Management Decision

Linking transformational leadership, creativity, innovation, and innovation-

supportive climate
Ashkan Khalili,
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Linking transformational Leadership,

creativity,
leadership, creativity, innovation, innovation
and innovation-supportive climate
Ashkan Khalili 2277
School of Management, RMIT University, Melbourne, Australia Received 31 March 2016
Revised 18 June 2016
Accepted 20 June 2016
Abstract
Purpose – The significance of creativity and innovation within organisations has been shown on
several occasions. The purpose of this paper is to investigate the association between transformational
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leadership and employees’ creativity and innovation. Additionally, this study explored the moderating
role of employees’ perceptions of a supportive climate for innovation.
Design/methodology/approach – Data were collected from 1,172 employees who were working in
various types of industries in Iran, a developing country.
Findings – The results of this study revealed positive and significant relationships between
transformational leadership and employees’ creativity and innovation. Also, the findings indicated
employees’ perceptions of a supportive climate for innovation moderated the transformational
leadership‐employees’ creativity and transformational leadership‐employees’ innovation
relationships.
Practical implications – Organisations should invest in transformational leadership training and in
the selection of leaders with this leadership style if their aim is to foster and enhance employees’
creativity and innovation. They also should invest in organisational climate improvement in order to
provide a dynamic platform for being creative and innovative in the workplace.
Originality/value – This study is one of the first to investigate the following relationships in a
developing country, Iran: the associations between transformational leadership and employees’ sense
of creativity and innovation and the moderating impact of employees’ perceptions of a supportive
climate for innovation.
Keywords Transformational leadership, Creativity, Innovation, Innovative climate, Iran
Paper type Research paper

1. Introduction
To remain competitive and sustainable in today’s fast-paced changing and highly
competitive business environment, organisations have to invest in creativity and
innovation. To achieve the desired outcomes such as creativity and innovation,
substantial attention has to be given to how employees as enablers of creative and
innovative outputs experience their firms’ leadership, practices and policies that
encourage or restrain creativity and innovation in the organisation. Creativity and
innovation are considered to be the most important capacity for organisations that
wish to establish a competitive advantage (Gisbert-Loṕ ez et al., 2014).
Scholars from a wide range of disciplines have tried to comprehend the key factors
that shape creativity and innovation. For instance, a review by Mumford et al. (2002)
notes a broad variety of factors such as climate, individual performance abilities, strategy
and structure. To be more specific, prior research has focussed on antecedents of
creativity and innovation including personal (i.e., leadership) and contextual
(i.e., supportive climate for innovation) factors (Černe et al., 2013; Wang et al., 2014). Management Decision
However, according to Černe et al. (2014), a better understanding of the factors impacting Vol. 54 No. 9, 2016
pp. 2277-2293
the creative and innovative behaviours of employees in firms is needed. Therefore, both © Emerald Group Publishing Limited
0025-1747
the leadership and organisational climate notions are the focus of this study. DOI 10.1108/MD-03-2016-0196
 MD Among all available leadership theories, transformational leadership was chosen, as
54,9 it has been documented to foster and enhance creativity and innovation (Sosik et al.,
1997). In this regard, Bass (1985) defined a transformational leader as one who inspires
subordinates to do more than they are expected to do in the first place.
Transformational leaders are dynamic and proactive and capable of leading not only
themselves but also their followers in order to embrace changes (Ahangar, 2009).
2278 According to Ergeneli et al. (2007), transformational leaders tend to take their
subordinates beyond their own self-interests for the benefits of their organisations.
As it is a theoretical reasoning, little empirical evidence exists to confirm the
associations as mentioned above (Reuvers et al., 2008).
Researchers have described organisational climate as the way it feels to be a
member of the firm; it reflects the behaviours and reactions of staff to what the
workplace assumes and values. The organisational climate construct reflects the
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shared values the workforce attach to the behaviours they believe are being
anticipated, encouraged and recognised (Gundry et al., 2015). A business environment
for creative and innovative behaviours reflects workforce’s perceptions of
organisation practices, procedures and policies and ways of interaction that
encourage or restrain the behavioural aspect of creativity and innovation (Schneider,
2000). According to Ren and Zhang (2015), employees’ creativity and innovation
emerge from the encouraging climate in which they find creativity and innovation to
be worthwhile. This climate convinces staff that their creative and innovative
behaviours are considered valuable. Therefore, the present research examines the
impact of employees’ perceptions of a supportive climate for innovation as a
moderator variable on the relationships between transformational leadership and
employees’ creativity and innovation.
In summation, this study is an attemp to provide an empirical answer for each of the
developed research questions:
RQ1. Are there positive and significant relationships between transformational
leadership and employees’ creativity and innovation in developing countries?
RQ2. Are these relationships moderated by employees’ perceptions of a supportive
climate for innovation in developing countries?

2. Literature review and hypotheses development

2.1 Transformational leadership and employees’ creativity and innovation
Transformational leadership has been recognised extensively as a popular notion in
management literature due to its relational and inspirational style (Gardner and
Avolio, 1998). Transformational leaders motivate subordinates to work for longer
hours and generate more than what is expected of them (Bass, 1985). They guide
them in all situations, assist them whenever needed, polish their competences, deliver
knowledge to them and treat them equally (Hall et al., 2008). According to Burns
(1978), it is a form of leadership in which associations are managed around a purpose
in ways that transform, inspire and enhance the aspirations of employees. Podsakoff
et al. (1990) identified six key transformational leadership behaviours: articulating a
vision refers to leaders’ behaviours that motivate the employees with a compelling
vision of the firm’s future. Providing intellectual stimulation includes challenging
employees to take various perspectives on tasks and to rethink the way the job is
done. Providing individualised support concentrates on the employees’ feelings.
 Providing an appropriate model comprises the leaders serving as a role model for the Leadership,
employees. Expecting high performance refers to the expectations leaders have creativity,
regarding the performance of their employees. Fostering the acceptance of group
goals refers to behaviours that nurture cooperation amongst employees and that
innovation
direct them to work together to obtain a shared goal (Podsakoff et al., 1990).
Transformational leaders are those who attempt to develop in their followers
knowledge and skills and higher needs and motivations (Bass and Avolio, 1994). 2279
In fact, this development inspires the subordinates to unite and alter goals and beliefs
(Rafferty and Griffin, 2004).
Previous research has linked employees’ creativity and innovation to the success of
firms (Rubera and Kirca, 2012). In late 1990s, researchers incepted to include the
concept of innovation into creativity. The connection made between these concepts
forced firms to recognise the importance of nurturing the creativity of employees.
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Mumford et al. (2002, p. 705) noted that “creativity, the generation of new ideas, and
innovation, the translation of these ideas into action, have come to be seen as a key goal
of many organisations and a potentially powerful influence on organisational
performance”. Generally, theorists explain two major steps of the innovation
process: initiation and application (Axtell et al., 2000). The first step ends with the
generation of a thought and the second with its application (King and Anderson, 2002).
In this paper, idea generation indicates creativity, and idea implementation indicates
innovation. Therefore, similar to prior studies by Amabile et al. (1996) and De Jong and
Den Hartog (2007), the focus of this study is on both the steps of innovation process:
creativity and innovation.
The fundamental source of any creativity is an individual (Redmond et al., 1993).
Also, an individual is the fundamental source of innovation in an organisation (Shalley
and Gilson, 2004). The creativity of employees theoretically provides the impetus
needed for innovation (Oldham and Cummings, 1996). In fact, employees who are
creative tend to see opportunities for new products or identify new ways of utilising
existing methods, producing new ideas to solve work-related problems and also often
developing sufficient plans for implementation (Gumusluoglu and Ilsev, 2009).
According to Shalley and Gilson (2004), creative employees produce novel and useful
ideas about products, procedures and practices.
Leaders with transformational leadership style are recognised as the main driver
of employees’ creativity and innovation ( Jyoti and Dev, 2015; Nusair et al., 2012).
In fact, transformational leaders let their subordinates to think creatively, analyse
their problems from several angles and look into new and fresh solutions for
problems (Gumusluoglu and Ilsev, 2009). According to Bennis and Nanus (1985),
employees of transformational leaders have much confidence and trust in their
leaders. Consequently, this trust would not only motivate and support employees to
take risks for the completion of their assignments but also encourage critical thinking
and stimulate them to take risks and initiatives most of the time in the workplace.
Transformational leaders ensure that subordinates have encouragement for taking
risks, and they own the results of the actions of their subordinates. This support
alters employees’ attitudes and stimulates them to involve themselves in creative and
innovative work processes (Den Hartog, 2003). Transformational leaders introduce
new patterns for the completion of task and are willing to face more challenges, which
expands the creative and innovative capabilities of their employees (Howell and
Avolio, 1993). According to Yunus and Anuar (2012), transformational leaders
challenge their followers and encourage them to seek new and fresh approaches to
 MD their task. The above literature led the researcher to formulate the following
54,9 hypotheses (Figure 1):
H1. Transformational leadership is positively and significantly related with
employees’ creativity.
H2. Transformational leadership is positively and significantly related with
2280 employees’ innovation.

2.2 Moderating influence of employees’ perceptions of a supportive climate for

innovation
Litwin and Stringer (1968, p. 1) defined organisational climate as “a set of measurable
properties of the work environment, perceived directly or indirectly by the people who
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live and work in this environment and assumed to influence their motivation behavior”.
Nystrom (1990) noted that an organisational climate consists of emotions, standpoints
and behavioural tendencies that explain organisational life. It indicates to individuals
what is important and how it may be obtained; it also identifies with the perception of
the processes, occurrences and types of behaviours that are emphasised and expected
(Schneider, 1990). Climate refers to firm members’ perceptions of processes, policies and
practices (Reichers and Schneider, 1990). Ekvall (1996) defined climate as a company’s
ethos and the accumulated behaviours, postures and feelings that clarify its working
life and the perceptions and comprehension of its members.
In general, there are two broad standpoints in regard to organisational climate.
Some scholars (Glick, 1985; James, 1982) explained work environment as the
peoples’ property which refers to the perception of members regarding organisational
characteristics and norms. They believed organisational climate is all about the
interactions of its individuals. On the other hand, some theorists (Friedlander and
Margulies, 1969; Schneider and Reichers, 1983) described organisational climate as an
objective property of the firm which can be considered as its practices
and policies. In this paper, employees’ perceptions of a supportive climate for

EC

H1

H3

TL EPSCI

H4
H2

EI

Figure 1.
Research model Notes: TL, transformational leadership; EPSCI, employees’ perceptions of a supportive
climate for innovation; EC, employees’ creativity; EI, employees’ innovation
 innovation is treated as their perceptions of workplace climate towards creative and Leadership,
innovative behaviours. creativity,
Researchers have noted that organisations which fail to bring creativity and
innovation in their routine assignments and tasks are not capable of being productive
innovation
and sustainable because of their inability in establishing a dynamic climate that values
creativity and innovation (Pitta, 2009). In this regard, prior research has documented
that a workplace environment positively affects creativity and innovation (Cummings 2281
and Oldham, 1997; Oldham and Cummings, 1996). Krause (2004) mentioned that a
supportive organisational climate is as an important predictor of creativity and
innovation. Mumford (2000) claimed that while innovative individuals tend to explore
first and ask permission later, they might withhold an innovative idea if met with
premature censure, especially when the thought is in an early phase. Basu and Green
(1997) declared that staff members are more likely to implement innovative thoughts
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when they are certain that they will not be penalised for it. De Jong and Den Hartog
(2007) stated that supportive organisational climate for innovation can foster and
encourage creativity and innovation.
The workplace environment is a key element for supporting or restraining creativity
and innovation (Scott and Bruce, 1994). Firms which support creativity and innovation
(i.e. through internal support) may support, acknowledge and reward creativity and
innovation as well as provide enough resources for creative and innovative activities
(Woodman et al., 1993). According to Amabile et al. (1996), such encouragement
provides the psychological context of creativity and innovation, which can impact the
employees’ creative and innovative behaviours. To establish a supportive working
climate towards creativity and innovation, the processes and resources require to be
distributed and designed in such a way that they could encourage creative and
innovative performances (Černe et al., 2013). In fact, the way employees perceive the
extent to which creativity and innovation is supported within the organisation affects
their creativity and innovation.
The significance of a supportive organisational environment in encouraging creativity
and innovation has been documented in previous studies (Gumusluoglu and Ilsev, 2009;
Hsu and Fan, 2010). According to Hunter et al. (2007), supportive working environment
for creativity and innovation is an important contributor to the workplace climate in
supporting and enhancing creativity and innovation. The findings of previous studies
(Basadur, 1997; Oldham and Cummings, 1996) suggest that individuals who are creative
and innovative respond to working climate characteristics and norms which are the
foundation for nurturing and fostering creativity and innovation.
While it has been claimed by many researchers that creative and innovative efforts
are influenced by contextual variables such as working environment (Rosing et al.,
2011; Wang and Rode, 2010), evidence of the contextual determinants of human capital
in developing countries such as Iran remains a research oversight that requires to be
examined; because of this, the role of employees’ perceptions of a supportive climate for
innovation as a moderator on the transformational leadership – employees’ creativity
and transformational leadership – employees’ innovation relationships was considered
in this study. Following this reasoning, it was hypothesised (Figure 1):

H3. Employees’ perceptions of a supportive climate for innovation moderates the

relationship between transformational leadership and employees’ creativity
such that the relationship is more positive with high than with low perceptions
of a supportive climate for innovation.
 MD H4. Employees’ perceptions of a supportive climate for innovation moderates the
54,9 relationship between transformational leadership and employees’ innovation
such that the relationship is more positive with high than with low perceptions
of a supportive climate for innovation.

3. Methods
2282 3.1 Sample and procedures
Simple random sampling was used to gather data for this study. Data were collected from
employees of different types of industries (retail, construction, oil, gas and
petrochemicals, electronics and computer, telecommunications, banking and tourism)
in Iran. The questionnaire was distributed among Iranian businesses located in Ardabil,
Gilan, Isfahan, Kish Island, Mashhad, Mazandaran, Shiraz, Tabriz and Tehran.
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A total of 2,500 survey questionnaires were sent out to Iranian companies. A total of
1,204 responses were received, including 1,172 useable responses, yielding a response
rate of 47 per cent. Overall, 44 per cent of the respondents were women. Of the
participants, 46.3 per cent were in the age group of 41-50 years, 30 per cent in
the age group of 31-40 years, 13.4 per cent in the age group of 21-30 years, 9.4 per cent
in the age group of 51-60, 0.5 per cent in the age group of 18-20 years and 0.4 per cent in
the age group of over 60 years old. In terms of education, 63.4 per cent had a bachelor’s
degree, 20.6 per cent had postgraduate qualifications, 14.6 per cent had an associate
degree, and 1 per cent had a diploma and 0.4 had a high school or lower degree.

3.2 Measures
Transformational leadership inventory developed by Podsakoff et al. (1990) was
utilised to measure transformational leadership behaviours in this study.
The inventory comprises six components: articulating a vision, providing an
appropriate model, accepting group goals, having high performance expectations,
providing individualised support and providing intellectual stimulation. This construct
was tested by 22 items (e.g. “In this organisation, leaders have provided employees with
new ways of looking at things which used to puzzle them”). The items of this construct
(22 items) were measured on a five-point Likert scale, ranging from (1) “strongly
disagree” to (5) “strongly agree”. Chronbach’s α was 0.80.
For this study, employees’ perceptions of a supportive climate for innovation were
measured using an instrument developed by Scott and Bruce (1994). This construct
was examined by 16 items (e.g. “In this organisation, our ability to function creatively is
respected by the leadership”). The items were measured on a five-point Likert scale,
ranging from (1) “strongly disagree” to (5) “strongly agree”. Cronbach’s α was 0.75.
Employees’ creativity was measured using an existing scale developed by Zhou and
George (2001). This construct was examined by 13 items (e.g. “In this organisation, an
employee develops adequate plans and schedules for the implementation of new
ideas”). The items of creativity construct (13 items) were measured on a five-point
Likert scale, ranging from (1) “not at all characteristic” to (5) “very characteristic”.
Cronbach’s α was 0.82.
To investigate employees’ innovation, the researcher used a measurement
instrument developed by De Jong and Den Hartog (2010). This construct was
examined by ten items (e.g. “In this organisation, an employee here contributes to the
implementation of new ideas”). The items were measured on a five-point Likert scale,
ranging from (1) “never” to (5) “always”. Cronbach’s α was 0.79.
 3.3 Reliability and validity Leadership,
The aim of this study was to investigate the link between transformational leadership creativity,
and the creativity and innovation of employees. Furthermore, it was designed to
appraise the moderating role of employees’ perceptions of a supportive climate for
innovation
innovation on the above relationships. Before using structural equation
modelling (SEM), the reliability of measurement scales was examined by gathering
data from 74 employees working in various industries (retail, telecommunications 2283
and tourism) in Iran. All of the measurement scales produced good reliability
(ranging from 0.75 to 0.82), indicating that none of the measurement scale items
should be dropped. Thus, the reliability estimated for all the constructs exceed the
acceptable threshold of 0.70, providing proof of enough fit and internal consistency
(Bagozzi and Yi, 1988; Fornell and Larcker, 1981). The results of the reliability test are
shown in Table I.
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Additionally, reliability of the measures was examined utilising confirmatory

factor analysis (CFA). Composite reliability (CR) and average variance extracted
(AVE) were calculated from model estimates using the formulas developed by
Fornell and Larcker (1981). AVE and CR should be equal to or greater than 0.50 and
0.60, respectively (Bagozzi and Yi, 1988). As displayed in Table I, measures employed
in this study were within the acceptable levels thus supporting the reliability
of the constructs.
Furthermore, a CFA was used to test the proposed measurement model fit and
construct validity. As presented in Table I, all 61 items were found to be statistically
significant with factor loading of more than 0.40 as recommended by Chen et al. (2002).
This proves good convergent validity. In addition, the findings of AVE showed in
Table I provide an additional support for convergent validity. According to Fornell and
Larcker (1981), when the AVE is greater than the squared correlations, discriminant
validity is reached. As displayed in Table II, discriminant validity is achieved since all
the constructs met this requirement, where the square roots of the AVE scores were all
greater than the correlations between the measurement constructs.

4. Results of the study

To test the significance of the theoretical relationships in Figure 1, SEM was conducted.
H1 anticipated that transformational leadership was positively and significantly
associated with the creativity of employees. The fit indices are as follows: normed χ2
(X)2/DF) ¼ 2.75, comparative-fit index (CFI) ¼ 0.93, Tucker-Lewis index (TLI) ¼ 0.93,
incremental-fit index (IFI) ¼ 0.92 and root mean-square error of approximation
(RMSEA) ¼ 0.06. The result shows that transformational leadership as perceived by
employees has a positive and significant effect on employees’ creativity ( β ¼ 0.68,
p o 0.001), which explained 51 per cent of the variance. Therefore: H1 was supported.
H2 predicted that transformational leadership was positively and significantly
related to employees’ innovation. The fit indices are as follows: X2/DF ¼ 3.04,
CFI ¼ 0.91, TLI ¼ 0.92, IFI ¼ 0.94 and RMSEA ¼ 0.05. The finding declares that
transformational leadership as perceived by employees positively and significantly
impacts employees’ innovation (H2: β ¼ 0.52, p o 0.001), which explained 43 per cent of
the variance. H2, thus, was supported.
H3 anticipated that employees’ perceptions of a supportive climate for innovation
moderates the relationship between transformational leadership and employees’
creativity such that the relationship is more positive with high than with low
perceptions of a supportive climate for innovation. To examine the moderating
 MD Construct Factor loading AVE CR Cronbach’s α
54,9
TL 0.62 0.70 0.80
1 0.50
2 0.62
3 0.63
4 0.47
2284 5 0.51
6 0.52
7 0.63
8 0.55
9 0.49
10 0.50
11 0.59
12 0.62
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13 0.52
14 0.53
15 0.61
16 0.61
17 0.57
18 0.58
19 0.50
20 0.55
21 0.59
22 0.47
EPSCI 0.54 0.66 0.75
1 0.47
2 0.53
3 0.53
4 0.54
5 0.60
5 0.62
7 0.58
8 0.48
9 0.57
10 0.50
11 0.64
12 0.52
13 0.69
14 0.55
15 0.64
16 0.59
EC 0.61 0.71 0.82
1 0.52
2 0.60
3 0.66
4 0.54
5 0.53
6 0.62
7 0.53
8 0.54
9 0.48
10 0.52
Table I.
Findings of the
measurement model (continued )
 Construct Factor loading AVE CR Cronbach’s α
Leadership,
creativity,
11 0.60 innovation
12 0.61
13 0.51
EI 0.56 0.68 0.79
1 0.60
2 0.61 2285
3 0.58
4 0.52
5 0.45
6 0.44
7 0.52
8 0.45
9 0.56
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10 0.54
Notes: TL, transformational leadership; EPSCI, employees’ perceptions of a supportive climate for
innovation; EC, employees’ creativity; EI, employees’ innovation Table I.

TL EPSCI EC EI

TL 0.683
EPSCI 0.431*** 0.671
EC 0.353*** 0.420*** 0.622
EI 0.221*** 0.333*** 0.348*** 0.586 Table II.
Notes: TL, transformational leadership; EPSCI, employees’ perceptions of a supportive climate for Correlations between
innovation; EC, employees’ creativity; EI, employees’ innovation. Bold numbers on the diagonal the constructs
represent the average variance extracted. ***p o0.001 and AVE

influence, the researcher conducted three tests as suggested by Baron and Kenny
(1986). First, the finding shows that transformational leadership ( β ¼ 0.70, p o 0.001)
has a significant relationship with employees’ creativity. Second, the result indicates
employees’ perceptions of a supportive climate for innovation ( β ¼ 0.51, p o 0.001) has
a significant association with employees’ creativity. Third, the interaction of
transformational leadership with employees’ perceptions of a supportive climate for
innovation ( β ¼ 0.25, p o 0.001) has a significant relationship to employees’ creativity.
Thus, all the three conditions suggested by Baron and Kenny (1986) were satisfied.
Figure 2 depicts the plot of the significant interaction term. As shown, the association
between transformational leadership and employees’ creativity is stronger when
employees have high rather than low perceptions of a supportive climate for
innovation. This result suggests that H3 is accepted.
To evaluate the moderating influence of employees’ perceptions of a supportive
climate for innovation on the transformational leadership – employees’ innovation
relationship, the researcher followed the same guideline as discussed for the previous
hypothesis. The finding shows that transformational leadership ( β ¼ 0.55, p o 0.001)
has a significant relationship with employees’ innovation. The result indicates
employees’ perceptions of a supportive climate for innovation ( β ¼ 0.40, p o 0.001) has
a significant association with employees’ innovation. The interaction of
 MD 5
Moderator
54,9 4.5 Low EPSCI
High EPSCI
4

3.5

EC
2286 3

2.5

1.5

1
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Low TL High TL

5
Moderator
4.5 Low EPSCI
High EPSCI
4

3.5
EI

2.5

1.5

1
Low TL High TL
Notes: TL, transformational leadership; EPSCI,
Figure 2.
employees’ perceptions of a supportive climate for
Scree plots of the
moderating effect innovation; EC, employees’ creativity; EI,
employees’ innovation

transformational leadership with employees’ perceptions of a supportive climate for

innovation ( β ¼ 0.14, p o 0.001) has a significant relationship to employees’ innovation.
Figure 2 shows the plot of the significant interaction term. As presented, the
association between transformational leadership and employees’ innovation is stronger
when employees have high rather than low perceptions of a supportive climate for
innovation. This finding recommends that H4 is supported.
All of the four formulated hypotheses for this study were accepted. The findings
proved that transformational leadership as perceived by employees positively and
significantly influence employees’ creativity and innovation in organisations in Iran.
Furthermore, it was found employees’ perceptions of a supportive climate for
innovation moderates the associations between transformational leadership and
employees’ creativity and innovation in Iranian companies. Therefore, the outcomes
indicated that transformational leadership and employees’ perceptions of a supportive
climate for innovation serve as two vital factors in encouraging the creativity and
innovation of employees in Iran.
 5. Discussion and conclusion Leadership,
Employees’ creativity and innovation can only be achieved if there is an effective creativity,
leadership style and a supportive climate or culture in the workplace (McAdam et al.,
2010; West and Sacramento, 2012). According to Tidd et al. (2004), leadership plays a
innovation
key role in encouraging creativity and innovation in workplaces. Furthermore,
organisational climate is an important predictor of creativity and innovation (Amabile,
1983; Woodman et al., 1993). This study contributes to the literature by testing 2287
the associations between transformational leadership and employees’ creativity and
innovation and the moderating effect of employees’ perceptions of a supportive climate
for innovation on the relationships between transformational leadership and
employees’ creativity and innovation.
The role of leadership is significant for creativity and innovation in workplaces.
It has been documented that leaders with transformational leadership style show
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support and consideration for staff. These behaviours assist employees to overcome
their fears of challenging the routine ways of working, which directs to higher
creativity and innovation ( Jyoti and Dev, 2015). The positive and significant
associations reported in this paper between transformational leadership and
employees’ creativity and innovation are consistent with the findings of studies by
Cheung and Wong (2011), Choi et al. (2016), Mohamed (2016), Nusair et al. (2012),
Qu et al. (2015), Slåtten and Mehmetoglu (2015) and Wang et al. (2014). For instance,
drawing from a sample of 182 supervisor – follower dyads from a restaurant, hotel,
retail store, travel agent and bank, Cheung and Wong (2011) found a positive
relationship between transformational leadership and employees’ creativity.
They argued that employees tend to be loyal and tend to rely heavily on a
transformational leader to support and inspire them in an Asian context. In other
words, they found that the attributes of a transformational leader could be adapted to
accommodate the needs of creative followers. In a study of 420 leader – follower dyads
in an energy company in China, Qu et al. (2015) demonstrated that transformational
leadership was an important enabler of employees’ creativity. In a study of
500 employees and 150 supervisors working in five-star hotels in Egypt, Mohamed
(2016) found that transformational leadership positively impacts employees’
creative behaviour. She argued that transformational leaders provide workforce with
support and encouragement to think more creatively. Choi et al. (2016) in a study of
356 employees working in manufacturing firms in South Korea discovered that
transformational leadership positively influences the innovation of employees.
They claimed that leaders with transformational behaviours encourage employees’
innovation by motivating them intellectually to create solutions to problems which
invigorate their innovation. Similarly, in a study of 345 frontline employees working in
hospitality organisations in Norway, Slåtten and Mehmetoglu (2015) found that
transformational leadership positively relates to employees’ innovation. They argued
that transformational leaders stimulate their employees and challenge them to adopt
innovative solutions in their work.
A supportive climate and culture for creativity and innovation is vital to advance
and enhance these facets of employees’ behaviours. Wan et al. (2005, p. 267) discussed
that “what is ultimately of crucial importance to organisations is the nurture and
development of an innovation-supportive culture”. The positive and significant
associations reported between perceptions of a supportive climate for innovation
and employees’ creativity and innovation are consistent with the results of studies
by Açıkgöza and Gü nsel (2011), Paulsen et al. (2013) and Rosing et al. (2011).
 MD For example, drawing from a sample of 104 participants in a large research and
54,9 development company in Australia, Paulsen et al. (2013) found a positive
and significant relationship between the perception of support for innovation and
employees’ innovation. They argued that in a supportive and encouraging climate,
each member of the workplace could feel comfortable taking risks, examining new
thoughts and exchanging knowledge, ultimately leading to creativity and innovation.
2288 In a study of 23 group leaders and 289 group members in a manufacturing
and processing company, Černe et al. (2013) argued that a supportive climate for
innovation is important in encouraging creativity in individuals and that employees
who work in a climate supporting creativity and innovation display high degrees of
creative performance. In a similar vein, Imran and Anis-ul-Haque (2011) noted
that creative and innovative behaviours usually involve making risky choice, and
the climate cannot be considered supporting if it does not provide proper structure
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and guidance.
The results of this study show that transformational leadership has positive and
significant influences on both the creativity and innovation of employees in Iranian
organisations. Quantitative data provide evidence that people in management
positions in companies in Iran must practise and develop the behaviours of a
transformational leader in order to encourage and sustain subordinates’ creativity
and innovation. Furthermore, the findings of this study indicate that employees’
perceptions of a supportive climate for innovation have a moderating effect
on the relationships between transformational leadership and employees’ creativity
and innovation in organisations in Iran. Employees’ creativity and innovation can be
facilitated by enhancement of the organisational climate, like providing
adequate time and resources for creativity and innovation. Leaders should improve
the perceptions of employees by valuing creative and innovative work. This suggests
that people in management positions need to provide enough level of support for
innovation in order to have a positive impact on employees’ creativity
and innovation. The results of this study corroborate these ideas. However, to
generalise these results, additional empirical investigation is needed in the context of
developing countries.

6. Limitations and suggestions for further research

This study has different limitations that should be taken into consideration when
interpreting the results. This research is a cross-sectional study, and thus its design is a
limitation as it may not provide any conclusions on the causal associations between
variables. A longitudinal design would better explain the direction of connections
between the variables. Also, the researcher used perceptual data based on employees’
appraisal of their leaders, without consideration of leaders’ evaluation.
The findings of this study emerge from a particular national context, Iran; therefore,
might be different for employees working in different cultural, economical and
environmental conditions. Additionally, there is a lack of clarity in prior research
studies examining the direct influence of transformational leadership and the
moderating effect of employees’ perceptions of a supportive climate for innovation in
Iran for the purpose of comparing.
Since this study limited itself to survey method, a follow-up qualitative research
would be helpful to discover what leaders’ behaviours nurture and enhance employees’
creativity and innovation. Also, while mostly transformational leadership style is
compared with transactional leadership style, future studies should evaluate the
 influence of both leadership styles to find out which one is more pivotal in terms of Leadership,
employees’ creativity and innovation. creativity,
Last but not least, other data collection techniques such as focus group and interview
might be useful to comprehend the direct effect of transformational leadership on
innovation
employees’ creativity and innovation, as well as the moderating influence of
employees’ perceptions of a supportive climate for innovation on the transformational
leadership – employees’ creativity and transformational leadership – employees’ 2289
innovation relationships in depth.

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About the author

Dr Ashkan Khalili received his PhD in Management from RMIT University, Melbourne, Australia.
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His research interests concern leadership and followership in organisation. Dr Ashkan Khalili can
be contacted at: [email protected]

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