rainhowilson@gmail.com First Supervisor: Dr. Florian Noseleit Second Supervisor: D.L.M. (Dries) Faems Word count: 11726 January 2016

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0 Master Thesis

Empirical analysis on how innovation performance of the team leaders is related with their leadership style.

“How is individual innovative performance related to leadership style?”

Master's degree in Business Administration Specialization Strategic Innovation Management

Wilson Rainho S2837692

rainhowilson@gmail.com

First Supervisor: Dr. Florian Noseleit Second Supervisor: D.L.M. (Dries) Faems

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Abstract

In this study, the relationship of individual innovative performance to leadership styles (transactional/transformational leadership) is analyzed in a group of 901 leaders and 4192 followers from different organizations of the pharmaceutical sector. Patents and the ratio citations per publication were used to measure individual innovative performance. Leadership styles were measured with an adaption of the Multi-factor Leadership Questionnaire. Multivariate analysis of covariance was used to test the variances on leadership styles attributed to leaders’ innovative performance and multivariate analyses variance were performed to understand the variances on leadership styles attributed to different performing groups. The results show that individual innovative performance when measured with patents predicts higher scores of idealized influence (dimension of transformational leadership). And when measured through citations per publication it predicts higher scores of intellectual stimulation (dimension of transformational leadership) and contingent rewards (dimension of transactional leadership). Conclusions and discussion of the findings and the relevance of environment and context for leadership styles are provided, as well as the implications for future research.

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Leadership has been considered a complex phenomenon since 1869, with the first quantitative studies about the subject. It has been defined as a unique characteristic of extraordinary individuals whose decisions are capable of radical change (Galton, 1869; Zaccaro, 2007) or the ability of individuals to build and maintain a team that performs well relative to its competition (Hogan & Kaiser, 2005).

In recent literature leadership has been presented as a determinant of innovation (Crossan & Apaydin, 2010) and organizational performance (Ogbonna & Harris, 2000). The upper echelon theory suggests that the firm performance is impacted by top management’s decisions and choices, which are related with the manager’s background and demographic characteristics (Child, 1972). Later, Waldman, Javidan and Varella (2004) associated firm outcomes to the executives’ charismatic leadership and found a link between leadership and strategic change.

There are two main leadership styles that have been assessed as determinates of innovation. Burns (1978), creator of the transformational/ transactional leadership theory argues that there are two constructs of leadership: (a) transactional leadership which is instrumental and focus on exchange relationship and (b) transformational leaders, which are visionary and focus on enthusiastic individuals with capacity to motivate employees.

Empirical studies have connected transformational leadership with organizational outcomes (Howell & Avolio, 1993; Ogbonna & Harris, 2000), with innovation climate (Jung, Chow, & Wu, 2003) and at team level with team performance and product success (Dionne, Yammarino, Atwater, & Spangler, 2004; Keller, 2006). Although, transactional leadership has been ignored by a greater part of the researchers, it is an important leadership style for followers’ motivation and satisfaction - main characteristics for team effectiveness and innovativeness (Dayan, Di Benedetto, & Colak, 2009; Liu, Liu, & Zeng, 2011).

As such, if leadership and leadership styles of a company’s leaders and projects‘ leaders are related with their success1_{, it would be important for firms to predict leadership and leadership style in}

order to have a stronger control of their own success. Fiedler (1996) argued that most leaders selection

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5 and leadership training have not been effectively validated which requires more research on the ground.

An important question in this field is what factors and how can they predict leadership and leadership style. Chelladurai (1980) using the multidimensional model of leadership argued that the personal characteristics of a leader, such as abilities and personality, are antecedents of leader behavior. Hogan et al. (1994) went further and proposed that to “forecast” leadership, a combination of cognitive ability, personality, simulation, role play and multi-rater instruments and techniques have to be assessed. More researchers have related leaders’ personality with the readiness to make decisions, resistance to stress, tolerance for uncertainty and inner work standards are able to predict the effectiveness of leadership (Hogan et al., 1994; Howard & Bray, 1990). In the same line of thought, McCormick (2001) argues that characteristics such as persistence, effort, goal directedness, and problem solving have been associated with successful leadership.

Closer related with leadership styles, motivation and character building efficacy were described as their predictors (Sullivan & Kent, 2003), when considering that confident leaders in their roles (as motivators and teachers) have a closer image to the ideal leader using feedback and suitable instruction and training (Sullivan & Kent, 2003). Further Feltz et al. (1999) demonstrated that less confident leaders show more instructing and organizing behaviors. As long as those leaders may rely more in direct instruction and organization. Then more confident leaders, achieved through experience and success, may switch to another leadership style more focused on the improvement of members’ performance. Reinforcing this idea Kolb (1999) argued that “some degree of confidence”, “self-reported leadership attitude” and “leadership experience” can predict leadership. Thus, McCormick (2001) argued that one of the most reported findings in the leadership literature is the correlation between a leader’s self-confidence and successful leadership.

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6 the most frequent predictor of both leadership styles (Garcia et al., 2014). Moreover Feese (2011) using logistic regression was able to predict leadership styles with 75.5% accuracy.

Despite the fact that the literature has (a) correlated leadership to teams and organizations‘ performance, (b) predicted leadership effectiveness assessing leaders‘ traits and even (c) predicted leadership style through leader’s personal traits, the existing prediction of leadership styles is a slow process which involves the presence and the active participation of the individuals under analysis. Therefore the leader selection stiff a long and complex process, which may benefit from simple and easier ways to predict leadership style.

The prediction effect of the individual innovative performance on leadership style would lead to a more simple and quick process to overcome those limitation, due to the public access to the individual innovative performance.

To fill this gap in the literature, this study developed at individual level aims to analyze whether performance of the team leader in terms of innovation is an indicator or determinant of specific characteristics of leadership style - transformational/ transactional.

“How is individual innovative performance related to leadership style?”

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2. Literature review

This section is structured in the following way: overview of the existing relevant literature about individual innovative performance (2.1) and leadership (2.2), namely transformational leadership (2.3) and transactional leadership (2.4).

2.1. Definition of individual innovative performance

Innovation and creativity are mentioned in the literature in an interchangeably way, however in more recent literature creativity is associated with the production of useful ideas and novelty. Innovation has to do with adoption of those useful ideas and their implementation (De Jong & Den Hartog, 2010; Scott & Bruce, 1994). In the literature idea generation is presented as a stage of a multistage innovation process where social factors also play a role (Scott & Bruce, 1994). Given that individuals are responsible to develop, carry, react to and modify ideas to foster innovation at different stages (Lee & Wong, 2006).

According to Carmeli et al, (2006) individual innovation has 3 stages. First an individual recognizes the problem and invents a solution, either novel or adapted. Second one promotes ones ideas to build legitimacy. The final stage consists of an individual realizing the ideas with a prototype or model. Then individuals are crucial to the innovation multistage process (De Jong & Den Hartog, 2010).

In conclusion, individual innovation performance is frequently presented in the literature as a result of organizational structures and contextual influences (structural characteristics), individual level antecedents (individualist perspective) or a result of both (interactive process perspective) (Lee & Wong, 2006).

2.2. Leadership introduced

For decades, leadership has been an important subject for social sciences, which was studied using different methods and definitions (Reuvers, Van Engen, Vinkenburg, & Wilson-Evered, 2008). Lately with a renewed interest within the subject a distinction between transactional and transformational leadership appeared (Den Hartog, Van Muijen, & Koopman, 1997).

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8 leadership, which is instrumental, and focuses on exchange relationship; and transformational leadership which is visionary and focus on enthusiastic individuals with capacity to motivate employees. However, Bass (1985) reformulated the theory and argued that transformational and transactional leadership styles are distinct but not mutually exclusive processes, which are combined within effective leadership and where transformational leadership might be built on top of transactional leadership.

2.3. Transformational leadership

The transformational leadership, sometimes known as charismatic leadership, is based on the emotional relation between the leaders with the followers and the followers with the environment (Keller, 2006). Thus there is a need for a strong personal identification with the leader and with the common vision of the future around a collective purpose (Hater & Bass, 1988; Simola, Barling, & Turner, 2012). Then it is necessary to change followers’ priorities from self-interests to group’s mission and purposes (Burns, 1978). Thenceforth, transformational leaders influence followers by connecting their self-concept to the mission of the group and by addressing their values (Reuvers et al., 2008), which may be achieved. This means that a transformational leader needs to raise awareness to the importance and value of group outcomes (Bass, 1985).

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9 dimensions. Thus they presented a model where transformational leadership is just measured by one dimension.

However, it is argued in the literature that the 4 initial main dimensions of leadership are still valid and provide a model with empirical distinguishable dimensions (Baldoni, 2005; Bass & Riggio, 2006; Gill, 2011; Lievens Pascal Van Geit,Pol Coetsier, 1997).

Following this literature, Individual Consideration is related to the personal attention that leaders give to their followers, taking their differences into consideration. The leader provides coaching and feedback to link the followers’ needs to the organizations’ needs (Avolio et al., 1999; Bass, 1985; Reuvers et al., 2008).

Intellectual stimulation is associated to supportive climate where creativity and innovation are

vital for the leader’s ability to increase the awareness of problems and recognition of their own beliefs and values within the group (Avolio et al., 1999).

Inspirational Motivation is linked with the inspirational vision challenge that the leader provides

to the followers making them to leave their comfort zone. Leaders communicate optimism about goals and provide meaning to the followers’ tasks to drive the group forward (Baldoni, 2005; Bass & Riggio, 2006; Gill, 2011).

Finally, Idealized Influence is connected with the leader’s values that the followers should learn and internalize. Leaders provide sense and meaning to the challenge fostering an inclusive vision, leading by example and showing a strong commitment to goals and high performance (Baldoni, 2005; Bass & Riggio, 2006; Gill, 2011).

These four factors are treated as distinct but related dimensions rather than a unique construction, which is consistent with the literature, namely for analyzing the relationship between leadership style and innovation performance (Dayan et al., 2009; Keller, 2006).

2.4. Transactional leadership

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10 might experience harsh criticisms, resulting in the followers taking the well-trodden track of approaching problems instead of trying new methods. Nevertheless, without transactional leadership, transformational effects may not be possible because it builds trust, dependability and perceptions of consistency among the followers (Srinivas, Kumar, & Vikramaditya, 2006). Therefore, a transactional leader within an existing system tries to satisfy the followers’ needs focusing on an exchange relationship - contingent rewards. As long as, the leader takes action to correct deviation, mistakes and irregularities, presenting a management-by-exception active (Bass, 1985; Liu et al., 2011; Srinivas et al., 2006).

3. Hypotheses derivations

3.1. Individual innovative performance and leadership

Innovation is associated with change and creativity among teams (Stalk Jr & Hout, 1990). A leader who aims to implement an innovation culture and achieve innovation performance needs to influence creativity and flexibility to enhance the team innovative performance (Mumford, Scott, Gaddis, & Strange, 2002). Jung (Jung, 2001) examined the effects of transformational leadership in 53 groups and found that the number of ideas created by a group (creativity) and the number of different ideas created (flexibility) were greater among groups with higher transformational than transactional leadership. In 2003 he found that innovation is enhanced by transformational leadership by motivating the employees through their personal values and encouraging them to be creative (Jung et al., 2003). Summing up, the literature presents a positive relationship between transformational leadership and innovation (Rosing, Frese, & Bausch, 2011). However, the inverse relationship of the individual innovative performance to leadership has not been explored in the literature.

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11 Less confident leaders show more instructing and organizing behaviors and may rely more in direct instructions and organization leadership style. More confident leaders (achieved through experience and success) may switch to another leadership style focused on the improvement of members’ performance (Feltz et al., 1999). Kolb (1999) reinforced this idea arguing that “some degree of confidence”, “self-reported leadership attitude” and “leadership experience” can predict leadership.

The integrative theory of leadership contends that a leader self-confidence determines leader self-efficacy, which influences leader behavior intentions. Then self-confidence (confidence in one ability to success) impacts leadership performance (Chemers, Watson, & May, 2000). Following this approach, the leader–member relationship has an important role for the development of leadership characteristics and style. Nahrgang et al. (2009) argue that factors such as leader performance will be important to determine the development and the quality of the “leader-member” relationship, given that higher-quality relationships are associated with high trust, high interactions and high support (Deluga, 1998; Nahrgang et al., 2009; Varma, Srinivas, & Stroh, 2005).

Scott and Bruce (1994) and Livingston (1969) argued that the "Pygmalion effect" referring to the expectations of individuals, can impacts behavior. It suggests the modification of individual's behavior based on the expectations for that behavior received from others. Thus the behavior of a leader is also shaped by the expectations of the followers (Scott & Bruce, 1994).

As such a successful leader, with experience and confidence, and self-judgement of its capabilities will be associated by their followers to a transformational leadership style. Therefore, a successful leader (in the market or/and academia) will then act as a transformational leader due to followers’ expectations. Then:

H1(a,b,c,d): The higher the number of leader’s patents, the more a )Individual Consideration, b) Intellectual stimulation, c) Inspirational Motivation, and d) Idealized Influence are associated to them.

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12 Transactional leadership has been ignored by a greater part of the researchers. However, Zeng (2011) argued that transactional leadership influences team innovativeness, through team efficacy enhanced by the exchange relationship between a leader and its followers. Srinivas, et al. (2006) claimed that transactional leadership is positively correlated with extra effort, leader’s effectiveness, satisfaction with the leader and negatively correlated with intention to quit. Consequently, Dayan et al.(2009) reported in their meta-analysis a positive correlation regarding the relation transactional leadership with product success and with R&D teams.

However, transactional leadership is often associated with bureaucratic authority and the tendency to emphasize work standards, assignments and task-oriented goals, which do not promote the followers’ innovativeness (Bass, 1985; Lee & Wong, 2006). Fiedler's contingency theory highlights the leader's personality and psychological disposition as the main factor in one’s ability to lead. He argues that low "human relations orientation” leaders (task-oriented) are effective, regardless whether the factors are highly favorable or not. Which leads them to act in a more assertive manner (Fiedler, 1964). Hence a less confident leader (who is afraid of the impact of other factors) shows more instructing and organizing behavior (Fiedler, 1958; Fiedler, 1996).

Also, the "Pygmalion effect" (Scott & Bruce, 1994) suggests that a non-successful leader, with no confidence will be associated by their followers to the transactional leadership style. Therefore, a non-successful leader will then act as a transactional leader due to followers’ expectations. Then:

H3(a,b): The higher the number of leader’s patents, the less a) Contingent reward and b) Management-by-exception are associated to them.

H4(a,b): The higher the leader’s citations per publication indicator, the less a) Contingent reward and b) Management-by-exception are associated to them.

4. Methodology

4.1. Conceptual model

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13 These analysis are used to evaluate statistical differences by the independent variables on the multiple dependent variables. Mainly, the hypotheses are tested via MANCOVAs, given the existence of different dependent variables and different continuous independent variables. However extra models are performed via MANOVA, due to the transformation of the continuous independent variables into non-continuous. These extra models are further explained in the results section.

Figure 1 – Conceptual model

4.2. Sample and data collection

To test the hypotheses presented above, the present study uses part of the sample related to the pharmaceutical industry of an existing database to access the data related to dependent variables. The collection of the number of patents, publications and citations related to the leaders individual innovative performance (independent variable) was done through a data base, namely Web of Science and the PATENTSCOPE database provided by the world intellectual property (WIPO).

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14 In order to focus this study on innovation, the team leader’s position was taken into consideration to evaluate the leader’s involvement with innovation activities mainly related to R&D. Then all unreadable team leader’s position title (mainly associated with no use of international alphabet) were deleted from the study. Next all the positions that were connected with innovation were selected. Also position’s titles that have characters related to research, science, innovation, R&D and development, such as: “research”, “scien”, “innov”, “R&D” and “develop” were selected. Furthermore, to refine the study and focus on leaders of product development, leader’s position title with wording like “innovation” and “development”, were assessed again. In order to delete from the study data related to business development and innovation, marketing development and innovation, H&RM development, leadership development and services development were deleted. Those phases of data selection leaded to a sample of 2413 leadership assessments related to product innovation in the pharmaceutical industry as shown in table 1.

Phase of data reduction Sample size

Initial existing database of pharmaceutical sector 47625

Sample size after exclusion of unreadable team leader’s position title 45730 Sample size after consideration only team leader positions with the characters:

“research”, “Scien”, “Innov”, “R&D” and “develop”

3301

Sample size after exclusion of business development, marketing development, H&RM development, leadership development and operations development related position

2413

Sample size after exclusion of team leaders impossible to identify 1937 Sample size after exclusion of missing data related to leadership style 901

Table 1 - Data reduction phases

As mentioned above the collection of the number of patents associated to the leaders (individuals) was done through the PATENTSCOPE database provided by WIPO (world intellectual property organization), which offers access to over 50 million of patents across 148 countries throughout the world (WIPO, 2015). The number of publications and citations were taken from Web of Science2_{, which is an index of literature in the world. “Web of Science has become the gold standard}

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15 for research discovery and analytics. Web of Science connects publications and researchers through citations and controlled indexing in curated databases spanning every discipline” (THOMSON REUTERS, 2015).

The data collection related to individual innovative performance induced further exclusions from the study of leadership assessments. Surveys with unreadable team leader’s names and with non-identifiable team leaders were removed from the analysis, which leaded to the eliminations of 476 assessments, as presented in table 1. The systematic process of matching the information regarding the leader, in order to precisely identify the publications, citations and patents related to the individual, consists of: (a) the identification of middle names of the individual associated with a company, via PATENTSCOPE database, Web of Science or LinkedIn profile and (b) career match to reinforce perfect corresponding between the person in the database and the individual’s patents, publication and citations. In order to reduce bias regarding the data collection, in case of imprecise identifications after this procedure, the individuals were dropped from the study.

After the removal of 1036 assessments from the study, due to missing data related to leadership style, the presented hypotheses were tested on a sample of 901 individuals that from 2001 to 2014 leaded teams responsible for the development of R&D to foster product innovation in the pharmaceutical sector, mainly in three companies. 37,6% are women and 23% aged between 40 and 59 (considering missing data), as shown in table 2.

Age Frequency Percentage

Until 29 0 0,00% 30 - 39 10 1,10% 40 - 49 110 12,20%

50 - 59 93 10,30% Gender Frequency Percentage

60+ 16 1,80% Male 562 62,40%

Missing 672 74,60% Female 339 37,60% Total 901 100,00% Total 901 100,00%

Table 1 - Sample characteristics

4.3. Dependent variables

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16 followers´ perceptions are the reality. The individual assessments of leadership were aggregated via average.

To measure the dimensions of both styles of leadership, this study is based on an adapted Multifactor Leadership Questionnaire (MLQ) (Avolio et al., 1999), mainly following Podsakoff, et al. (Podsakoff et al., 1990) and Bass and Riggio (2006), which has been used in a variety of studies (Barbuto Jr, Fritz, Matkin, & Marx, 2007; Dayan et al., 2009; Sarros, Cooper, & Santora, 2008).

In terms of transformational leadership, Barbuto, et al. (2007) presented that the items measured in a scale from 1 to 5 are related to inspirational motivation, idealized influence, individual consideration and finally intellectual stimulation. This scale has revealed in many studies to have internal consistency reliability with all Cronbach’s alpha coefficients >0.70 (Barbuto Jr et al., 2007; Dayan et al., 2009; Lievens Pascal Van Geit,Pol Coetsier, 1997).

Regarding transactional leadership Waldman et al. (2001) used a scale from 1 to 5, measured and conceptualized it as contingent reward and management-by-exception (active). This scale has demonstrated acceptable reliability (Cronbach’s alpha coefficients >0.70) among different samples (Dayan et al., 2009; Podsakoff et al., 1990; Waldman et al., 2001).

To measure the four dimensions of transformational leadership, this study matched the items present in the existing database in a scale from 0 to 6, with items present in the literature (Barbuto Jr et al., 2007; Podsakoff et al., 1990). Whilst to measure the two dimensions of transactional leadership, this study matched the items present in the existing database in a scale from 0 to 6 with items available in the literature. Dayan, Benedetto, & Colak, (2009) just used 11 adapted items from MLQ to measure transformational leadership and 6 items to measure transactional leadership.

4.4. Independent variables

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17 years of research and development were needed, where is always present the patent application phase (Wilsdon & Nitsche, 2004).

This study uses citations per publication and patent data as measures of innovation performance of individuals/ leaders that worked in a team in the pharmaceutical sector between the years of 2001 and 2014 around the world. Due to the fact that this paper analyses the pharmaceutical sector, the limitations of patents and publications to study innovation associated with strategic choice and thus the non-publications or non-patenting of all innovation are diminished. As presented above patenting is a usual phase of product development in the pharmaceutical industry especial because the sector protects the early mover advantage and also because it facilitate licensing in negotiations (von Hippel, 1988). Furthermore, existing studies recognized patents as major drivers of innovation, without which there would be no innovation (Bain, Mann, & Pirola-Merlo, 2001). Then patents are used in this study to measure product innovation focused on commercialization.

Regarding publications, they represent the findings that add to existing knowledge or create new knowledge. These were considered as a measure of individual innovative performance (Lee & Wong, 2006).To achieve a construction that measures the number of publications, but having into account their impact within the scientific community (indicator of quality), the final construction used in this study is the number of citations divided by the number of publications. As such, citations per publication represent the quality and relevance of the innovation regarding to academia, which represents innovation less focus on the market, which would be present in the first or second phase of innovation presented by Carmeli et al, (2006).

Due to the fact that this study aims to predict leadership style via individual innovative performance, all publications are taken into consideration, as well as, citations, and patents that individuals produced during their lives until the end of the year 2014.

4.5. Control variables

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18 In terms of the individual’s related variables, Barbuto Jr et al. (2007) studied the impact of leader’s gender on ratings of transactional and/or transformational leadership behaviors.

With respect to company effects, leadership behaviors can be influenced by the firm’s strategy through the selection process that leads a company to hire more leaders with a specific leadership style or implement a training plan focused on the development of a type of leadership. Chelladurai (1980) presented the multidimensional model of leadership, arguing that organizations may have an impact in leadership, mainly resulting from their organizational structure, size and nature of the work.

Variables Source

Dependent – Individual innovative performance (Publications, Citations and Patents)

-Von Hippel, 1988 -Lee & Wong, 2006 Independent – Leadership styles

-Transformational leadership -Transactional leadership

-Barbuto Jr et al. (2007)

-Dayan, Benedetto, & Colak, 2009;

-Podsakoff, MacKenzie, Moorman, & Fetter, 1990 -Waldman, Ramírez, House, & Puranam, 2001 Control variables -Barbuto Jr, Fritz, Matkin, & Marx, 2007

-Chelladurai (1980)

Table 3 - Overview of the theoretical bases of the variables

4.6. Validity

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19 To test the hypotheses and perform multivariate analysis of covariance analyses, a principal component of factor analysis and Cronbach alpha analysis was conducted for the dependent variables (leadership style). Table 4 shows the results of the principal component of factor analysis for the 6 dimensions presented above of the dependent variables, which revealed that the questions selected and presented in the appendix with reveled good loadings.

Cronbach alpha analysis (for the dependent variables), presented in table 5 reinforce the statistical strength of the study, with all dimensions of leadership scoring higher than Nunnally’s criteria of 0.7.

Table 6 shows the correlations between all the variables, which presents a non-significant correlations between the two independent variables. This once more reiterates the use of patents and citations/publication as a way to measure innovation in different phases of the development. All the other correlation between the dependent variables (dimensions of leadership) have been reported and accepted in the literature (Heinitz et al., 2005).

To run the multivariate analyses previous assumptions have been addressed in order to ensure (a) the normality of the data, (b) the no presence of outliers, (c) the homogeneity of variance-covariance and (d) the homogeneity of regression slopes (Tabachnick & Fidell, 2001).

Regarding normality and outliers, a visual inspection of frequency distribution (histogram), stem-and-leaf plot and Q-Q plot (quantile-quantile plot) revealed that the data regarding the dependent variables is approximately normally distributed (Ghasemi & Zahediasl, 2012). Regarding the Shapiro-Wilk test, that provides other evaluation of the normality of the data, different authors argue that for large sample sizes (>50), significant results would be derived even in the case of a small deviation from normality. When the deviation does not affect the results of a parametric test (Ghasemi & Zahediasl, 2012; Öztuna, Atilla, & Tüccar, 2006), it is then not relevant for this study. Finally a skewness and kurtosis analysis, presented on the table 5, ensure the no presence of values higher or lower than 3. Which according to Yuan and Bentler (Yuan & Bentler, 2006) confirms a pseudo-normal distribution.

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20 To address some issues regarding the dependent and independent variables with respect to homogeneity of variance-covariance and the homogeneity of regression slopes. The use of the natural logarithm on all the independent variables and on the two dimensions of transactional leadership resulted in a general non significance of the Levene's test of equality of error variances.

Component

TF_insp.mot TS_mbe TF_ind.cons TS_cr TF_ideal.infl TF_int.stim

q34 ,722 -,136 ,176 ,124 ,059 ,063 q52 ,658 -,035 ,315 ,167 ,072 -,127 q42 ,610 -,078 ,135 ,146 ,215 ,031 q26 ,598 ,219 ,189 ,086 ,207 ,027 q3 ,543 ,097 ,050 ,140 ,024 -,132 q54 ,523 ,010 ,367 ,165 -,050 -,193 q46 ,513 -,127 -,185 ,164 -,242 ,329 q68 ,497 -,080 ,292 ,090 ,074 -,378 q1 ,475 ,000 ,429 ,244 ,148 ,091 q58 -,024 ,828 ,042 -,011 ,097 ,158 q31 -,051 ,808 -,017 ,050 ,005 ,243 q17R ,242 ,678 ,065 ,106 ,097 ,099 q45R -,400 ,658 -,097 -,115 ,025 ,283 q2 -,013 ,468 ,090 -,046 ,102 ,272 q8 ,168 -,097 ,775 ,029 ,047 ,008 q22 ,126 ,061 ,726 ,039 ,030 -,011 q55R ,091 ,052 ,679 ,103 -,095 ,069 q53 ,361 ,020 ,539 ,178 ,018 -,099 q12 ,268 ,173 ,440 ,224 ,162 -,071 a10 ,197 ,059 ,189 ,805 ,043 -,004 a6 ,200 -,026 ,168 ,783 ,148 ,021 a34 ,241 ,006 ,294 ,716 ,080 -,006 a21 ,143 -,029 -,064 ,639 ,221 -,052 a27 ,160 ,099 ,024 ,184 ,729 ,004 q35R ,026 ,087 ,049 ,023 ,708 -,071 a40 ,090 ,078 -,015 ,215 ,696 ,101 q19R ,010 -,009 ,011 -,021 ,628 -,103 a36 ,128 ,051 ,014 ,382 ,505 ,196 q63 -,012 ,262 ,030 ,002 ,049 ,768 q61R -,046 ,210 ,019 -,007 ,069 ,742 q67 ,007 ,264 ,003 ,042 -,140 ,642 q47R -,376 ,315 -,096 -,061 -,014 ,497

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21

c(α) Mean Lower

Bound*

Upper

Bound* (St. Dev.) Skewness Kurtosis

Patents - 13,290 32,859 2,849 8,504

Citations/Publications - 27,830 43,561 1,867 3,987 Ln(Patensts+1) - 1,242 1,1397 1,3448 1,569 0,84 -0,764 Ln(Citations/Publications+1) - 2,392 2,2852 2,4980 1,627 -0,419 -1,241 Radical Patents (nominal) - 0,295 0,456 0,96 -1,08 Transactional - contingent reward 0,805 4,723 0,661 -0,298 -0,133 Transactional - management-by-exception

(active) 0,788 2,762 0,791 0,310 -0,030

Transformational - Individualized

Consideration 0,732 3,896 0,688 -0,266 0,150

Transformational - Intellectual Stimulation 0,742 2,51 0,705 0,359 -0,320 Transformational - Inspirational Motivation 0,81 4,469 0,563 -0,372 0,193 Transformational - Idealized Influence 0,719 4,218 0,525 -0,211 0,107

N:901

Table 5 - Cronbach's alphas and Statistics summary for all the variables (*95% Confidence Interval for Mean)

1 2 3 4 5 6 7 8 9

1 Patents 1

2 Citations/Publications ,063 1

4 Transactional - contingent reward ,018 ,045 ,023 1 5 Transactional - management-by-exception (active) ,013 ,063 ,005 ,004 1 6 Transformational - Individualized Consideration -,009 -,038 ,012 ,360** ,036 1 7 Transformational - Intellectual Stimulation ,091** ,164** ,092** -,049 ,544** -,079* 1 8 Transformational - Inspirational Motivation ,041 ,001 ,054 ,502** -,076* ,545** -,145** 1

9 Transformational - Idealized Influence ,053 ,005 ,052 ,400** ,136** ,289** -,033 ,370** 1 Table 6 - Correlations for all variables (Pearson correlation*p<.05, **p<.01)

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5. Results

To explore the relationship between individual innovative performance and leadership styles different analyses were conducted. Table 7 shows wilks’ lambda3_{for the independent variables and for}

control variables of the four models. Model 1 is the basic MANCOVA, which analyses the effect of independent variables (natural logarithm) on the dimensions of leadership styles. For the model 2 the control variables were inserted. Thus this MANCOVA assesses the statistical difference on the dependent variables by the natural logarithms of patents and the ratio citations per publication , while controlling for leader’s gender, leader’s organization, and leader’s gender* leader’s organization.

To further explore the relationship between the variables and thus understand the direction of the evaluation of those relationship extra analyses were performed.

In model 3, the independent variables were transformed into nominal variables, thus the continuous data of patents and citations per publication were transformed into a non-continuous variable, where “0” represents the non-existence of patents and citations per publication and “1” represents the number of patents and citation per publication higher than zero. Then this analysis (MANOVA) focus on the existence or not of individual innovative performance to explore the variance of performance between these two groups of leaders.

In model 4, again, the natural logarithm of the independent variables were transformed into nominal variables, thus the continuous data of patents and citations per publication were transformed into a non-continuous variable. Related to patents, “0” represents the lower bound of patenting with the values equal and lower than 1,1397 and “1”represents the upper bound with values equal and higher than 1,3448. Related to citations per publication, “0” represents the lower bound of ratio with the values equal and lower than 2,2852 and “1” represents the upper bound with values equal and higher than 2,4980. These bounds are present in the table 5. With this recode of the independent variables the analysis (MANOVA) focuses on the variance between the group of leaders with the lowest individual innovative performance (patents and citations per publication) and the highest individual innovative performance.

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Wilk's Λ Model 1 Model 2 Model 3 Model 4

Patents 0,986* 0,985** 0,984** 0.986*

Citations/Publication 0,966*** 0,981** ,992 0.978**

Leader's gender 0,998

Leader's organization 0,777***

Leader's gender*Leader's organization 0,978

Table 7 - Multivariate analysis of variance and co-variance results (*p<0.1; **p<.05; ***p<.001)

5.1. Model 1

The MANCOVA results reveled that individual innovative performance may explain differences in leadership styles rated by the followers. Table 8 shows the results from the basic MANCOVA, which indicates that there was significant difference between individual leaders that have a higher individual innovative performance and the ones that have lower innovative performance on the prediction of the dimensions of leadership. When measured through patents, this difference is significant at 10% level and when measured via citations per publication, the variance is significant at 1% level.

Patents presented a wilk’s Λ = 0,986, F(6, 874) = 2,070 and p= ,054, thus separate ANOVAs (which are analyses of variance used to measure the variance between the dependent variables related to a single independent variable) were conducted for each dependent variable related to the independent variables with significance. The ANOVAs are evaluated at an alpha level of 0.05. Concerning patents, there was a significant difference between higher individual innovative performance and lower individual innovative performance on intellectual stimulation with a F(1, 879) = 3,445 and p = .064, and on idealized influence with a F(1, 879) = 5,494 and p = .019.

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24

MANCOVA Univariate analysis of variance

Ind. Variable Wilk's F p Dep. Variables F df p

Patents 0,986 2,070 0,054 TS - contingent reward 0,006 1 0,938 TS - management-by-exception 0,419 1 0,517 TF - Individualized Consideration 1,197 1 0,274 TF - Intellectual Stimulation 3,445 1 0,064 TF - Inspirational Motivation 0,972 1 0,324 TF - Idealized Influence 5,494 1 0,019 Citations/Publication 0,966 5,089 0,000 TS - contingent reward 4,883 1 0,027 TS - management-by-exception 2,588 1 0,108 TF - Individualized Consideration 1,659 1 0,198 TF - Intellectual Stimulation 17,616 1 0,000 TF - Inspirational Motivation 0,754 1 0,385 TF - Idealized Influence 0,011 1 0,915 Table 8 – MANOVA - Model 1

5.2. Model 2

Model 2, shown in the table 9, revels that even with the significance of one control variable (Leader’s organization) to assess the variance between individual innovative performance, these control variables do not present a great effect on the relationship between individual innovative performance and the dimensions of leadership styles. Thus, this model reinforces the previous one. Individual innovative performance presents a significant difference between individual leaders that have a higher individual innovative performance and the ones that have lower innovative performance when measured through patents with wilk’s Λ = 0,985; F(6, 858) = 2,243 and p= .037 and when measured via citations per publication with wilk’s Λ = 0,981, F(6, 858) = 2,717 and p= .013.

Again, separate ANOVAs were conducted for each dependent variable, with each ANOVA evaluated at an alpha level of 0.05. Related with Patents there was a significant difference between higher individual innovative performance and lower individual innovative performance on individualized consideration with a F(1,863) = 2,875 and p = .090 and on idealized influence with a

F(1,863) = 2,875 and p = .090. Regarding citations per publication there was a significant difference

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25 Therefore, the major effects of the control variables on the relationship is related to the variances on transformational leadership - individualized consideration and transformational leadership - intellectual stimulation, regarding patents.

MANCOVA Univariate analysis of variance

Ind. Variable Wilk's F P Dep. Variables F df p

Patents 0,985 2,243 0,037 TS - contingent reward 0,019 1 0,890 TS - management-by-exception 0,124 1 0,725 TF - Individualized Consideration 2,875 1 0,090 TF - Intellectual Stimulation 0,993 1 0,319 TF - Inspirational Motivation 0,987 1 0,321 TF - Idealized Influence 7,774 1 0,005 Citations/Publication 0,981 2,717 0,013 TS - contingent reward 3,985 1 0,046 TS - management-by-exception 0,821 1 0,365 TF - Individualized Consideration 0,357 1 0,550 TF - Intellectual Stimulation 7,770 1 0,005 TF - Inspirational Motivation 0,825 1 0,364 TF - Idealized Influence 0,061 1 0,804 Leader's gender 0,998 0,245 0,961 Leader's organization 0,777 3,705 0,000 Leader's gender* Leader's organization 0,978 0,614 0,950

Table 9 – MANCOVA - Model 2

5.3. Model 3

To deepen the understanding of this relationship an extra model was performed, transforming the number of patents and citations/publication into a nominal variable (zero or some). In terms of patenting, as shown in table 10, there was a significant difference between individual leaders that have individual innovative performance and the ones that do not present individual innovative performance (wilk’s Λ = 0,984, F(6, 873) = 2,413and p= .026). Separate ANOVAs (evaluated at an alpha level of 0.05) conducted for each dependent variable show that the existence of patents predicts that a leader presents two dimensions of transformational leadership: (a) intellectual stimulation (F(1, 878) = 4,866,

p = .028 and partial and (b) idealized influence (F(1, 878) = 3,886, p = .049. As presented in the charts

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26

MANOVA Univariate analysis of variance

Patents 0,984 2,413 0,026 TS - contingent reward 0,094 1 0,759 TS - management-by-exception 1,157 1 0,282 TF - Individualized Consideration 1,787 1 0,182 TF - Intellectual Stimulation 4,866 1 0,028 TF - Inspirational Motivation 2,338 1 0,127 TF - Idealized Influence 3,886 1 0,049 Citations/Publications 0,992 1,239 0,284 Patents*Citations/Publications 0,996 0,584 0,743

Table 10 - MANOVA – Model 3

Figure 1 – Patents (non or some) - Estimated Marginal Means of dependent variables

5.4. Model 4

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27 Separate ANOVAs (evaluated at an alpha level of 0.05) conducted for each dependent variable show that there is a significant variance in terms of patenting on idealized influence with F(1, 878) = 3,709 and p = .054 and in terms of citations per publication on contingent reward with F(1, 878) = 5,669; p = .017 and on intellectual stimulation with F(1, 878) = 6,687 and p = 0,010.

As shown in the charts (figure 3 and 4), the upper bound of patenting (M=4.30) scores higher than the lower bound (M=4.20) for idealized influence. The upper bound of citations per publication (M=1.745) scores higher than the lower bound (M=1.72) for contingent reward. For intellectual stimulation, the upper bound of citations per publication with a mean of =2.555 scores higher than the lower bound of citations per publication (M=2.40).

MANOVA Univariate analysis of variance

Patents 0,986 2,063 0,055 TS - contingent reward 0,915 1 0,339 TS - management-by-exception 0,017 1 0,534 TF - Individualized Consideration 1,835 1 0,176 TF - Intellectual Stimulation 2,018 1 0,156 TF - Inspirational Motivation 0,760 1 0,384 TF - Idealized Influence 3,709 1 0,054 Citations/Publication 0,978 3,233 0,004 TS - contingent reward 5,669 1 0,017 TS - management-by-exception 0,660 1 0,417 TF - Individualized Consideration 1,384 1 0,240 TF - Intellectual Stimulation 6,687 1 0,010 TF - Inspirational Motivation 0,641 1 0,424 TF - Idealized Influence 0,054 1 0,817

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28

Figure 3 - Patents (Lower and Upper bounds) - Estimated Marginal Means of an dependent variable

5.5. Summary of findings

To easily understand the whole set of models and the evaluation of hypothesis a summary of the significant findings is provided in table 12. Regarding patents and transformational leadership, basing the analysis on the whole set of models, the hypotheses H1a, H1b, and H1c are rejected and H1d (the higher the number of leader’s patents, the more Idealized Influence is associated to them) is supported. In terms of patenting and transactional leadership the whole set of hypotheses 3 is rejected.

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29 Regarding citations per publication and basing the whole analysis in the two main models and the extra model 4, the hypotheses associated with transformational leadership, H2a, H2c, and H2d are rejected and H2b (the higher the leader’s citations per publication indicator, the more Inspirational

Motivation is associated to them) is supported. In respect to transactional leadership, all the

hypotheses 4 are rejected. However the results suggest that a eventual counter hypothesis associated to contingent reward (the higher the leader’s citations per publication indicator, the more Contingent

reward is associated to them) would be supported.

In conclusion, these findings indicate that partly individual innovative performance can predict leaders with stronger dimensions of leadership style.

H Ind. Variables Dep. variables Model 1 Model 2 Model 3 Model 4

H1 Patents

TF - Idealized Influence X X ↗ ↗

TF - Intellectual Stimulation X ↗

TF - Individualized Consideration X

H2 Citations/Publication TF - Intellectual Stimulation X X ↗

H4 Citations/Publication TS - contingent reward X X ↗

Table 12 - Summary of significant findings (“X” represents the significant results and “↗” represents the positive relationship between the variables for significant results )

6. Discussion and Conclusion

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30 These findings support the argument that confident leaders may rely more on improvement of members’ performance to achieve the teams’ goals (Feltz et al., 1999), given that a leader with patents´ publication has more experience, thus is able to shift from transactional to transformational leadership style. Furthermore, followers will associate them to performance, innovation, creativity and flexibility, which leads to a higher quality of the relationship between leader and follower (Nahrgang et al., 2009) and, consequently, idealized influence will be higher. In addition, an innovative leader, with more experience, may ask more questions, speak less, interrupt a follower (Feese et al., 2011), and hold effective managerial skills and highly developed emotional and social skills Mandell (2003), thus leads to a stronger connection with intellectual stimulation of the followers.

The findings may be in line with the transformation from a more rigid leadership style (transaction) to a more follower’s need focused style (transformational) (Feltz et al., 1999). Given that the predicted dimensions of transformational leadership (intellectual stimulation and idealized Influence) are higher when the leader had some performance and experience, with experience the leader may change its leadership style to a more charismatic one. Thus the explanation of the association of individual innovative performance (citations per publications) with contingent reward of transactional leadership may lie on the fact that contingent reward is usually high correlated with the dimensions of transformational leadership (Heinitz et al., 2005). The author even argued that the dimensions of transformational leadership should be “combine with the goal-oriented items of CR [contingent reward], a transactional scale” (Heinitz et al., 2005: p188).

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31 Fiedler's contingency theory of leadership suggests that leadership effectiveness is an interaction between leader and the leadership situation (Peters et al., 1985). Then a situational favorableness is evaluated with situational factors, such as a) leader-member relations, b) task structure and c) position power, which when combined defines different leadership situations. Thus fully prediction of leadership may tend to take into account the context.

In line with the above, and with the concept of not mutually exclusive processes of leadership styles suggested by Bass (1985), recent literature has proposed an ambidexterity theory of leadership for innovation (Zacher & Rosing, 2015). It suggests that leadership behavior fosters exploration and exploitation of individuals and teams, opening and closing leader behaviors and switches between them to deal with the ever-changing requirements of the innovation process. Then a better leader should be able to adapt the style to the moment, where two complementary leadership behaviors - have to intermingle to facilitate high levels of innovation (Zacher & Rosing, 2015). Thus once more, it prevents the fully prediction of leadership style via the more or less static measure of individual innovative performance, when the leadership style of an individual may change according to the need in the moment in innovation context.

The managerial implications of the findings of the study are related with the possibility to predict these three dimensions of leadership even before any contact with the leader. Leader’s selection for projects /positions where intellectual stimulation, idealized influence and contingent reward may play an important role could in the initial phase take into consideration the previous innovative performance to assess those leadership characteristics.

Briefly, individual innovative performance may predict idealized influence, intellectual stimulation and contingent reward, but it fails to fully predict styles of leadership. This may happen due to the importance of the context to leadership behavior.

6.1. Limitation and Future Research

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32 and in terms of industries and address the companies’ leaders as a factor which predicts leadership styles.

Another limitation of the study was the MLQ questionnaire. Given that the data is provided by an existent database, the questions/items matching with the literature sometimes did not present a perfect match, which may lead to a not fully evaluation of leadership styles. This is more evident when analyzing the idealized influences items, because they do not fully evaluate the whole set of areas of idealized influence presented in the literature. Which could lead to different findings related to this dimension of transformational leadership. Further research should proceed with an independent and exclusive data collection to ensure the coherence and the fully evaluation of leadership style to increase the validity of the constructions.

This study also is also based on the analysis of projects managers, which means that it evaluates the leadership style of the formal management team of an organization - senior position in an organization. As such, this research may not evaluate the fundamental essence of leadership (Hogan & Kaiser, 2005), which would be present in others non formal position not evaluated here.

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