Unlocking Employee Creativity Through Empowering Leadership: The Dynamic Interplay of Trust and Engagement

Abstract

This study aims to identify the effect of empowerment leadership on employee creativity at PT XYZ by considering the mediating role of trust in leaders and employee engagement. In a service-based work environment, employee creativity is a strategic element in creating innovation and maintaining company competitiveness. Using a quantitative method with Structural Equation Modelling-Partial Least Squares (SEM-PLS) approach, data were collected from 234 permanent employees of PT XYZ. The results showed that empowerment leadership has a significant effect on employee engagement and employee creativity. However, the direct effect of trust in leaders on creativity is not significant, although the trust serves as an amplifier in the relationship between empowerment leadership and employee engagement. The theoretical implications of this study extend the Job Demands-Resources (JD-R) theoretical framework by emphasising the importance of empowerment as a key resource in enhancing creativity. Practically, PT XYZ is advised to implement an empowerment-based leadership programme to increase employee engagement and encourage creative behaviour.