The relationship between leadership, organisational climate and workplace innovation

Innovation is a valued organisational asset that may assist in the creation and maintenance of competitive advantage. Recently, a number of authors have proposed links between the concepts of leadership, organisational climate and innovation. In particular, some literature in leadership, organisational climate and innovation has begun to converge. This convergence led researchers to produced models of the interaction between the three constructs within organisations. It has generally been reported that leadership effects innovation and organisational climate or vise versa. However, to date there is no substantial, direct nor robust empirical evidence to inform this view. This study addressed the relationship between, leadership, organisational climate and innovation simultaneously. The research sample comprised of 142 administrative and health-care professionals from a medium sized private consulting firm located from 28 different sites across Australia. The Multifactor Leadership Questionnaire (MLQ), Organisational Climate Questionnaire (OCQ) and the Workplace Innovation Scale (WIS) were used to measure leadership style, perceptions of organisational climate and innovation respectively. Ninety-eight surveys were completed resulting in a 69% response rate. Data were analysed using regressions and correlations to determine whether the putative relationship between the three constructs was demonstrated. This research revealed a significant relationship between measures of innovation with OCQ subscales of autonomy, worker cohesion and innovation. T-tests demonstrated that cohesion (p=0.0003) and pressure (negatively p=0.0032) predicted WIS organisational innovation; autonomy (p=0.0080), innovation (p=0.0001) and recognition (p=0.0057), predicted WIS innovation climate; autonomy (p=0.0076) and innovation (p=0.0211), predicted WIS individual innovation while cohesion (p=0.0069) significantly predicted WIS team innovation. The autonomy subscale was almost a significant predictor of team innovation (p=0.0597). Measures of transformational and transactional leadership revealed no relationship to either organisational climate scores or innovation scores. This is the first time this type of study was conducted in the Australian context and these findings were congruent with prior research taken place in the United States of America by Baer & Frese (2003). The findings from this Australian study supported the notion that a suitable vehicle to leverage workplace innovation could be to review aspects of organisational climate such as attention to level of autonomy, along with building strong co-worker cohesion rather than through the vehicle of leadership. The present study was the first of this type conducted in Australia. These parallel findings suggested a universality or generaliseability of the theory.