When are rewards bad for innovation? Leaders as catalysts for positive linkages between work motivation and innovation

Abstract

Building on the foundations of self-determination theory of motivation, the present study investigates the association between leader behaviors, autonomous motivation and employee innovativeness (innovative work behavior and innovation outcomes) in the Indian R&D context. Data were collected from 493 scientists working in Indian R&D organizations and structural equation modeling was used to test the hypothesized relationships between the study variables. The study found evidence for positive relationships between intrinsic motivation, integrated extrinsic motivations, and employee innovative work behavior and innovation outcomes. While extrinsic motivation is always considered to be negative and harmful for innovation, the present study shows that integrated extrinsic motivation has characteristics similar to intrinsic motivation and can be conducive for promoting innovative work behaviors and innovative outcomes. Extrinsic motivation (driven only by financial rewards) was negatively related to both innovative work behaviors and innovative outcomes. Leadership was positively related to intrinsic motivation, integrated extrinsic motivation and innovative work behaviors, but not to extrinsic motivation and innovative outcomes. Implications for theory and practice are discussed.