The Art of Making Workplace Innovative: Conceptual Integration of Leader-Member Exchange, Workplace Innovation and Employee Creativity

Abstract

An increased engagement in innovative activities has become an essential requirement for modern ventures to respond to the threats and opportunities they face. Due to increased globalisation and digitalisation, SME ventures are currently looking for ways to cultivate innovation at different levels such as individual, team and organisational levels to remain competitive. SME ventures need to focus on employee creativity in order to stimulate innovation at the individual level. Moreover, a favourable working environment is required for such cultivation. This short commentary aims to conduct an extant literature review proposing that Leader-Member Exchange (LMX) impacts employee creativity and workplace innovation mediates the relationship between them. Based on the social exchange theory, the literature on LMX, employee creativity, and workplace innovation is reviewed. This study's conceptual model opens new avenues for empirical studies and may help leaders cultivate innovation for improved organisational performance. The current study suggests that SME ventures should implement better LMX practices and better interaction with employees to cultivate ideas aimed to improve employee creativity.