Inte rna tio na l Journa l of M anage me nt Scie nce a nd

Bus ine s s Adminis t ra t io n

Volume 5, Issue 3, March 2019, Pages 10- 21

DOI: 10.18775/ijmsba.1849-5664-5419.2014.53.1002
URL: http://dx.doi.org/10.18775/ ijmsba.1849-5664-5419.2014.53.1002

The Impact of Servant Leadership on Employees’ Innovative Work

Behaviour-Mediating Role of Psychological Empowerment
1
Naveed Ahmad Faraz, 2 Muhammad Farhan Mughal, 3 Fawad Ahmed, 4 Ali Raza,
5
Muhammad Khalid Iqbal
1,3,4,5
School of Management, Wuhan University of Technology, Wuhan, P.R. China
2
School of Computer Sciences, Central China Normal University, P.R. China

Abstract: Change is the only constant phenomenon in this world, and organizations can bring it through innovation. This
innovation ultimately leads to an organization’s competitive edge and sustainability. Every new idea primarily originates
in the minds of individuals which when implemented successfully contributes for overall organizational innovation.
Nurturing employees’ innovative work behavior (EIWB) is prudent for every organization looking to enhance its
innovative outcomes. This research, at first, aimed to examine the influence of servant leadership (SL) at three distinctive
levels of employees’ innovative work behavior (EIWB) namely idea generation, idea promotion, and idea realizatio n .
Then, the influence of SL on overall EIWB is investigated. Finally, employees’ Psychological Empowerment (PE) is
assessed as a mediator through which SL exerts its influence on EIWB. Servant leadership in conjunction with Social
Exchange theories were used to develop the conceptual model of this research. Cross -sectional data were collected fro m
283 entry-level officers working in different Power Sector Companies of Pakistan. Partial least squares structural
equation modeling (PLS-SEM) was employed through Smart-PLS 3.2.8 software to analyze the hypothesized
relationships. The findings of this research show that SL positively influences each stage of EIWB as well as EIWB at
an integrated level. Employees’ Psychological Empowerment (PE) partially mediates the positive influence of SL on
EIWB. This research is one of the pioneers to examine the influence of SL at different levels of EIWB. Further,
investigating employees’ PE as mediating between the relationship of SL and EIWB is also a unique contribution of this
research. Detailed discussion on the results is carried out besides offering the theoretical and manageria l implications .
Lastly, limitations of this study and potential avenues for future research are highlighted .

Keywords: Servant leadership, Employees’ innovative Work behavior, Psychological empowerment, Power sector of
Pakistan

1. Intro d uctio n
Change is the only constant phenomenon in this world. Sustaining the status quo is no longer a pragmatic choice for
organizations. Successful and continuous innovation is vibrant for the existence of organizations in this competitive
business world. Ever-changing business environment compels organizations to look at innovation as a source of
productivity, efficiency, and sustainability. The competitive advantage of an organization transpires from the ideation
and implantation of novel ideas by its individuals. Organizations are keen to explore all the antecedents having the
potential to enhance employees’ innovative work behavior (A. Agarwal, 2014; Scott & Bruce, 1994). It is a fact that
without the participation of employees no organization can achieve inno vation (Abstein & Spieth, 2014). Alongside the
significance of innovation, researchers have widely acknowledged the need for leadership to focus and direct the creative
and innovative efforts of individuals to overall organizational innovation (Friedrich, Mumford, Vessey, Beeler, &
Eubanks, 2010; Tushman & Nadler, 1986) . As the business environments changed, leadership has also faced new
challenges. Particularly, one important trend in this respect is the growing dependence on human resources of
organizations (O'Leary, Lindholm, Whitford, & Freeman, 2002) . Consequently, academicians started exploring a
leadership style which is predominantly concerned with the employees’ needs, known as servant leadership. Both
academicians and practitioners substantively highlighted the need for more people-centered leadership style that forced

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International Journal of Management Science and Business Administration, vol. 5, issue 3, pp. 10-21, March 2019
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

leadership scholars to revisit the caring style of leadership such as servant leadership (Hunter et al., 2013; Peterson,
Galvin, & Lange, 2012). Those organizations that are keen to nurture innovation must pay attention on to leadership that
can inspire and champion its vision to its employees. Professional and personal development of the followers’ so that
they can deliver their levels best is the top priority of servant leaders. Researchers have now started to explore the
influence of servant leadership on creative and innovative behavior of the employees’ (Jaiswal & Dhar, 2015; Yoshida,
Sendjaya, Hirst, & Cooper, 2014). A critical review of the empirical literature revealed a hand ful of studies on the
relationship between servant leadership and employees innovation (Eva, Robin, Sendjaya, van Dierendonck, & Liden ,
2018). Therefore, investigating the impact of SL on EIWB in the presence of different mediating/moderating variables
is highly justified. Moreover, this is one of the pioneer researches to examine the influence of SL at different levels of
EIWB including idea generation, idea promotion and idea realization. Employees’ Psychological Empowerment (PE) is
investigated as a mediating variable in the relationship between SL and EIWB. The theoretical lens to develop the
conceptual model of this study extracted its concepts from Social Exchange and servant leadership theories. We
introduced and tested a unique model of EIWB.

The layout of this article is as follows: the next section will elaborate on the theoretical grounds of variables under
consideration. Then based on theoretical and empirical evidence, hypotheses are proposed followed by pictorial
representations of conceptual models. After that, the research methodology is presented followed by the results and
analysis section. Lastly, discussion on results, theoretical and practical implications are presented while ending the article
with the study’s limitations and potential avenues for future research.

2. How to Recognize a Good Manager?

2.1 Employees’ Innovative Work Behavior (EIWB)
The first time definition of EIWB was given by West and Farr (West & Farr, 1989) as “all employee behavior directed
at the generation, introduction and/ or application (within a role, group or organization) of ideas, processes, products or
procedures, new to the relevant unit of adoption that supposedly significantly benefit the relevant unit of adoption”.
Following West and Farr, Janssen (Janssen, 2000) defined EIWB as “the intentional creation, introduction, and
application of new ideas within a work role, group, or organization, to benefit role performance, the group, or the
organization.” Janssen identified three separate stages: idea generation, idea promotion, and idea realization (Janssen,
2000). Organizations should foster employee innovation to create organizational success (Axtell, Holman, & Wall, 2006).
For organizations to innovate and be successful with the implementation of in novation, they must rely on their employees
to deliver their processes, methods, and operations (Ramamoorthy, Flood, Slattery, & Sardessai, 2005). This is done
through employee engagement in individual innovative behavior. Innovative behavior is unlike cre ativity in the sense
that it is intended to provide some sort of benefit to the organization (De Jong & Den Hartog, 2010). Creativity is utilized
and necessary only for the stage of idea realization. Idea generation of an employee is his/her out of the box thinking and
coming up with distinctive solutions or improvements related to prevailing services, products or processes (Amabile,
1988). Idea promotion is necessary to win the support of the relevant decision making authorities for new ideas that often
go against the grain and can be costly, leading to unwanted risk. Thus, the backing and support of highly committed
people at powerful positions are needed for the accomplishment of innovative ideas (Howell, Shea, & Higgins, 2005).
Lastly, idea realization involves bringing concepts in actual products, processes, or services so that everyone can see the
innovation (Moss Kanter, 1988). EIWB is the basic building block for improved organizational performance, and thus,
it is highly justified to explore all the factors that aid or boost such behaviors of the employees (Scott & Bruce, 1994).

2.2 Servant Leadership (SL)

Greenleaf (Robert, 1977) refers to servant leadership not as a management technique but as a way of life, which starts
with a “natural feeling that one wants to serve, to serve first” (p.14), then aims to lead. Hale et al. defined servant
leadership as, “an understanding and practice of leadership that places the good of those led over the self-interest of the
leader, emphasizing leader behaviors that focus on follower development, and de -emphasizing glorification of the leader”
(Hale & Fields, 2007). Liden et al. (Liden, Wayne, Zhao, & Henderson, 2008) described the essential characteristics of
servant leadership into seven dimensions including: 1-Emotional healing, 2-Empowering, 3-Helping subordinates grow
and succeed, 4-Putting subordinates first, 5-Creating value for the community, 6-Having conceptual skills, and 7-
Behaving ethically. Emotional healing requires demonstrating care and sensitivity towards followers and ensuring their
well-being. Empowering subordinates’ includes facilitation and encourageme nt of their abilities to take responsibility

11
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

and provide them the necessary freedom to act upon and manage the tough situations in their way. Such leaders also aid
their followers to grow and succeed by showing genuine concern in their career development a nd goals attainment by
offering appropriate opportunities to polish their skills. These leaders put their subordinates’ interest and achievements
ahead of their own. Another unique characteristic of servant leaders is their concern for the community develo pment
outside the premises of the organization. They also encourage their followers to follow the same footsteps. Servant leaders
own and exhibit a lot of conceptual skills. Because of their sound understanding and information about the organization,
its goals, and the tasks, they are usually in a position to offer timely support, direction and resources to the followers’.
Finally, ethical behavior by virtue of open, fair and honest integration with others is also a valuable trait of servant
leaders. There is a growing interest of the scholars to enlarge servant leadership’s nomological network by exploring and
proving the practical utility of this leadership style through empirical evidence. Servant leadership has proven its utility
by yielding diversified positive outcomes at organizational (Choudhary, Akhtar, & Zaheer, 2013; Liden, Wayne, Liao ,
& Meuser, 2014), team/group (Yang, Liu, & Gu, 2017; Yoshida et al., 2014) and individual level (Donia, Raja, Panaccio,
& Wang, 2016; Panaccio, Henderson, Liden, Wayne, & Cao, 2015; Van Dierendonck, Stam, Boersma, De Windt, &
Alkema, 2014).

2.3 Servant Leadership (SL) and Employees’ Innovative Work Behavior (EIWB)
Leaders always have the potential to influence the capacity of followers to come up with novel and pract ical ideas to
resolve the problems (Amabile, 1988; Zhou & Shalley, 2003). ]. Servant leaders can enhance EIWB by offering them
empowerment and courage to take risks. Empowerment, helping to grow and succeed, and conceptual skills are such
characteristics of SL which are closely related to shape EIWB at the workplace. Yoshida et al. (Yoshida et al., 2014) ]
investigated that by way of relational identification, servant leaders stimulate innovative behavior of subordinates’.
Although the literature on investigating the influence of SL on EIWB is scarce, there are few empirical studies where SL
has shown its positive influence in enhancing EIWB (Krog & Govender, 2015; Panaccio et al., 2015; Rasheed, Lodhi, &
Habiba, 2016). ]. Employing the theoretical lens of social exchange theory (Blau, 1964) is also useful in understanding
the impact of SL on EIWB. Servant leaders believe in forming a close relationship with the subordinates’ by putting them
first, helping them and always reaming honest to them. Servant leaders close iteration creates an obligation on their
followers’ to reciprocate the same in their jobs. There is not a single study which has examined the influence of SL on
different stages of EIWB. However, the other leadership styles like transformational and relational leadership have been
investigated to demonstrate their influence at different levels of EIWB. In the same analogy, this research formulated the
following hypothesis:

H1: Servant Leadership directly and positively affects the Idea Generatio n stage of EIWB.
H2: Servant Leadership directly and positively affects the Idea Promotion stage of EIWB.
H3: Servant Leadership directly and positively affects the Idea Realization stage of EIWB.
H4: Servant Leadership directly and positively affects the overall construct of EIWB.

12
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

2.4 Servant Leadership and Employees’ Psychological Empowerment

Meaning, competence, self-determination, and impact are four sub-constructs that form the overall constructs of PE
which is theorized similar to intrinsic motivation (Spreitzer, 1995). Though researchers reasoned that PE is the way
through SL exerts its positive impact on the followers’ outcomes (Liden et al., 2008; Russell & Gregory Stone, 2002),
the empirical evidence to verify this argument is limited (Newman, Schwarz, Cooper, & Sendjaya, 2017). This is even
though almost all the SL scales emphasized the importance of empowerment as an important trait of servant leaders
(Ehrhart, 2004; Laub, 1999; Liden et al., 2008; Van Dierendonck & Nuijten, 2011). Through empo werment, SL can
influence the employees’ outcomes in many ways. First, providing them development opportunities and focusing on their
personal needs (Gregory Stone, Russell, & Patterson, 2004; Newman et al., 2017). Secondly, fair treatment and respect
instead of considering them as a source of personal or organizational advantage. Walumbwa et al. (Walumbwa, Hartnell,
& Oke, 2010) recently investigated the impact of SL on employees’ self-efficacy, a construct similar to competence
dimension of PE, and found significantly positive results. Further, servant leaders create a sense of competence in their
followers’ by giving them the chances to acquire new skills through training. Thirdly, SL believes in participative
decision making which possibly heightens the self-determination perception of the followers’(Robert, 1977; Van
Dierendonck, 2011). Lastly, SL realizes their followers about their jobs’ impact on the overall organizational level which
allows them to understand the worth (meaning) of their jobs. To con clude, servant leaders by increasing the subordinates’
perceptions of meaning, competence, self-determination, and impact augment the psychological empowerment of the
followers’. Thus, the following hypothesis is framed:

H5: Servant Leadership directly and positively affects the EPE.

2.5 Psychological Empowerment and Employees’ Innovative Work Behavior

PE gives a good feeling regarding the tasks the employees’ are performing. They also start perceiving their jobs
challenging and meaningful. This positive perception leads them to demonstrate innovative behaviors by aligning
personal goals with that of the organization’s (Jha, 2014). Control over decision-making control, freedom, the capability
to impact others, flexibility and meaningfulness of the work encourage employees to perform innovatively in their jobs
(Kendall, Chu, Gifford, Hayes, & Nauta, 1998). When employees are empowered, they find their work meaningful which
gives them the intrinsic motivation that ultimately leads to innovative work behavior (Laschinger, Finegan, Shamian, &
Wilk, 2004). Psychological empowerment encourages change and employees’ innovative work behavior is another way
to bring change (Conger & Kanungo, 1988). Psychological empowerment leads intrinsic motivation, flexibility, and self-
determination in performing a job which allows the employees’ to perform innovative work behav ior (Ryan & Deci,

13
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

2000). Recent empirical evidence have also established a positive association of employees’ PE with IWB (Afsar, F.
Badir, & Bin Saeed, 2014). This discussion leads to postulate the following hypothesis:

H6: PE directly and positively affects their IWB.

2.6 Mediating role of Employees’ Psychological Empowerment

When employees’ are empowered, they start believing in their self-worth, skills, capabilities, abilities and show
confidence to impact their work outcomes meaningfully and by offering value addition. Such positive belief allows them
to participate in creative and innovative initiatives(Burleson, 2005), besides involvement in extra -role efforts and coming
up with new ideas and reasons to implement those ideas. When employees recognize that their jobs are autonomous,
meaningful and personally valuable, they will start to deal with complex problems and look for new ways of improvemen t
(Gilson & Shalley, 2004). Further, servant leadership is an approach which remains more open to employe es; servant
leaders share more information and always remain open to hearing from their subordinates. Researchers have already
emphasized the mediating role of psychological empowerment in different leadership styles and important individual and
group level outcomes (Afsar et al., 2014; Avolio, Zhu, Koh, & Bhatia, 2004). Milton and van Dierendonck (Jorge Correia
de Sousa & van Dierendonck, 2014) identified PE as mediator in relationship of SL with employee engagement. More
specifically, Camilla L. Krog and Krishna Govender (Krog & Govender, 2015) investigated employee PE as a mediato r
in the relationship between SL and EIWB. Their findings suggested that employees’ PE mediates the said relationship.
Therefore, the following hypothesis is proposed:

H7: PE significantly mediates the positive influence of SL on EIWB.

H7
+
Mediation

Psychological
H5 Empowerment H6
+ +

Servant Employees’
Leadership IWB
H4
+
Figure-2: Conceptual
Model-II

3. Research Methods
3.1 Sample and Procedure
A list of all the entry level officers working in the Power Sector Companies of Pakistan was requested from the concerned
HR-Department. Systematic sampling, a probability sampling, technique was used for the selection of 450 samples.
Cross-sectional data through self-administered questionnaire was collected from the sampled respondents. Besides, data
on the constructs, demographic information was also requested voluntarily while ensuring anonymity and secrecy. The
questionnaire was designed with Google docs. Webb-link of the online questionnaire was sent to 450 entry-level officers.
Two hundred ninety-two (292) completed questionnaires were received and out of those 283 questionnaires were retained
for final analysis. Nine (09) questionnaires were discarded due to incompleteness or no variation at all. Thus, the final
response rate of this research is 62.89%. The entire questionnaire was in English language being the medium of official
dealings in Pakistan (Faraz, Yanxia, Ahmed, Estifo, & Raza, 2018).

14
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

3.2 Measurement
All the responses were measured by the ratings of the respondents on a five -point Likert scale where ‘1’ represents
‘strongly disagree’ and ‘5’ represents ‘strongly agree’. Employees’ innovative work behavior: This construct was
measured by nine (09) item scale developed by Janssen (Janssen, 2000). The scale comprised of three distinctive
dimensions namely idea generation, idea promotion and idea realization that form the overall EIWB construct. Each
dimension consists of three (03) items. The s cale has established validity. Servant leadership: SL was assessed by the
respondents’ rating on a seven (07) item scale developed by Liden et al.(Liden et al., 2015). The scale comprised of items
the seven (07) dimensions of SL construct. Psychological Empowerment: Spreitzer (Spreitzer, 1995) developed a twelve
(12) item scale to measure psychological empowerment. There are four sub -dimensions of this scale namely: meaning,
competence, self-determination, and impact. Each sub-dimension is measured with three (03) items.

3.3 Sample Profile

Table-1, presented below, summarizes the sample profile of this research. Information regarding gender, age, job nature,
tenure, and education level of 283 respondents is precisely elaborated.

Table-1: Sample Profile

Total respondents 283

Gender Male (68% ) Female (32% )
Age in Years 18 to 25 (31% ) 26 to 35 (29% ) 36 to 45 (24% ) 46 to 55 (13% ) 55 & Above (03% )
Nature of the Job Technical (66% ) Non-Technical (34% )
Tenure in Years Less than 1 (7% ) 1-5 (20% ) 6-10 (36% ) 11-15 (28% ) Above 15 09%
Education Level Below Graduation (05% ) Graduation (39% ) Master (56% )

Sample profile of the respondents revealed that 68% of respondents are male as compared to 32% of female. Seemingly
this indicates male dominance of employees; however, it is embedded in the culture of Pakistan and corroborates
employment trends of the country. The statistics regarding age showed that majority of the respondents’ age is within the
brackets of 18 to 45 years. This is a positive indicator and proves the absence of old age phenomenon in the employment.
Majority of the respondents’ job nature is technical which is consistent with the fact that the Power Sector Companies of
Pakistan employ individuals having technical expertise. As far as the tenure of the respondents is concerned, 36% of the
respondents have 06 to 10 years of experience which is the highest percentage in the dataset. Lastly, the edu cation level
of the respondents is also consistent with the job requirements in the Power Sector of Pakistan and the majority of the
respondents are very well educated (Graduation & Master).

4. Results and Analysis

4.1 Measurement Model Evaluation
The evaluation of the measurement model in PLS-SEM is based on individual indicator reliability, construct reliabilit y ,
convergent validity, and discriminant validity. The upcoming sections present the evaluation of the measurement model
of this research.

4.1.1 Reliability
Internal consistency of items in measuring a construct is known as ‘Reliability’ of the construct. It is the extent to which
the items on an instrument are homogenous and reflect the same underlying construct (Cooper & Schindler, 2014).
Typically, Cronbach’s alpha coefficient indicates the consistency of the measurement items. However, Hair et al. (Joseph
F Hair Jr, Hult, Ringle, & Sarstedt, 2016) argue that Cronbach's alpha might not be a suitable measure of reliabilit y
because it assumes that all indicators are equally reliable and the loadings of items on a construct are equal. PLS-SEM
uses another measure of internal consistency named as ‘Composite Reliability (CR)’ (Joseph F Hair Jr et al., 2016). The
CR is the extent to which reflective items indicate the latent variable, and it deals with the reliability of the individual
item. Cronbach’s alpha and Composite Reliability values are presented in Table -2 below.

4.1.2 Convergent Validity

15
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

Convergent validity is the degree to which responses on an item correlates with responses of other items for the same
construct (Cooper & Schindler, 2014). Hair et al. (Joseph F Hair Jr et al., 2016) suggested ‘Average Variance Extracted
(AVE)’ must be considered to assess the convergent validity of a reflective measure. AVE is a good measure of
convergent validity and is defined as the total amount of variance in the indicators accounted for the latent variables with
the cutoff point of 0.5 (Joseph F Hair Jr et al., 2016). The AVE values along with other descriptive statistics are shown
in Table-2 below.

Nonetheless, this idea or this study has its limits; it is questionable. It makes a very theoretical portrait: in fact, the woman
would be more enterprising, more honest, more endowed to create a cohesion of a team, but not very strong in initiativ e
taking, which is more recognized as a male skill. To say that she would be more honest in her management may be a
common stereotype in the same way as to say that she pays better attention to others . Alternatively, even greater integrity,
leaving superiority to men over the ability to develop a strategic point of view for the company.

Besides, some argue that nothing scientifically proves that a woman manages differently from a man, and it is life
experiences, but not gender, that forges the character of a manager. Other critics like Mickael Hingan, in 2016, went even
further to say that this article by Diana Rillet was useless. For him, the truth is that it is each individual (man or woman )
with his own "human qualities", "Skills" and "experiences" that will make the much-awaited difference in the area in
which he or she evolves according to his or her sensitivities. Moreover, that is because the author of this article is
paradoxically a woman. Worse, there are women who manage like men and vice versa (Look for example politics is a
beautiful showcase that illustrates that). Also, if we look around ourselves, we will see that there are men who develop
their femininity and women their masculinity.

Table-2: Descriptive Statistics and Reliability/ Validity Indicators

Variable Name / Reliability & Validity Indicators Item Loadings Mean SD S kewness Kurtosis
IG1 0.759 3.551 1.134 -0.287 -0.614
IG2 0.717 3.312 1.147 -0.413 -0.527
IG3 0.809 3.261 1.210 -0.354 -0.723
Employees’ Innovative Work Behavior (EIWB)
IP1 0.804 3.109 1.136 -0.404 -0.609
IP2 0.813 3.447 1.143 -0.304 -0.491
IP3 0.869 3.468 1.215 -0.283 -0.508
Alpha=0.966, CR=0.970, AVE=0.728
IR1 0.743 3.109 1.085 -0.304 -0.599
IR2 0.788 3.048 1.124 -0.207 -0.581
IR3 0.811 3.308 1.087 -0.189 -0.498
M1 0.745 3.067 1.067 0.043 -0.368
M2 0.752 3.291 1.004 -0.336 0.509
M3 0.791 3.049 1.135 -0.265 -0.622
C1 0.744 3.434 1.012 -0.381 0.530
Psychological Empowerment (PE) C2 0.805 3.646 1.125 -0.414 -0.651
C3 0.743 3.120 1.039 -0.313 -0.591
SD1 0.802 3.591 1.206 -0.258 0.465
Alpha=0.963, CR=0.968, AVE=0.714 SD2 0.821 3.287 1.109 -0.339 -0.599
SD3 0.819 3.404 1.166 -0.264 -0.410
I1 0.808 3.349 1.022 -0.446 0.526
I2 0.819 3.268 1.007 -0.238 -0.609
13 0.730 3.409 1.031 -0.204 -0.457
S ervant Leadership (S L) SL1 0.822 3.445 1.109 -0.288 -0.702
SL2 0.85 3.621 1.221 -0.303 0.513
SL3 0.879 3.520 1.035 -0.379 -0.525

16
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

Variable Name / Reliability & Validity Indicators Item Loadings Mean SD S kewness Kurtosis
Alpha=0.923, CR=0.939, AVE=0.687 SL4 0.879 3.209 1.109 -0.288 -0.673
SL5 0.856 3.524 1.116 -0.373 0.562
SL6 0.737 3.140 1.102 -0.452 -0.590
SL7 0.768 3.237 1.025 -0.362 -0.571
Note: CR (Composite Reliability), AVE (Average Variance Extracted), IG (Idea Generation), IP (Idea Promotion), IR (Idea
Realization), M (M eaning), C (Competence), SD (Self-determination), I (Impact).

4.1.3 Discriminant Validity

Fornell & Larcker (Fornell & Larcker, 1981) ] proposed a stringent approach to assess discriminant validity. They
recommend that the square root of each construct’s AVE needed to be more than its highes t correlation with any other
construct. Another method to access discriminant validity was proposed by Henseler, Ringle, and Sarstedt (Henseler,
Ringle, & Sarstedt, 2015) which is based on the hetrotrait-monotrait (HTMT) ratio of the correlations. In the latest
guidelines of PLS-SEM, HTMT is strongly suggested to be reported for establishing discriminant validity of the
constructs. For models having similar constructs, the threshold value of 0.90 HTMT is a good indicator to establish
discriminant validity (Henseler et al., 2015). Discriminant validity through different established criteria is ensured in
Table-3 given below.
Table-3: Discriminant Validity of the Constructs

Constructs IG IP IR SL PE EIWB

Idea Generation 0.910 0.814 0.729 0.772

Idea Promotion 0.809 0.845 0.806 0.831
Idea Realization 0.882 0.835 0.853 0.765
SL 0.721 0.787 0.727 0.829 0.831 0.765
PE 0.786 0.845 0.806
EIWB 0.727 0.836 0.853
Note: Values at the diagonal denote the square root of AVE. Above the diagonal, the values of HTM T have been placed. Further,
values of the correlations among the constructs have been depicted underneath the diagonal.

4.2 Structural Model Evaluation

Results of the structural model will be used to analyze whether the formulated relationships (hypotheses) are statistically
significant or otherwise. Evaluation of the structural model is done through the values of path coefficients (β), t-values,
p-values and confidence intervals (bias corrected). Table-4 below presents values of all those indicators. For the model
quality, the values of R2 are also given in the said Table.

Table-4: Results of Hypotheses

Confidence Interval
Hypothesized Relations β-Value SD t-Value (Bias Corrected) Result R2
5 % LL 95% UL
H1: SL -> Idea Generation 0.721 0.038 19.100 0.645 0.773 Supported 0.520
H2: SL -> Idea Promotion 0.878 0.034 23.276 0.713 0.829 Supported 0.619
H3: SL -> Idea Realization 0.727 0.043 17.057 0.640 0.787 Supported 0.529
H4: SL -> EIWB 0.726 0.042 17.330 0.647 0.786 Supported 0.527
H5: SL -> PE 0.786 0.031 25.428 0.724 0.831 Supported 0.618
H6: PE -> EIWB 0.693 0.062 11.154 0.589 0.791 Supported 0.185
Confidence Interval
Indirect
Hypothesized Relations SD t-value (Bias Corrected) Result R2
Effect
5 % LL 95% UL
H7: SL -> PE -> EIWB 0.545 0.050 10.932 0.470 0.628 Supported 0.712
Note: We used a bootstrapping routine as suggested by Hair et al. (Joe F Hair Jr, M atthews, M atthews, & Sarstedt, 2017) with 5000
subsamples, 283 observations per subsample, and a no sign change option to determine the significance of the path coefficients. p <
.05, one-tailed was used. LL (Lower Limit), UL (Upper Limit).

17
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

Results, presented in Table-4 above, clearly validated all the hypothesized paths are significant (p < 0.05). Servant
leadership is positively and significantly related to Idea Generation (β=0.721, t=19.100, p < 0.05), to Idea Promotion (β=
0.878, t=23.276, p < 0.05), to Idea Realization (β= 0.727, t=17.057, p < 0.05), and to overall EIWB (β= 0.726, t=17.330,
p < 0.05). The direct path from SL to PE gives (β= 0.786, t=25.428, p < 0.05), while PE to EIWB (β= 0.693, t=11.154, p
< 0.05). As far as the result of mediation analysis from SL to EIWB through PE is concerned, it is positive and significant
(β= 0.545, t=10.932, p < 0.05). Further, in accordance to the latest instructions regarding use of confidence intervals
(bias-corrected) rather the p-values, results of this study fully supported that the hypothesized relationships are
significantly supported because the confidence intervals did not cont ain a zero value (Sarstedt, 2017). The R2 values are
used to determine the percentage of variance explained by the exogenous constructs in the endogenous constructs (Joseph
F Hair Jr et al., 2016). Hock and Ringle (Hock & Ringle, 2010) stated that the results more than the cutoffs of 0.67, 0.33
and 0.19 to be labeled as ‘substantial’, ‘moderate’, and ‘weak’ respectively. The findings of this research demonstrate
that the model explains more than 71% variance in EIWB which can be labeled as ‘substantial’ variance explained. As
far as the stages of EIWB are concerned, SL explains the greatest variance in Idea Promotion stage equal to 61.90%. The
specific amount of variance explained by PE is 18.5% which should be considered as ‘weak’ in the guidelines referred
above. Figure-3 below gives an overview of the PLS-SEM structural model.

Figure-3: PLS-SEM Structural Model

5. Discussion and Implications Conclusion
We can say that women manage differently than men because they have a de facto management while men apply
management of law. It appears that they have made much progress because they are more present in major decision-
making; which was not the case before. Also, this is due to their management style (participative) different from that of
men (authoritarian, directive and often laissez-faire). Moreover, some women adopt a type of management similar to that
of men. There are, of course, common characteristics that identify the leaders and that correspond to the culture of the
company and the sector of activity. Denying the values of a woman manager would be reductive. Women have had to
develop specific skills through corporate culture. However, do women allow better group cohesion?

5.1 Discussion
This research was aimed to investigate the impact of SL at different stages of EIWB along with identification of the path
through which SL exerts its influence on EIWB. The results of this research strongly indicate that SL has a direct positive
impact on all the stages of EIWB. SL explains more than 50% of the variance in idea generation, idea promotion and
idea realization stages of EIWB. Moreover, SL has significant direct positive impact on EIWB. This finding is consistent
with the other studies which tried to investigate this relationship (Krog & Govender, 2015; Rasheed et al., 2016). The
results of this research can also be corroborated by the theoretical lens of social exchange perspective. The amount of
variance SL explains in EIWB in this study is almost 53%. Employees’ psychological empowerment has been identified
as a mediator by which SL exerts its influence on EIWB. The additional variance explained by PE in EIWB is accounted
for 18.5%. As far as the magnitude of the mediation through PE is concerned, it is found as ‘partial mediation, which
means that even after the significant positive mediation of PE, the path from SL to EIWB is still significant. Form this it
can be inferred that there could be additional mediators which can be analyzed in the relationship of SL to EIWB.

18
 Naveed Ahmad Faraz, Muhammad Farhan Mughal, Fawad Ahmed, Ali Raza1,
Muhammad Khalid Iqbal
The Impact of Servant Leadership on Employees’ Innovative Work Behaviour-Mediating Role of Psychological
Empowerment

5.2 Theoretical and Managerial Implications

This study has offered three distinctive theoretical contributions. At first, this is one of the pioneer researches where the
impact of servant leadership style has been investigated at different stages o f employees’ innovative work behavior.
Secondly, this study has employed employees’ psychological empowerment as a mediator in the relationship between
servant leadership and employees’ innovative work behavior. This inclusion makes the conceptual model of this research
a unique model that has never been investigated in the past. Third and lastly, this research included self-determination as
a component of employees’ PE construct making this construct similar to intrinsic motivation. It has partially respon ded
to the call for investigation (Eva et al., 2018). Theoretically speaking all of the above -mentioned contributions are
important for the academicians to get a deeper understanding of the knowledge stream on SL and EIWB.

The findings of this research are also helpful to practitioners. This research showed the positive influence of SL at
different levels of EIWB as well as at aggregate level. Moreover, psychological empowerment has been found as mediator
in the relationship between SL and EIWB. This showed that SL is an employee oriented leadership style. Servant leaders
believe in empowering their followers who in return offers a valuable contribution to the organization like EIW B.
Precisely speaking, the results of this research supported the argument t hat empowerment, emotional healing, ethical
behavior and the help of subordinates’ by a servant leader can be recognized as significant ‘tools’ by which employees’
behavior regarding idea generation, idea promotion and idea realization can be improved. Thu s, managers should have a
keen focus on such attributes if they want to have the greater innovative workforce in their organizations.

5.3 Limitations of the Study and Future Research Directions

At the outset, it is accepted that this is cross -sectional research and hence lacks in proving causality. This limitation can
be undermined through a longitudinal research design. The data of this study were collected on a self -reported
questionnaire which can cause common method and social desirability biases. To overcome this limitation, it is suggested
to get data regarding EIWB from the immediate supervisors or colleagues of employees. Further, this research
investigated only one mediator, psychological empowerment in the relationship between SL and EIWB. Future research
should include additional mediators and moderators to develop a rigorous and comprehensive model. Lastly, this research
included employees from the Power Sector Companies of Pakistan only. Inclusion of multiple industries and contextual
settings will enhance the generalizability of the findings.

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