Frontline Service Employee Engagement PDF

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Frontline Service Employee Engagement, Creativity, and Job Performance
Frontline Service Employee Engagement, Creativity, and Job Performance
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11/2/2018

Abstract
The purpose of this paper is to investigate how frontline service employee engagement is
related to creativity and job performance. Extending to the literature that examines employee
creativity, job performance, and engagement, this study assesses the simultaneous
relationships between the constructs in the service context. The current investigation also
examines how these associations are subject to the service levels (high- versus low-customer
contacts).
Key words: employee creativity, job performance, engagement, front line service
employees.
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Introduction
Today’s marketplace is immensely competitive. Many companies provide products
and services that offer solutions to customers’ specific problems (i.e., customer needs and
wants) and create value for their customers (Lovelock, Patterson, and Wirtz 2011). Employee
creativity significantly contributes to achieving organizational effectiveness, innovation, and
performance (Amabile et al. 1996). This is particularly true for front line employees, who are
required to demonstrate creativity to deliver excellent service and meet the expectations of
customers with different needs and wants (Wilder, Collier, and Barnes 2014). Accordingly,
service firms strive to enhance employee creativity to ensure sustainable growth in today’s
volatile, complex, competitive, and dynamic marketplace (Oldham and Cummings 1996).
Research has suggested that such growth is possible by fostering an environment
where both employee creativity and job engagement are stimulated and supported (Stanley
2016). Thus, in addition to employee creativity, job engagement is considered an important
element to drive firms’ long-term success (Lawler 1986; Lockwood 2007). Anecdotal
evidence shows that 32% of creatively engaged employees are more likely to increase job
performance through creative problem solving and high innovation (Taylore 2017).
Although the constructs of employee creativity, job engagement, and performance
have been extensively investigated in various disciplines, prior studies have examined how
employee creativity and engagement impacts job performance in non-service study contexts
(Amabile 1983, Stanley 2016; Shalley, Zhou, and Oldham 2004). Little is known about how
these two constructs together affect employee performance in the context of services. In this
sense, this investigation is timely and important for managers who strive to enhance frontline
employees’ job performance.
Therefore, this study illustrates how frontline service employees’ work engagement
relates to their creativity and job performance. Specifically, the present research tests the
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model highlighting the mediating role of employee creativity in the work engagement–
performance relationship. This research further examines whether the relationships of these
constructs are subject to job characteristics and nature (the levels of service encounter: high
versus low customer contacts, autonomy/empowerment, and service climate). Previous
researches have examined the simultaneous relationship between moderation and mediation
and how it affects each other at the same (Fairchild and MacKinnon, 2010). The conceptual
model in this paper is investigating the mediating and moderation effects together where the
mediation effect is assumed to be moderated by some variables called moderated mediation
effect (Edwards and Lambert, 2007). Likewise, this paper estimates the simultaneous
relationship between creativity as a mediator between engagement and performance and the
same time the effect of job characteristic and nature (service climate and empowerment) as
moderators which effects creativity, engagement, and performance.
Literature Review
Conceptual framework
Figure 1 illustrates the conceptual model of the current research. The model
underscores that frontline employees’ engagement relates to their job performance through
creativity. It also hypothesizes that job characteristics and nature (i.e., service levels,
autonomy/empowerment, and service climate) influence the associations between the
constructs of interest in this study.
The conceptual model of this study is understood as the componential theory of
creativity proposed by Amabile (1983). This theory is based on the premises that
organizations are motivated to innovate and have both the resources and management
practices to achieve such innovation. It underscores important social and psychological
domains that are essential for employees to solve business problems by generating new ideas
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that are feasible, correct, and valuable (Amabile 1988). According to Amabile (1988), the
creative process is an important element for individuals in the organization to solve the
problems, to deal more effectively and efficiently with work in order to avoid uncertainty,
and achieve excellent outcomes. In this sense, the componential theory of creativity explains
the hypothesized model that suggests the relationships of employee engagement, creativity,
and performance in the workplace. This research posits that an engaged frontline employee is
more likely to be creative in the service delivery process to meet organizational goals
effectively and efficiently by delighting customers.
The theory encompasses three domains: creativity-domain skills, social environments,
and creativity-relevant skills. Creativity-domain skills are related to an individual employee’s
knowledge and talent that enable him/her to perform the job. Surrounding social
environments extrinsically motivate and challenge individuals to innovate. Negative external
environmental factors include time pressure, political issues, and norms that criticize novel
ideas. Such negative external motivators undermine individuals’ intrinsic creativity and affect
the process of critical thinking (Amabile 2012). Individuals have different triggers to become
motivated and use their creativity; those triggers can be due to extrinsic or intrinsic
motivation. Thus, an individual’s degree of creativity is dependent on his/her motivations for
the specific tasks (Amabile 1988).
Creativity-relevant skills refer to proper cognitive styles and clear knowledge of the
heuristic for breeding novel ideas (Amabile 1988). Keeping options open, breaking existing
cognitive sets, exploring new cognitive pathways, suspending judgments, storing
information, and remembering accurately are some examples of cognitive perceptual styles
that allow individuals to challenge the status quo mentality set and understand the
complexities inherent in solving problems (Amabile 1983). In other words, individuals with
creativity-relevant skills are technically good, adequate, or acceptable, which enables them to
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perform their work in a creative manner (Amabile 1988). The ability to be creative increases
the chances of solving problems. Individuals who explore the possibilities of using these
responses and information can solve the problem and carry out their jobs effectively
(Amabile 1988). Various personality traits can influence creativity-relevant skills, such as
risk orientation, varied experiences, social skills, team qualities, special cognitive abilities,
and naiveté (Amabile, Hennessey, and Grossman 1986). This last domain is relevant to
understanding the study’s model positing the moderating roles of job characteristics and
nature.
Researchers have suggested that the characteristics of a job (e.g., task complexity)
affect the employee’s performance and creative relationship (Coelho and Augusto 2010).
Some job characteristics, such as clarity, variety, autonomy, and significance, can encourage
employees to become more creative and engaged with their jobs and achieve higher
performance (Coelho and Augusto 2010; Mugo, Wario, and Odhiambo 2014; Shalley Zhou,
and Oldham 2004).
Moreover, service climate in the organization has been shown to influence employee
creativity and performance. A work environment in which ideas can be exchanged, job
engagement is encouraged, and organizational resources are available can enhance
employees’ creativity (Hunter, Bedell, and Mumford 2007). Likewise, service
climate―characterized by supporting each other, sharing information, accepting and
respecting the shared values, norms, and beliefs, and empowering employees―facilitates
individuals to become more engaged with their work, thereby boosting their creativity and
performance (Stanley 2016).
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The conceptual model below explains the direct effect explaining that the effect
of engagement (x) is mediated by Creativity (m). This model explains the moderated
mediation effect which is introduced by James and Brett (1984) “moderated mediation”
for the condition where a moderator influences the mediational relationship. This study
explains that job characteristic and nature of an independent variable role as the
moderator affects the mediation relationship.
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Employee
creativity (m)
Employee
performance
(y)
Employee
engagement
(x)
In the given moderate mediation model the employee creativity has been taken
as the moderator which affects the employee engagement and overall relationship with
other factors such as performance, job characteristics and nature (Albrech, 2011).
Considering the following model, the job characteristics and the nature of the job such
as autonomy, and accountability and empowerment I (Schaufeli, & Salanova, 2007).
These job characteristics and nature such as work environment in terms of colleagues,
work pressure, attitude of people, climate, all these things have an impact on the
employee’s engagement in the company, for example, if an employee is not satisfied
with the work culture, or if in case he is not content with the work pressure, the
employee will experience his detachment from the company (Hui, et al. 2007). The
employee will be less engaged in social gatherings pertaining to business as well as will
not be able to engage himself within the work culture given his job characteristics.
Similarly, the employee engagement, then affects the overall employee performance
and employee creativity (Zhang, and Bartol, 2010). A less engaged employee will be
less bothered with the company policies and work culture. He will fail to bring his
creativity to surface which could help him come up with creative solutions and decision
making capabilities. The lost creativity will also eventually impact the performance
negatively. Therefore, with this model it can be understood that there is mediation
effect of creativity and job characteristics on employee performance and employee
engagement.
Figure 1. Conceptual model
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Job characteristics and nature
(service levels,
autonomy/empowerment, service
climate)
Job engagement
The concept of job engagement has been defined in many ways. According to Gallup
(2013), engagement refers to individuals’ willingness to display a positive manner, a level of
commitment, and enthusiasm in the organization. It has been suggested that an employee
who is engaged with the organization will become loyal, satisfied, empowered, and
passionate. The employee who expresses feelings in the work environment tends to achieve a
higher level of efficiency, retention, and productivity (Silverthorn 2001; Truss et al. 2006).
Engaged employees feel obligated to their organization, so they put more effort to do their
work-related duty to accomplish their own professional improvement, commitment,
teamwork, and superb quality of performance (Paulsen et al. 2013; Shantz et al. 2013).
Employee creativity
Creativity has drawn the attention of many scholars and organizations. It is related to
the generation of novel ideas focusing on individual attitudes towards the process,
procedures, and services for effective organizational outcomes (Amabile 1988, 2012;
Ellsworth 2002; Oldman and Cummings 1996; Zhang and Bartol 2010). The usefulness of
the idea is important because, if novel ideas cannot be implemented and used for the
purposes of achieving organizational goals, they are not beneficial for the organizations; thus,
the idea must be novel and useful for the organization (Erez, and Nouri 2010). Creativity is
individuals’ attitudes, through personality, and skills that can be used to solve problems
(Darley, Glucksberg, and Kinchla 1986). To implement the marketing concept, frontline
employees must successfully recognise and fulfil each specific customer need; therefore,
frontline employees must develop a good understanding of “customer need knowledge”
(CNK) (Homburg, Wieseke, and Torsten 2009). Providing knowledge to individual
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customers, generating customer satisfaction, and recognising customer needs and customer
value rather than focusing on immediate sale are frontline employees’ responsibility
(Homburg, Wieseke, and Torsten 2009).
In particular, employees in the services industry need to have superior knowledge of
customers’ needs and increase their engagement with customers and firms to provide better
service for customers and better outcomes for the company. Thus, they need to think more
creatively and provide feasible options to help customers with purchase decisions and the
ability to identify and react to customers’ needs—even before customers verbalize them
(Homburg, Wieseke, and Torsten 2009; Wilder, Collier, and Barnes 2014). According to
Mumford (2000) and Dudeck and Hall (1991) the need of knowledge method is essential for
creativity, but employees must have required skills to apply the knowledge method to help
customers, as employees with greater repertoire of skill helps them to come with solution
faster.
Creative employees must tolerate ambiguity, be interested in earning, have
substantial self- confidence, and being open and flexible, be independent, follow their own
ideas without being concerned about social judgement and expectations for stereotype
behaviour (Barron and Harrington1981; Dudeck and Hall 1991).
Linking job engagement to employee creativity
Employee engagement can trigger and strengthen attitudes, behaviours, and outcomes
(MacLeod and Clark 2009). Specifically, engaged employees have a greater tendency to find
creative ways to do their job and be effective because they are willing to exhibit higher task
performance and stay at the organization longer to achieve its goals (Al Mehrzi and Singh
2016). These employees are more likely to be involved in discretionary behaviours that can
positively impact employee creativity and performance (Saks 2006; Shuck and Wollard
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2010; Stanley 2016). Employees engaged in work activities may generate various creative
ideas (Delery and Shaw 2001; Gilson and Shalley 2004; Hartel, Schmidt, and Keyes 2003).
Engaged employees find meaningfulness in their creative work that increases their job
satisfaction and job performance (Cohen, Carmeli, and Waldman 2009).
Frontline employees who need to be fully engaged with their tasks and improvise
creativity in the service delivery processes tend to experience uncertainty and unexpected
situations. For example, when customers experience product variety and acquire extensive
information about products or services, they may become confused, frustrated, and stressed
about their choice and the decision they need to make; the way frontline service employees
react and present the information increases customer satisfaction and the possibility of
purchasing the product (Huffman and Khan 1998). Consequently, frontline employees who
have a high level of engagement and enthusiasm for their work are aware of the uncertainties,
so they use their creativity to establish a better solution for customers to achieve
organizational financial success (Schneider, Macey, and Barbera 2009). Engaged employees
can improvise and use their creativity to find solutions for customers. They can then turn
unsatisfied customer into satisfied ones (Huffman and Khan 1998). Research shows that the
creativity of frontline employees influences customer satisfaction and loyalty as well as
service quality (Benjamin and Sopadjieva 2017). Accordingly, the following hypothesis is
constructed:
Hypothesis 1: Work engagement of frontline service employees is positively related to their
creativity.
Employee performance
Job performance refers to employees’ behaviour towards the organization, customers,
and co-workers to achieve organizational goals (Bettencourt and Brown 1997). Employee
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performance has two aspects: in-role and extra-role performance. In-role performance refers
to all the formal roles that employees are required to accept and perform once they start
working in the company. Therefore, it has significant impacts on the firm’s financial
outcomes (Mackenzie, Podsakoff, and Ahearne 1998). Extra-role performance is related to
not-prescribed job requirements that employees fulfil (Bettencourt and Brown 1997) and
extends to the broader knowledge of the job, such as prosocial behaviour (Mackenzie,
Podsakoff, and Ahearne 1998). Such behaviours, including cooperating with colleagues,
protecting organizations from unexpected events or dangers, participating in organizational
improvements, helping clients, and taking voluntary assignments (Brief and Motowidlo
1986), occur when employees are highly engaged with their job (Katz 1964). Employees’
extra-role performance can maximise full performance and achieve organizational goals
(Ariani 2013) by creating a positive organizational image (Aldrich and Herker 1977).
Borman and Motowidli’s (1997) taxonomy of the contextual performance model summarises
organizational citizenship behaviour (OCB) and prosocial organizational behaviour (POB).
They explain that the differences between OCB and POB are that POB can be in-role
performance or extra-role performance while OCB is extra-role performance. POB can be
negative for an organization; however, it can be positive for individuals. For example,
helping colleagues with their personal problems benefits individuals, but individuals may fail
to finish the task by the deadline. Borman and Motowidli’s taxonomy of the contextual
performance scale is taken from other studies and was reworked for their studies.
Employee creativity as a mediator in the job engagement and performance linkage
Both in-role and extra-role performance are important for firms seeking to improve
organizational effectiveness and financial success (Mackenzie, Podsakoff, and Ahearne 1998;
Vandaele and Gemmel 2006). Researchers have indicated a positive effect of job engagement
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on employee performance (e.g., Chughati 2008; MacLeod and Clark 2009; Ibrahim and
Falasi 2014; Shantz et al. 2013). Greater performance at work requires that employees not
only perform their prescribed day-to-day roles, but also take further steps to be engaged with
their job, going beyond their prescribed roles and out of their way to provide excellent
service. Engaged employees display less deviant behaviour; instead, they tend to behave in a
more positive way as they feel indebted to their organization. They are more obligated to do
their duties and perform better (Shantz et al. 2013).
Evidently, the positive relationship between employee engagement and job
performance has been well documented in the literature. Employees with a higher level of
engagement and whose job is a central tenet of their life tend to be more motivated to exert
their efforts to perform better (Chughati 2008; Mone et al. 2011; Truss et al. 2013). These
employees display more care and concern about their job, feel satisfied and good about
themselves and their job, and perform better (Kanungo 1982; Lodahl and Kenjer 1965). They
have strong beliefs in organizational values and goals and exert efforts to act on behalf of
their organization, which results in increasing job satisfaction and performance (Ibrahim and
Falasi 2014). Organizational performance can reach the highest levels not only when
employees perform their required tasks, but also when they are engaged in other behaviours
that go beyond their prescribed role (Katz and Khan 1978).
Nonetheless, the constructs’ relationships have seldom been examined simultaneously
in the service contexts. For example, Zhou and George (2001) chose 149 office employees
from a company that manufactures petroleum drilling equipment. The employees engaged in
all types of jobs (e.g., human resource generalist, product coordinator, marketing, engineer).
The questionnaire was distributed through a company mailing, and data were collected from
employees and supervisors. Zhou and George (2001) found that creativity is the result of job
satisfaction when expressing voice as an element of dissatisfaction exist. They further found
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that dissatisfied employees who are committed to the organization do not leave the
organization; rather, they remain and have the potential to use their creativity to express their
dissatisfaction to get positive feedback. In addition, receiving positive feedback increases
employees’ confidence that their creative ideas are supported and accepted by co-workers
and supervisors.
Scott and Bruce (1997) examined a sample of engineers, statisticians, and technicians
in a large centralized R&D facility of a major U.S. industrial corporation. Initially they
conducted interviews with the vice president and directors of R&D. Questionnaires were
conducted via company email to determine how employees view innovation and whether the
organization plays a role in improving the innovation process. Initially, 22 employees were
interviewed, but 189 questionnaires were received, which is an 85 percent response rate. The
second questionnaire was completed by all 26 managers. In this study, the authors developed
a model in which leadership, work group relations, and individual attributes would affect the
innovative behaviour directly and indirectly via climate perception. They found that
leadership, managerial role expectations, support for innovation, career stage, and systematic
problem-solving style were significantly related to individuals’ innovative behaviour.
Gong et al. (2009) examined an insurance company in Taiwan. The authors stated
that, although creativity was not related to one particular job, they examined only an
insurance company because their sales function and marketing provide a real-world
explanation of creative performance. Initially, they conducted a focus group to identify the
creative aspects of the job. Their main study design involved selecting 277 insurance agents
out of 554 on the list. The goal of this study was to identify the relationship between
employee creativity and performance in a corporate setting, define the effect of leadership on
employees’ learning orientation and creativity, and assess employees’ self-efficiency as a
mediator or employee learning orientation on employee creativity. In Taiwan, the motivation
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for self-improvement is higher and stronger than in Western countries, which was why the
authors focused on Taiwan. They have found that employees’ learning orientation is more
likely to improve their creativity. They also found that the mediating role of creative self-
efficacy will impact employees’ learning orientation and transformational leadership will
impact employees’ creativity.
Zeithaml, Parasuraman, and Berry (1990) maintained that job performance mostly
relies on frontline employees’ creative thinking and new idea generation to provide better
service to meet customers’ needs. Creativity is considered an individual personality trait that
an individual uses for problem-solving and that shapes the habit of thoughts and attitudes,
which then influences the individual’s performance (Baer 1991). Job performance indicates
individual and organizational success, and creative process engagement is the main
component of achieving high performance (Gilson, Shalley 2004; Ng et al. 2005). Being
engaged with work and the process of doing the task increases employees’ creativity because
it allows employees to think about and deal with tasks creativity to create better solutions to
the problem and novel ideas than can be useful for the organization (Zhang and Bartol 2010).
Engagement with a job that requires creativity means that employees must use their
knowledge and, skills; this will take more time and effort, which will lead to a higher level of
in-role performance (Du, Zhang, and Chen 2016). Providing support for employees, such as
giving them information, advise, and resources, increases employee job efficiency, which
helps activate employees’ creative process engagement to achieve high performance (Du,
Zhang, and Chen 2016). Job engagement is closely related to individual employees’ strong
commitment and responsibility for their performance (Du, Zhang, and Chen 2016).
Hypothesis 2: Employee creativity mediates the relationship between job engagement and
performance.
Moderating roles of job characteristics and nature
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Referring to the moderated mediating effects, there must be a partial effect of creativity as
mediator on the result or the partial effect of the creativity as mediator depends on job
characteristic and nature as a moderator, so in this condition there should be a complete
effect on creativity as mediator. Consequently, the moderated mediating effect explains the
indirect effect of moderate between the constructs can change the outcome (Muller, Judd, and
Yzerbyt 2005). The indirect effect of creativity on the job characteristics and performance is
seen using an intrinsic motivation point of view. When an employee is internally motivated
because of the job characteristics and job roles and nature, the employee will eventually be
internally motivated to further improve performance and to bring creativity in decision
making and application of processes (Oldham and Cummings 1996). The cognitive theory
aspect argues that the environmental factors control an employee’s performance (Shalley,
Zhou, and Oldham 2004). Out of all other job characteristics, autonomy has been studied
extensively in order to understand the impact of autonomy on internal motivation and how
the job characteristics can affect the creativity and performance indirectly. However,
According to Amabile et al., (1996 ) in their study explains the autonomy has less importance
in promoting employee creativity, though it largely impacts the performance. However, the
positive relationship of autonomous job role with creativity in work obtained in the study
highlights the thought process that in order to be creative and to improve performance the
employees need a significant amount of, prudence on the implementation of their tasks for
producing the innovative outcomes (Shalley and Gilson 2004). The front line employees need
to stay updated to attract the quality guests for their services, they are the faces of any
company and in order to channelize the people towards the company, they need to have a
voice in how they can bring value by changing things around. They need to venture into
bringing new, creative and innovative ideas (Coelho, Augusto, & Lages, 2011).
Furthermore, it seems possible that a job with variety of skills and roles might prove more
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inspiring which might allow the development of proficiencies, however, only if the diverse
skills are exercised within the job role regardless of the autonomous role. Autonomy has an
extensive impact on the identity. However, in case of low task identity, the relationship
between autonomy and creativity is unidentified (Bakker, 2011).
Employee creativity can positively affect job performance given certain conditions.
The characteristic has important impact on employee creativity.
According to Oldman and Cummings (1996), employees achieve a higher level of
creativity and performance when they have supportive supervisors and work on complicated
tasks. In other words, job that are more complex, meaning they are rich in identity, variety,
autonomy, and feedback, increase employee motivation and excitement for creativity
(Shalley, Zhou, and Oldham 2004). Oldham and Cummings (1996) claim that Job complexity
has significant effect on employee creativity. When employees have more complex and
challenging job rather than simple routine task, they have greater tendency to develop
creativity. For instance, frontline service employees have more chance of having direct
contact with customers, so, their job require more variety and skill compare to employee who
is working as a back office worker who has less interaction with customers (Oldham and
Cummings, 1996). Wang and Chen (2010) stated that employees with more job complexity
have higher level of creative role identity. Shally, Gilson, and Blum (2009) found in their
study operating a survey of 1430 workers in the Unites State that job complexity increases
employee creative performance.
Coelho and Augusto (2010) and Coelho, Augusto, and Lages (2011) also observed
that other characteristics, such as management practice, role stressor, variety, and feedback,
have moderating effects on the relationship between employee creativity and performance.
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In particular, frontline service employees are often required to be creative to perform
their jobs that are no routine and unstructured (Coelho and Augusto 2010). Frontline
employees are involved in dealing with customers with different needs and wants. Therefore,
they need to be able to discover customers’ needs better, and the job performance of such
employees is highly dependent on their ability to deliver quality service creatively, which is a
characteristic of frontline employees’ jobs (Coelho and Augusto 2010). As one of the work
environment dimensions, contextual job characteristics (e.g., time deadline and goals, work
setting configuration, relationships with co-workers, rewards, leaders, evaluation, and work
setting) potentially influence employees’ creativity (Shalley, Zhou, and Oldham 2004). Job
characteristics affect employees’ intrinsic motivation as individuals are excited about their
work and become engaged in the task not only for the sake of doing the task (Utman 1997).
For challenging work, employees need to invest more efforts into achieving self-satisfaction
and meeting organizational goals by accomplishing their tasks successfully (Orpen 1994).
When employees fulfil the difficult, complex job, they feel capable and valued. Therefore,
they are more likely to be motivated to do more tasks for the organization, which in turn
increases their identification, involvement with, and sense of belonging to the firm (Cohen,
Carmeli, and Waldman 2009).
Previous studies have shown that work characteristics are closely linked to employee
creativity and job performance (Scott 1996; Sim, Szilagyi, and Keller 1976). Schneider and
Bowen (1985) stated that delivering the service occurs when customers are in contact with
employees; thus, employees’ attitudes (service encounter) influence customers’ perceptions.
Employees’ attitudes towards customers are essential because if customers experience
positive emotion they will be content, happy, impressed, and pleased; if they experience
negative emotions with the poor service, they will be disgusted, frustrated, disappointed, and
angry (Lovelock, Patterson, and Wirtz 2011). Thus, customers’ experience is important
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because consumers will remember any memorable experience, which can build or destroy the
trust between the company and its customers (Lovelock, Patterson, and Wirtz 2011).
In the context of services, some jobs require more creativity and engagement than
others, depending on the degree of customer contact. For example, high contact services
(e.g., hairdressers, education, and medical services) include jobs in which customers are very
involved with organizations and are in contact with service organizations in person
(Lovelock, Patterson, and Wirtz 2011). On the other hand, low contact services such as home
shopping through the internet requires employees to provide very limited physical contact.
The greater the personal interaction and customization are in the service delivery, the greater
engagement and creativity the job requires.
Therefore, it is presumable that the linkage of employee creativity to job performance
is subject to the nature of the job. Employees may often use their creativity to perform their
job and find a better solution to solve problems, thereby increasing the levels of effectiveness
and efficiency (Reaves 2015; Shalley 2008). Although job performance and employee
creativity are closely linked in many cases (Reaves 2015), some jobs require more creativity
than others.
Hypothesis 3a: Job characteristics (the degree of customer contact) moderate the
relationships between employees’ creativity and job performance.
Moderating effect of service climate in the employee engagement–performance linkage
Moderated mediation effect of employee engagement and performance In the study
conducted by Saks and Robinson the findings show that employee engagement is closely
linked to the innovative and creative behaviour of employees. According to the study is has
been identified that the frontline employees being engaged to their work adds value to their
performance and job role. Furthermore, the study demonstrates that the job role, job
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autonomy, and strategic attention are all significantly related to employee engagement. It has
been studied from the literature review that it is the duty of the managers to create and
manage an engaged workforce (Korschun, Bhattacharya, & Swain, 2014). Therefore, it is
crucial for the managers to note that engagement is a chief driver of innovative behaviour.
For frontline managers to perform efficiently and effectively by engaging themselves in their
job roles and characteristics and it has been said, that the employee engagement is the base
for improved employee and organizational performance and creativity (Saks, 2006; Robinson
et al., 2004). Another study reveals that there is a relationship between the employee
engagement and employee creative and innovative behaviour. It was concluded that it has a
significant percentage of impact that is 37.7 percent on the performance and creativity
(Slåtten, & Mehmetoglu, 2011). The results of the study show and supports the theory of
broadening and build. This theory states that if a person has a positive state of mind, it will
broaden the person’s thoughts as well, which will have a mediatory impact on the
performance (Miles, 2000; Wong and Ladkin, 2008).
Organizational culture is defined as the system, ensuring that individuals within the
organization have mutual communication and understanding of its shared values, beliefs, and
norms (Matins and Terblanche 2003). Every organization has a different culture, and its
leaders are responsible for creating a work environment in which employees are engaged
with their work (Taylor 2017). Organizational culture is a useful tool not only for learning
and improve employees’ skills, but also valuing, trusting, and supporting employees (Levine
2017). Organizational culture has a positive influence on employee productivity (Martins and
Terblanche 2003; Martin, and Siehl 1990) because trust, integrity, knowledge about work,
the right people, better use of skills, good teamwork, and work orientation shared between
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individuals can be seen as the right organizational culture (Akin and Hopelain 1986; Jossy
2007).
Service climate is the organizational culture in which individuals share views and
perceptions about organizational practices, policies, and procedures that are expected,
supported, and rewarded and that impact employees’ involvement and commitment (Holt
1993; Patterson, Warr, and West 2004; Schneider, White, and Paul 1998). Employees’ shared
values, norms, beliefs, and behaviours as well as a supportive and flexible team are some
examples of service climate (Johnson 1996; Jong, Ruyter, and Lemmink 2004).
Service climate is critical for boosting creativity, engagement, and performance. To
enhance creativity, it is important for the firm to have a service climate encouraging support,
freedom, challenge, openness, and tolerance of uncertainty (Ekvall and Ryhammar 1999).
Service climate also influences organizational outcomes (Amabile et al. 1996; Ekvall and
Ryhammar 1996; Ismail 2005). Lin and Liu (2012) found that supervisory encouragement,
work group support, sufficient resources, and challenging work are the stimulating factors
supporting creativity and performance in a service climate.
Frontline service employees are responsible for the delivery of excellent services and
engage in some discretionary behaviour as necessary, thereby representing organizational
climate to their customers (Boshoff and Allen 2000). Some performance task-required
deadlines and motivation give employee’s direction for drawing up a plan in a supportive
service climate, where employees are empowered, rewarded, and inspired; as a result,
frontline employee performance increases and they can give customers the best possible
service (Hui et al. 2007). The service climate should assist employees by providing training
and information to employees to display excellent performance (Schneider, White, and Paul
1998).
Employee Empowerment as an important factor in service climate
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People usually desire to have control over the situations, their own physical, and
social environment (Burger 1992). A strong service climate is more essential in service
organizations than in manufacturing organizations because service organizations’ workers
operate on their own, they have a face to face relation with customers, thus, it is impossible
for managers to observe and correct the service workers (Schneider and Bowen 1995).
Bowen and Lawler (1992) claim that service climate of organization must allow service
workers’ independence as the performance of their job increase. Organization to a higher
level of service climate give authority to service workers to exercise self- direction and self-
management in different situations (Yagil and Gal, 2002). Kelly (1993) urges that a strong
service climate or organizational culture conveys employees to the proper means of task
performance while weak organizational culture manages service encounter through
bureaucratic rules and decrease service encounter control (Bateson 1995). Service workers
give better service, and satisfy customers more than they have some control (empowered)
over service encounter and customers are more satisfied when their problems can be solved
over service encounter and meet their needs (Bateson 1985). Stewart et al. (1996) states that
service workers who were trained for self-direction have better results in performance of low
consciousness.
Empowerment needs employees to engage in discretionary behaviour in an effort to
help customers meet their expectations during routine and non-routine conditions (Klidas,
Berg, and Wilderson 2007). Empowerment gives employees the authority to be independent
when it comes to decision making, taking the initiative, and being creative (Klidas, Berg, and
Wilderson 2007). Examples include taking immediate action to solve a customer’s complaint
even when the complaint is not related to the area of employees’ responsibility, making
financial decisions (e.g., giving customers a discount), using creativity, and doing whatever it
takes to enhance customer satisfaction (Brymer 1991; Jones, Tylor, and Nickson 1997;
21

Lashley 1997). According to Bowen and Lawler (1992), the benefit of empowering
employees is that customers want quick responses to their issues and do not really want to
hear that something is “against the rules”; therefore, empowering employees increases the
chances of a situation in which spontaneous, creative rule-breaking occurs that can turn an
angry and frustrated customer into a satisfied and content customer. Stander and Rothmann
(2010) identified a significant relationship among employee empowerment, job security, and
engagement. Empowering employees decreases stress and increases innovative behaviour,
leading employees to believe in themselves and increasing their engagement at work. Yao,
Chen, and Gouliang (2013) found that empowerment has a significant positive effect on
employees’ task performance and loyalty, mediated by employees’ satisfaction.
Hypothesis 3b: Service climate moderates the relationship between employee engagement
and job performance.
Theoretical and managerial implications
Service employees or frontline employees are critical assets to the organization
because they have a direct relationship with customers and can influence customers’ loyalty
and perception about the organization. Frontline employees’ creativity and engagement are
essential, especially if the job requires more creativity and engagement, because they have a
significant impact on performance. Many jobs require creativity, whether they are small
firms or big; they still need to use employees’ creativity to address any uncertainty that
happens in the workplace. Thus, providing better employee training, encouraging and
motivating them to be engaging and creative in their workplace, increases the chance of
achieving organizational profit and goals. Employees’ opinions about the organization’s
service climate influences consumers’ opinions about the quality of service, thus, customer
22

behaviour for the quality of service and their purchase behaviour are related to employees’
opinion about the service climate (Soterious and Zenios 1999). Consequently, the service
climate is important for tying the employees to the organization and enhancing employees’
engagement, creativity, and performance.
Conclusion
Employee creativity and engagement and their job performance are important for
firms to survive in today’s volatile, complex, competitive, and dynamic marketplace.
Successful firms tend to foster an environment in which creative behaviour and job
engagement are stimulated and supported (Stanley 2016). Despite the importance of
employee creativity and engagement in achieving job performance at a workplace, previous
studies have overlooked how these two constructs together affect employee performance in
the context of services. Nevertheless, little is known about whether their relationships are
subject to the level of service encounter (high versus low customer contacts). In this sense,
this investigation is timely and important for managers striving to enhance frontline
employees’ job performance.
Engaged employees tend to have greater motivation to achieve organizational goals
because their job is the center of their lives; if employees are satisfied, they are more willing
to exert effort to perform on behalf of the organization. Being engaged, motivated
psychologically, and encouraged, employees tend to become more creative and perform
better to gain organizational profit and customer satisfaction. Employee engagement,
performance, and creativity flourish under the right conditions, such as organizational culture
and climate. In an appropriate and healthy culture and climate, empowered frontline
employees will be better able to help customers, especially those having a harder time, than
employees who are not empowered because they feel less responsible.
Recommendation and future research
23

This paper is conceptual paper, therefore for future study, we recommend to test this model
and investigate whether the hypotheses of this study are accepted or not. We believe culture
of the company affects the relationship between employees and customers, how cultural
differences can change the result of this study. In the study conducted through review
research, the importance of creativity is discussed along with the mediating impact of
creativity on the performance. If the company culture shifts to a more collaborative type, it
will all be about the self expression, the leaders, however, will permit and appreciate their
followers’ creativity and out of the box thinking (Mark, 2018). If the culture shifts to
competitive organizational culture, for employees in this type of culture, winning becomes
utmost important. The results such as bringing creativity for overall development will change
to bringing creativity in their own work to achieve their own success than by using the
creativity to improve the overall work culture and environment to help everyone improve
upon their productivity and performance. The leaders, however, will focus on team
achievements as well. If the organization has a controlled culture, it demands the right order
and alignment of item basis the clear objectives and instruction, in this type of culture there is
a lesser room for personal creativity the moderating effect of strictly abiding by the rules and
stated goal sheets on the employee performance will be there (Branislav, 2017).
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