Unlocking the Creativity Potential of Dialectical Thinking: Field Investigations of the Comparative Effects of Transformational and Transactional Leadership Styles

In a digital economy characterized by high volumes of information and ideas, many of which could be contradictory to one another, employees high in dialectical thinking should be well poised to connect disparate ideas to generate creative solutions for business problems. Yet, it is unclear whether dialectical thinking as a creativity-relevant skill can be realized in naturalistic workplace settings, given past mixed findings and the lack of field studies. We propose that supervisors’ leadership styles are important moderators that can unlock employees’ creativity potential in dialectical thinking. Additionally, we compare the activating effect of transformational leadership and the inhibiting effect of transactional leadership to investigate which leadership style is more impactful in unlocking the power of dialectical thinking on creativity. Through two multisource field studies, we find that dialectical thinking’s effect on creativity is context-sensitive, and transactional leadership’s inhibiting effect on the dialectical thinking-creativity relationship is stronger than transformational leadership’s activating effect. These findings qualify the predominant view that leaders should focus on enacting activators to stimulate employee creativity; rather, avoiding inhibitors might be more effective instead. Practically, our findings suggest that leaders should ensure they engage in fewer transactional leadership behaviors.