Stimulating Innovation and Creativity

In relation to employee empowerment Opens in new window, as discussed in the literature, several authors note that effects of positive psychological implications of locus of control Opens in new window, self-efficacy Opens in new window and self-esteem Opens in new window lead to encouraging innovative and creative behaviors in people (Thomas & Velthouse, 1990; Spreitzer, 1995).

As Gandz (1990: 78) states: ‘Intensified competition requires more and more innovation’, thus, the psychological implications cannot be ignored. In the competitive marketplace, recruiting employees who have the potential to be creative and innovative is highly desirable, as they can create value for organizations.

Allowing people to be more innovative and creative can help to drive down costs and make the organization more effective, which has resonance with SHRM theory Opens in new window and views from the economic perspective debate, as illustrated:

The overhead costs of excessive bureaucratic controls, people checking up on people, layers of supervision and so on can be avoided by those organizations that work in an empowered mode. Innovative ways of working can drive down costs, and human capital resources can be utilized more effectively (Gandz, 1990: 75).

According to Walton (1985: 77), “workers respond best—and most creatively—not when they are tightly controlled by management, placed in narrowly defined jobs, and treated like unwelcome necessity, but, instead, when they are given broader responsibilities, encouraged to contribute, and helped to take satisfaction in their work”.

It is true to say that people who have always been supervised are also anxious and fearful of being watched all the time, as Marchington and Wilkinson (2000: 40) point out:

individuals empowered to make decisions may be unwilling to use their discretion if they feel continually under the watchful eye of “Big Brother” (Marchington and Wilkinson, 2000: 40).

Under such conditions, innovation and creativity Opens in new window, which are seen as important skills in SHRM Opens in new window, may be stifled. Competitive organizations are always seeking ways and methods to be innovative.

Several authors report that employee empowerment is positively related to innovation and capability and it is also viewed as being motivational:

Innovative work practices can increase motivation by providing more interesting work, increasing flexibility and improving individuals and organizational performance (Marchington and Wilkinson, 2000: 342).

On a psychological level, innovative organizations are seen to have positive benefits:

Innovative organizations foster more self-esteem and self-worth in individuals (Ripley and Ripley, 1993: 30).

Hence, the arguments behind innovation and creativity Opens in new window are that when organizations encourage these behaviors in individuals or even teams, it can enable employees to be imaginative, creative and feel empowered.

Velthouse (1990: 13) explains how creativity is defined as the “spark of the soul, joie de vivre”. In theory, employee empowerment is supposed to help unleash the potential and creative side of people, as Kondo (1997: 256) highlights:

Creativity is the driving force behind the discovery of better ways of doing things (Kondo, 1997: 256).

In a similar vein, Ripley and Ripley (1993: 29) point out that innovative organizations can “achieve long-term competitiveness with an ever increasing market share”.

However, Simons (1995: 80) cautions that although innovation and creativity can create opportunities for organizations and employees, it is also important to exercise some control to avoid exposing organizations to adverse situations, as illustrated:

A fundamental problem facing managers is how to exercise adequate control in organizations that demand flexibility, innovation, and creativity. Competitive business with demanding and informed customers must rely on employee initiative to seek out opportunities and respond to customers’ needs. But pursuing some opportunities can expose businesses to excessive risk or invite behaviors that can damage a company’s integrity (Simons, 1995: 80).

This is an important point and it is necessary for organizations to be tolerant of risk-taking and of employees making mistakes.

Interestingly, implied in employee empowerment is not only the development of innovative and creative behaviors of employees, but risk-taking as well.

Velthouse (1990: 14) highlights that there is a complementary relationship between creativity and employee empowerment and they are similar in many aspects, such as:

• individual expressions of independence,
• risk-taking,
• confidence and commitment.

However, encouraging risk-taking is not always easy for organizations, due to the potential for mistakes (sometimes costly) made by employees. Hence, in an environment of risk-taking, organizations must make sure that employees are encouraged to learn from their mistakes. Where there is risk involved, clear parameters need to be communicated to employees, and having trust and confidence in employees is vital.