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Harnessing Innovation in the 21st Century: The Impact of Leadership Styles Open Access

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Innovation is essential for organizational survival and effectiveness and often requires a balance between managing existing competencies, skills, and resources, and pursuing newer and radical aspirations. Organizational leaders play an important role in fostering innovation in the workplace and striking a unique equilibrium between these competing priorities to maximize individual creativity and organizational innovation outcomes. By employing path analyses, this study examined the relationship between two leadership styles--transformational leadership (TFL) and leader-member exchange (LMX) and two forms of organizational innovation (exploration and exploitation). The study also investigated the role that individual and organizational variables played in explaining the leadership-innovation relationship. Results suggested positive but non-significant relationships between leadership styles and organizational innovation due to the high correlations and overlap between the two leadership styles. Follower autonomy was positively and significantly related to exploration innovation. When analyzed separately, positive and significant associations were found for both leadership styles and organizational innovation. Results of this study suggest the equal importance of transformational and relational styles of leadership towards fostering both forms of organizational innovation. In particular, organizational support for innovation was found to mediate the leadership-innovation relationship, suggesting the importance of social mechanisms in translating the effects of leadership into innovation outcomes for the organization.

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