Leadership style and innovation atmosphere in enterprises: An empirical study

Existing literatures have explored the positive effect of leadership style on innovation atmosphere from a team perspective. However, much attention has been paid to transformational leadership style, whereas studies on transactional leadership style are not available. To this end, this paper explores the relationship between the two leadership styles and innovation atmosphere in enterprises. The intermediary role that trust and individual identification play in the relationship between leadership style and innovation atmosphere is examined as well. We conduct a survey on 294 respondents and run hierarchical regression and adjustment regression. The results show that (1) transformational leadership style can facilitate to build trust and individual identification; (2) transformational leadership style is more helpful for building innovation atmosphere; (3) it is easier for leaders with transformational leadership style to build trust and that trust positively affects innovation atmosphere; (4) trust and individual identity are helpful for creating innovation atmosphere; (5) trust and individual identification play an intermediary role between transformational leadership style and innovation atmosphere; (6) trust does not play an intermediary role between transactional leadership style and innovation atmosphere, whereas individual identity does. Implications from the findings are discussed.