Frontiers of Entrepreneurship Research
1997 Edition

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THE CONTEXT OF CREATIVITY:  IMPLICATIONS FOR STRATEGIC HUMAN RESOURCE MANAGEMENT AND COMPETITIVE ADVANTAGE FOR SMALL FIRMS IN GROWING INDUSTRIES

Terry C. Blum
Lucy L. Gilson
Christina E. Shalley

DuPree School of Management
Georgia Institute of Technology
Atlanta, Georgia 30332

Telephone: 404-894-4924
Fax: 404-894-6030

Principal Topics

Enhancing creative performance of employees has been considered by numerous authors as critical for improving competitiveness and innovativeness in rapidly changing environments.  There is empirical evidence, based mostly on studies of large employers, that suggests that appropriate structuring of the work environment, through human resource management techniques, can foster creativity.  There is also evidence that smaller employers do not think about their firms strategically, and therefore tend not to form strategies for personnel development that can give them a competitive advantage in managing growth.  This paper examines the job design context and the organizational climate that are associated with jobs that require creativity, the production of new and useful ideas to better accomplish a purpose.  It also considers the implications of the alignment of jobs that require creativity with appropriately structured work environments for small firms, particularly those in growing industries, where the appropriate management of creativity may be most critical for organizational success, growth and survival.

Methods

The data for the analysis comes from telephone interviews with full time employees working in the U.S., obtained from a national probability sampling procedure, which yielded a 65% response rate and is generally consistent with demographic distributions available from the U.S. Census.  The proposed analyses include 800 respondents who work for employers with 50 or fewer employees. Respondents were asked about job design, organizational climate, required creativity,  human resource practices, and outcomes predictive of performance.  In addition, the data set was coded for respondents' occupation and industry classifications, along with the size of the worksite.  The data set is complemented by a cross check of required creativity in occupations according to the Dictionary of Occupational Titles (DOT), and whether the organization is in a  growth industry, as indicated by U.S. Census data.

Major Findings

Using regression analyses, we test hypotheses concerning whether job characteristics that have been proposed to promote creative performance, such as job autonomy, complexity, and participation in decision making are positively associated with, and whether job characteristics that have been proposed to inhibit the execution of required creativity are negatively associated with, required creativity. We find that, among companies with 50 or fewer employees, job designs facilitative of creativity, such as autonomy, complexity, and demanding work are associated with high job required creativity.  Whereas hypothesized barriers to creativity, such as repetitive work and work that is controlled by machines are associated with less job required creativity. These relationships are similar to those found in samples of larger work organizations.  These data also show that number of employees and being in a growth industry are not significant predictors of creativity over and above the significant effects of the job design characteristics.

We then ascertain whether  the alignment of work environment with required creativity, based on the  predicted creativity required given the  linear combination of job characteristics and organizational climate in the regression models, is associated with a number of psychosocial outcomes that are associated with performance.  We find that job satisfaction is associated with the alignment of job design and required creativity, even when negative affectivity and perceived level of required creativity are controlled.  In addition, job satisfaction is higher among those in growth industries.  Intention to turnover and perceptions of procedural justice are associated with alignment, net of creativity and negative affectivity, but growth is not.   Further, while escapist drinking behavior has been inversely associated with alignment in studies of larger workplaces, the association is not present in the smaller workplaces.

Analyses of means indicates that creativity is more likely to be required in smaller organizations in growing industries, and least likely in larger ones in non growing industries.  The alignment of creativity with job designs that facilitate creativity is higher in the organizations in growing industries, and highest in smaller organizations in growth industries.  Similarly, the  means of the psychosocial outcomes appear to indicate higher scores in the smaller organizations in growth sectors.

Implications

The impression that smaller organizations in growth industries do not manage their human resources as well as larger organizations appears to be exaggerated.  We find that the models of job required creativity that fit larger organizations also fit smaller organizations.   Further, job required creativity, a job characteristic that is both desired by many, and allows organizations to achieve competitive advantage, appears to be more available to workers in smaller organizations.  Moreover,  when coupled with being in a growing industry, it appears that these workers are more satisfied.  As smaller organizations manage their growth, they should continue to design jobs in ways that facilitate creativity, which is likely to contribute to their organizational survival and performance.  Further, it appears that smaller work places in growing industries may be the best places to work and should be able to attract the best employees.

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