Innovative behavior among service workers and the importance of leadership: evidence from an emerging economy

This study focuses on how service firms can nurture innovative behavior of employees through the important role of leadership. Despite the growth in innovation research, scholars have been slow to move from an R&D (i.e., technical capital) focus to that focusing on employee innovative behavior. However, organizations’ innovation initiatives heavily depend on employee human capital and behavior at work as these are key inputs in the value creation process. We focus on a specific type of leadership, transformational leadership, and explore a nascent employee concept, job embeddedness, to enhance our understanding of the mechanisms and conditions by which leaders may encourage follower innovative behavior. We collected data from employees working in the hotel service sector in Ghana, and analyzed the data using structural equation modelling and Hayes’ PROCESS Macro. Our results revealed that leaders can promote innovative behavior among service workers only when the workers are embedded in the organization. Further, our results showed positive relationships between transformational leadership and organizational embeddedness, and organizational embeddedness and innovative behavior. However, we found no evidence to suggest that employees’ embeddedness in their community might alter the relationship between organizational embeddedness and innovative behavior. We conclude that to support innovation among employees, the behaviors of leaders are important especially in terms of encouraging employees to proactively embed themselves in their organizations, thereby contributing to the development of the hospitality industry and other service sectors in emerging economies.