livingston trust and innovation (2) 2016

Running head: INNOVATION BUILT ON TRUST

Innovation Built on Trust:

Employee Commitment to Firm Innovation as a Social Exchange with Leaders

Dr. Mark A. Livingston

Innovation Process & Strategy

August, 2016

INNOVATION BUILT ON TRUST

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Abstract

The purpose of this paper is to explore the topic of employee trust during their adoption of innovation in

their organization. Using the lens of social exchange theory (SET) to examine innovation diffusion, this

study explores employee trust in leadership when employees exchange that trust for their support of firm

innovation. There has been substantial management research into the concepts of innovation, creativity,

idea generation, and new product development; however, there has been much less academic research on

the trust between employees and leaders as an innovation is implemented. In order to achieve innovation

that benefits the organization, there must be trust between employees and leaders. Findings included that

employees who trust their leader are more open to innovation, more likely to be committed to innovation,

and more likely to become involved and adopt the innovation when it is implemented. As a result,

employee trust in leadership was found to be related to innovation success. Additional findings included

three overarching themes: (a) uncertainty and risk during innovation implementation change is a major

concern for employees; (b) the influential role of employee trust on uncertainty and risk can influence

firm innovation outcomes; and (c) the influence of employee trust on attitudes towards innovation is

correlated to firm innovation. Strategies to develop employee trust in leaders included the identification

that trust built between employees and leaders occurs over time. This review identified seventeen

strategies' and six findings managers can utilize to build trust for firm innovation.

Keywords: Innovation, change, trust, social exchange theory


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Innovation Built on Trust: Employee Commitment to Firm Innovation as a Social Exchange with

Leaders

Firms are always looking to increase competitive advantages through innovation as

innovation is widely regarded as a critical source of competitive advantage (Crossan & Apaydin,

2010, p. 1154). Organizations need to implement innovation in the form of new ideas, processes,

and information systems into their environments to gain or maintain this advantage. For an

innovation to be successful, it must be grounded in solid innovation concepts and accepted by

organizational leaders and employees alike (Tantardini & Kroll, 2015, p. 84). Organizations must

deliver more value through new and innovative strategies (Franken et al., 2009). To be

competitive – organizations need to innovate, which requires leaders to build trust between

employees and leaders.

Once leadership has made the decision to adopt a specific innovation into the

organization, implementation represents a critical gateway to the successful utilization of that

idea in the organization. Innovation implementation is “the process of gaining targeted

organizational members' appropriate and committed use of an innovation” (Klein & Sorra, 1996,

p. 1055). In order to bring value to the organization, innovations must be implemented and

adopted by employees to be successful (Dovey, 2009).

Support for innovation by employees is critical for success. The problem is that if

employees are not willing to actively support the implementation of an innovation, it is more

likely to fail. Michaelis, Stegmaier, and Sonntag (2009, p. 400), argued that many attempts to

innovate fail. This failure is because the attempt was not successfully implemented with support

from the employees, not because the attempt was based on flawed conceptual innovative designs.

This argument suggests that in addition to investing in innovation research and development,

organizational leaders need to consider the other influences that could affect the likelihood of

adoption such as trust, specifically trust between employees and leaders in the firm (Bijlsma &

Koopman, 2003; McAllister, 1995).

If trust can be this positive influence, then trust can be used in a manner that facilitates

firm innovation. In addition, organizations may have a basis to build a strategy to improve their

ability to successfully innovate. Employee commitment has been established in the literature as a


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direct influence on successful innovation implementation and utilization (Klein & Sorra, 1996).

Therefore, the combination of trust and commitment may be positive influences on firm

innovation.

Trust is identified as an important social bond, and an important influence on employee

attitudes toward management actions. Employee trust in management has been seen as an

important influence to employees accepting new ideas in the workplace (Cho & Ringquist,

2011). Employees are more likely to support the implementation of new ideas if sufficient trust

in leadership exists. Trust is important to the innovation of firms, because it facilitates leader and

employee cooperation and exchanges, especially under the context of change, risk, and stress as

byproducts of innovation implementation plans (Bijlsma & Koopman, 2003; McAllister, 1995).

Researchers (Cole et al., 2002; Ferrin et al., 2006; Nambudiri, 2012) agree that trust is the basis

for this social exchange, which involves trust between employees and leaders in an

organizational setting. Therefore, social exchange theory (SET) is an appropriate lens to examine

employee trust in leadership during innovation, because social capital best describes the

necessary relationships and exchanges that rely on trust and norms to innovate.

There has been significant research on innovation idea generation and product

development. However, there has been far less investigation into the dynamics of

implementation of innovation concerning employee attitudes of trust in leadership. This paper

will explore this research gap by examining how employee trust in leadership may affect firm

innovation by considering employee commitment through social exchange during innovation

implementation decisions. Klein and Sorra (1996) argued that employee commitment was crucial

for organizations to successfully transition from acceptance to support by organizational

employees when implementing new firm innovations. Additional support for this argument can

be found in Oreg et al.’s (2011) systematic review that argued when employees are not

committed to adopting a change, the new idea is less likely to be successfully implemented.

Trust and innovation are important to the study of management because both critical success

factors influencing competitive advantage (Crossan & Apaydin, 2010; Mone, McKinley, &

Barker, 1998; Wolfe, 1994). Considering how important employee commitment and trust is to

firm innovation, and the potential gap in the literature, there is reasonable justification to


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examine the topic of employee trust in leadership for firm innovation. The purpose of this paper

is to explore the topic of employee trust on their adoption of innovation in their organization.

Using the lens of social exchange theory, how does employee trust in leadership affect employee

attitudes towards organizational innovation adoption? To begin this examination, a literature

review of innovation implementation, innovation diffusion theory, and trust is provided,

followed by a discussion of the theoretical lens, social exchange theory. Next, the methods

section outlines the rapid evidence assessment (REA) used, followed by a thematic analysis,

conceptual model, and discussion of findings. Lastly, based on the findings, the author identifies

limitations and theoretical and practical implications.

Review of Literature

As organizations strive to implement innovations, leadership and employee commitment

are important to understand. To understand the affect that employee trust in leadership has on

influencing their attitude toward the successful implementation of innovations, this review of

literature began with an examination of innovative implementation and innovation diffusion

theory. Once the environment of implementation was established and understood, the theoretical

background of trust was explored to demonstrate the criticality of employee trust during firm

innovation. The author introduces the lens of social exchange theory (SET) to explain the

concept of employee and leader trust relationships, which entail unspecified future obligations.

In this context of innovation implementation, social exchange generates an expectation of some

future return for employee commitment to innovation as leaders commit to providing

trustworthiness leadership (Blau, 1964).

Innovative Implementation

Implied in the implementation of new innovation, is that employees in the organization

must adapt existing routines, processes, or procedures to new innovations. New perspectives by

the employees are required for innovation implementation, as this perspective must adjust for the

required changes (Klein & Sorra, 1996, p. 1057). Organizational change has a ripple effect and

can affect the structure, from strategic to organizational, and begin as small as the conceptual or

concrete level (Mintzberg & Westley, 1992). Pullen’s (1993, p. 30) definition of organizational


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change, directly influences this user-based model as it considers the adaption of employees in

organizations to any change in the environment, which is the case for innovation.

Organizational change is a much debated and studied issue in the academic literature. As

part of the trust development, innovation should address the associated issues with organizational

change, such as the strategic or organizational context and the impact across the organization

(Mintzberg & Westley, 1992). Dent and Goldberg (1999) argued that employees do not resist

the change itself. Instead, they argued that employees only resist negative consequences of

changes. This is a matter of great concern for employees who are impacted by innovation and

changes within an organization. Changes that introduce new procedures or technology that

jeopardizes position, job security, or seniority are more likely to have a negative response from

employees at risk (Dent & Powley, 2003). These harms could include loss of influence, loss of

competency, or even the threat of job loss (Callan, Terry, & Schweitzer, 1995; Correia Rodrigues

& de Oliveira Marques Veloso, 2013; Devos, Buelens, Bouckenooghe, 2007, p. 612; Ito &

Brotheridge, 2001).

Rogers (1983, p. 6) argued that innovation efforts, if not properly introduced to the

organization can introduce significant uncertainty into the work environment as to the nature,

end-state, and impact of the innovation. In order to prevent misunderstandings about innovations

within the firm, leaders need to work especially hard to communicate clearly to all employees

about all innovation plans.

However, even when the harms are not clear, or employees are unsure of the nature of the

change, this issue can lead to a state of uncertainty. As mentioned earlier, innovation is a broad

concept, covering scenarios such as the implementation of a new information technology system,

changes in organizational structure, or new business processes. While all change involves some

level of uncertainty, innovation implementations are substantially outside the existing paradigm

of the businesses model. Rogers (1983, p. 6) argued that innovation implementation introduces

significant uncertainty as to both the nature, end-state, and impact of the innovation were not

fully understood by employees. Gurteen (1998) suggested that this uncertainty was from a shift

in the existing paradigm, which was a challenge to existing mental models, often causing

employees to be unsure of the final state. Due to this paradigm shift, Michaelis et al. (2009) felt


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that innovation implementations are particularly challenging organizations to manage due to the

high level of uncertainty for employees.

In a systematic review of literature, Bordia, Hunt, Paulsen, Tourish, and DiFonzo (2004)

found that the level of employee uncertainty during change has a direct correlation to firm

innovation success or failure. An additional and similar review by Oreg et al. (2011) discovered

and supported this claim by showing that employee acceptance in the innovation implementation

phase was a critical factor to success. In a third study by Klein and Sorra (1996), a model of

innovation considered employee commitment to the innovation to be critical for its effective

implementation. A fourth study by Michaelis, Stegmaier, and Sonntag (2009, p. 399) also

supported this concept in their findings that employees must be committed to the innovation for

successful adoption.

As with most employees, under stress or perceived attack, they instinctively take a

defensive posture and assume the worst (Sarinopoulos, Grupe, Mackiewicz, Herrington, Lor,

Steege, & Nitschke, 2010). Employees assume the worst until they have a reason not to consider

worst-case scenarios. Until employees are able to reasonably trust firm leadership, they are likely

to view firm innovation and associated change as a direct risk. In 2010, Schein (p. 303) wrote

about the term survival anxiety, which suggests that both learning anxiety and survival anxiety

play a role in the innovation implementation plan when trust is not present. Therefore if

leadership increases the pressure to accept the innovation without building trust, the employees

will only have increased anxiety.

Proposition 1: During the innovation implementation, employees experience uncertainty, which

may lower their commitment to the innovation.

Innovation Diffusion Theory

Communication is important to innovation in an organizational setting as it can be the

foundation for effective communications (Rogers, 1983). The inherent risk associated with

innovation, and the required trust that is necessary by both leader and employee for the firm to

the successful innovation diffusion is predicated on effective communications. The smallest

consideration for sharing information as widely as possibly within the organization helps to

reduce the uncertainty and reduce the inherent associated risks of organizational change with


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innovation. Innovation diffusion is the communication process of spreading new ideas

(innovations) through network channels over time among the members of the organization

(Rogers, 1983, p. 35). Innovation implementation plans should include the key element of an

effective communications plan for innovation.

Historically, centralized and decentralized innovation diffusion systems theory has

described how innovations are adopted and passed along to inform the employees of innovation

plans. The innovation decision process theory has five sharable stages that employees will

experience as they embrace for innovation, as they are incremental stages and directly related to

communication: (a) knowledge; (b) persuasion; (c) decision; (d) implementation; and

(e) confirmation (see Figure 1; Rogers, 1983, p. 36). This information flows logically and

sequentially as a simple but persuasive plan of inclusiveness that lends itself to an effective

communications style.

Figure 1. Rogers’ (1983, p. 165) model of stages in the innovation-communication process

includes five stages. From Diffusion of innovation, (p. 165). By E. M. Rogers, 1983, London,

UK: The Free Press. Reprinted with permission.

Proposition 2: The social exchange between leaders and employees bridges the innovation

implementation gap between persuade and decide stages of innovation diffusion.


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Employee Trust in Firm Leadership

Trust is a fundamental social construct, which has a significant influence on how

individuals in organizations operate. Trust is defined as the “positive expectations individuals

have about the intent and behaviors of multiple organizational members based on organizational

roles, relationships, experiences, and interdependencies” (Shockley-Zalabak et al., 2000, p. 35).

Trust is an essential element for organizational success, as it is the basis for interactions between

employees at all levels. Trust has been the subject academic study, military leadership

philosophy, and government agency principles (Ring & Van de Ven, 1992).

Trust is noted as a core component of social capital at the organizational level (Fukuyama,

1995; Leana & Van Buren, 1999). Clegg, Unswroth, Epitropaki, and Parker (2002) argued that

employee trust was a critical component throughout the innovation process, from idea generation

through development, adoption, implementation, and continuous improvement. The authors

coined the concept of innovation trust. Putnam defined social capital as “the connections among

individuals, as social networks and the norms of trustworthiness that arise from them” (2000, p.

19). For these reasons, for firms implementing innovation, these employee connections and the

need for trust are important.

In his seminal work, Deutsch (1958) viewed trust as an inter-personal dynamic which

acted as a means of managing risk. In situations which might normally be viewed as harmful,

trust allows individuals to accept the risk without the negative side effects normally associated

with risk, such as anxiety and stress (Neves & Caetano, 2006). In an organizational setting, trust

allows employees (trustors) to accept risk in a situation with the certainty that their leader (the

trustee) will protect them from danger. Trust is important to the innovation of firms, because it

facilitates leader and employee cooperation, especially under the context of change, risk, and

stress as byproducts of innovation implementation plans (Bijlsma & Koopman, 2003;

McAllister, 1995).

When and where there is trust, there can be an acceptable level of risk; because there is a

belief that the leader will provide protection as needed (McAllister, 1995). Trust is predicated on

an understanding that trust is given and provided back (Serva, Fuller, & Mayer, 2005). This

argument supports Rogers (2003) finding that "understanding of trust in an organization as part


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of a social system which is defined as a set of interrelated units that are engaged in joint problem

solving to accomplish a common goal” (p. 23).

Because innovation entails a certain level of ambiguity, employee perceptions of firm

intentions is a major influence on employee’s acceptance of the firm leadership actions.

Employees and leaders who forge a bond of trust, generally experience less stress and

uncertainty as innovation implementation plans are worked throughout the organization (Choon

Yeong Ng, 2013, p. 43). Mayer, Davis, and Schoorman (1995) argued that trustworthy leaders

were ones which employees viewed as those most able to protect them from harm, act in a

predictable manner, and handle uncertain situations. This predictability is important to

employees as it builds a rapport between employees and leaders, and it facilitates greater trust

when employees feel they can predict leader trust related actions. This allows employees to

better anticipate the intent of the trusted leader. Their model considered three factors which made

a leader perceived as trustworthy: ability, integrity, and benevolence. These three factors when

combined demonstrate a leader's trust actions and the potential to act in the best interest of the

employees; and thereby helped to build trust.

Ability is a key aspect of trust with regards to firm innovation and subsequent change.

Mayer et al. (1995) argued that ability allows a leader to act on their desires in a trusting manner

towards their employees. A leader who lacks the competency or authority to act effectively is not

viewed as one who can take independent actions to benefit or care for the employees, and

therefore is not individually trustworthy. In addition, a leader with noted ability is seen as

competent and more likely to make sound decisions. Employees are more likely to view

innovative changes proposed by such leaders in a positive manner, as that information is

communicated in the organization more effectively over time (Michaelis, et al., 2009, p. 404).

For example, employees who see a leader as lacking in ability are unlikely to trust the

introduction of a new technology (innovation), causing uncertainty.

The two remaining components of trustworthiness (integrity and benevolence)

demonstrate firm leaders' intent to act in the best interest or benefit of the employee. Integrity

shows that the leader’s decision-making framework is visible and compatible with the

organizational employee's standards or norms. Benevolent leaders in turn make decisions, which


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are beneficial to the specific employee who trusts them. Combined, these two components

inform employees as to leaders' intent and regard as it relates to innovation and trustworthiness

(Michaelis et al., 2009, p. 404). This is particularly important, as trust is perceived as a missing

leadership trait in many organizations, leading employees to often have cynical views of senior

organizational leadership and proposed innovations by senior management (Hattori & Lapidus,

2004). Since innovation involves a high level of uncertainty, employees’ perception of the

motives of those proposing them would appear to be a strong influence on their attitudes towards

acceptance.

Employees who form a bond of trust with their leader generally experience less stress and

uncertainty. With a leader who has the capability and desire to act in their favor, trusting

employees are more likely to be active participants in the change regardless of uncertainty they

may experience (Bordia et. al., 2004). As a result, trust in leadership has been found to lead to

innovative behavior among employees (Hattori & Lapidus, 2004; Tan & Tan, 2000).

Proposition 3: Employee trust in leadership leads to a willingness to accept the additional

uncertainty and risk of innovation.

As discussed previously, employee commitment is important to innovation adoption. In

addition, trust in leadership plays a role in developing this commitment. Klein and Sorra (1996,

p. 1057) stated that innovation implementation was dependent on employee commitment to the

effort. Given that employee uncertainty appears to be a factor in their lack of commitment, and

trust appears to support commitment during uncertainty, this suggests a third proposition.

Proposition 4: Employee trust in leadership leads to employee commitment to adopting

innovations.

Social Exchange Theory (SET) as a Lens

The lens of social exchange theory (SET) was chosen to evaluate the role of employee

trust on their openness and commitment to innovations proposed by management, because it

models inter-personal interactions as a series of exchanges of actions and goods of value over

time (Ritzer, 2011, p. 427). SET guided the evaluation of the role of employee trust and their

willingness to commit to firm innovations. In his seminal work, Blau (1986) explained that social


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exchanges are the foundation for social structures and a key foundational building block for the

human element for building trust between employees and leaders for firm innovation.

These acts of building more trust over time occur as employees build a history of trust in

a leader by exchanging their commitments through positive actions for future leader payback in

acts of repeated trust (Cropanzano & Mitchel, 2005). SET provides two ways to evaluate the

dynamics of trust being built over time. First, Kramer and Taylor (1996) identified social

exchange as being an appropriate model for exploring trust in organizations through past

scholarly examination. Secondly, this lens transcends other areas that are associated with trust in

organizations. One reason is that this lens aligns well with Deutsch (1958) and Mayer et al.’s

(1995) view of trust as a medium of exchange between trustor and trustee. For example, trust

acts as the medium by which employees exchange their commitment for the fulfillment of their

leader’s trustworthiness (Michaelis et al., 2009, p. 404).

In addition, social exchange provides a robust foundation for the temporal aspect of trust

(Casimir, Lee, & Loon, 2012, p. 741). Cropanzano and Mitchel (2005) argued that trust acted as

both the foundation for and result of social exchange. This argument is valuable when

investigating trust in organizations, since the events which cause trust in a leader to develop and

the fulfillment of that trust often occur at different times. For these reasons, SET is an

appropriate lens while evaluating the literature.

Methods

This paper used a rapid evidence assessment (REA) to identify and evaluate the relevant

literature. A REA is a type of systematic review approach for developing actionable findings.

Rousseau (2012, p. 5) identified this approach as appropriate, when primary research is not the

main goal but rather the tenants of evidence-based management, such as providing findings

which could better inform decisions. REAs have been recognized as effective at providing initial

data discovery and the necessary themes in the research (Ganann et al., 2010; Gough et al., 2012,

p. 39). As recommended by Rousseau, Manning, and Denyer (2008), the author of this research

synthesized evidence across context, methodologies, and epistemologies to triangulate more

generalized findings.


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A REA was used because of limited time and resources available. Gough et al. (2012, p.

40) suggested the REA approach for a non-exhaustive assessment of literature when time and

human resources were limited. While not as in-depth as a full systematic review, REAs are

recognized as generally effective at providing initial findings (Ganann et al., 2010; Gough et al.,

2012, p. 39).

Searches were performed (see Appendix A) using UMUC’s OneSearch tool (47

databases listed in Appendix B). The PRISMA diagram (Appendix B) illustrates how the 23 final

studies were selected from the original 344 candidate studies. The data related from these studies

was evaluated as it relates to this topic using a thematic synthesis approach. This configurative

approach is considered an effective method for evaluating theory (Gough et al., 2012, p. 52).

Inclusion and Exclusion Criteria and Quality Appraisal

Inclusion and exclusion criteria were applied to specific scholarly articles on the topics of

firm innovation, trust, and social exchange theory; all in an effort to better understand employee

acceptance of firm innovation. The search resulted in 344 initial records. After narrowing the

results down by full text, subject, language, date, and topic, 32 articles remained. The exclusion

criteria were limited to: (a) articles had to be in English; (b) no academic reviews of articles, only

actual articles included in the synthesis of the evidence; and (c) the article had to directly relate

to the topic, no implied understanding or intended data conclusions.

In addition, the systematic searching resulted in a high percentage of literature from

snowballing (7 out of 23 studies) and manual searching (5 out of 23 studies) activities.

Snowballing is the process of expanding literature by examining the references of the original

studies.

By utilizing the weight of evidence procedures for quality appraisal, the articles

considered were narrowed to the final 23 articles (see Appendix E; Pawson, 2005, p. 3). A

ranking of high, medium, or low was assigned based on the establish criteria. The remaining 23

articles included 17 rated high and 6 rated medium (see Figure 1). A WOE model was utilized to

add the necessary rigor to the inclusion exclusion criteria.


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Table 1

Quality Appraisal of Studies: Modified Weight of Evidence (WOE) Matrix

(modified from Harden & Gough, 2012, pp. 161-162)

WOE Q1 Soundness of study execution (internal validity)

High: Explicitly follows an appropriate plan based on type of review

Acceptable: In general, a researcher can understand how the research plan was executed

Low: Cannot understand execution of research plan or other major flaw

WOE Q2 Appropriateness of chosen research method

High: Addresses the RQ with empiric data (survey since no trials)+/- expert opinion

Acceptable: Unstructured review or expert opinion addressing the RQ

Low: Inappropriate study design or otherwise "misses the mark"

WOE Q3 Generalizability and external validity of study

High: Results can be operationalized in some way. Results should be generalized.

Acceptable: Results can be operationalized, but may not be valid in a generalized setting.

Low: Results cannot be operationalized and does not help in addressing the RQ.

Note: High Quality: At least 2 high, and no low appraisal marks

Acceptable: Absence of any "low" appraisal mark, up to 1 high Quality mark.

Unacceptable: A "low" appraisal mark in any WOE category. Excludes article from further consideration.

Thematic Results

Using a lens of social exchange theory (SET), The REA investigated the influence of

trust in leadership on employee adoption of innovation. Three macro-level themes emerged: (a)

uncertainty and risk during innovation implementation change; (b) the moderating role of

employee trust on uncertainty and risk; and (c) the influence of employee trust on attitudes

towards innovation. Appendix D displays the themes by study and systematic literature coding.

Uncertainty and Risk during Innovation Implementation

Seven (7) out of 23 articles found that employees experience feelings of risk and

uncertainty during change driven by innovation. Risk was found to be perceived as either the

employee being a failure as well as the innovation representing risk to the employee in terms of

position, influence, or expertise if it were successfully implemented. In addition to both these


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perceptions of risk was a general sense of uncertainty as to how the future state of the

organization would be after the innovation was implemented. Four papers provided support for

employees experiencing a sense of risk during organizational change. Krot and Lewicka (2011,

p. 46) postulated that employees were wary of innovations due to both risk factors (failure-risk

and personal risk). Trust in leaders can negate this duel risk and SET as a lens further supports

this claim as it demonstrates that trust can be over-arching attitudinal construct that drives firm

innovation.

This result was supported in Neves and Caetano’s (2006) work which also found that

employees view changes in their organizations as a potential threat to their status. Studies by

Michaelis et al. (2009, p. 403) and Dovey (2009, p. 313) argued that employees needed to be

able to accept a certainty level of vulnerability in order to be comfortable with changes dictated

by innovation. There is evidence in the literature that employees experience uncertainty during

all types of innovation and change. Regardless of the intrinsic value of any proposed innovation,

without clear communication, employees will oftentimes assume the worst if they are unsure of

the future (Sarinopoulos, et al., 2010). SET explains the motives for communications and better

coordination for firm innovation (Agneessens & Wittek, 2012). Therefore, according to Putnam

(1993) SET serves as a bonding agent in organization when implementing innovation, which

reinforces individual employee identities and maintains homogeneity. When employees feel

uncertainty and risk, SET can explain why employees would come together and maintain strong

in-group loyalties to reinforce existing self-identities. While the bridging aspect of social capital

brings together people from diverse organizational sections, and can lead to better linkage to

exchange of information, SET also serves as an internal provider of important information

exchange. Therefore, leaders must adapt by learning from these informal and formal social

networks of employees to build the necessary trust to better the employee concerns.

The concept of employees experiencing uncertainty during all types of change was

supported in three additional studies that found that fear of innovation adoption is rooted in

uncertainty of how change may affect the employee (Bordia et al., 2004; Devos et al., 2007,

p.612; Sagie & Koslowsky, 1996). All three of these studies suggested that trust was a potential

moderator, which allowed employees to feel safe from the uncertainty and risk of innovative


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implementation. This evidence is important to answering the research question, because the

literature in these cases supports the need for balance as innovation and trust need to avoid the

extremes of failed innovation and employee uncertainty.

Trust and Employee Acceptance

From its original conceptualization, trust has been viewed as a means of exchange for

accepting risk. In return for the trustee reducing risk through their trustworthy actions, the trustor

is able to take actions which they might normally not take. Seven (7) out of 23 sources supported

the finding that employee trust in leadership acted as an influencer for the perception of risk and

uncertainty during innovative change (see Appendix D). This was found to be due to trust giving

employees feeling of control during the change driven by the innovation (three sources) as well

as increasing employees comfort taking risk (six sources).

Trust in organizational innovation was found to be a powerful interpersonal bond, and an

important influence on employee attitudes toward management decisions and influences

outcomes of organizational innovations. Employee trust in management has been seen as an

important influence to employees accepting new ideas in the workplace (Cho & Ringquist, 2011;

Ertürk, 2008; Hattori & Lapidus, 2004; Oreg, Vakola, & Armenaks, 2011; Rogers, 1983, p. 343).

Employees appear to be more likely to support the implementation of new ideas if there is

sufficient trust in leadership (Brockner, Siegel, Daly, Tyler, & Martin, 1997). Therefore,

examination of trust in leadership while implementing innovation in an organizational setting

through the lens of SET demands a consideration of the influence of trust on the formation of

social ties from the idea generation to the conclusion of innovation success.

Innovations are inherently uncertain, and as discussed earlier, employee trust in

leadership allows employees to have a sense of certainty and balance. Four out of 23 studies

found that employee trust in leadership leads to acceptance of innovations. Neves and Caetano

(2006) argued that employee trust in leadership caused employees to have a sense of control

during change. One additional reason for this was that employees feel a sense of surety and

control due to their past positive interactions with their leader (Choon Yeong Ng, 2013, p. 40).

Acceptance was predicated on these interactions, and employees were more likely to feel less

uncertain about the impacts of the innovative proposals of their leaders. This is supported in


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Dovey’s (2009, p. 320) work which found that employees felt less uncertainty and stress about

innovations when they trusted their leader. Therefore, all three of these findings suggest that

employees who trust their leaders are able to maintain a sense of control and are more likely to

have a sense of trust while displaying innovation acceptance. SET argues that during exchanges

both employees and leaders alike evaluate their relationship in a behavioral context, looking

beyond short run inequities or risks to focus on long-run mutual gains. This is the intersection of

innovation and trust (Luo, 2002).

Finally, six out of 23 studies found that employee trust in leadership increases the

willingness of the employees to take and accept risk. Two studies found that employee trust in

leadership helped them to be comfortable with being vulnerable to risk, which in turn made them

more likely to engage in the innovation (Choon Yeong Ng, 2013; Clegg et al., 2002). In addition,

Dovey (2009) argued that employees who trusted their leader were more comfortable with

innovation and accepting risk and change.

This acceptance was not baseless, but rather a result of willingness to build on trust and

regard acceptance of innovation because of trustworthiness of leaders. This distinction of

employee acceptance is important to understand, as employees who trust their leader do not act

without reckless regard, but rather as a result of trust and acceptance of proposed innovation

(Correia Rodrigues & de Oliveira Marques Veloso, 2013, p. 550). Two studies supported this

idea that the ability component of their trust in leadership led employees to believe the

innovation was a good idea and unlikely to fail (Krot & Lewicka, 2011, p. 55; Michaelis et al.,

2009, p. 404). These findings support the research question by answering how employee

acceptance of organizational innovations influenced by trust between employees and leaders.

Employee Acceptance of Innovation Implementation

The purpose of this paper was to investigate the role of employee trust on their attitudes

toward innovations proposed by management. The data supports the idea that employee trust in

leadership leads to those employees having a more positive attitude towards innovation. This, in

turn, leads to them being more likely to accept and implement innovations proposed by

leadership. There was significant support (19 out of 23 sources; see Appendix D) which found

that: (a) trust positively influenced employees’ perception of proposed innovations (five studies);


18

(b) trust increased employee openness, support, and/or commitment to new ideas and innovation

(13 studies); and (c) employee trust in leadership led to employees being more likely to adopt

innovations (four studies).

The first employee attitude uncovered was that trust in leadership led to employees

having generally a more positive perception of the proposed innovation. Three contributing

factors were discovered. First, as mentioned previously, employee trust in leadership is based

partially on positive feelings about the leader’s ability. This leads to employees who trust their

leader having a more positive perception of the value of the innovation (Choon Yeong Ng, 2013,

p. 43; Michaelis et al., 2009, p. 404). For instance, Condrey (1995) found that employee trust

was a positive factor in determining perception of innovative human resources support systems.

Second, trust in leadership was found to promote corporate citizenship over self-interest, which

in turn, allowed or caused employees to be willing to accept personal risk for the benefits of the

entire team (Correia Rodrigues & de Oliveira Marques Veloso, 2013, p. 546). Finally, Clegg et

al. (2002, p. 419) found that trust in leadership led employees to be more open with their

individual concerns about the change. Therefore, employees were more supportive since they

were heard. SET, as a lens, can be used to view these interpersonal relationship perceptions as a

cost-benefit proposition and an innovation benefit to the firm and employee (Gefen and Ridings

2002).

The clearest supported finding in this theme (13 out of 23 studies) was that employee

trust in leadership led to employees being more open, supportive, and/or committed to the

changes required by the innovation. This result is critical as commitment was noted as a key

factor in the successful implementation of changes (Oreg et al., 2011). Trust was found to

increase openness and acceptance to new ideas (Devos et al., 2007, p. 612; Ertürk, 2008; Neves

& Caetano, 2006) and increasing support for innovations (Van Gorp, 2013; Vineburgh, 2010).

Michaelis et al. (2009, p. 410) and Ruppel and Harrington (2000) found employee trust in

leadership to be a strong factor in determining commitment to proposed innovations, while

Reinke (2003) found trust to be an important factor in employee acceptance of new innovations.

Therefore, SET as a lens builds on this argument by adding additional reasoning as to why trust

in leaders is important to innovation.


19

Employees who trusted their leader were also more likely to look at the potential value

brought to the entire group (Cho & Ringqueist, 2011). This led to employees feeling more

committed to the change as they perceived less risk (Correia Rodrigues & de Oliveira Marques

Veloso, 2013, p. 546). Therefore, even if they might individually be harmed, employees would

still support the change. Two additional studies found that the support garnered from trusted

employees persisted even when the environment was negative and the change potentially

harmful (Brockner, Siegel, Daly, Tyler, & Martin, 1997; Cho & Ringquist, 2011).

As shown in Figure 2, based on the results of this theme, it can be concluded that

employee trust in leadership is a strong influence on the likelihood of innovation acceptance

(five out of 23 studies). Employees who trusted there leader were more likely to adopt

innovations (Krot & Lewicka, 2011, p. 56; Rogers, 1983, p. 389). Hosmer (1994, p. 193) argued

that trust was what underpinned employee willingness to participate in launching new

innovations. This is supported by Devos et al.’s (2007, p. 623) finding that employees who

trusted their manager were more likely to participate in innovative change and accept it when it

was implemented. Based on these findings, there is support for answering the research question

as to how employee acceptance of organizational innovations influenced by the trust between

employees and leaders. Having a high degree of trust in organizational leadership is a basis to

increase the likelihood of an employee’s willingness to be placed a vulnerable position, but with

that acceptance comes an expectation that the leader will act in the employee’s best interest.


20

Conceptual Model

Figure 2: Proposed conceptual model of the social exchange of trust between employee and

leadership during innovation implementation.

Findings and Discussion

As the conceptual model portrays, within the Venn diagram, Mayer, Davis, and

Schoorman (1995) argued there were three traits that were considered instrumental whereby a

leader was perceived as trustworthy: ability, integrity, and benevolence. Alone each trait was not

enough, but combined it was enough to convince employees that the leader was capable of acting

in the best long-term interest of the employees and thereby earning their trust. The propositions

portrayed in the conceptual model represent the findings and themes discovered in the review of

the literature that identified the seventeen strategies and six findings managers can use in

implementing firm innovation. The ability to effectively demonstrate leadership proficiency by

displaying traits like persuasion and knowledge leads to leadership trustworthiness. Combined

with the other three traits, such as ability, benevolence, and integrity identified in the model

discussed earlier, can lead to achieving trust between employees and leaders. That trust then


21

reduces risk, leads to acceptance of more risks, and willing to innovate and finally firm

innovation can be achieved.

The inter-relational element of trust between leader and employee is understood to be a

fundamental driver of organizational innovation (Burt, 2005; Granovetter, 1973, 1983). The

linkage is dependent not only on people identifying desired resources that reside in others, but

also on people perceiving that the interaction will bring benefits as a mutual relationship of trust

is formed. Ability reflects a cognitive belief about another’s human aspect such as skills,

competencies, and expertise, which in turn directly influence the innovation effort. Benevolence

senses the sincerity and perceived concern another has while demonstrating trust in a relationship

while innovating, which in turns creates an emotional bond of mutual trust (Mayer et al., p. 717).

Integrity is the perception of principles and values that the each demonstrates for the other such

as delivering on promises. The combination of these three ideas leads to leadership

trustworthiness by employees.

The right side rectangles on the figure represent the required elements from an employee

perspective, and the three propositions, reduced uncertainty, risk tolerance, and commitment to

innovation. The conceptual model illustrates the value and need for trust between employee and

leader for successful innovation. Inherent in both theories is the innovation diffusion theory,

which is intended to help to explain how, why, and at what rate new innovation is introduced

into an organization. This reduces uncertainty and risks when employees better understand the

innovation rationale (Rogers, 1983).

Proposition 1: During the innovation implementation, employees experience uncertainty, which

may lower their commitment to the innovation.

Based on the REA, the there is a link between trust in leadership as having a direct

correlation to successful firm innovation. Based on the first proposition, the literature supported

the idea that innovation implementation can create a condition of uncertainty for employees and

a perception of risk, which in turn can influence their commitment to firm innovation (see Figure

2). This issue of commitment can be negotiated through effective leadership and communication,

and employees are then more likely to engage in the innovation and be supportive firm

innovation implementation plans.


22

Proposition 2: The social exchange between leaders and employees bridges the innovation

implementation gap between persuade and decide stages of innovation diffusion.

Effective trust leadership between employee and firm leadership also directly affected

support for the second proposition. The issue of innovation and change was considered as it was

viewed through the innovation diffusion and the lens social exchange theory. Trust is particularly

important to organizational innovation because of the inherent risks and uncertainties when

creating and implementing new ideas (Shazi, Gillespie, & Steen, 2015, p. 81).

Proposition 3: Employee trust in leadership leads to a willingness to accept the

additional uncertainty and risk of innovation

The third proposition supports the research question by demonstrating employees and

leaders who are engaged in a trust relationship are more likely to successfully implement firm

innovation plans. In the literature, commitment was identified as a critical component for

successful firm innovation. This was also true for change, trust, and trust between employee and

leaders (Rodrigues & de Veloso, 2013, p. 549; Tan & Tan, 2000). In general, trust plays a major

role in all aspects of the firm’s innovation efforts from ideation to implementation to future and

continuous improvements was found to increase the success of innovation efforts (Michaelis et

al., 2009, p. 400).

Proposition 4: Employee trust in leadership leads to employee commitment to adopting

innovations.

Finally, SET further explains how important trust is to innovation and relationships

between employees and leaders as it provides social benefits for both (Nahapiet & Ghoshal,

1998). There are indications in the identified themes, that organizational commitment is an

important predictor of organizational outcomes including employee performance which can be

directly related to firm innovation (Wong et al., 2002).

Using a lens of social exchange theory, this research investigated the question: how is

employee acceptance of organizational innovations influenced by the trust between employees

and leaders? The propositions were analyzed using the literature on trust and innovation by

understanding the topic of organizational innovation through the lens of social exchange theory

Rogers’ (1983) five stages of innovation communication model of innovation diffusion play an


23

important role of trust in the relationships between employees and leaders in an organization

working to implement innovation. Rogers (2003) noted that within the first two stages, the

perceived characteristics of innovation are important in explaining an innovation’s rate of

adoption. This is a key point in the overall strategy, as trust is built on that initial rate of

adoption as employees either accept or refuse to participate in organizational innovation. Moore

(2004) clarified the difficulty in making that leap between innovation and acceptance,

specifically aligning trust as a moderator (p. 91).

The findings from this review are that trust does influence the innovation and firm

relationship between employee and leadership in a positive manner. In particular, employee trust

in leadership, innovation, and willingness to accept a certain level of risk during innovation

implementation are catalysts for firm innovation. As such, it is imperative to articulate how trust

between employee and leadership influences their innovation implementation plans and future

firm performance. Trust between employees and leaders are directly correlated to firm

innovation. Employees who trusted their leaders and leaders who trusted their employees were

both were more likely to adopt innovations (Krot & Lewicka, 2011, p. 56; Rogers, 1983, p. 389).

Hosmer (1994, p. 193) specifically argued that trust was what underpinned employee willingness

to participate in launching new innovations. This is supported by Devos et al.’s (2007, p. 623)

finding that employees who trusted their manager were more likely to participate in innovative

change and adopt and implement it. Overall, trust was found to increase the success of

innovation efforts (Michaelis et al., 2009, p. 400).

Based on the theoretical lens, the systematic review of literature and the themes

discovered in this review, there is reasonable management consideration to conclude that trust

between leader and employee is important to firm innovation. Employees trusting in their

leadership served as a guide to research these research propositions. In accordance with the

research question, trust was evaluated whether it improves employee commitment to innovation

implementation by increasing their willingness to accept risk and uncertainty during

implementations. Innovation implementation is inherently uncertain and perceived as risky to

employees, which can result in them becoming disengaged and resistant to the innovation

implementation plans.


24

Conclusions

Innovation adoption presents a significant challenge to organizations. Despite the

recognition by most executives that innovation is a critical capability to develop competitive

advantages, most companies struggle to effectively implement innovations in their organization.

In order to address this challenge, this paper investigated how employee trust in leadership can

help organizations be more successful with the implementation of innovation. Based on social

exchange theory, a proposed a model of trust as a medium in which employees exchanged their

commitment to the innovation in exchange for the past and future trustworthy actions of their

leaders which would protect them from harm is offered (see Figure 2). The findings of this study

support the argument that employees are supportive of innovation, but that the risks they

perceive when trust is absent can be perceived as resistance to change. Based on social exchange

theory and innovation diffusion theory; a proposed model of trust in innovation provides a path

to better understand trust between employee and firm leaders to implement firm innovation

(Figure 2).

The manner in which employees in an organizational social system perceive the five

attributes of an innovation decision determine its rate of adoption or acceptance is dependent on

the independent variables of associated trust (Rogers, 2003). Two major variables would be the

ability to persuade employees that the innovation is in their best interest by providing them the

knowledge to draw that conclusion on their own. In order for an innovation to diffuse, a

communication process must occur.

As proposed, researched, and discovered, the three propositions and the research question

indicated trust between employee and leader in firm innovation are directly correlated. When

employees trust their leaders, have reduced risk, are committed to new innovations, and better

understand of exactly why change is important or occurring in organizations, then new

innovations are more likely to be successful and trust is more likely to exist between leader and

employee.

Based on the confirmation of the three propositions, the research question is confirmed in

the positive in that employee trust in leadership positively influences their attitudes towards the

implementation of new innovations. Employees who trust their leader perceive less risk and


25

uncertainty from innovation adoption and are more likely to have a positive attitude towards the

changes needed, adopt the new innovation, which all lead to great success in innovation

implementation.

Through a systematic search, 23 studies were synthesized to evaluate three propositions

raised in the literature review. One clear challenge highlighted in the research was that

employees experience uncertainty and a feeling of risk when faced with new innovations. The

uncertainty was generally a result of being unaware how the innovation would affect their job. It

was also found that this uncertainty led employees to become defensive and resist the changes

needed to implement the innovation. Fear of risk came from two sources, both a fear of the

innovation being a bad idea and therefore a risk to the organization (failure risk), as well as a fear

of the innovation bringing harm to the individual employee (personal risk).

From the findings in the second and third themes, employee trust in leadership appears to

offer a means to improve employee’s perception of the innovation and become more engaged

and committed to its implementation and success. Specifically, four dynamics were uncovered.

First, trust reduced employee’s fear of personal harm due to their historical experience with the

leader. Their leader’s benevolence and integrity which fostered trustworthiness helped

employees feel that would not be personally harmed by the innovation. Second, trustworthiness

comes from leaders with high levels of competency and ability. This helped employees to

support the innovation as a good idea and helpful to the organization.

Third, this support was found to be the case even if the innovation might be harmful to

the employee role in the organization. Trust in leadership increased corporate citizenship which

helped foster a feeling of togetherness and support for innovative changes, even when the

organization was struggling or the changes caused a difficult situation. For example, a new

technology which was going to reduce the need for staffing in certain areas would still be seen as

a good idea, even if individuals might experience job loss. Finally, employees who trusted their

leader were able to use their leader’s trustworthiness as a substitute for certainty. Even though

innovation can be an uncertain experience, employees who trusted their leader did not experience

the same level of uncertainty.


26

Given these dynamics, employee trust in leadership addresses some of the challenges in

innovation implementation and therefore it was shown that employee trust in leadership may

leads to improved innovation adoption. Employees who trust their leader are more open to

innovation, more likely to be committed to innovation, and more likely to become involved and

adopt the innovation when it is implemented. As a result, employee trust in leadership was found

to be related to innovation success.

Limitations of Methodology

There are limitations to what this study can offer. First, the use of a REA, while

appropriate, is not intended to be the definitive answer to the research question posed here.

Rather, this paper was intended to be an informative paper on the research question posed here

and a starting point for a more complete analysis on a potential gap in the literature (Gough et al.,

2012, p. 39). Trust, innovation and change should be further studied. This essay should be

considered a starting point rather than a complete analysis (Gough et al., 2012, p. 39). In

addition, the systematic searching resulted in a high percentage of literature from snowballing (7

of 23) and manual search (5 of 23) activities. Snowballing represents literature, which was

manually uncovered through reviews of bibliographies of literature found in the searches. Future

research should consider performing a broader literature search. There is an abundant amount of

research available on the topic of trust but very little scholarly literature on the actual aspect of

employee interaction between employee and firm leadership leading to increased trust for firm

innovation. Future research should consider performing a broader literature search.

Implications of Findings to the Research Question

The findings seem to suggest that employees are more likely to accept and adopt firm

innovations when trust is prevalent between employees and leaders as a matter of routine in

organizational matters. Employees who view leaders as trustworthy and consider leaders to act in

their best interest are more likely to commit to the risk associated with change and uncertainty

when they believe leaders have their best interest in the decisions required to implement firm

innovations. In addition, it was implied, through the discovery of themes within the literature

review, that the synergy required firm innovation to be successful it requires communication,


27

through persuasion and knowledge sharing. Employees are more likely to accept innovation and

change together as Rogers (2003) argued, “a social system is defined as a set of interrelated units

that are engaged in joint problem solving to accomplish a common goal” (p. 23). Combined with

trust, innovation and change, these findings indicate that firms can meet the challenges of

implementation.

Implications for Management

The results of the literature review suggest that trusted leaders are an important

component to firm innovation. As such, this has a direct and specific impact on management

scholarship and practice. First, the acceptance of innovation is predicated on trust by employees

in leaders. The review of the literature indicates that there is a either a real or a perception that

trust in leadership is missing from many organizations (Porter, Steers & Mowday, 2007, p.185).

Trust, innovation and change should be further studied. This essay should be considered

a starting point rather than a complete analysis (Gough et al., 2012, p. 39). In addition, the

systematic searching resulted in a high percentage of literature from snowballing (7 of 23) and

manual search (5 of 23) activities. Snowballing represents literature, which was manually

uncovered through reviews of bibliographies of literature found in the searches. Future research

should consider performing a broader literature search. There is an abundant amount of research

available on the topic of trust but very little scholarly literature on the actual aspect of employee

interaction between employee and firm leadership leading to increased trust for firm innovation.

Trust is an important element in the firm’s innovation plan and has to be earned, nurtured

and considered in future plans. Trust has proven that both employee and leaders give and receive

trust and the firm benefits in return (Michaelis, et al., 2009, p. 404). Trust has proven to be

earned, but what has not been discussed here can be lost or recovered if it has been damaged in a

business setting, both of which are covered on a limited basis in the literature.

Colquitt and Rodell (2012) found that organizational environments where the decision

making process was open, complete, and understood by the employees enabled them to feel

confident in trusting their leaders. Employees who perceived this procedural process to exist

were more likely to be trusting in the innovations being proposed (Brocker, et al., 1997; Dovey,


28

2009). Organizations can help create this environment by being more transparent in decision-

making and making information used for decision making more available.


29

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Rousseau, D. M., Manning, J., & Denyer, D. (2008). Chapter 11: Evidence in management and

organizational science: Assembling the field's full weight of scientific knowledge through

syntheses. Academy of Management Annals, 2, 475-515.

doi:10.1080/19416520802211651

Ruppel, C. P., & Harrington, S. J. (2000). The relationship of communication, ethical work

climate, and trust to commitment and innovation. Journal of Business Ethics, 25, 313-

328. doi: 10.1023/A:1006290432594

Sagie, A., & Koslowsky, M. (1996). Decision type, organizational control, and acceptance of

change: An integrative approach to participative decision making. Applied Psychology:

An International Review, 45(1), 85-92. doi:10.1111/j.1464-0597.1996.tb00850.x

Sarinopoulos, I., Grupe, D., Mackiewicz, K., Herrington, J., Lor, M., Steege, E., & Nitschke, J.

(2010). Uncertainty during anticipation modulates neural responses to aversion in human

insula and amygdala. Cerebral Cortex, 20(4), 929-940.

Sawhney, M., Wolcott, R. C. & Arroniz, I. (2006). The 12 different ways of companies to

innovate. Sloan Management Review, 47(23), 75-81.

Shazi, R., Gillespie, N. & Steen, J., (2015) Trust as a predictor of innovation network ties in

project teams. International Journal of Project Management, 33(1), 81-91.

doi:10.1016/j.ijproman.2014.06.001.

Schein, E. (2010). Organizational Culture and Leadership. (4 ed., p. 303). San Francisco, CA:

Jossey-Bass.

Serva, M. A., Fuller, M. A., & Mayer, R. C. (2005). The reciprocal nature of trust: a longitudinal

study of interacting teams. Journal of Organizational Behavior, 26(6), 625-648.

doi:10.1002/job.331

Tan, H. H., & Tan, C. S. F. (2000). Toward the differentiation of trust in supervisor and trust in

organization. Genetic, Social, and General Psychology Monographs, 126(2), 241-260.


35

Tantardini, M., & Kroll, A. (2016). The role of organizational social capital in performance

management. Public Performance & Management Review, 39(1), 83-99.

doi:10.1080/15309576.2016.1071163

Tranfield, D., Denyer, D., & Smart, P. (2003). Towards a methodology for developing evidence-

informed management knowledge by means of systematic review. British Journal of

Management, 14(3), 207-222. doi:10.1111/1467-8551.00375

Van Gorp, S. (2013). Innovation in the nonprofit organizational context: Examining the strategic

significance of systems trust and individual resistance to change. Dissertation Abstracts

International Section A, 73

Wolfe, R. A. (1994). Organizational innovation: Review, critique and suggested research

directions. Journal of Management Studies, 31(3), 405-430. doi:10.1111/j.1467-


36

Appendix A

Search Strings:

Innovation AND Trust AND Implementation

Innovation and Trust AND (leadership OR commitment)

Employee Trust AND Leadership TRUST

("Trust" AND "Innovation")

Trust AND Innovation AND Change

Innovation, Organizational Change, Trust


37

Appendix B

PRISMA Diagram for systematic review of articles used in this paper

Note: n = 23 is a result of a search in the UMUC library. Business Source Complete provided 16

articles, Research Starters 4, and PsychINFO added 3 for a result of 23.


38


39

Appendix C

Databases included in UMUC OneSearch

Academic Search Complete

Business Source Complete

CIHAHL

Computers & Applied Sciences Complete

eBook Collection

Education Research Complete

Environment Complete

ERIC

GeoRef

JSTOR

Library, Information Science & Technology Abstracts

Military & Government Collection

Oxford Scholarship

Political Science Complete

PsycARTICLES

PsycINFO

ScienceDirect

SocINDEX


40

Appendix D

Systematic Literature Coding

1 Risk during Innovation Implementation

2 Uncertainty during Innovation Implementation

3 Trust Increasing Feelings of Control during Change driven by Innovation

4 Trust Increasing Risk Tolerance

5 Trust Positively Influencing Employee Perception of Proposed Innovation

6 Trust Increases Employee Openness to Innovation

7 Trust Increases Employee Adoption of Innovation

Running head: INNOVATION BUILT ON TRUST

Source

Supported Themes

Uncertainty and risk during

innovation implementation

change.

The moderating role of

employee trust on uncertainty

and risk.

The influence of employee trust on

attitudes towards innovation.

1 2 3 4 5 6 7

Brockner, et

al., 1997

X

Brodia, et

al., 2004

X

Cho &

Ringqueist,

2011

X

Choon

Yeong Ng,

2013

X X X

Clegg, et

al., 2002

X X

Condrey,

1995

X

Correia

Rodrigues

& de

Oliveira

Marques

Veloso,

2013

X X X

Devos, et

al., 2007

X X X

Dovey,

2009

X X X

Ertürk, 2008 X

Hosmer,

1994

X

Krot &

Lewicka,

2011

X X X


Appendix D

Legend

Systematic Literature Coding

1 - Risk in Innovation Implementation

2 - Uncertainty in Innovation Implementation

3 - Increased Trust, impacting change for firm Innovation

4 - Trust building Risk acceptance for innovation

5 - Trust positively guiding Employee understanding of firm innovation

6 - Trust increasing Employee willingness to accept and participate in innovation

7 - Trust increasing Employee acceptance and adoption of firm innovation

Michaelis,

et al., 2009

X X X X

Neves &

Caetano,

2006

X X X

Reinke,

2003

X

Rogers,

1983,

X

Ruppel &

Harrington,

2000

X

Sagie &

Koslowsky,

1996

X

Van Gorp,

2013

X

Wolfe,

(1994).

X


Appendix E

Quality Appraisal Results

Bibliography Purpose Publication Credibility

Author(s) Credibility WoE

Brockner, J., Siegel, P. A., Daly, J. P., Tyler, T., & Martin, C. (1997). When trust matters: The moderating effect of outcome favorability. Administrative Science Quarterly, 42(3), 558-583. doi:10.2307/2393738

Provided a useful descriptive framework to analyze workplace conflict and diversity challenges.

Ulrichsweb search found the journal to be scholarly, refereed, and reviewed.

Ph D academic Professors who have published widely on the topic and are affiliated with a University.

High

Bordia, P., Hunt, E., Paulsen, N., Tourish, D., & DiFonzo, N. (2004). Uncertainty during organizational change: Is it all about control?. European Journal of Work & Organizational Psychology, 13(3), 345-365. doi:10.1080/13594320444000128

This study tested a model of change-related communication, uncertainty, and control and their relationship with psychological strain, job satisfaction, and turnover intentions for employees and supervisors.

Ulrichsweb search found the journal to be scholarly and refereed.

Scholars and Terminal degrees. Peer reviewed and published.

Medium

Cho, Y. J., & Ringquist, E. J. (2011). Managerial Trustworthiness and Organizational Outcomes. Journal of Public Administration Research & Theory, 21(1), 53-86. doi:10.1093/jopart/muq015

This article examined a survey showing the managerial traits of competence, integrity, and benevolence share an important common dimension that we identify as the trustworthiness of managerial leadership


Scholar, widely recognized as an expert.

High

Choon Yeong Ng, J. (2013). Trust and innovation: The impact of interpersonal - Trust on team innovation. Review of Business Research, 13(1), 39-52.

This article identified a systematic plan to discuss the concepts of trust, psychological safety, and cohesion from each other, and point out the difference between creativity and innovation, to illustrate the need for research that has a focus on trust and innovation.



High

Clegg, C. W., Unsworth, L. L., Epitropaki, O., & Parker, G. (2002). Implicating trust in the innovation process. Journal of Occupational and Organizational Psychology, 75(4), 409-422

This study sought to introduce the development of two new measures of innovation trust, ‘trust that heard’ and ‘trust that benefit’

Journal of Public Relations Research


Medium




Condrey, S.E. (1995) Reforming human resource management systems: exploring the importance of organizational trust. American Review of Public Administration, 25(4), 341–354

This study shows that high trust levels within organizations may aid human resource management reform efforts.

Ulrichsweb search found the journal to be scholarly and refereed. (American Review of Public Administration)

University of Georgia, Professor High

Correia Rodrigues, A., & de Oliveira Marques Veloso, A. (2013). Organizational trust, risk and creativity. Revista Brasileira De Gestão De Negócios, 15(49), 545-561. doi:10.7819/rbgn.v15i49.1334

An examination of 244 employees detected that there is a positive relationship between trust and behavior to provided new ideas

Revista Brasileira De Gestão De Negócios,

Latin American Scholars with a global perspective.

Medium

Devos, G., Buelens, M., & Bouckenooghe, D. (2007). Contribution of content, context, and process to understanding openness to organizational change: Two experimental simulation studies. Journal of Social Psychology, 147(6), 607-630.

The authors examined the contribution of the content, context, and process of organizational transformation to employees' openness to change. Including trust in executive management and trust in the supervisor.

Ulrichsweb search found the journal to be scholarly and refereed. (Academy of Management Journal)

Scholars and Terminal degrees. Peer reviewed and published

High

Dovey, K. (2009). The Role of Trust in Innovation. Learning Organization, 16(4), 311-325.

The purpose of this paper is to explore the role of trust in the collaborative learning processes that underpin innovation as a competitive strategy in organizations.



High

Ertürk, A. (2008). A trust-based approach to promote employees' openness to organizational change in Turkey. International Journal of Manpower, 29(5), 462-483. doi:10.1108/01437720810888580

This study examined the mediating role of psychological contract fulfillment, trust, and perceived need for change in the relationship between change information and employee attitude toward organizational change.


Ph D academic Professors who have published widely on the topic and are affiliated with a Turkish University.

High

Hosmer, L. T. (1994). Why be moral? A different rationale for managers. Business Ethics Quarterly, 4(2), 191-204.doi: 10.2307/3857491

Trust, commitment, and effort on the part of all of the stakeholders are essential for long-term corporate success; given

Ulrichsweb search found the journal to be scholarly,

Scholar, Peer reviewed and published

High




the economic conditions of intense global competition that now exist for the foreseeable future.

refereed, and reviewed

Krot, K., & Lewicka, D. (2011). Innovation and organizational trust: study of firms in Poland. International Journal of Innovation & Learning, 10(1), 43-59.

Ulrichsweb search found the journal to be scholarly, refereed, and reviewed


High

Michaelis, B., Stegmaier, R., & Sonntag, K. (2009). Affective commitment to change and innovation implementation behavior: The role of charismatic leadership and employees' trust in top management. Journal of Change Management, 9(4), 399-417. doi:10.1080/14697010903360608

The purpose of this study is to examine charismatic leadership and employees’ trust in top management and how they affect employees’ innovation implementation behavior.



High

Neves, P., & Caetano, A. (2006). Social exchange processes in organizational change: The roles of trust and control. Journal of Change Management, 6(4), 351-364. doi:10.1080/14697010601054008

This study conducted a field research experiment to clarify the role trust in the supervisor plays in implementing organizational change.



High

Reinke, S.J. (2003) Does the form really matter? Leadership, trust, and the acceptance of the performance appraisal process, Review of Public Personnel Administration, 23(1), pp. 23–37. doi: 10.1177/0734371X02250109

This study explores the role of trust in shaping supervisor and employee acceptance of the appraisal process and associated trust that supervisors will be fair.


Scholar and Terminal degrees. Peer reviewed and published

Medium

Rogers, E. M. (1983). Diffusion of innovation. (3rd ed.). London, UK: The Free Press.

Diffusion of innovations research directly correlates to trust in innovation by enhancing our understanding of how innovation implementation occurs.


Noted Scholar and recognized expert.

High




Ruppel, C. P., & Harrington, S. J. (2000). The relationship of communication, ethical work climate, and trust to commitment and innovation. Journal of Business Ethics, 25, 313-328. doi: 10.1023/A:1006290432594

This study tests this model of trust by using Victor and Cullen's (1988) ethical work climate instrument to measure the perceptions of the “right,” “just,” and “fair” treatment of employee stakeholders.



Medium

Sagie, A., & Koslowsky, M. (1996). Decision type, organizational control, and acceptance of change: An integrative approach to participative decision making. Applied Psychology: An International Review, 45(1), 85-92. doi:10.1111/j.1464-0597.1996.tb00850.x

Discussed the development of an integrative model of the relationship between participation in decision making (PDM) during an organizational change and work attitudes (organizational commitment, job satisfaction, and sense of effectiveness



High

Van Gorp, S. (2013). Innovation in the nonprofit organizational context: Examining the strategic significance of systems trust and individual resistance to change. Dissertation Abstracts International Section A, 73

The purpose of this study was to assess the relationship of organizational trust and resistance to change (intervening variables) to organizational support for innovation (dependent variable).


Thesis submitted in partial fulfillment of the requirements for the Doctor of Philosophy degree in Educational Policy and Leadership Studies (Higher Education) in the Graduate College of The University of Iowa

High

Wolfe, R. A. (1994). Organizational innovation: Review, critique and suggested research directions. Journal of Management Studies, 31(3), 405-430. doi:10.1111/j.1467-

The purpose of this study is to clarify that there is no one way to understand innovation.


Scholar, widely recognized as an expert

Medium


Appendix F

Analysis Themes

Analysis Themes with Evidence by Supporting Literature

(Note: In the order that the information appears in the paper, by page number

Bibliography Strategy Findings Sentence WoE

Rigor Relevance Total

Rogers, E. M. (1983). Diffusion

of innovation. (3rd ed.). London,

UK: The Free Press.

X In order to prevent

misunderstandings about

innovations within the firm,

leaders need to work especially

hard to communicate clearly to

all employees about all

innovation plans. (p.6)

High High High

Schein, E. (2010). Organizational

Culture and Leadership. (4 ed., p.

303). San Francisco, CA: Jossey-

Bass.

X Therefore, if leadership increases

the pressure to accept the

innovation without building trust,

the employees will only have

increased anxiety. (p.7)

High High High



UK: The Free Press.

X The inherent risk associated with

innovation, and the required trust

that is necessary by both leader

and employee for the firm to the

successful innovation diffusion is

predicated on effective

communications.(p.7)

High High High



UK: The Free Press.

X The smallest consideration for

sharing information as widely as

possibly within the organization

helps to reduce the uncertainty

and reduce the inherent

associated risks of organizational

change with innovation. (p. 7-8)

High High High



UK: The Free Press.

X Innovation implementation plans

should include the key element of

an effective communications plan

for innovation. (p.8)

High High High

Mayer, R. C., Davis, J. H., &

Schoorman, F. (1995). An

integrative model of

organizational trust. Academy of

Management Review, 20(3), 709-

734.

doi:10.5465/AMR.1995.9508080

335

X Their model considered three

factors which made a leader

perceived as trustworthy: ability,

integrity, and benevolence. These

three factors when combined

demonstrate a leader's trust

actions and the potential to act in

the best interest of the

employees; and thereby helped to

build trust. (p.10)

High High High




X X A leader who lacks the

competency or authority to act

effectively is not viewed as one

High High High






734.

doi:10.5465/AMR.1995.9508080

335

who can take independent actions

to benefit or care for the

employees, and therefore is not

individually trustworthy. (p.10)






734.

X X Employees are more likely to

view innovative changes

proposed by such leaders in a

positive manner, as that

information is communicated in

the organization more effectively

over time (p.10)

High High High






734.

X X Integrity shows that the leader’s

decision-making framework is

visible and compatible with the

organizational employee's

standards or norms. Benevolent

leaders in turn make decisions,

which are beneficial to the

specific employee who trusts

them. (p.10)

High High High

Hattori, R., & Lapidus, T. (2004).

Collaboration, trust and

innovative change. Journal of

Change Management, 4(2), 97-

104.

doi:10.1080/1469701032000154

9197

X X This is particularly important, as

trust is perceived as a missing

leadership trait in many

organizations, leading employees

to often have cynical views of

senior organizational leadership

and proposed innovations by

senior management. (p. 11)

High High High

Bordia, P., Hunt, E., Paulsen, N.,

Tourish, D., & DiFonzo, N.

(2004). Uncertainty during

organizational change: Is it all

about control?. European Journal

of Work & Organizational

Psychology, 13(3), 345-365.

doi:10.1080/1359432044400012

8

X X With a leader who has the

capability and desire to act in

their favor, trusting employees

are more likely to be active

participants in the change

regardless of uncertainty they

may experience. (p.11)

High High High

Ritzer, G. (2011). Sociological

theory. (8th ed., pp. 416-427).

New York: McGraw-Hill.

X The lens of social exchange

theory (SET) was chosen to

evaluate the role of employee

trust on their openness and

commitment to innovations

proposed by management,

because it models inter-personal

interactions as a series of

exchanges of actions and goods

of value over time (Ritzer, 2011,

p. 427). (p.11)

High High High

Blau, P. M. (1986). Exchange

and Power in Social Life. New

X Blau (1986) explained that social

exchanges are the foundation for

High High High




Brunswick, NJ: Transaction

Publishes.

social structures and a key

foundational building block for

the human element for building

trust between employees and

leaders for firm innovation.

(p.11)

Cropanzano, R., & Mitchell, M.

S. (2005). Social exchange

theory: An interdisciplinary

review. Journal of Management,

31(6), 874-900.

X These acts of building more trust

over time occur as employees

build a history of trust in a leader

by exchanging their

commitments through positive

actions for future leader payback

in acts of repeated trust. (p.12)

High High High

Kramer, R. M., & Tyler, T. R.

(1996). Trust in organizations:

Frontiers of theory and research.

Thousand Oaks, CA: Sage.

X SET provides two ways to

evaluate the dynamics of trust

being built over time. (p.12)

High High High

Casimir, G., Lee, K., & Loon, M.

(2012). Knowledge sharing:

Influences of trust, commitment

and cost. Journal of Knowledge

Management, 16(5), 740-753.

doi:http://dx.doi.org.ezproxy.umu

c.edu/10.1108/136732712112627

81

X X Social exchange provides a

robust foundation for the

temporal aspect of trust. (p.12)

High High High

Casimir, G., Lee, K., & Loon, M.

(2012). Knowledge sharing:

Influences of trust, commitment

and cost. Journal of Knowledge

Management, 16(5), 740-753.

doi:http://dx.doi.org.ezproxy.umu

c.edu/10.1108/136732712112627

81

This argument is valuable when

investigating trust in

organizations, since the events

which cause trust in a leader to

develop, and the fulfillment of

that trust often occur at different

times. For these reasons, SET is

an appropriate lens while

evaluating the literature.(p.12)

High High High


Target Journals

International Journal of Human Resources Development and Management

http://www.inderscience.com/info/ingeneral/cfplist.php?jcode=ijhrdm

The International Journal of Human Resource Management (Taylor Francis Online)

http://www.tandfonline.com/toc/rijh20/23/12

Society for Human Resource Management

http://www.shrm.org/Publications/hrmagazine/Contactus/ContactEditors/writersguidelines/Pages

/default.aspx

These select journals were identified through a rigorous selection process based on three

criteria. The criteria was: 1) the journal had to be in good standing within the management

community; 2) the subject of this paper had to have a natural linkage to the journal audience or

consumer base; and 3) the process for submission had to be one that this author thought was

achievable.

livingston trust and innovation (2) 2016

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