What Makes Small- and Medium-Sized Enterprises Promote Organizational Creativity: The Contingency Perspective

Abstract

In this study, we examined the effects of chief executive officer (CEO) characteristics and organizational systems on organizational creativity, particularly in small- and medium-sized enterprises (SMEs). Using upper echelon and contingency perspectives, we hypothesized that CEO characteristics would promote organizational creativity in SMEs, but the effect of CEO characteristics would be attenuated when SMEs have strong organizational learning systems in place. Consistent with our expectations, the results show that a CEO's orientation toward employee development plays an important role in organizational creativity. Moreover, the effect of CEO development orientation on organizational creativity is greatest when the organizational system is weak. Theoretical and practical implications are also discussed.