each other and therefore prefer to form teams with people they know. For this reason, prior relationships is included in the control variables. The construct prior relationships will be measured by asking the students to answer two questions, like Jackson and Moreland did in their research in 2009. This 2-item scale provides knowledge about how well team members knew each other, and about whether or not they had worked together before. It is likely that prior relationships result in team members trusting each other better, collaborating better, and having the knowledge about from whom to retrieve information they seek more quickly. This all contributes to a better development of a TMS, which is the reason that the prior relationships variable has to be controlled for.

The big five variables are well-known to cover the basic structure behind all personality traits without overlapping (O’Connor, 2002). This makes it unwisely to do research on a personality trait without controlling for the big five, since it is most-likely that

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the trait in one form or another is (partly) incorporated in the big five. By controlling for the big five it makes it possible for me to isolate proactive personality as a substantive variable.

3.7 Testing for mediation

I tested the simple mediating effects of transactive memory systems regarding the relationship between team proactivity and team creativity using the PROCESS macro developed by Hayes (2014). PROCESS allows for the execution of a bootstrapped Sobel test with confidence intervals. The bootstrapped Sobel test addresses limitations in the Baron and Kenny (1986) procedure related to the positive relationship between the independent and dependent variable (Preacher and Hayes 2004), as well as assumptions of normality underlying the original Sobel test (Preacher and Hayes 2004, Sobel 1982).

3.8 Data preparation

3.8.1 Missing values

First of all, it is important to check for errors in the data by checking frequencies. In total there were 566 respondents, of which no more than 10% of the values are missing per item. There are several ways to deal with missing values: Hotdeck imputation, list-wise deletion, pairwise deletion, and mean substitution. They all have their pro’s and con’s. The most precise manner to deal with missing values, is by using the Hotdeck imputation which is only possible if the number of missing values per item does not exceed the 10% limit. Hotdeck replaces the missing value with a similar value by looking at the ‘possible’ value that suits the respondent. In this case, the 10% criteria holds, but the reason some data is missing in this dataset, is because a student bailed out or just didn’t fill in the questionnaires. For this reason, Hotdeck imputation cannot be used, because the missing values cannot be ‘borrowed’ from

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also the mean substitution option is ruled out because if all values for a certain student are replaced by mean values, this student will not be adding any information to the sample.

The difference between list-wise and pairwise deletion is that list-wise deletion is a no-nonsense measure: it deletes every respondent with a missing value. Pairwise deletion only looks at the relevant items (the ones you are analyzing) and then deletes the respondents with missing values within those items. I will combine two methods of handling missing values: In order to keep the sample size the same for all items and to keep teams constant (otherwise in some cases a certain student will be deleted, in others not), I will use list-wise deletion for the students who have missing values on more than 5 items. Furthermore, I will delete all teams who have only one or two members left after deletion, since a team cannot exist with only one member and a TMS has no extra value for only two people (Hoegl and Gemuenden, 2001).

The rest of the missing values I will impute using Hotdeck, because currently the missing values are randomly distributed and not any student has more than 5 missing values. In order to decide and ‘tell’ Hotdeck which other items the missing value can relate to, I have to check the correlation matrix of all the items. The items of my control variable (prior relationship) for example, strongly correlated with the 2nd and 3rd item of the credibility construct. So in order to fill in the missing values of the prior relationship items, Hotdeck will look at the values the respondent has for these credibility items and based on these values it will calculate what should be entered in the prior relationship item for that same respondent. After the list-wise deletion and Hotdeck imputation, the sample is as follows: there are 112 teams left, together consisting of 495 students.

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3.8.2 Reliability and validity analysis

The measurements used in this study all have a higher than standard (0.7) Cronbach’s alpha (Specialization: 0.90; Credibility: 0.88; Creativity: 0.79; Proactive personality: 0.74; Prior relationships: 0.83), which ensures reliability, except for the coordination construct (0.68), because there are only two items are left out of five due to deletion. This was necessary in order to maintain the construct validity. Also, since the reliability is fairly close to 0.7, I will assume that the scale is reliable.

Construct validity will be measured through factor analysis, using the principal component analysis and varimax rotation to assess the uni-dimensionality and factor structure. I will check whether the variance is explained by a common factor for the variables I have. Here for I will look at the ‘Rotated Component Matrix’ table (Appendix 2). Ideally, all items of a construct, only have loadings on that one single construct, with an eigenvalue above 1. As one can see, this is the case for most of my constructs, except for TMS, consisting of the credibility, specialization and coordination variables. The fourth and fifth credibility item, and the first, second and fourth cooperation items have loadings on other components than they should. After deleting these items one by one, the rotated component matrix shows that now the right items account for the right components, endorsing the construct validity. Also, now all the factor analyses satisfy the four criteria set by DeVellis (1991). These are: (1) commonality must be higher than 0.3, (2) dominant loadings must be greater than 0.5, (3) cross-loadings must be lower than 0.3, (4) satisfactory scree plot criterion. This means, that when this study reveals some kind of effect on team creativity for example, that one can rely on the fact that it is actually the team creativity construct the effect was found on, ruling out the possibility that the effect actually expresses itself on a different component than team creativity.

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3.8.3 Computing scale means

Lastly, in order to continue the analysis, constructs have to be made from the items. These new items, represent the variables as a whole, mostly computed by taking the mean of the single items together and dividing it by the number of items a variable consists of. In this case, this will result in eleven new items, namely team proactivity, team creativity, specialization, coordination, credibility, and the control variables: the big five and prior relationship. After this step, I have to create the TMS construct, consisting of the specialization, coordination and credibility constructs.

For all the constructs, the two-way mixed intra-class correlation coefficient (ICC) was determined which assesses the reliability by comparing the variability of the items to the total variation across all items. The single ICC’s were: 0.29 for proactive personality, 0.39 for creativity, 0.64 for specialization, 0.52 for coordination, 0.70 for credibility, 0.14 for TMS, 0.40 for extraversion, 0.01 for conscientiousness, 0.13 for emotional stability, 0.25 for agreeableness, 0.03 for openness, and 0.71 for prior relationship.

Now can be checked whether or not the items are distributed normally. When doing so, one must check for the skewness and kurtosis. The skewness indicates the asymmetry of the distribution and the kurtosis indicates how ‘pointy’ the peek is. When distribution is normal, both skewness and kurtosis lie close to 0. If the skewness and kurtosis are greater than 1.0 (or less than -1.0), the skewness and /or kurtosis is substantial and the distribution is far from normal. This is the case for two of my control variables (Appendix 3), where the kurtosis is above reaches a value above 1. The rest of the variables can be considered normally distributed, except for these two. In order to compensate for this, when performing regression analysis, the sample will be bootstrapped 10000 times to get closer to a normal distribution.

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Lastly, the respondents should be merged together in order to get team values. I have done this by using the mean of the values of the respondents to represent their team as a whole.

4. Results

4.1 Regression analysis

Table 1 shows an overview of the general descriptive statistics of the variables. It shows the mean, standard deviation and zero-order correlations. Before testing the hypotheses through a series of regressions, there has to be checked whether or not the assumption for

multi-collinearity is satisfied. This means that none of the inter-correlations reached above the .80 threshold, which is the case.

Table 1: Descriptive statistics

The regression analysis outcomes of this study can be found in Table 2. I performed 3 regression analyses: (1) one where TMS is the dependent variable and proactive personality is the independent variable (Table 2; model 4) to test their relationship separately, (2) one where team creativity is the dependent variable and TMS is the independent variable (Table

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creativity as the dependent variable, and proactive personality as the independent variable (Table 2; model 2). Besides these regressions, I also performed regression analysis on the dependent variables only including the control variables. Regression analysis 1 will provide insights on whether H2 will be supported or not. Regression analysis 2 will prove if H3 holds or not, and regression analysis 3 proves if H1 holds.

Table 2: Team creativity as dependent variable, proactive personality as independent variable, TMS as mediating variable + TMS as dependent variable, proactive personality as independent variable (model 4)

Regression analysis 1: In the model summary table, one can find an adjusted R² of -.025 for the first model, only including the control variables. This means that 0% of the variance of the TMS variable is explained by the control variables. When looking at the coefficients of all the control variables, one can see that none of them are marked significant,

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whatsoever. Model 2 shows what percentage of the variance of TMS is explained by the independent variable (proactive personality), in addition to the control variables. As one can see, now the adjusted R-square is .038, an increase of .063. This implies that 3.8% of the variance is explained by this model, although this result is not significant. By looking at the coefficients, it is easy to see that this increase is due to the independent variable proactive personality, which has a significant (p < 0.01) regression coefficient of .266, which is much higher than the rest. The latter means that H2 is supported

Table 3: Team Creativity as dependent variable, TMS as independent variable

In order to prove whether or not H3 holds, regression analysis 2 was performed (Table 3). Through this regression, one can see if TMS has any significant effects on team creativity. The adjusted R² for model 1 (only the control variables) is .069, which is significant due to the prior relationship control variable (p < 0.05). Nonetheless, when adding

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significance level of p < 0.001. This significant increase in the explanation of the variance of the team creativity construct (6.9% to 25.3%) is caused by TMS, which has a significant direct effect itself too (.423; p < 0.001). These results therefore support H3 meaning that this hypothesis holds.

Regression analysis 3, in addition to the second analysis, is performed to check what effect the control variables and independent variable(s) have on team creativity. When looking at the effect of just the control variables, as in regression 2 – model 1 (Table 2), one can see that 6.9% of the variance is explained, which is a significant result (p < 0.05). Separately, prior relationship seems to have a significant direct effect on team creativity also (p < 0.01). By adding the independent variable proactive personality to the model, the adjusted R-square increases to .440, a significant explanation of the variance of team creativity (p < 0.001). Also, the coefficients for prior relationship (.274; p < 0.01) and proactive personality (.610; p < 0.001) are significant meaning that these variables indeed have an effect on team creativity. The latter also proves that H1 holds.

4.2 Testing for mediation

By using the process macro in SPSS, written by Andrew F. Hayes (2014), it was possible to test for mediation. This basically means that I tested whether or not there exists a significant mediation effect on the relationship between team proactivity and team creativity. As can be seen in the output of the test (Table 2; model 3) the total mediation interaction has an effect of .475 with a p-value of .000; the results are significant. This means that there is a 0.0% possibility that the 47.5% explanation of the variance is due to chance. To see how big the mediation effect was, we can look at the direct and indirect effect. The direct effect of team proactivity has a value of .755 and a significance level of .000 (confirmation that H1 holds).

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The indirect effect has a value of .110 meaning that 11.0% of the variance is explained by the mediation effect (p < 0.05).

The latter results lead to the approval of my fourth hypothesis: “TMS has a mediating role on the effect of team proactivity on team creativity”. It seems, that when teams have a better developed TMS, the size of effect of proactive personalities on team creativity, increases with 14.6% (.110/.755*100).

Table 4: Team creativity as dependent variable, proactive personality (SD) as independent variable, TMS as mediating variable + TMS as dependent variable, proactive personality (SD) as independent variable (model 4)

To test whether diversity of proactive personalities within a team, rather than homogeneity has any effect on team creativity, another model was used where the proactive

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personality construct based on the SD. The results can be found in Table 4. As one can see, although model 3 proves significant (p < 0.05), the SD team proactivity construct never has any direct significant effects on team creativity. This is the case for both the models 2 (direct effect on team creativity) and 3 (including the mediation effect of TMS). The regression coefficients as shown, are negative, meaning that it is more likely that homogeneity of proactive personality within a team has positive results on team creativity, rather than diversity. Even though it is more likely, the results are not significant, and therefore H1b and H4b are not supported. Also, as the fourth model shows in Table 4, the effect proactive personality diversity has on TMS is not significant, and therefore inconclusive. This means that also H2b is not supported.

5. Discussion

5.1 Findings

The main goal of the research presented here was to investigate what effects personality traits have on team creativity, and how these effects originate. Results showed that higher levels of team proactivity resulted in higher levels of team creativity because of an enabling process, namely a transactive memory system. Furthermore, I researched whether proactive personality homogeneity or diversity had any effects on the development of a TMS or on the level of team creativity, but no significant conclusions can be drawn. Also, direct positive effects between team proactivity and TMS, TMS and team creativity, and team proactivity and team creativity were significantly present. Especially the latter is of importance, because it confirms my expectations of the partly mediating effect TMS has instead of a fully mediating effect.

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This research yields several findings. (1) Team proactivity has a positive impact on team creativity, (2) Team proactivity has a positive impact on the development of a TMS, (3) Team TMS has a positive influence on team creativity, and (4) TMS has a mediating role on the effect team proactivity has on team creativity. These findings contribute to the literature on proactivity, TMS, and team creativity in different ways. The fact that a direct effect between proactivity and the development of a transactive memory system was found, is new to both the proactivity literature as the TMS literature. In fact, hardly any research has ever focused on a possible linkage between personality traits and TMS. This study therefore fills up the latter gap, broadening both research areas. Especially in TMS literature this could be of great significance because by exploring the personality trait effects on TMS new ways of stimulation can be investigated, other than the already known contextual factors.

The relationship between team proactivity and team creativity has already been studied before, and as this study acknowledges, there exists a direct connection. But, the premier finding of this study is the revelation of the enabling process of this relationship – TMS serves as a mediator. Never was the process of how proactivity leads to better team creativity studied before, and therefore it adds to the present literature of proactivity, TMS and team creativity. This paper has shown that transactive memory systems partly enable the stimulating effects team proactivity have on team creativity, which has both theoretical and managerial implications. For one, a new research direction is created, making way for scientists to continue study in this area by changing the personality trait or process enabling variable for example. This will further expand the knowledge base concerning personality traits and their possible outcomes, and enlighten possible explanations for increasing or decreasing creativity within teams since more variables will be known to man.

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