The role of stimulating employees’ creativity and idea generation in encouraging innovation behaviour in Irish firms

Abstract

This paper analyses the impact of stimulating staff creativity and idea generation on the likelihood of innovation. Using data for over 3,000 firms, obtained from the Irish Community Innovation Survey 2008-2010, we examine the impact of six creativity generating stimuli on product, process, organisational and marketing innovation. Our results indicate that the stimuli impact the four forms of innovation in different ways. For instance, brainstorming and multidisciplinary teams are found to stimulate all forms of innovation, rotation of employees is found to stimulate organisational innovation, while financial and non-financial incentives are found to have no effect on any form of innovation. We also find that the co-introduction of two or more stimuli increases the likelihood of innovation more than implementing stimuli in isolation. These results have important implications for management decisions in that they suggest that firms should target their creative efforts towards specific innovation outcomes. We consider four types of innovation: product, process, organisational and marketing. The Oslo Manual notes that these forms of innovation are a mixture of technical and non-technical innovation which may have different determinants (OECD, 2005). Indeed in the context of R&D, Doran et al. (2013) note that different forms of R&D have diverse impacts on the likelihood of performing different forms of innovation. Therefore, it is possible that our idea generation and creativity stimuli may have a differentiated impact on innovation types. We assess the importance of our stimuli on as wide a spectrum of innovation types as our data facilitate to ascertain whether there are any commonalities or substantive differences in their effectiveness. The remainder of this paper is structured as follows. Section 2 presents a review of the literature. The data and methods are presented in Section 3. The results are set out in Section 4, while Section 5 discusses these results. Section 6 concludes our study. LITERATURE REVIEWInnovation is the key to maintaining competitiveness in the global market. The capability of a firm to develop new goods and services, to transform its structure into a more efficient one and to make its marketing more competitive determines its success. Since idea generation and creativity are fundamental to innovation, firm owners and managers frequently encourage, stimulate, fund and reward such activities (Hansen and Birkinshaw, 2007;OECD, 2005;Roper et al., 2008). We begin this section by examining what is meant by idea generation and creativity stimuli, and how these concepts are linked to innovation. Following this we examine the Componential Theory of Creativity (Amabile, 1988(Amabile, , 1996Amabile and Mueller, 2008) and use it to identify stimuli that may enhance organisational creativity. Linking idea generation, creativity and innovationSince the concepts of idea generation, creativity and innovation are used interchangeably in the literature (Ford, 1996;Shalley et al., 2004), it is imp...

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“…These findings are in line with the recent theories of team innovation, highlighting that external knowledge acquisition develops team members in searching for novel routines and practices (Jiang & Chen, 2016). Doran & Ryan (2017) provide an explanation of the existence of the relationship between the development of employees' knowledge and creativity. They argue that job training boosts employees' knowledge about job context, which in turn increases their potential to generate new ideas.…”

Product innovation and performance in SME’s: the role of the creative process and risk taking

“…Although the models differ in the number of stages and specific content of each stage (Reiter-Palmon & Murugavel, 2018), the linear perspective offers better results (Rosing et al, 2018). All stages of the linear creative process are essential (Reiter-Palmon & Leone, 2019) and failure to correctly complete a stage will lead the actors to step back in the process (Doran & Ryan, 2017).…”

Physical activity and creativity of children and youths

“…Critical thinking, communication, collaboration, and creativity have been classified as the most prominent twentyfirst century competencies identified on the basis of making a measurable contribution to educational accomplishments, relationships, employment, and health and well-being outcomes [19]. Creativity has been defined as the ability to produce novel and appropriate work.…”

“…Novel work means original or unexpected, while appropriate work implies useful or adaptive [20,21]. Creativity is important for social development because that lead to driving innovation and responding to unforeseen problems [19]. Cognitive abilities attributed to prefrontal cortex function are required for creativity.…”