The Effects of Innovation Climate on Employee Job Satisfaction and Affective Commitment: Findings from Public Organizations

Published date01 March 2023
Date01 March 2023
Subject MatterArticles
Review of Public Personnel Administration
2023, Vol. 43(1) 130 –158
© The Author(s) 2021
Article reuse guidelines:
DOI: 10.1177/0734371X211043559
The Effects of Innovation
Climate on Employee Job
Satisfaction and Affective
Commitment: Findings
from Public Organizations
Mehmet Akif Demircioglu1
This article tests the effects of innovation climate on two major employee attitudes,
employee job satisfaction and affective commitment, using 2017 Australian Public
Service Commission (APSC) data (n = 83,943). The Australian Public Service (APS)
is a suitable context because the APS prioritizes and is con cerned with b oth
innovative activities and employee attitudes (e.g., job satisfaction and affective
commitment). To develop hypotheses, this study applies insights from different
theories, including perceived organizational support (POS), self-determination
theory (SDT), empowerment, employee engagement, and job engagement. The
empirical results of the structural equation models (along with robustness checks)
demonstrate that innovation climate has a statistically significant and positive
effect on both job satisfaction and affective commitment and that job satisfaction
positively mediates this relationship. For policy makers, these findings suggest an
innovation climate can be an important tool to increase employee job satisfaction
and commitment.
public sector innovation, innovation climate, affective commitment, job satisfaction,
public organizations
1National University of Singapore, Singapore
Corresponding Author:
Mehmet Akif Demircioglu, Lee Kuan Yew School of Public Policy, National University of Singapore,
469C Bukit Timah Road, Oei Tiong Ham Building, Singapore 259771.
1043559ROPXXX10.1177/0734371X211043559Review of Public Personnel AdministrationDemircioglu
Demircioglu 131
The expanding knowledge base on public sector innovation suggests innovative activ-
ities in public organizations can play an important role in government, society, and
business. Innovation can increase public organizations’ legitimacy, trust, and effi-
ciency. In addition to improving efficiency and organizational processes, innovation
can be a remedy for macro-economic issues and may have positive spillover effects to
other sectors, such as increasing the competitiveness of the private sector through
changes in government processes (see Borins, 2014; Demircioglu & Audretsch, 2017;
de Vries et al., 2018; Kattel et al., 2013; Leyden & Link, 1992; Moore, 2005; Newnham,
2018; Walker, 2014; Wipulanusat et al., 2018).
At the organizational level, as Nasi and colleagues state, innovative activities in
public organizations are crucial because public agencies need “to cope with wicked
societal challenges and an increasing demand for high-quality public services, while
facing a reduction of available resources” (Nasi et al., 2015, 111). Recent systematic
reviews for public sector innovation (e.g., de Vries et al., 2018) and barriers to innova-
tion (Cinar et al., 2019) reflect the importance of innovative activities in public orga-
nizations, as innovation increases organizational performance. Nevertheless, a crucial
gap in these studies is that innovation, or innovative activity, is studied as a behavior
in terms of implementation but not as an attitude in terms of the climate of innovation,
which is more associated with studies of organizational behavior (OB) and human
resource management (HRM). More specifically, a major gap in the literature is that
studies of innovation do not typically link to work in OB and HRM. This study, in
contrast, analyzes the effects of innovation climate on two major employee attitudes
central to HRM: employee job satisfaction and affective commitment.
There are different understandings and thus measures of innovative activities in the
public sector. For example, research has focused on a variety of innovative activities,
including open government innovations (e.g., Grimmelikhuijsen & Feeney, 2017;
Hameduddin et al., 2020; Mergel & Desouza, 2013), social media use in governments
(Demircioglu, 2018; Fusi & Feeney, 2018; Oliveira & Welch, 2013), and public sector
entrepreneurship (Singla et al., 2018); specific types of innovation such as process
(e.g., Walker, 2014) and technological innovation (e.g., Welch & Pandey, 2005); and
differences between radical and continuous innovations (Moore, 2005) in the public
The focus of this study is on innovation climate, a concept distinct from other
innovative activities1 (e.g., the adoption of innovations such as open government
innovations). Innovation climate is an employee attitude or employee perception of
organizational and leadership support for innovation, as well as whether employees
are encouraged, inspired, and recognized for coming up with new ideas (Demircioglu
& Berman, 2019; Lee et al., 2014; Popa et al., 2017; Ren & Zhang, 2015). Innovative
activities and different OB and HRM practices are highly related, such that effective
leadership, commitment, and inclusion can positively impact employees’ innovative-
ness (Brimhall, 2021) and innovation climate (Ashikali et al., 2020). Innovative activi-
ties can also impact HRM practices such as employee empowerment, employee

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