This literature review references and highlights the key ideas and some of the existing researches conducted as well as the gaps to be filled in order to properly address the need that twentieth century born organizations have to become more competitive through creativity and innovation. Creativity is a broad domain but has also been vastly researched and documented with a clear link to innovation. Areas that deserve more focus and work are on driving large organizations through behavioral and cultural change, to adapt and remain competitive in a context of rapid distortion. In the era of exponential growth, nothing can be predicted. It is thus a pressing need to find the most appropriate and flexible behavioral change model, because of the high velocity of changes and the volatility of systems and contexts we are part of. This context offers a perfect opportunity to create a joint academic and corporate collaboration as a majority of organizations have high stake in finding the way forward to regain control over the inevitable transition to the digital age they have been forced to embark in.

1. Literature Review
Introducing a culture of creativity and innovation in twentieth century
born corporations
Sau-Yeng Dixon
101625295@student.swin.edu.au
2017-HS2-DDD40001-Methods for Design Research (Semester 2)
A1_SY_Dixon
Master of Design Strategy and Innovation
Swinburne University of Technology

2. pg. 2
Literature Review
Introduction
Every single industry in all sector without exception is going through, or will imminently go
through an inevitable transition into the digital economy. This transition is more so an earthquake
with the impact equivalent to a tsunami rather than a steady evolution. This transition is so
impactful in fact, that economists are calling the phenomenon the fourth industrial revolution or
“Industry 4.0” (Stăncioiu A, 2017).
The strength of the impact follows the velocity of disruptions and innovations in each industry.
The bigger the innovation and the faster the disruption, the more likely the industry will be
distorted, flooded by digitally native corporations able to reinvent products, services and even
entire systems. Left behind are the twentieth century born dinosaurs who live with the illusion
that they are too big to be killed, and keep operating under the old rules of standardization
(Johnson NJ., 2007).
Can the twentieth century born corporations be saved? In recent years, we have seen many
collapses (entire media industry distorted in less than ten years), predicting a trend which pace
seems to be inevitably increasing. And if they can be saved, how? How can they become part of
the tsunami? One way to do so would be to essentially adopt the ways of the digital native
companies: being agile, flexible, experimental, technology enabled, able to deliver a high velocity
of successful innovations by breaking the old models. Many pre-digital organizations have
attempted to turn towards technology innovations to mimic the millennials with debatable
success. Indeed, despite the massive investments, dinosaurs behave like giant oil tankers,
investing in advanced and more powerful engines to race a hydro speed boat: it is doomed to
fail…
Research in fields of economics and business innovation suggests that one of the key attributes
for success in the digital age is creativity. Employee creativity is an important source of
organizational innovation and competitive advantage (Amabile, 1988, 1996; Oldham &
Cummings, 1996; Shalley, 1991; Zhou, 2003). Creativity, enabled by the power of technologies
fuels innovations and disruptions.
So, rather than to expect to transform from the outside-in by injecting new technologies, there
are evidences that pre-digital organizations could bet on transforming from the inside by
adopting a culture of creativity.
Looking through literature across multiple disciplines of social sciences regarding business
management, economics and behavioral psychology, this article aims to explore and verify
methods that can be applied to large corporations in order to introduce a durable culture of
creativity and influence innovation production.

3. pg. 3
Creativity and innovation: innate qualities or abilities one can gain?
Tan (2015) quotes Kaufman (2015) and declares that creativity is life. It is a manifestation, it is
generative and induced by faith. It grows with life experience, self-reflection and repetitive
practice of imagination and is part of the self-enquiry process.
Creativity is about bringing something into being or becoming (Rogers, 1961). By definition, it is
deeply human and closely linked to innovation. What is deeply human and what is related to
innovation, often holds a part of mystery or magic: either something innate, a gift of nature or a
miracle.
However, according to research conducted by Perry-Smith and Mannucci (2017) from the London
Business School, there is a creative process that innovative organizations follow. The “creator”
goes through a “journey” or a process from idea generation to idea implementation and hence
converts the idea into a new tangible outcome. This outcome is an innovation.
The research challenges previous views that creativity is a function of innate personality trait and
hence cannot be learnt, developed and strengthened. Indeed, it introduces the concept that
external factors, such as the physical environment or the collaboration system, can influence
creativity and hence innovation production.
It opens the opportunity to explore to what extent creativity can be introduced and developed
at an individual level similarly to more traditional technical skills, and hence transition an
individual from a standardized to a creative way of working.
Creativity at the organization level
There is also interest in exploring how creativity operates (or not) at an organization level.
Organizations are alive and moving systems independent from individuals who constitute it. If
creativity can be characterized as “life” for an individual, for organizations, creativity can be
defined as employees’ generation of novel and useful ideas concerning products, procedures,
and processes at work (Amabile, 1988; Oldham & Cummings, 1996).
To optimize the level of creativity within an organization, research conducted by Hirst,
Knippenberg and Zhou (2009) looks at individuals’ systems of interactions, organizations’ context
and settings. Essentially, an organization is a complex structure and a large number of factors
could influence the level of creativity of each individual and the group as a whole. Some factors
tested in research include goal orientation, team learning behavior and individual intrinsic
motivation. While correlations are found between these afore mentioned factors and the level
of creativity, results suggest that there are limits when these factors are mixed.

4. pg. 4
Leadership and culture
In addition, research conducted by Sehrish and Sarfraz (2016) aims to demonstrate a positive
correlation between ethical leadership and employees’ creativity. Ethical leadership is defined as
“The demonstration of normatively appropriate conduct through personal actions and
interpersonal relationships, and the promotion of such conduct to followers through two-way
communication, reinforcement, and decision- making” (Brown, Trevina & Harrison, 2005 p. 120).
Their findings support that ethical leadership influences positively employee creativity through
cognitive and motivational mechanism. In contrast, uncertainty avoidance weakens the
relationship between leaders and employees and has a negative impact on creativity.
Leaders are found to be the gate keepers to the culture of an organization and greatly influence
shared values and behaviors. This is again corroborated by research conducted by Michaelis,
Stegmaier and Sonntag (2009): “Innovation implementation behavior is significantly and
positively correlated with charismatic leadership, trust in top management, and affective
commitment to change. Affective commitment to change is significantly and positively correlated
with charismatic leadership and trust in top management.”
Since multiple research findings suggest the importance of trust, transparency and positive
leadership in the success of an organization’s ability to create and innovate, corporations will
want to consistently increase this factor for competitive advantage.
Design for sustainable behavioral change
Whilst individual behavioral change is well covered by scientific literature with a plethora of
empirical data, it is not the case when it comes to organizations. Most corporations struggle with
sustaining innovations that require a major shift in behavior from their employees and
sometimes their ecosystem stakeholders. What differentiates these corporations with the
market disruptors that sway collective behaviors faster than ever in history? When the telephone
took seventy-five years to reach fifty million customers, it took facebook only three and a half
years.
A research on behavioral change in the public and private sector published in the journal of
change management in 2016 (Niedderer, K., Ludden, G., Clune, S. J., Lockton, D., J. Mackrill, A.
Morris, R. Cain, E. Gardiner, M. Evans, R. Gutteridge, P. Hekkert, 2016), suggests that the difficulty
encountered by pre-digital corporations is due to the lack of cognitive model addressing the
contextual aspects of large organizations. Instead of models and theories, change practitioners
use intermediate level knowledge in the form of toolkits and guidelines and do not prove
effective. Whilst there is a high level of understanding and clear interest from corporate and

5. pg. 5
public sector stakeholders on the theory of behavioral change, there is limited amount of
evidence based examples and academic research done. There are significant opportunities to
conduct work in this area.
Conclusion
This literature review references and highlights the key ideas and some of the existing researches
conducted as well as the gaps to be filled in order to properly address the need that twentieth
century born organizations have to become more competitive through creativity and innovation.
Creativity is a broad domain but has also been vastly researched and documented with a clear
link to innovation. Areas that deserve more focus and work are on driving large organizations
through behavioral and cultural change, to adapt and remain competitive in a context of rapid
distortion. In the era of exponential growth, nothing can be predicted. It is thus a pressing need
to find the most appropriate and flexible behavioral change model, because of the high velocity
of changes and the volatility of systems and contexts we are part of.
This context offers a perfect opportunity to create a joint academic and corporate collaboration
as a majority of organizations have high stake in finding the way forward to regain control over
the inevitable transition to the digital age they have been forced to embark in.
Word count: 1424

6. pg. 6
Synthesis Matrix
Digital economy Psychology of
creativity,
motivation and
culture
Leadership Behavioral change
Celaschi, F. (2017)
Definition Industry
4.0
Leadership in
Industry 4.0
Human-centre
design of
behavioural change
Hirst, G., Van
Knippenberg, D.,
Zhou, J. (2009)
Intrinsic and
extrinsic motivation
Role of leadership
in creativity
Motivation for
innovation adoption
Johnson, NJ. (2007)
Pre-digital versus
digital native
corporations
Adapting to digital
economy
Majovski, I.,
Davitkovska, E.
(2017)
Impact of
technology
Entrepreneurship
skills
Digital skills
Michaelis, B. &
Stegmaier, R.,
Sonntag K. (2009)
Culture
Motivation
Charismatic
leadership and
impact on creativity
Adoption levers
Niedderer, K.,
Ludden, G., Clune,
S. J., Lockton, D., J.
Mackrill, A. Morris,
R. Cain, E. Gardiner,
M. Evans, R.
Gutteridge, P.
Hekkert (2016)
Models, guidelines,
toolkits
Role of leadership
Behavioral change
at the organization
level
Pandarakalam, JP.
(2017)
Definition of
creativity
Transcendental
purpose
Purpose for change
Perry-Smith, J.E.,
Mannucci, P.V.
(2017)
Network as enabler
to innovation and
creativity
Context and
systems that
motivate creativity
Sehrish A. K.,
Sarfraz, S.U. (2016)
Motivation
Motivation
hindrance
Role of ethical
leadership
Stăncioiu, A. (2017)
Industry 4.0
Drivers, social and
economic impacts
Consumer
Workforce
Tan, AG. (2015)
Definition of
creativity
Transcendental
purpose

7. pg. 7
References
Celaschi, F. (2017), ‘Advanced design-driven approaches for an Industry 4.0 framework: The human-
centred dimension of the digital industrial revolution’, Strategic Design Research Journal, May-August
2017, pp 97-104.
Hirst, G., Van Knippenberg, D., Zhou, J. (2009), ‘A cross-level perspective on employee creativity: goal
orientation, team learning behavior, and individual creativity’, Academy of Management Journal, Vol.
52, No. 2, pp 280-293.
Johnson, NJ. (2007), ‘21st
century business: managing and working in the new digital economy’, Choice,
June 2007, pp 1674.
Majovski, I., Davitkovska, E. (2017), ‘Human resource prerequisite for digital economy development’,
Economic Development / Ekonomiski Razvoj, Vol. 19, No. 1/2, pp 181-198.
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, Vol. 9, No. 4, pp 399-417.
Niedderer, K., Ludden, G., Clune, S. J., Lockton, D., J. Mackrill, A. Morris, R. Cain, E. Gardiner, M. Evans, R.
Gutteridge, P. Hekkert (2016), ‘Design for Behaviour Change as a Driver for Sustainable Innovation:
Challenges and Opportunities for Implementation in the Private and Public Sectors’, International
Journal of Design, Vol. 10, No. 2, pp 67-85.
Pandarakalam, JP. (2017), ‘A Deeper Understanding of Consciousness through Study of Creativity’,
NeuroQuantology, Vol. 15, No. 2, pp 171-185.
Perry-Smith, J.E., Mannucci, P.V. (2017), ‘From creativity to innovation: the social network drivers of the
four phases of the idea journey’, Academy of Management Review, Vol. 42, No. 1, pp 53-79.
Sehrish A. K., Sarfraz, S.U. (2016), ‘Creativity is everyone’s business: how to enhance employee creativity
in telecommunication sector?’, Annals of the University of Oradea, Economic Science Series, Vol. 25, No.
1, pp 515-524.
Stăncioiu, A. (2017), ‘The fourth industrial revolution: industry 4.0’, Fiability & Durability / Fiabilitate si
Durabilitate, 2017, Issue 1, pp 74-78.
Tan, AG. (2015), ‘Connecting Theory, Research, and Practice in the Psychology of Creativity: An
Introduction to a Special Issue’, Journal of Creative Behavior, Vol. 49, No. 3, pp 157-164.