Managing open innovation

Abstract

Purpose The purpose of this paper is to examine the relationships between empowering leadership style and two types of open innovation: inbound and outbound. The intervening mechanism of employee involvement climate in these relationships is also investigated. Design/methodology/approach The paper uses data collected using a questionnaire survey from middle and top managers working in various firms in northern India. Findings Results reveal that empowering leadership positively affects both types of open innovation. Thus empowering leadership supports followers to seek, integrate and diffuse new ideas and knowledge to improve open innovation outcomes. Further, the mediating role of employee involvement climate is established for empowering leadership-inbound open innovation link. This suggests that an empowering leadership style creates an employee involvement climate that empowers employees and involves them in relevant decision-making which consequently enhances a firms inbound open innovation performance. Research limitations/implications This study used a cross-sectional research design and a relatively small sample size. These limitations can affect generalizability of the findings. Originality/value The paper contributes to leadership and open innovation literatures and provides insights into how the practitioners can use an appropriate leadership style to maximize success in the open innovation paradigm. The study is one of the first to empirically shed light on this strand of open innovation research.