Purpose

Integrating the behavioral theory of leadership, the componential theory of creativity and the self-determination theory (SDT), the study tests the relationships between leadership, work motivation (intrinsic motivation, integrated extrinsic motivation, extrinsic motivation) and employee-level innovation (innovative work behavior and innovation outcomes) in a work setting.

Design/methodology/approach

Data were collected using a survey questionnaire from 493 scientists working in India's largest civilian research and development (R&D) organization. The structural equation modeling (SEM) method was used to test the hypothesized relationships between the study variables.

Findings

The study found evidence for positive relationships between leadership, employee autonomous motivation (intrinsic and integrated extrinsic motivation) and employee-level innovation. The study shows that extrinsic motivation is positively related to innovation only when the value of rewards is integrated to one's sense of self (integrated extrinsic motivation). Extrinsic motivation, otherwise, is not related to innovation.

Research limitations

The study was cross-sectional, so inferences about causality are limited.

Practical implications

First, while extrinsic motivation is considered bad for innovation, the study provides evidence that integrated extrinsic motivation complements intrinsic motivation and encourages employee-level innovation. Second, the study shows that leaders can aid the process of development of autonomous motivation by displaying positive behaviors. Third, the study validates the mediating role of autonomous motivation for the leadership–innovation relationship.

Originality/value

The study provides an insight into the underlying process through which leaders can impact innovation at the workplace. To the best of the author's knowledge, such a study is the first of its kind undertaken in an organizational context.