Collaborative problem solving and radical employee creativity.

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Collaborative problem solving and radical

employee creativity.

The mediating role of creative self-efficacy and the

‘dark side’ of leader-member exchange.

Master Thesis

MSc. Human Resource Management

University of Groningen

Faculty of Economics and Business

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ABSTRACT

Although scholars have examined the relationship between collaborative problem solving and creativity, the underlying mechanisms remain under examined. This study addresses this research gap, by investigating whether creative self-efficacy acts as a mediator. Few studies have made the distinction between radical and incremental creativity, as such this study will test for both radical and incremental creativity. In addition, this study addresses the little researched ‘dark side’ of member-exchange, by assessing whether leader-member-exchanges works as a negative moderator on the collaborative problem solving – creativity relationship. The hypotheses were tested using a sample of 366 employees and 53 leaders, collected through a field-study in the Netherlands. In contrast to what was predicted, initial results show that collaborative problem solving does not lead to higher radical or incremental creativity, nor does creative self-efficacy function as a mediating mechanism. Upon further assessment, a negative moderating function for leader-member-exchange was found, however only when measuring self-rated creativity. Given the significance of creativity in the field, and the lack of research on the ‘dark side’ of leader-member-exchange, this study opens a new horizon for future research into the topic.

Key words: creativity, collaborative problem solving, leader-member-exchange, creative

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INTRODUCTION

Increasingly complex and turbulent business environments require organizations to be flexible and innovative to survive and prosper (George and Zhou, 2002; Shalley and Gilson, 2004). Previous research has provided considerable evidence suggesting that organizational creativity can contribute to the survivability and effectiveness of the firm because it allows organizations to be flexible and respond to changes in the environment (Shalley and Gilson, 2004). Individual creativity, defined as the production of novel and useful ideas concerning products, services and processes to the organization lies at the heart of organizational creativity (Amabile, 1996). Hence, understanding what creates and affects individual employee creativity can be of high, if not critical, importance for leaders in firms willing to thrive in today’s environment (Nayak and Agarwal, 2011).

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creativity. Despite this necessity to understand the underlying mechanisms that affect creativity, limited research has been done to understand them (e.g. Gong et al., 2009; Shin and Zhou, 2003). Addressing this need, this research will first set out to assess how collaborative problem solving will lead to employee creativity.

Adding to previous research, this paper makes a distinction between incremental and radical creativity. Incremental creativity being minor adaptations to existing processes, whereas radical creativity builds on new knowledge and skills to generate set-breaking ideas (Gilson et al., 2013; Mumford, 2000). Radical creativity substantially departs from the behavioral norms in an organization, and thus is considerably more challenging for management to facilitate successfully. However, the high payoff associated with radical creativity makes it even more valuable for organizations (Slater et al., 2013). Because of the fact that radical creativity departs so strongly from current norms and behaviors, Hargadon and Bechky (2006) state that a collaborative approach to problem solving - where individuals build on group members’ contributions and combine them with ideas of their own - is essential for truly creative ideas to occur. In this way, collaborative problem solving can facilitate radical creativity. This in contrast to incremental creativity, which by staying close to current behaviors and norms benefits little from the stimulation provided by collaborative problem solving. However previous research has not yet provided a comprehensive analysis of the relationship between collaborative problem solving and creativity, nor has it made a distinction between its effects on radical and incremental creativity. This paper sets out to examine this relationship, including its mediators and moderators.

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solving stimulates individuals to share viewpoints, discuss issues and work together towards a common goal, this can make them feel more secure about their capabilities (Dampérat et al., 2016; Gong et al., 2009). As such, it improves their creative self-efficacy, or the confidence of individuals in solving problems in creative ways (Yuan & Woodman, 2010) and could thus work as a mediating mechanism through which collaborative problem solving can lead to employee creativity. Knowledge sharing is crucial because it enables people to capitalize on existing knowledge bases residing within and out-side the organization, thus enhancing their capacity to come up with creative solutions, and enabling their organizations to develop new platforms for the development and introduction of new products and services to the market (Baer et al., 2010).

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solving on employee creativity. This is especially true for radical creativity, given that its associated behaviors deviate significantly more from the status quo than is the case with incremental creativity. The fact that creativity among employees is stimulated through collaborative problem solving is thus mitigated in high-quality exchange relationships, as individuals do not wish to challenge the leader to change the status quo (Jiang and Yang, 2015).

This paper will further develop the understanding of the relationship between collaborative problem solving and employee creativity, by investigating creative self-efficacy as an underlying psychological mechanism. In addition, this paper will make a valuable contribution for organizational leaders in that it researches what the leader can do with his team to promote collaborative problem solving, by introducing leader-member-exchange as a moderator. In the following section, a literature review on this topic will be presented, as well as the hypotheses that have been derived from the review. The hypotheses will be tested empirically in a field study set out among leaders and employees in Dutch organizations. The relationships proposed in this paper are presented schematically in the following conceptual model (see Figure 1). The individual relationships will be discussed in the following section.

Figure 1: Conceptual model

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7 THEORETICAL FRAMEWORK

The following section will discuss the main theoretical concepts used in this paper and the proposed relationships between concepts in the conceptual model.

Collaborative problem solving and employee creativity

Organizational literature has long debated the effectiveness of groups in problem solving, trying to answer the question whether groups or individuals come to better solutions to problems (e.g. Gerard and miller, 1967). In time, research has found conflicting findings, based on the nature of the group interaction and the problem proposed. One stream of research argues that groups can inhibit the solution-finding process, especially when tension arises between individuals due to differences in agenda or motivation (e.g. Bottger and Yetton, 1987). However, in situations where group members work together in a collaborative manner, research has shown that groups perform better than individuals (e.g. Kerr & Tindale, 2004; Wang and Noe, 2010). Collaborative problem solving is defined as a situation in which two or more individuals work together to solve a problem, where all participants work towards the same goal (Nokes-Malach et al., 2012). In this case, the individuals are able to tap into the knowledge and skills provided by the group, and can capitalize on existing resource bases provided within and outside of the organization (Carmeli et al., 2013). Thus, the social interactions involved in collaborative problem solving allow for the development of collaborative practices, skills and strategies among groups.

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benefits for the organization itself. If managed properly, it allows for organizations to be more flexible, and to respond adequately to changes in the environment (Shalley and Gilson, 2004).

In their study, Gilson et al. (2013) make the distinction between ‘incremental’ and ‘radical’ creativity, but state that this is not a distinction which is commonly made in research on creativity. Creativity can range from minor adaptations in existing processes to major breakthroughs that lead to entirely new products (Mumford, 2000). Mumford and Gustafson (1988) describe creativity as a continuum, ranging between performance that “…relies on

familiar algorithms and minor adaptations to relying on set-breaking heuristics and radical breakthroughs.” (Mumford and Gustafson, 1988: 132). This study acknowledges the

significance of making this distinction, and given that this distinction is not frequently used in research on creativity, this paper adopts the distinction between incremental and radical creativity in its model.

Incremental creativity can be defined as ‘ideas that imply minor changes in

frameworks and approaches, making modifications to the existing practices and products’

(Mumford, 2000). Incremental creativity takes existing knowledge as its foundation, and works to make minor adaptations from there. Because incremental ideas use the current status quo as their framework, rejection from the external environment is less likely and as such makes incremental ideas less risky. In contrast, radical creativity is defined as ‘ideas that

differ substantially from existing practices and alternatives’ (Gilson and Madjar, 2011). These

ideas are often revolutionary or groundbreaking and seek for new knowledge and skills, utilize set-breaking processes and require a certain degree of risk-taking (Gilson et al., 2013; Mumford and Gustafson, 1988; Mumford, 2000).

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beyond the ordinary behavior, those who set out to defy the norms are often those that find ideas that drastically change the status quo (e.g. Gilson and Madjar, 2011; Gilson et al., 2013). Relative to other forms of creativity, radical creativity is seen as a dynamic capability that allows for substantial cost reductions, unprecedented customer benefits, or even the ability to establish a new business alltogether, all of which can lead to enhanced performance for the organization (Slater et al., 2013). However, because radical creativity substantially departs from the norm it also makes it difficult for managers to correctly facilitate. In addition, to show radical creativity, employees have to depart from habitual actions, which might require working in cooperation to gain new knowledge and to combine new knowledge in order to break current norms. This is not the case for incremental creativity, given that this is closer to behavior individuals show in their normal day-to-day activity and as such is closer to people’s comfort zone (Gilson and Madjar, 2011; Gilson et al., 2013).

Given the high significance of radical creativity on organizational performance and survival (e.g. Slater et al., 2013), it is imperative for research to further study this relationship. This need to further understand the workings of radical creativity is bolstered by the fact that, in contrast to incremental creativity, radical creativity departs significantly from common norms and behaviors and as such is difficult to stimulate by management. In order to address these needs, this paper will empirically assess the effects of collaborative problem solving on radical creativity. However, in order to gain a more complete understanding of what sets radical creativity apart from incremental creativity, this study will take both types of creativity (incremental and radical) in consideration.

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positively related to creativity and innovation, as it can pool individual resources, giving individuals more knowledge to draw on (Wang and Noe, 2010). In addition, through a collaborative setting, individuals are more likely to share a wide extend of their knowledge and skills. In this way, the group can access knowledge that goes beyond what is common ground, allowing for divergence from the standard practices (Gilson and Shalley, 2004; Wang and Noe, 2010). In addition, a collaborative setting encourages individuals to share their point of view, which exposes individuals to multiple perspectives on issues at hand. Research on group interaction has shown that being exposed to multiple different perspectives is a key component to generating new and innovative ideas and products, as people think ‘out of the box’, (e.g. Anderson et al., 2014; Wang and Noe, 2010).

Radical creativity is a result of individuals departing from normal behavior, and applying knowledge outside of common ground for new applications (Gilson and Madjar, 2011). By stimulating exposure to different viewpoints and experiences, through interaction with other individuals, collaborative problem solving creates an environment that stimulates behavior in line with radical innovation. This paper proposes a positive direct relationship between collaborative problem solving and radical creativity (but less so with incremental creativity). Incremental creativity requires individuals to go with behavior as is normal, seeking to support current patterns and not to seek information that diverges from the knowledge stored in the group currently (e.g. Gilson and Madjar, 2011). Working together to seek out new information and combine resources in such a way to break behavioral norms is thus less likely to apply for incremental creativity. As such, a group that perceives to have a high degree of collaborative problem solving will show a higher degree of radical employee creativity. This relationship translates into the following hypothesis.

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11 The mediating effect of creative self-efficacy

Research on collaborative problem solving and employee creativity lacks a complete and comprehensive view of the relationship, including its’ underlying mechanisms and conditions (e.g. Gong et al., 2004; Yuan and Woodman, 2010). Literature lacks a comprehensive view of the relationship between collaborative problem solving and radical as well as incremental creativity, which is where the underlying mechanisms come into play. Previous research on creativity has shown that an important psychological mechanism for individual creativity is the creative self-concept, which in practice comes down to an individuals’ creative self-efficacy (Yuan and Woodman, 2010).

Creative self-efficacy is defined as the confidence of individuals in their ability to

solve problems in creative ways (Yuan and Woodman, 2010). Per Bandura (1997), self-efficacy views influence the motivation and the ability of individuals to engage in specific behaviors. The concept of creative self-efficacy thus holds much promise for understanding the mechanisms through which employee creativity can be influenced.

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different perspectives of the issue at hand. From this reasoning, he states that a key resource for creative self-efficacy among individuals is information provided by others.

Collaborative problem solving provides a setting to share a wide range of information in a harmonious manner. This availability of resources will thus have a positive influence on the feeling of mastery and confidence when it comes to creative behavior. In addition, Mathisen (2011) stated that seeing others engage in successful creative behaviors can convince the individual that he or she is also able to show successful creative behavior (i.e. vicarious experience). Furthermore, positive verbal communication during collaborative problem solving can convince an individual that they possess the capacities required for creative behavior. For example, discussing viewpoints together and sharing issues while working towards a shared goal can make individuals feel more secure regarding their capabilities. A study by Dampérat et al. (2016) had shown that verbal encouragements from third parties, emotional activation, knowledge gained by observation and knowledge gained from experience all have a direct and indirect effect on creative self-efficacy. All of the before mentioned effects are mechanisms an individual will be exposed to when engaging in collaborative problem solving with others. Based on this reasoning, this paper proposes the following hypothesis, where collaborative problem solving is expected to have a positive effect on creative self-efficacy.

H2: Collaborative problem solving has a positive effect on creative self-efficacy.

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problem engagement. Literature has stated that individuals with high self-efficacy are more determined to find solutions to problems, and are more likely to continue their efforts when an obstacle is in their way (Tierney and Farmer, 2002). As for the creative process, being self-efficacious can build self-regulative learning strategies, as well as the confidence in own capabilities. Having confidence in one’s own capabilities, and the ability to regulate one’s own behavior to facilitate learning help to add towards a mastery goal orientation, which research has linked as having a positive effect on overcoming obstacles in the creativity process (Beghetto, 2006).

Following this literature, it can be concluded that individuals who score high on creative self-efficacy form a strong positive image regarding their ability to come up with creative ideas. They are more likely to put forward their ideas and will continue to work on a novel solution with more determination than individuals with low self-efficacy (e.g. Shin and Zhou, 2007; Tierney and Farmer, 2002, 2004). In addition, because these individuals feel more involved with the work they are doing, they will be more personally engaged and are thus motivated to go out of their way to find creative ideas. This trust in themselves will also allow them to put forward ideas that are more risky, being more likely to go with ideas that go beyond the current situation (radical) instead of making minor changes to the group practices (incremental). Incremental ideas do not require a high creative self-efficacy, as these are built upon previous knowledge and are thus more likely to lead to success (and less likely to be rejected). Therefore, creative self-efficacy is more of a necessity in terms of radical creativity than incremental creativity. Because of these reasons, this paper proposes a positive direct relationship between creative self-efficacy and radical employee creativity where high creative self-efficacy will result in high radical creativity among employees, but less so for incremental creativity. This is translated into the following hypothesis.

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When combining all three hypotheses, we come to the core of the conceptual model proposed in this paper, which states that collaborative problem solving has both a direct and indirect effect on employee creativity, using creative self-efficacy as a mediating mechanism. Through creative problem solving, managers can create an environment which stimulates individual creative self-efficacy, which in turn has a positive effect on radical employee creativity. Due to the nature of both incremental and radical creativity, the mediation effect is expected to be weaker for incremental creativity compared to radical creativity. This mediation effect is hypothesized as follows.

H4: Creative self-efficacy mediates the positive relationship between collaborative problem solving and radical employee creativity.

Leader-member exchange as a moderator

Leader-member exchange theory looks at the dyadic relationship between leaders

and their followers. The theory states that leaders engage in different patterns with members, which result in different quality leader-member exchange relationships (Gerstner and Day, 1997; Schwepker, 2017). These exchange relationships can range from low to high-quality, and leaders use different managerial strategies to deal with each individual relationship (Liden et al., 1997; Yuan et al., 2016). The relationships between leaders and members are created over time through interaction and exchanges (social exchange theory). In time, leaders will differentiate between those with whom they develop close relationships (i.e. in-group members) and those with which they don’t (out-group members).

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Individuals that are part of the in-group benefit from high-quality interaction with their leader, and have favorable benefits in comparison to their out-group colleagues (Hwang et al., 2016; Liden et al., 1997; Schwepker, 2017). The feeling of trust and reciprocity means that these individuals are more likely to see their leaders as a credible individual, and are more willing to show behavior that supports the actions of the leader (Hwang et al., 2016). These in-group members are less likely to show critical behavior that challenges their leader, to maintain the current status-quo (which is favorable for them). As for the direct relationship between collaborative problem solving and radical employee creativity, in-group members will thus be less likely to raise ideas that do not fit with the current group setting, afraid of challenging the group-leader (which could result in them losing their in-group status). Thus, with a high-quality leader-member exchange relationship, the relationship between collaborative problem solving and radical employee creativity is expected to be weaker. Following this same line of reasoning, individuals experiencing a high-quality leader-member exchange relationship are more likely to forward ideas that are minor adaptations, in order to make the current status quo more efficient. This would mean that under a high-quality exchange relationship, individuals are more likely to show behavior in line with incremental creativity, defined by Mumford (2000) as ‘ideas that imply minor changes in frameworks and

approaches, making modifications to the existing practices and products’.

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individuals might seek out to change the current status quo, to benefit their own situation. Therefore, in the situation of a low-quality leader member exchange relationship, individuals are more likely to forward ideas that question the leader’s current ideas, ideas that go beyond the status quo of the group in order to change the setting (to improve their own position). This paper therefore hypothesizes that with a low-quality leader member exchange relationship, the relationship between collaborative problem solving and radical employee creativity will be stronger. Individuals will show behavior that is more akin to radical creativity and as such will show less signs of incremental creativity. The moderating role of leader-member exchange has been translated into the following hypothesis.

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17 METHODOLOGY

Sample and procedure

To test the hypotheses proposed in this paper, data was collected from organizations in the Netherlands operating in multiple sectors. As indicated by the leaders, the majority (62.3%) operated in the quaternary sector (i.e. the non-commercial service industry). The second largest sector consisted of the commercial service industry (15.1%), followed by the primary and secondary industry (both 11.3% each). The data used was collected as part of a larger scale research on leadership attributes and outcomes. In order to approach leaders, the personal network was used to create a snowball effect with which to contact individuals that would be willing to participate. Leaders were approached with information regarding the topic of the research, the research setup and what to expect upon completion of the research. The leaders were then asked to participate in the research. Individuals that indicated to be willing to participate were asked to forward the email addresses of themselves as well as ten employees directly under them. This setup was used to keep the time investment realistic for the leaders, so as to improve the possible response rate. Data was collected by means of an online questionnaire. The questionnaire was provided in Dutch only, to cancel out any effects of meaning lost in translation. Participation in the questionnaire was voluntary and the individual results were kept confidential. The leader was asked to rate the creative performance of the employees directly under his/her supervision, and the employees were asked to evaluate the leader on their behavior as well as rate their own behavior and how they experience their work environment.

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leaders the gender distribution consists of 30 males and 23 women (ratio of 1.30). Among responding employees this distribution is 154 men and 212 women (ratio of 0.73).

The average age among leaders is 46.32 years, with a minimum age of 24, a maximum age of 61, and a standard deviation (SD) of 10.21. As for the employees, the average age is 42.93 years, with a minimum age of 17, a maximum age of 61 and a standard deviation (SD) of 11.82. The mean tenure of leaders is 12.28 years (SD=10.76, min=0, max=39), and for employees the mean tenure is 11.43 years (SD=9.47, min=0, max=39). The education level of the leaders ranged from high school to University level, with most (n=30) having completed an HBO degree (Hoger Beroeps Onderwijs - University of Applied Sciences). For employees, the education ranged from ‘primary school’ to ‘PhD.’ with most employees (n=147) having completed an MBO degree (Middelbaar Beroeps Onderwijs – Vocational Education), closely followed by an HBO degree (n=143, SD=0.83).

Measures

In order to test the hypotheses proposed in the model, the following measures were used: collaborative problem solving, radical employee creativity, incremental employee

creativity, creative self-efficacy and leader-member exchange. These items were measured

using existing measurement scales, to be answered on a 5 point Likert-scale, where a score of 1 means ‘completely disagree’ and a 5 means ‘completely agree’. In addition, an internal reliability analysis was performed to measure the internal consistency of the items, this to see whether the individual items measure the same construct (results indicated as Cronbach’s Alpha value indicated after each measure).

Collaborative problem solving. To measure collaborative problem solving, the

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19 Radical employee creativity. Radical employee creativity was measured using three

items, based on the works of Baer (2012) and Madjar, Greenberg and Chen (2011). An example of an item used is: “... proposes radical ideas for doing things differently.” (Cronbach’s Alpha = 0.95).

Incremental employee creativity. Incremental employee creativity was measured

using three items, based on the works of Baer (2012) and Madjar, Greenberg and Chen (2011). An example of an item used is: “… proposes ideas for minor alterations to existing states of affairs.” (Cronbach’s Alpha = 0.92).

Creative self-efficacy. Three items were used to measure creative self-efficacy,

adopted from the measurement scale by Tierney & Farmer (2002). An example of an item used is: “I feel that I am good at generating novel ideas” (Cronbach’s Alpha = 0.76)

Leader-member exchange. To measure leader-member exchange, ten items were

used, which were adopted from the measurement scale by Liden and Maslyn (1998). An example of an item used is: “I like my supervisor very much as a person” (Cronbach’s Alpha = 0.87)

Control variables. This research controls for age, gender, tenure and education level

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20 Analytic approach

The collected datasheet was prepared for statistical analysis with IBM SPSS Statistics. Following this, a preliminary analysis of the individual correlations among variables was performed by means of a Pearson-correlation test. From here on, the mediation and the moderation model will first be tested separately, before being combined. Once the Pearson-correlation test had been performed, all variables except for the dependent variables (radical creativity and incremental creativity) were standardized. Making use of standardized variables is required when performing moderation analyses (Field, 2013).

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21 RESULTS

The following section will present the results of the statistical analysis performed to test the hypotheses in this study. These results will be further discussed in the discussion section. First, the hypotheses related to radical creativity will be discussed (H1, H2, H3, H4 and H5), given that these are the main focus of the study. For the sake of completeness, the conceptual model and all hypotheses will be tested with incremental creativity as the dependent variable afterwards. Finally, any additional analyses will be presented.

Correlation

Appendix 3 – Correlation matrix shows the means and standard deviations for all

variables included in the study. In addition, in order to assess the separate correlations between variables, a Pearson-Correlation test was performed in SPSS, these results are also shown in Appendix 3 – Correlation matrix. As for the independent variable, collaborative problem solving, no significant correlation can be found with the dependent variable, radical creativity (r= -0.01, p>0.10) nor with the mediator, creative self-efficacy (r= -0.15, p>0.10). With regards to creative self-efficacy, this variable is positively correlated with radical creativity (r=0.21, p<0.01). Looking at the moderator proposed in this study (leader-member exchange), a positive correlation is found with collaborative problem solving (r=0.20, p<0.01), creative self-efficacy (r=0.16, p<0.01) and radical creativity (r=0.15, p<0.01).

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that have a longer tenure with the organization will show less creative behavior. Employees that have a high level of education however show more creative behavior than employees with a low level of education. Finally, in terms of gender, women are more likely to engage in collaborative problem solving than men.

Hypothesis testing – Mediation

First, the proposed mediation effect in the model was tested. This was done in multiple steps, beginning with testing hypotheses 1 through 3 by means of hierarchical linear regression in SPSS. Afterwards, a Sobel-test was performed to assess the significance of the mediation effect (H4). An overview of the results of these analyses can be found in Appendix

4 – Hierarchical regression table (mediation).

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for a relationship as proposed in H1 was found. As for creative self-efficacy, no changes in its relationship to radical creativity were found with the IV included in the model (B=0.20, SE=0.05, p<0.01).

Provided that H2 has shown no significant evidence for a relationship between the IV and the mediator, it is not possible for a mediation effect to take place, given that both the relationship between IV and mediator as well as the mediator and DV need to be significant (Frazier et al., 2004). However, for the sake of completeness the Sobel-test was still performed and its steps and results are explained below.

The Sobel test was performed, using the data provided by the previous analyses. The Sobel test assesses whether the indirect effect of the independent variable on the dependent variable through the mediator variable is significant in this model (Sobel, 1982; Soper, 2007). The results of the Sobel test statistic show that there is no significant evidence to indicate a mediation effect (Sobel test statistic Z=0.07, p(two-tailed)>0.10). As such, H4 (stating that creative self-efficacy mediates the positive relationship between collaborative problem solving and radical employee creativity) is rejected.

Hypothesis testing – Moderation

The moderation analysis was performed in multiple steps. First, hierarchical linear regression was used to test the main effect between independent variable and dependent variable as described in H1. The second model includes both the independent variable and the moderator, and the third model includes the interaction effect between the moderator and independent variable. For an overview of all results of this analysis, refer to Appendix 5 –

Hierarchical regression table (moderation).

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mediation results, in that no significant effect was found to support H1 (B=0.01, SE=0.05, p>0.10). As stated, for the second model the moderator (leader-member-exchange) was included. The effect of leader-member-exchange on radical creativity was found to be significant and positive (B=0.14, SE=0.05, p<0.01).

In order to test the effect of moderation, the interaction effect between leader-member-exchange and collaborative problem solving was included in the third model. The results of this analysis show that there is no significant evidence to suggest that moderation takes place (B=0.01, SE=0.05, p>0.10). This means that H5, which proposed that leader-member-exchange would negatively moderate the relationship between collaborative problem solving and radical employee creativity, is rejected. For a visual representation of the interaction, please refer to Appendix 6 – Interaction plot (moderation).

Hypothesis testing – Moderation and mediation

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25 Incremental creativity

As stated in previous sections of this paper, this study adds to literature on creativity by separating creativity in radical and incremental creativity. Whereas radical creativity builds on new knowledge and skills to generate set-breaking ideas, incremental creativity consists of minor adaptations to existing processes (Gilson et al., 2013; Mumford, 2000). To see whether there are any differences for incremental and radical creativity, all hypotheses presented in this study have been tested using incremental creativity as the dependent variable (DV).

Hypothesis testing – Mediation

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Provided that H2 does not show a significant relationship between IV and mediator, no mediation can occur (Frazier et al., 2004). However, for the sake of completeness a Sobel test was performed. The Sobel test proves this statement, as the Sobel test statistic shows that there is no significant evidence to suggest that mediation takes place (Sobel test statistic Z=0.33, p(two tailed)>0.10). Given these results, H4 is rejected.

Hypothesis testing – Moderation

The moderation analysis was performed following the exact procedure as described for radical creativity. For an overview, please refer to Appendix 8 – Hierarchical regression table

(moderation) – Incremental creativity.

No significant evidence was found to suggest a positive relationship between leader-member-exchange (moderator) and incremental creativity (B=0.05, SE=0.04, p>0.10). Testing for moderation, the interaction effect was included in the final model. Test results show no evidence to suggest a moderating effect of leader-member-exchange on the collaborative problem solving – incremental creativity relationship, as proposed in H5 (B=0.03, SE=0.04, p>0.10). Given these results, H5 is rejected.

Hypothesis testing – Moderation and mediation

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27 Additional analyses

To gain further understanding of the results, several additional analyses were performed. As stated, the study additionally assessed several other measures of creativity. Besides radical creativity and incremental creativity, general, team and self-rated creativity were measured. As such, the analyses previously run were again tested for each of the measures of creativity. No different results were found for general or team creativity. However, for self-rated creativity different results were found.

When using self-rated creativity as the dependent variable (DV), no significant evidence was found for the relationship as stated in H1 (B=0.05, SE=0.04, p>0.10). In addition, no support for the relationships as described in H2, H3 and H4 was found. However, with regards to moderation, the interaction effect between the moderator (leader-member-exchange) and IV was found to be significant (B= -0.05, SE=0.02, p<0.05). Leader-member-exchange negatively moderates the relationship between collaborative problem solving and self-rated creativity, where for low levels of leader-member-exchange this relationship is positive (-1 SD, B=0.10, SE= 0.04, p,0.01), and for high levels the strength of the direct effect decreases and becomes insignificant (1 SD, B= -0.01, SE=0.04, p>0.10). This is in line with H5, and as such support is found H5 under the condition that self-rated creativity is used as the DV. Please refer to: Appendix 10 – Hierarchical regression table (moderation) –

Creativity self-rated and Appendix 11 - Interaction plot (moderation) – Creativity self-rated,

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28 DISCUSSION AND CONCLUSION

Summary of results

This study was conducted to examine whether and how collaborative problem solving is related to employee creativity, more specifically making a distinction between radical and incremental creativity. In addition, this study assessed whether creative self-efficacy mediates the relationship between collaborative problem solving and both types of creativity. Furthermore, the effect of leader-member exchange as a moderator on the relationship between collaborative problem solving and both types of employee creativity was assessed. By using a sample of 366 employees and 53 supervisors from different companies in the Netherlands, this study found mixed results. In contrast to expectations, collaborative problem solving showed to have no significant relationship with radical and incremental creativity, nor with creative self-efficacy. In addition, no mediating function for creative self-efficacy on the relationship between collaborative problem solving and both radical and incremental creativity was found. As for the negative moderating function of leader-member-exchange on the relationship between collaborative problem solving and radical creativity, no significant evidence was found to support this relationship. In addition, leader-member exchange also was not found to function as a positive moderator for the relationship between collaborative problem solving and incremental creativity. The additional analyses however did show support for a negative moderating relationship of leader-member exchange on the relationship between collaborative problem solving and self-rated creativity.

Theoretical and managerial implications

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literature on team collaboration and creativity (Damperat, 2016; Fillis and McAuley, 2000; Jensen and Beckmann, 2009; Sik, 2016; Vissers and Dankbaar, 2002), who generally agree that through interaction between creative people new ideas can be generated that individuals could not have produced alone. Through discussion, exposure to multiple viewpoints, experience and creative techniques such as brainstorming, (radical) creativity of the individual and the group is stimulated (Sik, 2016).

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results found in the analyses. However, this study was not able to add any additional insights for literature to this matter.

As for the relationship between collaborative problem solving and incremental creativity, results were less surprising. Incremental creativity makes use of ideas and knowledge already existing within the group, and makes minor adaptations based on these processes to make current procedures more efficient (Mumford, 2000). Hence, it is less likely that incremental creativity would require stimulation from collaborative problem solving. Incremental creativity can be seen more as a natural process, that requires little stimulation from the outside to take place.

Further exploring the collaborative problem solving to creativity relationship, merely having people engage in collaborative efforts does not necessarily result in knowledge sharing. Research in knowledge sharing among work teams (Choi, 2000; Holste, 2003; Zhikun et al., 2007) indicates the importance of personal constructs such as inter-group trust and willingness to share knowledge by individual members. In this case, groups that engage in collaborative problem solving activities can still show little to no creative output if there is a low degree of trust and willingness to share knowledge among members. Given that these personal constructs were not included in this study, they can have a valid explanatory value.

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2014). All in all, these streams of literature provide alternate explanations to individual creativity, and pose a fundamental question as to whether working together actually results in creativity. It could very well be that the most important determinants of creativity, let alone radical creativity lie with personal traits and characteristics first, and that team settings and interaction come afterwards.

Empirically, an explanation as to why the results differ from those hypothesized can be found within the way collaborative problem solving has been measured in this study. This study used a three-item scale based on De Dreu (2006). Collaborative problem solving has been indicated to be an inherently complex mechanism, incorporating components of cognition as found in individual problem solving, as well as components of collaboration (Hacker, Dunlosky, and Graesser, 2009; Funke, 2010). As such, the measurement scale used in this study could have presented too broad a view of collaborative problem solving, requiring further

refinement to accurately capture the concept.

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However, another explanation is that creative self-efficacy is more strongly influenced by individual factors, such as personality characteristics and traits, and that in this case the benefits from collaborating are of less importance to the development of creative self-efficacy. For example, results of studies by Chong and Ma (2010) and Karwowski et al. (2013) have linked personal characteristics such as the big five traits and positive personality traits to creative self-efficacy.

This explanation of course raises the question whether collaboration in organizations is really necessary in order to facilitate creative self-efficacy among employees. Given that creative self-efficacy is a strong and highly significant determinant of (radical) creativity, as has been shown in this study (in line with research by e.g. Shin and Zhou, 2007; Tierney and Farmer, 2002, 2004), it is important for literature and for managers to know exactly how to influence the creative self-efficacy of individuals. However, it is also important to know how organizational and work settings can affect the development of creative self-efficacy.

Literature on leader-member exchange predominantly highlights the positive effects of leader-member exchange, and as such possible downsides of leader-member exchange remain mostly unassessed. This study included leader-member exchange as a moderator, to assess whether leader-member exchange would negatively moderate the relationship between collaborative problem solving and radical/incremental creativity. However, in contrast to the hypotheses, no such moderating effect of leader-member exchange was found.

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words, because creativity is more likely to stem from individual determinants, and leader-member exchange functions on a dyadic level, it does not show a moderating function as expected.

However, upon further assessment, an interesting find was made in that a negative moderating function for leader-member exchange was found when testing for self-rated creativity. When testing for the effect of collaborative problem solving on self-rated creativity using leader-member exchange as a moderator, results indicated that under a low-quality leader-member exchange, collaborative problem solving has a positive effect on creativity. However, as the quality of the leader-member exchange increases, collaborative problem solving no longer adds to the creative self-rating of the individual employee. Whereas previous literature on leader-member exchange and creativity has focused primarily on the positive effects of leader-member exchange (e.g. Atwater & Carmeli, 2009; Isaksen & Lauer, 2002; Janssen & Van Yperen, 2004; Lee, 2008; Tierney et al., 1999), this study is one of the first to show the negative aspects of leader-member exchange when it comes to facilitating creativity.

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There is a possibility that these differences in observations between self and leader-rated forms of creativity stem as a result of self-leader-rated bias. However, Ng and Feldman (2012) tested whether differences in self-rated and non-self-rated results in measures of creativity come as a result of observation inflation due to self-rating. Their results however showed that for leader-member exchange this was not the case, as leader-member exchange is a construct that captures a wide array of behaviors which do not trigger social desirability or consistency biases.

In practice, this means that leaders will not always be able to correctly judge the creative actions taken by an individual, nor are they always capable of correctly assessing the effects of their behavior. This is supported by the fact that self-rated creativity shows only a weak to moderate correlation with leader-rated measures of creativity like radical creativity (r=0.25, p<0.01) and incremental creativity (r=0.19, p<0.01). Literature on creativity provides multiple reasons as to why creative actions could be hidden from co-workers or leaders, for example as a means of impression management, or reluctance to share (e.g. Axtell et al., 2000; Janssen, 2000). It is important for managers and literature to understand why this takes place, to further analyze which personal variables affect this difference in leader versus self-rated creativity.

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to set specific conditions and guidelines for group interaction to counteract the effects of ‘group think’ and to make best use of the diversity and expertise in the group. Otherwise, the effects of collaboration in teams will hinder creativity in comparison to what an individual could do. Should managers want to stimulate overall creativity among individuals more effectively, an effective measure to do so is to improve the creative self-efficacy of the individual. In other words, to make employees show more creative behavior, managers should provide them with a stimulating environment in which they have a strong trust in their ability to come up with creative solutions. In practice this can come down to recognizing creative input from individuals, and being open as a manager to help people build their self-concept (i.e. through positive reinforcement). The results of this study have shown that creative self-efficacy is a strong indicator for all types of creativity, thus investing to improve this aspect should give considerable payoff for those managers that wish to see higher creativity.

With regards to the negative effects of leader-member exchange, leaders also need to create an environment in which they explicitly encourage individuals to engage in discussion with their views, and allow for critical thinking from their side. This could mean that managers directly ask individuals for opposing points of view during their meetings. In this way, individuals feel less inclined to ‘retain the status quo’ for the sake of pleasing the supervisor.

Limitations and future directions

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where data is gathered at several points over a period of time could improve the causal relationships.

Second, the data used in this study was gathered from several firms located in the Netherlands. Even though these firms operate in multiple sectors, most leaders (33 out of 55) indicated to be working in the quaternary industry. Given these numbers, the potential for industry bias cannot immediately be disproven. Moreover, this study selected companies to participate based on availability. In doing so, it did not distinguish between the need for creativity in different industries. Because different industries require different degrees of creativity in order for firms to survive, it can be the case that whereas for some firms radical creativity is a prerequisite to survival, other firms do not benefit at all from showing such behavior. An interesting next step for future research could be to examine those firms where radical creativity is highly necessary for survival and to see what relationships hold there.

In addition, because the sample consisted solely out of firms located in the Netherlands, no effect of culture could be taken into consideration. Literature assessing the dark side of leadership and governance structures often state hesitation to speak up, or fear of changing the status quo as main mechanisms (e.g. Jiang and Yang, 2015). The effects of cultural dimensions such as Hofstede’s (2010) power-distance scale make a logical next step in gaining additional insights into the model. For example, it could be that in a culture characterized by high power-distance (where status differences between leaders and members are widely accepted), the negative moderating effect of leader-member exchange could be even stronger, compared to countries with a low power-distance (where leader and member are closer related).

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creativity and creative self-efficacy, however that it does so indirectly through additional mechanisms. Given the importance of creative self-efficacy and creativity to an organization’s performance and survival, these explanatory psychological mechanisms require more attention in future research. Finally, the differences between self-rated and other-rated measures of creativity have shown to be significant in this study. As such, this provides an interesting further direction for research to take. A body of literature exists establishing the question as to whether this difference exists, however research asks for further assessment looking at what personal factors can explain these differences, and what these differences actually imply in an organizational setting.

Conclusion

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APPENDIX

Appendix 1 – Descriptive statistics (employees)

N Minimum Maximum Mean SD

Gender1 ₃₆₆ ₁ ₂ _1.58 _0.49

Age 366 17 65 42.93 11.82

Tenure 366 0 39 11.43 9.47

Education 366 1 6 3.56 0.83

1_{Dummy coded, 1 = male, 2 = female}

Appendix 2 – Descriptive statistics (supervisors)

N Minimum Maximum Mean SD

Gender1 ₅₃ ₁ ₂ _1.43 _0.50

Age 53 24 61 46.23 10.31

Tenure 53 0 39 12.28 10.76

Education 53 2 5 4.09 0.74

Appendix 3 – Correlation matrix

M SD 1 2 3 4 5 6 7 8 1. Gender1 1.58 0.94 2. Age 42.93 11.82 -0.08 3. Tenure 11.43 9.47 -0.10* 0.59*** 4. Education 3.56 0.83 -0.09* -0.16*** -0.26*** 5. Collaborative problem solving 4.08 0.70 0.15*** 0.04 0.04 -0.08 (0.84) 6. Creative self-efficacy 3.62 0.63 -0.07 0.01 -0.09* 0.11** -0.15 (0.76) 7. Leader- Member-Exchange 3.56 0.59 0.04 -0.05 -0.03 0.09* 0.20*** 0.16*** (0.87) 8. Radical Creativity 2.65 1.04 0.01 -0.11** -0.15*** 0.21*** -0.01 0.21*** 0.15*** (0.95)

* p < .10 ** p < .05 *** p < .01

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Creative

self-efficacy DV: Radical creativity Predictors 1 Control variables Gender1 H2: -0.07 (0.05) H1: 0.01 (0.05) H3: 0.03 (0.05) H4: 0.03 (0.05) Age H2: 0.10 (0.07) H1: -0.03 (0.07) H3: -0.05 (0.07) H4: -0.05 (0.07) Tenure H2: -0.14 (0.07)** H1: -0.09 (0.07) H3: -0.06 (0.07) H4: -0.06 (0.07) Education H2: 0.09 (0.04) H1: 0.19 (0.05)*** H3: 0.17 (0.06)*** H4: 0.17 (0.06)*** 2 Main effects

Collaborative problem solving

H2: 0.00 (0.05) (Sobel: A) H1: 0.01 (0.05) H4: 0.01 (0.05) Creative self-efficacy H3: 0.20 (0.05)*** H4: 0.20 (0.05)*** (Sobel: B) R2 _0.03 _0.05 _0.09 _0.09

* p < .10 ** p < .05 *** p < .01

Collaborative problem solving and radical employee creativity.