PEER EVALUATION OF RESEARCH STUDY

BY Dr. SHAHID MALIK

TITLED DO EMPLOYEE PARTICIPATION PROGRAMS IMPROVE

PRODUCTIVITY IN AMERICAN MANUFACTURING FIRMS?

By Dr.Shahid Hussain MALIK PhD(Unisa),M.Mgt(UWS),MBA(UTS),M.A

Admin(Unisa)

Ackowledgements 1

Summary 11

CHAPTERS Page No

Chapter 1

INTRODUCTION 1

Chapter 2

RESEARCH ISSUES & LITERATURE REVIEW 14

Historic antecedents 14

What is empowerment 21

Performance outcomes of empowerment 23

Contemporary challenges in empowerment 31

Emerging issues in empowerment practices 39

Role of empowerment initiatives in decision making 46

Key components of empowerment 52

Leader’s role in creating an empowered culture 54

Strong cultures and empowerment 58

Training and development opportunites for empowered

employees 66

Power and empowerment 73

Need for further research 80

Critical cultural precondition 92

Belief and trust in empowerment 96

Conclusion 104

CHAPTER 3

Case 1

Pacific Gas & Electric 105

Case 2

Empowerment process at Wiggins 114

Case3

Team approach at Corning plant in Blacksburg 119

Case4

Empowerment approch at Tennalum Aluminium 124

CHAPTER4

Theory and hypotheses 129

Antecedents of team empowerment 129

Supervisory support 129

Supportive organizational environment 132

Delegation of operational & strategic responsibilities 133

HR policies construct 135

Socio-political support 133

PERFORMANCE OUTCOMES OF EMPOWERMENT

Productivity 138

Proactivity 139

Customer service 139

Job satisfaction 140

Organizational commitment 140

Hypothesis 1 141

Hypothesis 2 142

Hypothesis 3 142

Hypothesis 4 142

Hypothesis 5 143

Conclusion 144

CHAPTER 5

Methodology 145

Sample 145

Measures 146

Independent variables 146

Dependent variables 149

Analytical procedures 152

Confirmatory factor analysis (CFA) 153

Structural equation modelling (SEM) 154

Limitations 154

Results 159

CHAPTER 6

Conclusion 163

Major findings 163

Theoretical implications 165

Managerial implications 169

Contribution to the existing literature 174

Implications and future research issues 180

LIST OF TABLES

TABLE NO PAGE NO

1.1

Benefits associated with empowerment dimensions 185

1.2

Positive results of empowered teams 186

1.3

Comparison of empowered teams and traditional

workgroups 187

1.4

Empowerment features (set of hypotheses) 188

2.1

Behavioral and attitudinal consequences of

empowerment 191

Empowerment interventions

2.2

Systematic empowerment interventions 193

2.3

Structural empowerment interventions 194

2.4

Programmatic empowerment interventions 195

2.5

Comparative analysis of new trends in participative

and old culture 197

2.6

Organizational change 199

2.7

Causes of resistance to change in organizations 200

2.8

Assumptions underlying the participative process 201

5.1

Industries sampled 206

5.2

Results of the measurement model of the independent

variables 207

5.3

Nested measurement model of the independent variables 209

5.4

Descriptive statistics and correlation 210

5.5

Full sample regression analysis: empowerment dimension

variables regressed on performance outcome model 228

LIST OF FIGURES

FIG NO PAGE NO

1.1

Empowerment dimensions 189

1.2

Empowerment dimensions & performance outcomes 190

2.1

Essential ingredients of empowerment 192

2.2

Process empowerment model 196

2.3

Process for enacting the empowerment process 202

2.4

Performance output model of empowerment 204

4.1

Performance outcomes 205

5.1

Performance outcomes 229

5.2

Structural equation modelling 230

Acknowledgments V11

Summary V111

CHAPTERS Page No

Chapter 1

INTRODUCTION 1

Chapter 2

RESEARCH ISSUES & LITERATURE REVIEW 14

Historic antecedents 14

What is empowerment 21

Performance outcomes of empowerment 23

Contemporary challenges in empowerment 31

Emerging issues in empowerment practices 39

Role of empowerment initiatives in decision making 46

Key components of empowerment 52

Leader’s role in creating an empowered culture 54

Strong cultures and empowerment 58

Training and development opportunities for empowered

employees 66

Power and empowerment 73

Need for further research 80

Critical cultural precondition 92

Belief and trust in empowerment 96

Conclusion 104

CHAPTER 3

Case 1

Pacific Gas & Electric 105

Case 2

Empowerment process at Wiggins 114

Case3

Team approach at Corning plant in Blacksburg 119

Case4

Empowerment approach at Tennalum Aluminium 124

CHAPTER4

Theory and hypotheses 129

Antecedents of team empowerment 129

Supervisory support 129

Supportive organisational environment 132

Delegation of operational & strategic responsibilities 133

HR policies construct 135

Socio-political support 133

PERFORMANCE OUTCOMES OF EMPOWERMENT

Productivity 138

Proactivity 139

Customer service 139

Job satisfaction 140

Organizational commitment 140

Hypothesis 1 141

Hypothesis 2 142

Hypothesis 3 142

Hypothesis 4 142

Hypothesis 5 143

Conclusion 144

CHAPTER 5

Methodology 145

Sample 145

Measures 146

Independent variables 146

Dependent variables 149

Analytical procedures 152

Confirmatory factor analysis (CFA) 153

Structural equation modelling (SEM) 154

Limitations 154

Results 159

CHAPTER 6

Conclusion 163

Major findings 163

Theoretical implications 165

Managerial implications 169

Contribution to the existing literature 174

Implications and future research issues 180

LIST OF TABLES

TABLE NO PAGE NO

1.1

Benefits associated with empowerment dimensions 185

1.2

Positive results of empowered teams 186

1.3

Comparison of empowered teams and traditional

workgroups 187

1.4

Empowerment features (set of hypotheses) 188

2.1

Behavioral and attitudinal consequences of

empowerment 191

Empowerment interventions

2.2

Systematic empowerment interventions 193

2.3

Structural empowerment interventions 194

2.4

Programmatic empowerment interventions 195

2.5

Comparative analysis of new trends in participative

and old culture 197

2.6

Organizational change 199

2.7

Causes of resistance to change in organizations 200

2.8

Assumptions underlying the participative process 201

5.1

Industries sampled 206

5.2

Results of the measurement model of the independent

variables 207

5.3

Nested measurement model of the independent variables 209

5.4

Descriptive statistics and correlation 210

5.5

Full sample regression analysis: empowerment dimension

variables regressed on performance outcome model 228

LIST OF FIGURES

FIG NO PAGE NO

1.1

Empowerment dimensions 189

1.2

Empowerment dimensions & performance outcomes 190

2.1

Essential ingredients of empowerment 192

2.2

Process empowerment model 196

2.3

Process for enacting the empowerment process 202

2.4

Performance output model of empowerment 204

4.1

Performance outcomes 205

5.1

Performance outcomes 229

5.2

Structural equation modelling 230

ACKNOWLEGEMENTS

I convey thanks to the staff at New South Wales Government

library who helped me in finding journals, articles and

newspapers which were helpful in my research. At the same

time help desk staff at the IT section assisted me in every

possible way to use the technology in an efficient manner.

Last, but not the least I thank my wife who provided much

needed comfort and relief and helped me to forget my recent

family tragedies.

SUMMARY

Empowerment is a multi-dimensional concept. It can lead to

both attitudinal and behavioral changes in employees. These

changes resulting from empowerment include increased job

satisfaction, organizational commitment, increased customer

service, increased productivity and proactivity. This study

permits the examination of the relative strength of

predictors drawn from competing theories of the

effectiveness and explore a relationship between various

dimensions of empowerment and performance outcome model.

Findings which resulted from this study suggest some

important implications for practitioners interested in

designing effective empowerment practices for optimum

performance outcomes. The research on participative

management has been fairly consistent in reporting

beneficial outcomes. These outcomes seem to have been

confirmed over time and in a variety of settings. This

increasing interest in participative management combined

with the apparently inconsistent results reported in the

extant literature suggests the need for continued efforts

to clarify existing relationships.

I hope, from this perspective this study makes a number of

important contributions to the literature on empowerment

and its relation to performance outcomes. This study

develops and tests a comprehensive, theory-driven model of

team effectiveness. The use of five dependent variables

permits to examine the differential effects of the

predictor variables as well as the interrelationship among

the dependent variables. Thus, a key contribution of this

research is that it simultaneously examines a more complete

set of independent and dependent variables, thus minimizing

the potential for biases.

INTRODUCTION

The inability of traditional bureaucratic organizations to

face the new competitive realities that confront many

American industries is well documented (Mills, 1991).

Traditional management styles slow down decision making and

make it risk averse (Mintzberg, 1979). This can be fatal in

a hyper competitive environment, where the window of

business opportunity is open but briefly and there is

seldom room for a follower (D'Aveni, 1994).

A plethora of new organizational practices have been

suggested to cope with the increasingly global and

hypercompetitive environment that confronts many

businesses. They are called variously by names such as

'infinitely flat', 'spider's web', or 'inverted' (Quinn,

1992); and 'shamrock' (Handy, 1990).

Empowerment initiatives in many contemporary organizations

specially in manufacturing organizations are fast becoming

the corporate catch phrase of the 1990s, because

corporations want to survive in a globally competitive

environment. Empowered work teams have been credited with

saving hundreds of millions of dollars, achieving

conceptual breakthroughs, and introducing an unparalleled

number of new products. For further details refer to table

1.1.

Flanagan (1994) demonstrates that empowerment practices led

to improvement in employee productivity, efficiency,

quality, and a steady stream of innovations at the IBM

plant in Lexington. For further details refer to table 1.2.

Employee empowerment is the concept of subordinates having

the authority and capacity to make decisions and act for

the organization so that individual motivation and

organizational productivity are improved. Thus, empowerment

is more than just the delegation of authority; it possesses

the essence of motivation and self-actualization. It is a

process of enhancing feelings of self-efficacy among

organizational members through the identifications of

conditions that foster powerlessness and through their

removal by both formal organizational practices and

informal techniques of providing efficacy information.

Employee empowerment did not become a business concern in

the U.S. until the 1960s and 1970s. It is now widely

believed that empowerment is a competitive necessity.

Unpredictability in the global marketplace, and the

accelerated speed of change have made attention to quality,

productivity, and customer satisfaction a necessity. Such

an environment calls for a more dynamic, adaptable, and

creative system. Empowered teams are expected to lead to

improved working conditions, greater opportunities for

expression and self-development, as well as increased,

organizational commitment, job satisfaction, proactivity,

customer service, quality, and cost reduction.

It is widely believed that when employees are involved in

the creation and progress of their operations, they are

more interested in their jobs. Also, they are more likely

to remain involved and committed to their work. This

creates a work environment where the employees know their

mission and have a vested interest in its success. A

comparative analysis between traditional work groups and

empowered teams is presented in table 1.3.

Studies support the common belief that empowerment programs

generally improves organizational effectiveness. Sirkin

(1993) argues that empowered teams can produce greater

satisfaction, reduced costs, faster and better decision-

making. There are many sound business reasons for

organizations to adopt the empowerment initiatives.

Although empowerment driven programs have long lists of

possible benefits, they can have some limitations. The

first is a shortage of planning and time consideration due

to unrealistic expectations. Empowerment may often fail

because people expect to see results without investing time

and effort into the team. In table 1.4 some hypotheses are

presented as to why some empowerment initiatives fail?

Another limitation is poor judgment or abuse of authority

exhibited by some employees. Empowerment may not always be

the best approach for an employee who has poor decision-

making skills or who lacks keen judgment, for it could lead

to bad decisions or wasted time. Employees may also have

trouble defining the limits of their authority, which can

lead to even greater problems.

Lack of employee motivation can be a big problem when

empowerment is implemented. Not all employees make good

team players. If there is an outsider or misfit in the

group, it may be difficult to build trust and function

smoothly. Other employees may not want to be empowered. If

they are used to reporting to a member of higher

management, they may not want more responsibility or what

seems to be a heavier workload.

Employees may also fear that the new strategies are only a

fad and that they will disappear as other management

strategies have in the past. Employees with this attitude

are often reluctant to put the time and effort needed into

the implementation of the new strategy. Many US companies

that have implemented empowerment practices have learned

that these programs are long-term strategies. Other

limitations include resistance to change, costly mistakes,

and the tremendous amount of time involved in planning,

implementing, directing, and controlling.

Empowerment practices, with their promises of higher

performance, lower costs, greater employee satisfaction,

organizational commitment and customer satisfaction have

become very attractive to businesses. These designs are so

attractive, in fact, that the concept now runs the risk of

becoming a fad as companies implement empowerment

strategies without adequate preparation or continuing

support. Failures of employee empowerment initiatives in

many organizations have made it clear that the concept

should no longer be considered as a simple set of tools or

practices.

United States business leaders are realizing, to a greater

extent than ever before, that they must take decisive

action to preserve their position as a world supplier of

goods and services. Increasing numbers of firms are

revamping their management styles and work processes in

favor of those more effective in meeting the needs and

expectations of customers. The topic of employee

empowerment has been one of much discussion, including the

effects of its implementation on managers and employees.

For decades following their introduction in 1911, Frederick

Taylor's principles of Scientific management dominated

worldwide thinking about how organizations should be

managed. U.S. organizations adopted these principles with

great success. The crux of Taylorism is that it places

authority and decision making at the highest levels of the

organization while requiring lower-level employees to

perform, not think. During the 1950s and 1960s, U.S.

organizations, because of their effectiveness, were viewed

by some Europeans as a major competitive threat. The fear

was that American manufacturing organizations would

dominate world markets because their management skills,

which were based on Taylorism, were far superior to those

of European managers (Servan-Schreiber, 1968).

There were, however, critics of the traditional American

approach to management. Some of the criticism came in the

initial form of research such as the landmark work by Trist

and associates at the Tavistock Institute of Human

Relations in London (Trist, Higgin, Murray, & Pollock,

1963). Their work was the foundation for sociotechnical

systems theory which is based on a set of principles that

seeks to optimize both the social and technical components

of work systems.

Another early critic was Likert (1961) who emphasized the

negative social consequences of giving people simplified,

standardized jobs and no voice in the management of their

work. It wasn't until the mid-to-late 1970s that U.S.

manufacturing corporations started experimenting with

various forms of participation. Global competition of the

1980s served as one of the major impetuses for the adoption

of participative management systems in the U.S specially in

the US manufacturing firms.

Currently, U.S. firms are implementing many forms of

participation ranging from employee survey feedback to

self-managed work teams to high involvement plant design.

Thus far, participative techniques appear to be producing

favorable results for quite a number of U.S. companies.

Likert's (1976) theory of management systems strongly

suggests that a participative management system will be

accompanied by productivity. This general relationship is

also supported by other U.S.-based theories (e.g., Locke,

Schweiger, & Latham, 1986; Cotton, Vollarth, Froggatt,

Legnick-Hall, & Jennings, 1988). While the research to date

demonstrates that participation has a positive impact on

job satisfaction (Miller & Monge, 1986; Wagner III &

Gooding, 1987) and attitudes toward work (Leana, Ahlbrandt,

& Murrell, 1992), the conclusions about its impact on

productivity are equivocal (Graham & Verma, 1991; Luthans,

Kemmerer, Paul, & Taylor, 1987; Welsh et al., 1993).

Similarly, empowerment is also becoming a central element

of most modern quality improvement efforts. The issue of

employee involvement in change processes has a long history

in the study of organizations as well as in the literature

on management. There is an ongoing debate on political

aspects of participative processes. One of the most central

questions is, of course, whether it can be proven that

particpative practices are effective (Cole, Bacdayan, dc

White, 1995, Naschold, Cole, Gustavsen, & van Beinum, 1993;

Wagner, Leana, Locke, & Schweiger, 1997). Employee

empowerment in decision making as a means of improving

performance has been studied by behavioral scientists for

several decades. In the United States, there has been a

long and extensive debate on the question of whether or

not, or under which circumstances, one finds different

outcomes of employee involvement (Cotton, Vollrath,

Froggatt, Lengnick-Hall, & Jennings, 1988; Leana, Locke, &

Schweiger, 1990).

Bacharach and Lawler (1980) argue that all hierarchies of

authority, centralized or decentralized, unleash tendencies

toward the formation of coalitions. In the absence of

authority various workgroups make coalitions and bargain

politically to shape the flow of problems, solutions, and

choice opportunities. New forms of political behavior open

up access to power. Similarly Mintzberg (1983), contends

that few organization can survive very intense, highly

pervasive and lasting conflicts. It is sometimes difficult

to establish what is in the best interest of

organanization. Goal consensus may not be achieved easily

and quickly in empowered groups. To achieve this everyone

should be working towards the same or at least compatible

ends. People are present in organizations for a range of

purposes, both common and competing. Rarely, one would find

an organization where everyone can always seek to achieve

uniform goals. Horizontal conflicts or conflicts between

two groups who have equal access to power can become more

intense when their interests are at stake. In empowered

organizations there are more points of access to power as

compared to standard hierarchical organizations where the

decision making authority rests with top echelons.

The idea that increased empowerment and employee

involvement leads to greater worker satisfaction is a well

established notion in much of management literature

(Argyris, 1964; Likert, 1967. Similar reservations are

raised by Wall and Lischeron (1977) and O’Brien (1987).

However, empowerment of employees in decision making

process is not a guarantee of their influence if the final

decision is taken by top management. Those responsible for

organizational policy wish to make better use of existing

experience or competence, then decision making practices

have to allow employees to exert influence. There has been

a prevalent assumption in the literature that empowerment

is a way of reducing conflict. However, as Heller et al.

(1988) assert, this is not nearly as evident or

generalisable as such authors assume. Employee involvement

through empowerment process opens up the possibility for

alternative views to be presented and different experiences

to enter the discussion and this can lead to disagreement.

It is generally agreed that disagreements to some extent

improve the quality of the final outcome of the decision

process. However, this should not be interpreted as

implying that the articulation of and consideration of

alternative views lead to a resolution that always

satisfies all parties.

Indeed, there is a school of thought which argues that

increased worker participation actually reinforces and

magnifies management control (Maulder and Wilke, 1970;

Ramsay, 1977, 1986). Mulder and Wilke present conclusive

evidence that under certain conditions-specifically where

there is an unequal spread of expert knowledge-more

participation results in increased susceptibility of

subordinates to the influence and arguments of superiors.

Organizations should be understood as consisting of

shifting coalitions that form and reform around issues of

concern to them. The goals of the organization are in fact

the goals of coalitions (Lupton 1971). In an empowered

organizations these goals can be easily challenged by other

powerful coaliations.

Organizational democracy, power, involvement,

participation, and more recently empowerment are among the

terms used to describe a variety of organizational

practices in interpersonal and hierarchical relationships

and other structural arrangements. A considerable number of

theoretical schemas have evolved to describe and define

these terms.

Several reasons are generally put forward in support of

participative practices. They are supposed to induce job

satisfaction, increase employee loyalty, lead to higher

productivity, and reduce resistance to change. Except for

job satisfaction, the evidence in support of these

contentions is not very strong (Wagner & Gooding, 1987),

and ever since the Bank Wiring Room experience in the

Hawthorne studies, there is evidence that job satisfaction

may be associated with complacency and low productivity.

Experiments have shown that cooperative and competitive

goals affect power dynamics of managers and employees.

Using a variety of operations and samples in both the

United States and Canada, researchers have found that,

compared with competitive goals, cooperative goals induce

higher expectations of assistance, more assistance, greater

support, more persuasion, less coercion, and more trusting

and friendly attitudes in leader relationships (Tjosvold,

1981, 1985a, 1985c; Johnson, & Johnson, 1984). However it

should be kept in mind that theories developed mostly in

large U.S and Canadian settings cannot be assumed to apply

in diverse cultural settings especially in societies where

the values and beliefs of followers very much affect

success (Adler, 1983; Hofstede, 1993).

Colette Murphy and Doug Olthuis concluded through their

extensive survey at major U.S. corporation that empowered

workers actually reported less cooperation as compared to

teams working within traditional managerial boundaries.

They also reported that while the quality of work life

reported by CAMI workers was superior to that reported by

welders working in traditionally organized departments, it

was about the same as that reported by workers in other job

classifications working in traditionally organized

departments (Murphy and Olthuis, 1995).

Steve Babson surveyed 2,400 workers at the Mazda assembly

plant in Flat Rock, Michigan. They concluded that Mazda

management have created a system which tightly controls

workers. The management rights clause in the collective

agreement clearly establishes the company's exclusive right

to direct control over the methods, processes and means of

handling work. (Babson, 1993). Each worker is provided

with a programmed work sheet which defines each job in

minute detail, including the tasks to be performed, their

sequence, and the number of seconds allotted for each task.

Deviation from this planned worked sequence is discouraged

as consistency in following the Work Sheet is seen to

ensure quality. Babson concluded that participation was

structured by management in such a way that management, not

workers, controlled the process.

Garrahan and Stewart interviewed workers employed at

Nissan's new assembly plant in Britain. Their research

revealed that at Nissan the definition of skill, and the

implied need to make decisions, had been turned on in

favour of management. Skill was defined as being able to do

the job correctly and that this was most likely if workers

carefully followed the standard operations guidelines

determined by management. Rather than exercising

creativity, the essence of skill, workers were moulded into

a reactive environment, responding to the needs of the line

and technology (Garrahan and Stewart, 1992). The plant

makes use of teams, but they were not a mechanism through

which workers could exercise some control over their work

environment. Instead, teamwork is a process in which

workers control one another's actions

Several metastudies conclude that finds of the impact of

employee empowerment on performance are inconclusive (Locke

dc Schweiger, 1979; Wagner, 1994; Wagner et al; 1997). On

the other hand, numerous case studies have found positive

correlation between performance and employee empowerment

(Beer, Eisenstadt, & Spector, 1990; Macy, Peterson, &

Norton, 1989; Nurick, 1982), not to speak of all the

reports from practitioners in the field (e.g. Argyris &

Schon, 1978). Organizations have limited resources or

operate under conditions of scarcity. This means that

rewards and opportunities are never adequate to meet

everyone’s expectations. Given the complexity of the

situation any general conclusions about the effects of

participation are hard to draw.

The central thesis of the present study is to investigate

whether various dimensions of empowerment present in the

literature affect performance outcomes for large American

manufacturing industries. For details of these dimensions

refer to fig 1.1. The five dimensions of empowerment will

be tested against five performance outcome models to test

the validity of various theoretical assumptions prevalent

in the literature. Five most debated performance outcomes

discussed in the empowerment literature are productivity,

organizational commitment, job satisfaction, proactivity

and customer service. For further details refer to fig 1.2.

Chapter 2 presents a review of the literature and

highlights various research issues which will form the

basis of hypotheses for this study. This chapter will then

discuss five most commonly known performance outcomes

models achieved as a result of empowerment and

participative practices. Critique of literature review will

appear thoughout this chapter and where possible

explanation will be provided as to why various empowerment

initiatives fail to achieve high performance output. In

addition, findings of prominent studies carried out in the

past by various researchers will be discussed critically

throughout this chapter. Chapter 3 presents four cases of

American manufacturing industries where empowerment

practices helped in achieving differential advantage.

Based on extensive review of literature presented in

chapter 2 five most important antecedents of empowerment

and five performance outcome models will be presented in

chapter 4. Effect of each empowerment dimension will be

statistically tested against each performance outcome

model.

Chapter 5 deals with methodology and present statistics of

various results carried out on set of hypotheses presented

in chapter 3.

Last chapter will discuss how this study can contribute to

the existing literature, its theoretical and managerial

implications and will then provide few directions for

future researchers interested in carrying out research in a

related discipline.

CHAPTER 2

RESEARCH ISSUES & LITERATURE REVIEW

The present chapter identifies various research issues and

reviews literature both historic and contemporary spanning

over number of decades. This chapter is divided into

various sub sections. For instance various definitions of

empowerment are presented in section 2.1. Section 2.2

discuses contemporary challenges in empowerment practices.

Section 2.3 highlights various emerging issues in

empowerment literature. The next section describes how

empowerment contributes in decision making. Contemporary

challenges and new emerging issues are identified in

subsequent sections. Contribution of various empowerment

dimensions in achieving performance outcomes with

particular reference to manufacturing industries and

critical analysis is the most important component of this

chapter. These issues are highlighted throughout this

chapter.

2.1 HISTORIC ANTECEDENTS

A distribution of influence at work has always existed.

Influence is a way of describing the distribution of power-

related activities between people. In prehistoric hunting

societies, influence was based on skill and strength. In

medieval Europe, feudalism was the main form of social

stratification. Like later systems, it was based on a

hierarchy of authority and power from the apex of an

inherited aristocracy to the lowly serf. The system

involved an intricate sets of duties and obligations and,

while serfs could not be sold, they were not allowed to

leave their place of work. However, in return for services

rendered to their lord, serfs were usually given a measure

of autonomy over a portion of land which they could

cultivate for their own benefit. Gradually feudalism became

inconsistent with the growth of commerce, trade, and

industry; in France it lasted until the eighteenth century

and in Russia until 1861.

Various forms of slavery have been practiced since time

immemorial. In Britain, it was formally ended with a law of

1833 and in the United States, where it led to a civil war,

slavery became illegal with the victory of the northern

states in 1865. However, some forms of slave labor were in

evidence even in the last decade of the twentieth century;

in Mauritania, it was outlawed in 1980, but has not been

eradicated completely and bonded workers and child labor

still exist in several low income countries (The Economist,

1996).

When economies of scale and the use of power based on

water, steam, and electricity led to the establishment of

places of work away from the home in factories and offices,

the distribution of influence at work became more complex

as well as controversial. During the Industrial Revolution

in England, formal power moved to the investor or

shareholder and de facto power to the inventor of new

machinery and later to managers

Employees trying to improve their own conditions through

association in trade unions were stopped by the Combination

Laws of 1799 and 1800 and even limited collective

bargaining rights had to wait another 70 years for some

legislative support. Political freedom for unions in the

U.K. was only granted in 1913.

Up to the end of the Second World War, the distribution of

influence at work in most industrialized societies was set

in a fairly rigid pattern of centralized hierarchies

influenced by F.W Taylor's scientific management.

It is not unreasonable to see the trend towards a more

democratic distribution of influence in postwar

organizations, particularly in Western Europe, to be

related to the lessons learned from the defeat of the

Second World War. Of course, there had been earlier

attempts to democratize working life. Consumer cooperatives

had started in Britain in 1844, and in Germany consultative

and participative structures were legally sanctioned from

early in the twentieth century. These tentative steps found

little broad support although limited progress was made in

some directions. The cooperative movement was successful in

many parts of the world in spite of the well-documented

difficulties of competing against more traditional

hierarchically organized enterprises for access to finance,

experienced management, and other support measures (Abell,

1983; Cornforth & Thomas, 1990).

In Britain, worker cooperatives grew from 40 in 1968 to

approximately 1200 in 1987, but then declined. During the

First World War, production committees had been established

and had successfully supported the war effort. The

experience was incorporated in a recommendation to set up

management-employee committees in public industries which

became known as Whitley Councils. Having languished in the

inter-war years, they again came into prominence during the

Second World War and then became either bargaining bodies

or effete talking shops.

The cyclical nature of influence-sharing practices has led

Ramsay (1977) to look at variations over a 100-year period

and to conclude that participation flourishes when it suits

management and when it helps to secure labor's compliance.

A slightly different analysis of the distribution of

influence sharing practices is put forward by Brannen,

Batstone, Fatchett, and White (1976) who describe two

periods; one covers the first 20 years of the Twentieth

Century, which included the rise of the shop steward

movement, a worker control movement in engineering,

syndicalism in mining and railways, guild socialism as a

popular movement, and joint management-worker Whitley

Committees.

The second period covers the Second World War and

reconstruction era which again brought on demands for

worker control of industry (Coates & Topham, 1968; Robert,

1973) and led to a period of rapid growth of voluntarily

established Joint Consultative Committees (Poole, 1975)

which later registered a substantial decline. In the 1970s,

seeing the fairly successful example of the German

codetermination system which had been in operation since

1952, the British Government set up a Committee of Inquiry

on Industrial Democracy accepting the need for a radical

extension of industrial democracy in the control of

companies by means of representation on boards of

directors. Several British unions and many industrial

relations academics opposed boardroom representation,

preferring to stay with traditional adversarial collective

bargaining. Employers, too, believed that influence-sharing

at any level had to be voluntary.

In the 1950s and 1960s, European industry was weak and was

being rebuilt; the strength and productivity of the United

States was widely envied. Britain sent many sectorial teams

of inquiry to the United States to discover the secrets of

success and differences between U.S. and European

organizations were closely investigated and analyzed to see

whether America's high productivity in manufacturing firms

was due to superior technology, greater inventiveness,

higher capital investment or other macro economic

indicators. However, none of these assumptions turned out

to be convincing. Gradually, a considerable body of

informed opinion came to believe that the difference in

productivity was managerial and, in particular, that

European industry operated with more centralized

authoritarian methods than American industry. The term

"participation" came up frequently in these comparisons and

social scientists and consultants in Europe were well aware

of a major area of American research carried out in the

University of Michigan which had come to the conclusion

that participation was associated with higher employee

satisfaction and greater productivity.

It is interesting that 20 years later, a leading American

academic in analyzing the relative weakness of American

industry compared with Japan comes to the opposite

conclusion: namely, that American management does not use

"high-involvement practices" sufficiently (Lawler, 1986).

The authenticity of participatory practices has been

challenged from time to time. Child (1976), for instance

examined the trends in the 1970s with their demands for an

extension of participation in organizational decision

making while, at the same time, organizations became ever

bigger, more bureaucratic, and centralized.

Extensive and important reviews of the literature on the

nature and distribution of power and influence accumulated

after 1945 (for instance, Lowin, 1968; Bernstein, 1976;

Loveridge, 1980; Chell, 1985; Kochan & Osterman, 1994;

Rogers & Streek, 1995). However, the preliminary evidence

assembled suggests that there is no simple linear

evolutionary trend.

Several other studies by Tavistock Institute researchers

(for instance, Jaques, 1951; Emery & Thorsrud, 1969;

Herbst, 1976). and their Scandinavian colleagues are highly

relevant for an understanding of the opportunities and

limitations for participative organization. The development

of the sociotechnical model led to a recognition that

decentralized influence to multiskilled semi-autonomous

groups could prove to be more productive than

hierarchically arranged work structures.

Pateman (1983) argues that unless people are allowed to

exercise influence and discretion in their work lives,

their "political efficiency" will be diminished and their

motivation and competence will be underused. She is also

one of several observers who is aware that if the structure

of hierarchical power is left unaltered, participation will

be contrived and unreal, what Etzioni (1969) has called

inauthentic participation.

Bowlby (1946) has argued that it is difficult to sustain

democracy when technical knowledge is unequally distributed

and while there is a remote similarity between

representative participation at work and the political

system, there is none with direct informal participation.

The cumulative evidence from various studies now shows that

relevant experience and skill are a critical requirement

for effective organizational participation (Heller, Pusic,

Strauss, & Wilpert, 1998).

Improved performance is then a consequence of the superior

utilization of the human potential. The improved

performance, often achieved by a better quality of

decisions, is conceptually independent of productivity,

which can be a function of a variety of exogenous factors.

Unrealistic and exaggerated expectations of the likely

impact of participative practices on organizational

productivity and therefore global competitiveness have

ignored the obvious reality that the so-called "bottom

line" is a function of many overlapping and competing

external and internal circumstances among which democratic

practices are only one ingredient.

Nevertheless, appropriate influence sharing leads to a high

level of achievement and effectiveness of decision

objectives accompanied by a substantial reduction in the

pervasive underutilization of human capacity. It is this

effect on the greater utilization of existing competence

and motivation that is the major outcome of democratic

organizational practices. Successful influence-sharing is

contingent on task and competence. Decisions that have

critical personnel implications for work design or safety,

for instance, require much higher levels of participation

than issues concerned with narrow technological, legal, or

financial considerations. Not all tasks are equally

congenial or motivating to potential participants or are

congruent with their current experience and skill.

2.2 WHAT IS EMPOWERMENT

Employee empowerment is a multi-dimensional concept which

makes it a difficult to define. Additionally, writers on

the concept use different words to describe similar

approaches. Sullivan (1994) indicates that prior to 1990

empowerment could only be accessed through articles that

discussed topics such as participative management, total

quality control, individual development, quality circles,

and strategic planning. Various researchers have looked at

the dimensions of empowerment through different lenses.

Control of one’s own work, autonomy on the job, variations

of teamwork, and pay systems that link pay with performance

are all called empowerment. Menon (1995) terms this the

“empowered state”. Alternatively, teams, job enrichment,

pay for performance, employee stock ownership, are also

termed as employee empowerment.

Empowerment also has been described as the breaking down of

traditional hierarchical structures, as in an empowered

organization, the line personnel closest to a problem, are

given the authority to solve the problem (Blanchard, 1997).

The concept has spanned cultures and industrial sectors

Morales (1997). Employees who have autonomous decision

making capabilities, can act as business partners, keeping

watch on profitability (Ettorre, 1997). True empowerment

means that employees can bend and break rules to do

whatever is necessary (within reason) to take care of the

customer (Tschohl, 1997).

The team concept of empowerment probably developed out of

the quality circle efforts of the 1970s and 1980s (Sims,

1986). Empowerment from this perspective is an act of

building, developing, and increasing power through

cooperating, sharing, and working together (Rothstein,

1995). In other words empowerment means managing

organizations by collaboration where workers have a voice

(Gorden, 1995).

Some organizational practitioners define empowerment as the

process of encouraging employees, including management, to

utilize their skills and experience by giving them the

power to use more judgement and discretion in their work.

It provides employees with enough authority, resources and

latitude to be able to work effectively (Eccles, 1993).

Vogt and Murrell (1990) suggest that most motivational

approaches to employee empowerment come from a position of

control and do not imply personal or group development.

The most successful orientation of empowerment is when

leaders focus on liberation of human potential and on

personal and organizational development. The major

difference with this type of empowerment is the realization

that total power can be created and expanded when people

are given greater freedom of decision making whereas many

other approaches assume power is shared or given up by one

party when given to another. Research has demonstrated that

people both feel and perform better when perceived control

is high (Parker and Price, 1994).

The approach to leadership that empowers subordinates as a

primary component of managerial and organizational

effectiveness is also called employee empowerment (Bennis,

1989; Block, 1987; Kanter, 1977; Kanter, 1979; Kanter,

1989; McClelland, 1975). Another dimension has its

beginnings in the analysis of internal organization power

and control. Tannenbaum (1968) which showed that the

sharing of power and control increases organizational

effectiveness. Others identify the team dimension of

empowerment (Beckhard, 1969; Neilsen, 1986). Research on

alienation (Seeman, 1959) and discussion of employee

participation (Lawler, 1992) are also precursors of the

idea of employee empowerment.

2.3 PERFORMANCE OUTCOMES OF EMPOWERMENT

The last decade of the twentieth century has witnessed a

proliferation of economic and organizational ideas that

have led to an increased speed of change, to greater

pressure on individuals, to reduced organizational slack,

and to a widening gap between the financial power exerted

by people at the top and bottom of the organizational

pyramid.

The beginnings of the concept of employee empowerment can

be found in several places. The idea of job enrichment

(Herzberg, Mausner et al., 1959; Herzberg, 1968) work was

focused on increasing control and decision-making in one’s

work. The literature on job autonomy, (Herzberg, Mausner et

al., 1959; Herzberg, 1968; Hackman and Oldham, 1976;

Hackman and Oldham, 1980; Menon, 1995) addresses component

of what is today referred to employee empowerment.

Empowerment of the front line can lead to both attitudinal

and behavioral changes in employees. Attitudinal changes

resulting from empowerment include increased job

satisfaction, reduced role stress, and less role ambiguity.

For instance, research has shown that decision-making

influence task autonomy (Niehoff et al., 1990, Brown and

Peterson, 1993). Decision-making latitude are related to

increased job satisfaction and reduced role stress

(Zeithaml et al., 1988, Westman, 1992). Another empirical

study (Singh, 1993) reports that boundary spanning

employees (such as contact service employees) experience

less role ambiguity when they are given decision-making

latitude. A consequence of increased job satisfaction is

greater enthusiasm for the job.

Empowerment also has important behavioral consequences. For

instance, empowerment can increase the self-efficacy of

employees as discretion allows them to decide the best way

to perform a given task (Gist and Mitchell, 1992).

Empowerment leads to employees becoming more adaptive

(Scott and Bruce, 1994). Empirical support for adaptiveness

is provided by the fact that it is associated with autonomy

and decision-making influence (Niehoff et al., 1990; Scott

and Bruce, 1994), as well as freedom of employee action

(Spiro and Weitz, 1990). Empowerment also leads to quicker

response by employees to the needs of customers, as less

time is wasted in referring customer requests to line

managers. In situations where customer needs are highly

variable empowerment is crucial in allowing employees to

customize service delivery.

Empowerment plays a vital role as service failures are

inevitable (Berry and Parasuraman, 1991; Hart et al.,

1990). Speedy service recovery is essential when service

failures occur. Otherwise, if service failures are not

rectified quickly and satisfactorily, customers may lose

faith in the overall reliability of the service.

Schlessinger and Heskett (1991), for instance, note that

empowerment of front-line employees is one of the key

components in breaking the cycle of failure in services. It

is also a vital component in a service firm’s strategy of

maintaining customer satisfaction. For further details of

behavioral and attitudinal consequences of empowerment see

table 2.1.

Empowerment can be viewed as a comprehensive contemporary

version of the participation and industrial democracy

movement of the 1970s. It is a set of motivational

techniques that are designed to improve employee

performance through increased levels of employee

participation and self determination (Vecchio, 1995). These

emerged in response to the quest of keeping organizational

effectiveness in a democratic society. Traditional

paradigms were predominantly based on strong managerial

control.

Empowerment means more than merely delegation (Malone,

1997). Empowerment is concerned with trust, motivation,

decision making and basically, breaking the inner

boundaries between management and employees. The impetus of

empowerment emerged as the trend of delayering spread in

the Western industrial society in the 1980s (Liden and

Tewksbury, 1995). The trend of delayering and flattering,

coupled with changes within society and in individual

awareness, encouraged people to take more responsibility

(Block, 1988) and forced organizations to re-think

managerial approaches (Handy, 1986; 1989; 1994). The

competitive environment forces are compelling organizations

to re-think their business strategies in the face of

intense competition (Naisbett and Aburdene, 1990; Senge,

1990).

Employee empowerment is also the process of decentralizing

decision making in an organization, whereby managers give

more discretion and autonomy to the front-line employees.

The purpose of shifting decision making to the employees is

not to remove managers totally from making decisions, or to

turn the operation into a democracy. Indeed, it is

management's new role to guide, assist and support the

employees in achieving success through this self-directed

leadership strategy (Brymer, R. 1991). Empowerment may

assume several distinctive forms which could be role

empowerment, reward empowerment, process empowerment, and

governance empowerment.

Role empowerment refers to arrangements that give workers

more discretion over their own work. These arrangements

typically allow workers greater say over the pace of work,

the timing of when they begin and end work, the conditions

in which they labor, and the allocation of tasks among

workers, and the degree of discretionary authority that

they exercise (Blauner, 1964).

Reward empowerment allows workers greater discretion in

assessing the quality of their own performances and

allocating corresponding privileges and benefits. These

programs may on the one hand allow individuals greater say

in establishing objectives and standards in relation to

which their own performances are evaluated (Culbert and

McDonough, 1980). On the other hand, they may allow groups

of workers greater say in assigning pay raises, perks, and

promotions.

By process empowerment, employees, usually through work

groups, gain opportunities to affect the design of

organizational processes themselves. Work teams typically

increase their discretionary power over unit assignments,

their internal budget allocations, the choice of and

control over the contributions of specific suppliers, and

the selection of supervisors. The basic idea is that the

larger organization delegates to these units authority in

specified areas related to both problem solving, agenda

setting, and contracting that had previously been exercised

by centralized personnel, accounting engineering, and

purchasing departments (Mategko and Rubenowitz, 1980).

Governance empowerment refers to arrangements that allow

workers greater participation in and influence upon the

overall direction of organizations. By naming

representatives to corporate boards or to executive

management council, either as individuals or through

designated work units, workers may exert greater influence

on budgetary, environmental, plant location, affirmative

action, or a variety of other organizational policies.

While such empowerment is really just beginning to be

experienced on a broad scale it has been institutionalized

for decades in many parts of Europe through workers'

councils, worker representation on boards of directors, and

indirectly through tri-partite bodies involving management,

labor and government (Crispo, 1978; Mintzberg, 1983).

Many see the rise in the popularity of empowerment as a

response to the impact of global competition and

information technology revolution. It is generally believed

that empowerment is an effective method for equipping

organizations and employees with skills necessary to meet

the challenges of the future. Manufacturing firms have

particularly been attracted to employee empowerment to

improve service quality and ensure that the organization is

more responsible and responsive to their customers.

Empowerment is a vital ingredients in providing a higher

level of service and quality. Theoretical and empirical

evidence suggests that firms providing higher levels of

service quality usually generate higher customer

satisfaction and loyalty, which in turn generate higher

profits (Jacobson & Aaker, 1987).

Burdett (1996) recognizes that the empowered must have:

authority, responsibility and accountability; the skill,

experience and understanding of task requirements;

motivation, commitment, confidence and a willing attitude;

in an environment which does not hinder the transfer of

ownership. For further details see fig 2.1. Empowerment is

the voluntary transfer of ownership of a task or situation

to an individual or a group having the ability and

willingness appropriate to that situation, in an enabling

environment.

Empowerment has been described as a means to enable

employees to make decisions and as a personal phenomenon

where individuals take responsibility for their own actions

(Pastor, 1996). Nixon (1994) sees empowerment arising from

external and internal challenges for organizations.

External challenges have resulted as a result of higher

levels of competition, changes in the composition of the

workforce, and higher expectations from customers. Internal

challenges relate to employee retention, motivation, and

development.

Empowerment is understood as a result of better matches

between worker characteristics and organizational needs,

and it is believed to result in increased satisfaction and

productivity. Across the private, public, and voluntary

sectors, empowering staff is widely advocated as a means to

improve the performance and productivity of organizations

(Brooke, Russell, & Price, 1988; Pierce, McTavish, &

Knudsen, 1986; Robertson, Cooper, & Williams, 1990;

Spector, 1986). Managers are increasingly delegating

sharing authority over work decisions with their employees

to increase worker productivity, improve satisfaction, and

reduce turnover. Many organizational development programs

emphasize reducing hierarchical distinctions among staff

and increasing teamwork through worker empowerment as the

key to success.

The notion of empowerment is based on the idea of

legitimated power or authority as an attribute of

organizational positions (Hasenfeld, 1991). Power in

organizations involves the right to make decisions that

affect one's own and others' work activities. Power or

control has been seen as differentially distributed among

participants, with those nearer the top of the organization

appropriately having more control and those lower in the

hierarchy having less. However, in contemporary

organizations empowerment of staff is being advocated to

reduce dependence on those in supervisory or managerial

positions. Organizational changes that increase staff

empowerment are believed to result in increased

productivity, reduced dissatisfaction, and greater job

retention (Summers, Coffelt, & Horton, 1988).

Most people desire opportunities for participation in

matters directly affecting them. Employee empowerment

fosters greater performance, releases latent knowledge and

skills, produces better solutions to problems, greatly

enhances acceptance of decisions, reduces resistance to

change, increases commitment to the organization, reduces

stress levels, and generally makes people feel better about

themselves and their world (Lewin, 1951; McGrath, 1984).

In participative environments, individuals use a common

task and shared rewards, and they believe that their goals

are positively related. In competitive environments, they

use individual goals and win-lose rewards, and they believe

that their goals are incompatible.

People with highly cooperative goals discuss their opposing

ideas and positions directly, examine each other's

perspectives, and work for mutual benefit. With open minds,

they understand the opposing positions, integrate their

ideas, and achieve a mutually acceptable, high-quality

decision (Tjosvold & Field, 1984; Tjosvold & McNeely,

1988). People with competitive goals are reluctant to

discuss their views directly and may belittle and attack

another's position.

Cooperative goals and constructive controversy may be

necessary for participative, democratic leadership

(Tjosvold, 1987), which seems to be a critical component of

empowerment (Block, 1987; Burke, 1986; Neilsen, 1986).

Effective participation requires managers to provide forums

for employees to discuss major issues and to listen and

incorporate their ideas and suggestions into the decisions.

For details of empowerment interventions see tables 2.2 to

2.4.

2.4 CONTEMPORARY CHALLENGES IN EMPOWERMENT

Today's employees are a breed apart from the laborers of

the early 20th century, whose work consisted of narrow,

repetitive tasks. Technological advances and the

development of a globally competitive marketplace have

decentralized decision-making and compelled changes in

employer employee relationships. Employees are increasingly

involved in solving problems and making decisions that were

once the province of management. Committees and other

cooperative programs often address workplace issues such as

safety, efficiency and quality. Employers see these

cooperative efforts as crucial to streamlining management

and giving employees a greater sense of involvement and

motivation.

The concepts of organization that have driven the design

and construction of enterprises for the past 100 years are

increasingly less effective in the face of increasing rates

of change. Basic machine bureaucracy theory, based on the

concepts of Taylor and Weber, was designed to create

stability in organizations, the new environments demand

speed, innovation and flexibility, the very opposite of

stability.

The new environment therefore demands the development and

implementation of new concepts of organization. The rates

of change and the volatility of outside forces are placing

new, unique, and unabating demands on organizations. Each

of these realities poses considerable challenges in itself.

Many companies, however, are experiencing the effects of

several at the same time. The result is that they find

themselves facing the reality of rapid rates of change as a

fact of life. At times, the complexity of competing in the

modern business climate can seem over-whelming,

particularly to those accustomed to a more stable business

environment. A turbulent business environment can also

force those leading organizations to abandon, if not

actively destroy what worked for them in the past.

The complexity and the pace of change in organizations are

increasing at a rapid pace. Countless firms are struggling

to adapt to new pressures reassigning their business

processes, and rethinking their strategies. The decade of

the 1980s was a period of remarkable transformation. Large

organizations were replaced by small, more adaptive and

competitive organizations. Hierarchies and unnecessary

management levels were demolished. People at all levels in

organizations demanded and were given unprecedented levels

of autonomy and responsibility. They began to take the

initiative in working together with others in their

organization to provide new products and services, without

waiting for commands from above.

Effective human resources management thus has become one of

the most pressing contemporary challenges in modern

organizations. Increasingly, mangers of today have to be

able to mange in an environment of equals and have to prove

their worth by being a resource to those being managed, as

troubleshooters, idea generators, problem solvers, team

builders, networkers, orchestrators, facilitators, conflict

mangers, and motivators. The concept of manger has

transformed as organizational structures become flatter

through the removal of traditional supervisory roles.

Contemporary organizations require their members to promote

creativity, learning, and innovation. Managers thus have to

find the key to unleashing individual creativity and

learning, and develop organizational processes and

structures that promote this. Managers interested in

promoting learning and innovation thus have to find new

ways of structuring relations to promote the creative

process of their employees.

The flattening of organization structures require new

approaches to management and control. The hands-off style

demands a very different philosophy and approach from that

required of managers working in hierarchical situations.

Besides appropriate leadership, vision, practices and

policies, people are seen as a key resource. Popular

opinion often leads us to conclude that money is the most

scarce and most valuable organizational resource. Every

organization understands the importance of money, as every

manger knows, there is precious little on can do without

it. But in most organizations, especially those that are

not in immediate financial difficulty, the truly key and

scarce resource is excellent people.

The predominant form of organization in the industrial

economy, the divisionalised functional hierarchy, was

characterized by a set of management principles centered

around the notion of a hierarchy: chain of command, span of

control etc. This organizational structure is slowly giving

way to an alternative structures characterized by an

alternative set of management principles: empowerment,

participation, teams, strategic alliances etc. These new

management paradigms are giving way to new approaches that

require people to exercise discretion, take initiative, and

assume a much greater responsibility in organizations.

One of the major contemporary issues in organizational

design is the question of how centralized or decentralize

the decision-making process will be, how much of the

decision making should be done by the executives of the

larger units, and how much should be delegated to lower

levels.

But centralizing and decentralizing are not genuine

alternatives for organizing. The question is not whether we

shall decentralize, but how far we shall decentralize. Over

the past twenty years or so there has been a movement

toward empowerment and participation in large American

business organization. This movement has probably been a

sound development, but it does not signify that more

empowerment is at all times and under all circumstances a

good thing. It signifies that at a particular time in

history, many American firms, which had experienced almost

continuous long-term growth and diversification, discovered

that they could operate more effectively if they

decentralize a great deal of decision making to the shop

floor level.

In recent times empowerment and participation has been

overly stressed without changing the attitude and mindsets

of the people in an organization. As a result companies are

structuring and restructuring continuously and their

employees fail to adopt themselves to continuously changing

patterns. It costs a company human and financial resources

to shift from one form of structure to another and great

amount of time is wasted in between. New patterns have to

be learned in short time without sufficient mastery or

skill.

Unnecessarily empowering employees can create division in

the organization. Dividing the entity of an organization

into smaller independent or empowered units without unified

approach can result in different strategies. It becomes

very difficult for an organization to align various

strategies of smaller units and still preserve the overall

philosophy of the organization. The case for empowerment,

employee involvement, right of decision making etc. are

advocated so forcefully that any other view sounds

untenable and ineffective. This uncritical acceptance of

contemporary management perspectives is forcing us to

overlook many sound management practices which have been

built over the years and which served us so well until now.

New approaches to management like decentralization,

empowerment etc. are advocated in such a way that thinking

in any other ways appears to be unthinkable. In fact, in

decentralization when individuals are divided into small

empowerment groups, it may be possible that the politics of

the organization get more strong and forceful as compared

to centralization where the power is exercised only by few.

In such organizations, the political activities of interest

groups and bargaining coalitions are much more overt than

in the standard hierarchy of authority. Because these sub-

units structurally provide more points of access to power.

Many organizations are cutting management levels and

empowering and delegating difficult tasks to their newly

recruited employee with limited skills to handle complex

organizational functions. To empower people in an unaligned

way can be counterproductive. If people do not share a

common vision, and do not share common mental models about

the business reality within which they operate, empowering

people will only increase organizational stress and the

burden for management.

Participation or empowering employees may not mean that

power is delegated to shop-floor level if the final

decision still rests in the hands of the superiors in the

organization, little power is actually delegated to the

shop floor level. Although participation may help in the

implementation of a decision, there is no decentralization

or delegation of power unless it contributes to the actual

decision. Effective teams don’t just happen; their members

have to learn and use a variety of skills which include

shared values, clear worthwhile goals, genuine commitment

to the goals, specific measurable objectives etc.

Participation in decision making is one thing while the

implementation of decision is another. Conflict is endemic

in organizations, and, therefore, impossible to eradicate

completely. The conflict can be avoided by delegating

decision making authority to particular units, departments

or positions within the organizations. If however, the

various autonomous decision making units become too

inconsistent with one another then the overall stability of

the organization is put in danger.

The effort to introduce new approaches of management like

decentralization, empowerment can stir up sensitive issues

that have to be carefully managed. In the absence of

central authority, the goals of sub-groups may quickly

become vague and may not align with the overall

organizational philosophy. Factional interests within the

organization can become more intense by conflicting demands

and unnecessary bargaining power. Some members with control

over organizational resources can easily gain the ability

to manipulate official organizational goals and objectives.

Uncritical adaptation of new management strategies for

instance empowerment, participation, delegation etc. is

essentially not a prerequisite for creating differential

advantage. The continuous creation of new form of leaner

and flatter structural configuration means that

organizations continue experimenting with new challenges

and tideous tasks consuming significant amount of financial

and human resources. It has been successively argued in the

management literature that fluid patterns of decision

making, empowerment, quick decision making is an ideal to

manage in the 90s.

It has been advocated that less management is better

management. However such an approach does not explain the

conflicting interests of various interests groups present

in the organization. Successive management literature has

argued that Delayering, cutting executive perks, empowering

and group participation are the basis of organizational

efficiency. These are too simplistic responses and ill-

suited solutions to the complexities of business. It

appears that in centralization managers are there to

capture the benefits, making money and unnecessary

suppressing their employees and that firms cannot achieve

competitive advantage in such environment.

The benefits of participation, empowerment or delegation

must, therefore, be seen within a framework of consensus or

common interests which all participants in the decision

making process share. If all are agreed upon the

organization’s goals then these participative approaches

may have beneficial results for an organization.

2.5 EMERGING ISSUES IN EMPOWERMENT PRACTICES

Simply allowing workers to participate in decision making

does not overcome the knowledge differentials which exist

within an organization, and knowledge may be a key factor

in the decision making process. In fact Mulder (1971)

suggests that participation may decrease the power of the

workers and not increase it as might assumed.

Organizations are political systems in which people seek to

acquire power. Workers are interested not simply in

enhancing organizational productivity, customer service,

but also in the enlargement of their personal domains. In

the service of their own personal interests, they organize

others by manipulating definitions of responsibility and

authority. Personal motivations and interests in such a

situation operate alongside. In decentralization, there are

more avenues for powerful groups to manipulate the agenda

and achieve their self interests. Complexity of tasks may

confuse people about who has relevant expertise. Role

ambiguity can create very real and complex problems which

ordinary workers cannot handle.

Diversity of viewpoints can stimulate innovative thinking

but under certain conditions especially when the firm has

sufficient resources to fulfill contradictory demands of

various sub-groups who hold different view points on the

same issue. A firm who initiates the empowerment process

and then fails to fulfill the expectations of various

conflicting groups is more likely to face production

inefficiency rather than the firm who avoided such

processes in the first place .

Excessive empowerment of groups may not produce desired

results in certain circumstances, especially when there is

a great deal of diversity in attitudes, mindsets, and

thinking of various members. In such a situation every

member will try to advocate group interests and can block

any productive move which is against their interests.

Organizational members must have the same values only then

there will be a relative stability in organizational

functions.

Not all sub-groups are capable of developing ideologies,

even in decentralization only a handful members assume

control of their members and drive the group to achieve

particular goals. Usually vast majority of employees in

empowered groups assume subordinate role and simply carry

out the goal of dominant members within organizational sub-

group. Thus group’s ideology does not reflect what each and

every member wants to achieve. It is an idealized version

of what the dominant member(s) want to achieve.

Alutto and Belasco (1972) investigated the degree of

empowerment enjoyed by school teachers in Western New York

State. Although the authors took into account a wide range

of variables their main argument sought to show that it was

not the absolute level of involvement that determines

commitment to an organization, rather it is the difference

between the degree of participation an individual desires

and the amount he actually enjoys that is significant.

Even where indirect participation of workers at a higher

level has been instituted it is doubtful whether it is the

workers who benefit most. In an extensive review of the

literature on this issue Mulder (1971) has pointed out that

simply allowing workers to participate in decision-making

does not overcome the knowledge differentials which exist

within an organization, and the ‘knowledge’ may be a key

factor in the decision making process. When there are

relatively large differences in the expert power of members

of a system, an increase in participation will increase the

power differences between members.

The benefits of participation must, therefore, be seen

within a framework of consensus or common interests which

all participants in the decision-making process share, if

all are agreed upon the organization’s goals (and their

relative priority), then participation may have beneficial

results for an organization’s efficiency and productivity

within those teams.

Participation is about commitment, and is certainly not a

new concept. It grew from the human relations movement in

the 1920s and 1930s after the Hawthorn Experiments. If true

participation is to be practiced, members need to be

involved in both decision making and problem definition. As

Handy (1976) notes that participation increases commitment

only if the individual considers participation worthwhile

and legitimate. Similarly Gibson and Hodgetts (1986)

suggest that the four major benefits of collaboration or

participation are greater knowledge and/or information,

increased number of approaches to problem solving,

increased commitment to implementation and more

comprehensive analysis of problems. Anantaraman (1984a) is

of the view that participation leads to better decision

through pooling talents and resources, individual ownership

of the decision increases, commitment and involvement to

implementation is elevated.

Thamhain (1990) looks at the issue of participation in

relation to innovative team efforts and emphasizes the

involvement of members even during the problem definition

stage. The benefits from this extent of empowerment are

better understanding of task requirements, stimulation of

interest, team unity improvements and commitment to the

project plan. If people are allowed to participate in team

management, it might be argued that greater integration

between individual aspirations and team goals is achieved.

There are also considerable benefits to individual team

members.

Wynn and Guditus (1984) draw extensively on the research to

outline some of the desirable effects that participative

decision making might have on members. These include

increased productivity, reduced resistance to change,

higher levels of motivation and satisfaction, increased

sense of mutual interdependence, stronger commitment to

decisions and the setting of higher performance goals for

individuals and their teams.

Indeed, as participative structures came more and more into

vogue, many companies attempted to institute participative

mechanisms everywhere, regardless of their utility. Many of

these organizations found out to their cost that

participation processes such as empowerment and delegation

was not always necessary or productive. Roberts and Hunt

(1991) report literature which question the value, in terms

of productivity, of participation. Many of the cautions

appear realistic but perhaps relate more to the unthinking

and inappropriate use of participation by organizations.

Forced or contrived empowerment cannot only be useless but

also destructive. Empowerment is not necessarily always

good. If team members feel a decision has already been made

or their input will be ignored they may turn-off and simply

comply and contribute nothing.

It is worth noting that systematic processes of decision

making and decentralization often assume rationality and

comprehensiveness. They often imply clear, unconflicting

objectives, a perfect knowledge of the decision. Infact

that rarely happens in the real world.

Wynn and Guditus (1984) argue that the absence of broader

involvement can, and frequently does, jeopardize successful

implementation of even a highly appropriate solution. On

the other hand Peterson (1991) interestingly disputes the

fact that decisions in teams take longer. He advocates

problems are seldom as they appear on the surface and

considerable effort may have to be expended in getting

behind the symptoms to search for genuine causes. Since

there is a knowledge gap at all levels and especially

between team members in general, the problems may not be

defined in the first place.

The classic study of Marjorie Shaw (1932) long regards as

the basic empirical support for participatory approaches

superiority in view of her finding that a higher proportion

of collective groups than individuals solved some common

problems. Her general explanation and that of many who

followed her was that group interaction stimulated

intellective activity, permitted the mutual catching of

errors, and allowed partial ideas to be integrated by

social interaction.

However, writers like Taylor (1954), then Marquardt (1955)

and most incisively Lorge and Solomon (1955) showed in a

rather simple form that Shaw’s interpretation of the

apparent participative group performance superiority could

be seriously challenged. It is now well known that the

superiority of participative group problem solving cannot

in general be maintained, and for many (though not all)

intellective tasks could be seriously questioned.

Conflict and strife between groups and individuals are

among the most pressing problems faced in organizations.

There has been a long and venerable tradition to compare

the performance of empowered groups. Quasi-experimental

studies by Sherif (1966) and Blake and Mouton (1961)

indicate that highly cohesive groups may become very

antagonistic toward other groups. Janis (1972) in his

analysis of “group think” at the highest levels of

government comes to a very similar conclusion.

Cohesive group consisting of satisfied members do not mean

that they will automatically yield high productivity.

Sometimes cohesiveness and satisfaction develop even when a

group has developed a norm of low productivity. Berkowitz

(1975) found that cohesive groups that agree on low

productivity may still be attractive to the members. He

found a negative relationship between productivity and

group cohesion. In the absence of a real group commitment

to productivity, the group may engage in social activities

to such an extent that they spend too little time on task-

related issues.

There have been arguments in favor of the uneven

distribution of power. Salancik and Pfeffer (1977) see it

as a necessary mechanism for aligning the organization with

reality. Crozier (1964) considers that some individuals

must be given freedom of action to make decisions, and

therefore have more power than others. Mechanic (1962)

asserts that organizations must control their ‘lower

participants’, meaning of course that the higher

participants must control the lower ones, that is that

there must be an uneven distribution of power.

Hall and Wamsley (1970) argue that an even distribution of

power in an organization is a disadvantage, causing the

organization to stagnate. Blau (1970) sees the sharing of

power as risky for an organization, and tries

unconvincingly to show that the risk of decentralization

(which essentially means empowerment practices) can be

reduced by simultaneously high degree of formalization.

Bacharach and Aiken (1976), dealing with a similar dilemma

argue that authority is the right to make final decisions,

must be retained by the higher echelons while influence

should be widely distributed within the organization.

2.6 ROLE OF EMPOWERMENT INITIATIVES IN DECISION MAKING

Initiatives to involve employees in organizational

decision-making are as old as industrial democracy, which

can be traced back to the last century (Hancock et al.,

1991; Lichtenstein & Howell, 1993; IDE International

Research Group, 1993), and as recent as team building

(e.g., McCann & Galbraith, 1981), participation (e.g.,

Leana, 1987; Leana et al., 1992), and total quality

management (e.g., Dean & Bowen, 1994; Spencer, 1994;

Waldman, 1994).

The latest variation on this theme has been termed

"employee empowerment." The businesses all over the world

are taking aggressive initiatives to discover the creative

energies of their employees. Asian, American and European

organizations are taking significant steps in realigning

their strategies in such a way as to encourage their

employees to take part in decision making process. It

appears that organizations irrespective of their

geographical locations are inclined towards liberating the

creative and innovative energies of employees thus

benefiting shareholders through improvements in the bottom

line, customers through value and service, suppliers

through more effective partnership agreements and employees

through a higher quality of worklife (Gandz, 1990, Burke,

1986; Conger & Kanungo, 1988; Thomas & Velthouse, 1990;

Bowen & Lawler, 1992; Ford & Fottler, 1995).

Many US business have accepted the general concept of

empowering employees. However, there is considerable

disagreement regarding what empowering employees and teams

actually means (Dumaine, 1994). There appears to be a high

level of agreement among managers that empowering teams is

desirable but a great deal of disagreement on what it is

they, as managers, should do to implement it. The most

common definition of team-based management is that it is an

evolutionary process in which team members eventually are

"empowered" to make all decisions relevant to the

functioning of their work unit (Case, 1995).

Numerous organizations irrespective of their geographical

locations are moving toward participative strategies to

answer the challenges of the 90's. Is empowerment truly the

key to creating energy, excitement and commitment in

organizations large and small? Evidences so far are

inconclusive. Change on a massive scale is forcing many

organizations to adopt new strategies and varied approaches

of management. There is not an individual, family, business

or government that does not feel that the scale and pace of

change around us seems greater today than at any previous

time.

The empowerment of people is clearly emerging as the

organizational revolution of the 1990s. From their origins

in the manufacturing plants of companies such as Procter

and Gamble, Cummins Diesel, and General Motors in the 1960s

and early 1970s (Lawler, 1990). Empowerment initiatives

have now spread to many large and small companies in North

America and different parts of the world. Empowerment is

manifested in many ways: machine operators are empowered to

stop production when they see quality defects and make the

necessary adjustments; customer service clerks settle

customer claims for damaged goods without reference to

supervisors; service technicians settle warranty claims;

and employees even monitor and sign their own expense

claims.

Empowerment aims at increasing the discretionary decision-

making authority and/or influence of organizational members

in their organizations. These programs add to the degree to

which workers individually or in groups can realize their

own desired objectives, sometimes even in the face of

resistance and possible opposition (Weber, 1978; Mintzberg,

1983).

There are many reasons for this trend toward empowering

employees within business organizations: customers are

demanding better products and services delivered in a

rapid, efficient, assured, and friendly manner and this

requires the accelerated development of products and

services which is sometimes referred as 'turbo-marketing' -

which can only be achieved through empowered employees

working in multi-disciplinary teams with decision-making

occurring at the non-managerial levels (Kotler and Stonich,

1991). Major corporations such as Disney, General Electric,

AT&T, and Levi-Strauss are engaged in these culture-change

endeavors aimed at creating large companies with the

efficiency and agility of small ones (Lynch, 1991; Johnson,

1991; Stewart, 1991).

This move toward empowerment seems revolutionary raises a

number of significant issues because some people gain while

others lose in this empowerment process.

However, Employee empowerment is important to the

organizational change process because empowerment satisfies

the individual's need for a sense of control and this is

particularly critical when the changes are beyond the

individual employee's control. Organizations influence work

efforts through motivation and effective motivation is

achieved through positively addressing individual needs and

goals with extrinsic or intrinsic rewards; which in turn

affects work efforts (Maslow, 1943, 1954; Herzberg, 1968;

Mitchell, 1982; Evans, 1986). Moreover, a recent study

carried by Arthur in a steel mill setting indicates that an

empowering human resource strategy aimed at fostering

worker commitment results in higher productivity, less

waste, and lower employee turnover (Arthur, 1994).

Another, much different, issue is that managers do not know

if empowerment has any effect on profitability. The concept

remains difficult to quantify. Ettorre (1997), for example,

suggests that for empowerment to be measurable, there must

be a direct relationship to the organization’s strategic

goals and accountability at every level in the hierarchy,

calling for a kind of courage, honesty and strategic

tracking foreign to most managers.

Thus, Crouch (1997) indicates that although many innovative

managers are beginning to dislike the word empowerment,

fundamental concepts behind the idea are critical to

organizational success. Even so, autonomy cannot be given

without perimeters, or chaos will result until an

appropriate framework is put in place. The truly

professional manager, therefore, knows that in order to

have power, one must give up power (Champy, 1997).

Argument over whether empowerment is an effective tool of

organizational development is not new. A review of the

literature shows that organizations have a long history of

trying to encourage employee participation. This can be

traced back to the 1960s when managers began to realize the

benefits of giving their employees the power to control

their own work environment. In the past, these attempts

have focused on initiatives such as job enlargement, job

enrichment, management by objectives and quality circles.

There is sufficient literature which indicates that

empowerment programs have worked in selected companies

(Breeding, 1996). Even though there are substantial results

when empowerment is successful, a recent survey conducted

by researchers at the University of Southern California

suggests that many organizations are ignoring the benefits.

The survey found that only 10 percent of employees in

Fortune 1000 companies are truly empowered (Johnson and

Thurston, 1997).

Successful applications of empowerment depend on management

commitment and continual communication of information

Randolph (1995). Organizations successfully implementing

appropriate empowerment programs benefit from a quicker

response to customer needs, a quicker response to

dissatisfied customers, employees feel better about their

job which results in improved service . Employee

empowerment opens up many more opportunities for employees

to exercise creativity, flexibility and autonomy on the

job. This is believed to have a beneficial effect on

employee self-esteem and motivation.

However still there is considerable disagreement about the

effectiveness of empowerment. Many researchers (Spreitzer,

1995; Thorlakson and Murray, 1996), voice concerns about

the lack of objective research regarding the effectiveness

of empowerment programs in the organizational setting.

Despite testimonials advocating an empowered approach,

these researchers believe that empowerment programs are in

danger of failing due to the lack of knowledge and

understanding of the constraints surrounding the

empowerment process.

2.7 KEY COMPONENTS OF EMPOWRMENT

(a) Authority

A key component of empowerment is granting employees

authority, or giving them the right to act in ways needed

to accomplish tasks (Schermerhorn, 1993). McConnell (1995)

contends that if the empowered employee is given a certain

amount of decision-making authority, this must consist of

the authority to deliver certain expected results. Research

(e.g. Schlesinger et al., 1991) suggests that the

acquisition of decision-making authority by employees is

likely to result in customer satisfaction.

(b) Resources

Homans (1958) suggested that a lack of access to critical

organizational resources contributes to employee feelings

of powerlessness and dependency. Access to organizational

resources enhances employees’ sense of self-efficacy and

control over environmental contingencies (Bowen and Lawler,

1995), and makes it easier for them to tap locally what

they need to get things done Kanter (1986). Walton (1985)

described an empowering system as one in which individuals

have the appropriate authority to allocate spending and

approve budgets. Such a system allows empowered employees

immediate access to funds which may be necessary to

implement and maintain programs designed to help them

better understand customer requirements and meet their

changing needs (Hall,1987).

(c) Information

It has been argued that to properly empower employees,

organizations must make more information more available to

more people at more levels through more devices. Employees

need information about changes occurring in the firm’s

external environment, information about the firm’s

strategic goals, and they need to understand the impact

their work has on the achievement of those goals (Lawler,

1992). Access to information concerning a firm’s strategic

goals and changes occurring in its external environment

allows employees to see the big picture, and this picture

is usually communicated through vision and mission

statements (Drucker, 1973; Pearce, 1982). Information that

empowered employees glean from these statements is

important because it helps to create a sense of meaning and

purpose and enhances their ability to make and influence

decisions related to meeting customer expectations and

demands.

(d) Trust

Trust is one of the most critical component of empowerment,

therefore, organizations and their managers must trust the

people they empower (Mountford, 1997). Ward, (1996), claims

that accountability is the key to successfully empowering

employees. Three conditions, however, must be met. First,

managers must assess the capabilities of employees to

perform a particular task. Second, managers must lead in a

manner that gives employees these capabilities and third,

managers and employees must understand completely the

structure in which tasks are to be carried out. Managers

need to change the way they manage. They need to overcome

fears to perceived loss of control, concerns about employee

competence and doubts as to whether or not employees

possess the necessary skills. Perhaps the managers’ main

fear, however, is how their jobs might change. Indeed, many

feel they may become redundant (Perry, 1997). A more

detailed illustration of other essential components of

empowerment is presented in fig. 2.2. (process empowerment

model).

2.8 LEADER’S ROLE IN CREATING AN EMPOWERED CULTURE

Leader’s role is advocated as one of the most important one

in successful empowerment process. Empowered organization

is one where leaders supervise more people than in a

traditional hierarchy and delegate more decisions to their

subordinates (Malone, 1997). Leaders act like coaches and

help employees solve problems. Superiors empower their

employee by delegating more responsibilities to them.

Employees who are more satisfied with their leaders and

consider them to be fair and in turn are more willing to

perform to their superior’s expectations (Keller and

Dansereau, 1995).

In a study surveying 393 middle managers of Fortune 500

corporations, Spreitzer (1996) found that employees who are

empowered have low ambiguity about their role in

organizations. The leaders in empowered organizations have

a wide span of control which leads to more autonomy for the

employee. Empowered employees feel that their organization

provides them sociopolitical support, that they have

greater access to information and resources than in

traditional organizations, and that their work climate is

participatory.

In his study of 75 employees at a power plant, (Ward, 1993)

determined that employee empowerment has three critical

elements: (1) clarity and consistency of the organization’s

over-all production and development goals, and an alignment

of all systems and management and employee levels toward

those goals, (2) ongoing evaluation and development of the

professional needs of the employees with preparation for a

greater sense of process ownership and accountability, (3)

assurance of congruence between corporate goals, management

goals, and the goals of the organization’s employees.

Much of the most current writing on employee empowerment

suggests that one-dimensional approaches are not enough.

For empowerment to be effective it must be multi-

dimensional. Vogt and Murrell (1990) identify six

dimensions to empowerment: educating, leading,

mentoring/supporting, providing, structuring, and one that

incorporates all of the above.

In an empowered organization, employees are able to fully

participate as partners, they take initiative, work on

teams as well as individually, and have the authority to

make strategic decisions (Garfield, 1993). Management’s job

from this perspective is to create a culture of

participation by providing a compelling mission, a

structure that emphasizes flexibility and autonomy, rewards

for participation and a lack of punishment for risk taking,

as well as ongoing involvement programs and support for the

integration of employees’ work and family lives.

When work is satisfying, meaningful, and enjoyable,

individuals will strive to perform. When it is conflict-

ridden, unreasonable, and threatening, these same

individuals will be preoccupied with surviving and/or

searching for external opportunities while productivity,

effectiveness, and quality decline at astonishing rates.

The traditional management model of the autocratic manager

in strict control, and workers under strict control, is no

longer effective. In the empowered workplace these old

management styles are now recognized as being forms of

coercive manipulation and even abuse. To create an

empowered workplace, the role of management in the

organization must move away from a command-control mindset

to a responsibility-oriented and supportive environment in

which all employees have the opportunity to do their best.

If management desires an effective organization, business,

or industry that will still be around, operating

effectively and profitably in the new millenium, there is

no choice but to empower first-line workers. With

empowerment, management can cut costs and improve quality

by letting workers decide the best way to perform their own

jobs safely and effectively. These empowered workers will

use their heads as well as their hands, while the

organization saves money by cutting redundant layers of

management and applying these resources more effectively to

market needs analyses, and the research and development of

new products and services.

Conventional wisdom suggests that managers with empowered

people on their staff are more effective. They achieve more

of their objectives and they achieve them more easily.

Empowerment embodies the concepts of intrinsic motivation,

internal justification for decision making, shared

responsibilities and integration for problem solving. As

employees mature in an organization, they gain more

knowledge, internalize justification for the actions they

take, and become more intrinsically motivated.

Some of the more restrictive forms of participative

management involve workers on the shop floor discussing

operational issues and producing recommendations for

management. More open forms of participative management

give workers decision-making authority regarding their

domains of responsibility. When companies shift to the more

open forms of participative management, they begin the

process of empowering their employees.

When sharing responsibilities, management releases some of

its responsibility and authority to the levels or units in

the organization that deal directly with the product or

service. Day-to-day decision making responsibility is left

in the hands of the workers who are in a better position to

take decisions regarding quality and customer services.

2.9 STRONG CULTURES AND EMPOWERMENT

An organization's level of empowerment is related to its

culture. A strong culture supports the empowerment process

in many ways. First, companies with strong cultures provide

continuity and clarity with respect to their missions.

Second, companies with strong cultures have a central core

of consistency that drives the basic decision-making

processes throughout the organization.

A high level of empowerment can produce a strong culture in

an organization. Members in a strong culture can make

decisions in the absence of tedious policy and procedure

documents or in the absence of upper management. To get to

this point, an organization needs the foresight to empower

its people, but its people must also be ready for this

step, as well. Good leaders and good followers are needed

for empowerment to be influential in developing a strong

culture organization. For comparative analysis and details

of new trends in participative culture and old culture

refer to table 2.5.

Empowerment essentially is an ongoing interpersonal

relationship that fosters mutual trust between employees

and employers. This relationship permits individuals to

strive toward continuous improvement in quality,

productivity, superior customer service, and vendor

negotiations with minimal personal or professional risk and

cost. The benefits of empowerment are real and can lead to

substantial benefits. Successful empowerment will increase

employee productivity, improve attitudes by assigning

responsibility and authority to those who are responsible

for work output. To this end, an empowerment statement

should be developed and communicated to the entire

organization.

By empowering employees, the organization's quality and

productivity increases due to the initiatives taken by

general employees. There are a number of success stories

demonstrating that empowered employees are more productive,

more positive and enthusiastic about their work and their

organization, and less likely to change jobs than

individuals who are not empowered.

Another significant benefit of empowerment is improved

management productivity. When managers can delegate tasks

to empowered workers in an environment characterized by

trust, open communications, and highly skilled employees,

less time will be expended on administrative and management

tasks, leaving more time for value added management

activities, such as business planning and developing

employees.

Inter-functional teams of empowered employees can work to

streamline systems, such as purchasing, accounts

receivable, production scheduling, inventory replenishment,

etc. Inter-functional teams, effectively established, led,

and organized can help reduce conflicts, improve

communications, establish trust, and maximize productivity.

However, empowering employees is not without risk. The

risks include: 1. Managers are more dependent on employees

for problem identification and resolution, productivity

improvements, and innovation. 2. Managers are required to

negotiate more and command less, thus making negotiating

skills become much more critical. An effective empowerment

environment requires a setting which facilitates mutual

trust between managers and employees.

A study (Martin, 1994) researching conditions that

facilitate or impede employee empowerment, suggested that

personal empowerment demanded self confidence and a strong

work ethic. Leaders must provide positive feedback,

information, resources, supportive policies, and a stress-

minimized working environment.

Macy, Thompson, and Farais (1995) identify the major

components of high performing organizations to be very

similar to those found in the literature on empowering

organizations. They include activities such as multi-

skilling, cross training, self-directed work teams, and

horizontal design; human resource systems such as learning

and development, job enrichment/enlargement, peer review,

and innovative compensation plans; and total quality

management that involves line employees such as, just-in-

time inventory and delivery, and formalized supplier/vendor

partnerships.

Empowerment is the expansion of the concept of

participative management (Mallak and Kurstedt 1996).. They

suggested that ideal model of empowerment should include.

-intrinsically motivated behavior leading to

-internal justification for actions taken whereby

-management releases some of its authority and

-responsibility to other levels in the organization that

-deal directly with the product or

-service integrating coworkers for problem solving.

Empowerment is something which should be integrated into an

organization’s culture in a progressive manner. Empowerment

is about freedom to act freely but at the same time it also

imposes certain responsibilities on individual (Blanchard,

Carlos & Randolf,1996).

McLagan and Nel (1997) also provide a multi-dimensional

perspective on employee empowerment. It consists of the

establishment of a system of corporate values; a flowing

structure as opposed to a hierarchy with boxes;

facilitating leadership; each person becoming a manager of

his/her own job; open and honest communication;

relationships of partnering for performance; employees who

understand business and industry as well as finance and

economics, who possess critical thinking skills, who are

flexible in their learning and decision making, and who are

competent in their jobs; controls based on checks and

balances and feedback on performance; and a pay system that

rewards everyone when the organization performs well.

Using the employee empowerment process at Colgate-Palmolive

as a model, Caudron (1995) suggests that key components

include: self-directed work teams; free flow of information

about company goals and directions; training and continual

development of work, management, and leadership skills by

all employees; managers who are more like coaches and who

empower gradually; employee control of needed resources,

provision for performance measurement; continual positive

feedback and reinforcement on performance.

There are plenty of evidences that support that employee

empowerment has compelling results for organizations but

still not everyone agrees that employee empowerment is an

appropriate approach to managing an organization.

Citing the absence of literature describing empowerment in

any large corporation, Koch and Godden (1997) proclaim that

employee empowerment is unworkable. It is their contention

that empowerment is incompatible with strong leadership and

is an inefficient way to control an organization

Rothstein (1995) describes a situation where the president

of a company empowered a team to deal with declining sales.

The effort fell apart when upon presenting their

recommendations to the company’s management team, the

solutions were criticized as being unworkable. The company

president did not support the team. He did not facilitate a

conversation to assist the team and the critical managers

in resolving their differences. The employees did not have

the authority to make anything happen; boundaries were not

clearly delineated. Too much was expected too fast without

ensuring that everyone in the company knew what empowerment

was about.

Culture of an organization is one of the most important

ingredient in promoting an atmosphere where employees can

participate effectively and efficiently. Unless the culture

of an organization is appropriate, employee empowerment

efforts are doomed to failure (Foster-Fishman 1995).

Management must be willing to allow for increased staff

control of the work, to allow them to have greater access

to resources, and to have more discretionary choice in the

way they do their work. There must be an environment of

trust and inclusion as well as a tolerance of risk-taking.

Employee empowerment is not for every organization. It

should be undertaken only when it fits an internal or

external need and when the people and the systems are

willing to make changes. This willingness can be determined

by looking at the issues of control and power, trust and

inclusion, and risk-taking .

Parker and Slaughter (1995) equate employee empowerment to

a management-by-stress approach that pushes people and

systems to the breaking point by increasingly forcing

workers to do more with less. Adler (1995) sees empowerment

as working, but only to a point. In one company he

examined, workers get control over doing things like

stopping the production line over quality issues and cross-

training, yet the work that they do is standardized and

controlled by the management of the plant. Babson (1995c)

found a similar occurrence at a car factory.

Responsibilities that were transferred to employees were

things like the ability to hand out paychecks on payday,

and other minor tasks which had very little to do with

empowerment.

Employee empowerment does not happen naturally in

organizations specially when there are too many

disempowering structures exit in an organization. Changing

leadership alone cannot achieve meaningful empowerment.

Both the leadership component and the individual must be

present in an organization to get desired results. Multi-

dimensional approach is one of the pre-requisite for

successful empowerment. Some of the important ingredients

of this approach should be:

(a) Leadership focused on the development of the

individuals throughout the organization, creating a vision

and developing common goals, and continually scanning the

environment and adapting to it;

(b) Teams and collaborative working arrangements;

(c) Personal responsibility for performance exemplified in

job autonomy, control over decisions directly relating to

one’s work, job enrichment through multi-skilling and cross

training, access to information to measure one’s own

performance and make good decisions;

(d) Structure that is decentralized, has controls based on

checks and balances, and is flexible allowing for

development over time;

Organizations wishing to instill a culture of empowerment

must find a way of establishing systems and processes that

do not restrict employees. By concentrating on what

behavior is considered optimal for the employees and what

they do well, management can adapt, develop and change the

organizational structure to produce the sought after

behavior for instance, employees dedicated to learning,

growing, and developing; employees who are self-managed;

leadership not only existing at the top; a high level of

trust between management and employees as well as among

employees; employee participation in decision making; a

high level of vertical and horizontal communication; and

employees able to deal with conflict management and

resolution effectively and efficiently.

The commitment and participation of top management, the

strategy and policy makers of an organization, are

necessary for a truly comprehensive culture of empowerment

to exist. Empowering employees does not mean disempowering

managers but rather permits time and energy to be used more

efficiently and productively by all players. Empowerment

offers the potential for guaranteeing employee performance

through a higher level of self-control (Collins, 1996b)

A five-point empowerment strategy is described by Nixon

(1994) in order to develop an organization where people can

work as individuals and also in teams towards common goals.

The strategy consists of :

• establishing a vision;

• prioritizing and acting only where most impact is

possible;

• developing strong relationships with colleagues;

• expanding networks;

• using internal and external support groups.

Cook (1994) summarizes essential stages in the empowerment

process that includes the vision, values, management role

as facilitator, teamwork, training support and process

improvement which are all reviewed and monitored at the end

of the process.

2.10 TRAINING AND DEVELOPMENT OPPORTUNITIES FOR EMPOWERED

EMPLOYEES

Jones et al. (1996) stress the need to shift away from

controlling to enabling in order for employees to

contribute more. This requires new management skills to

maximize employee potential. These skills relate to co-

ordination, facilitation, commitment and trust,

communication, knowing more precisely what people can and

cannot do, and promoting learning and employee ownership of

what they do. Identification with organizational values,

competence building, employee self esteem, delegation, and

coaching are fundamental qualities for employee

participation (Potter, 1994).

A three-stage training structure for managers which begins

at the bottom is advocated by Nicholls (1995). In the first

stage, an analysis is made of current capabilities and

employees are helped to work to their full potential. Next,

managers need to use coaching techniques to get employees

to work beyond their present capabilities. Third, the

commitment of the employees is obtained through the sharing

of visions and values. When the last stage has been

completed, then full empowerment has been achieved.

When the training needs of the organization as a whole have

been attended to, it may be necessary to identify any

special areas or disadvantaged groups that would benefit

from further preparation.

Kappelman and Richards (1996) advocate allowing employees

to participate early on in change programs. Their study was

undertaken in bank branches during the implementation of a

data system. Some employees were able to decide the dates

when they would undergo training, and data from this group

were compared to employees who were not able to decide on

the dates. The empowered employees from the first group

were 88 per cent more motivated, 146 per cent more

satisfied with their training, and 99 per cent more

satisfied with the change process.

Lloyd studied the result of employee participation at

British Gas and found that over a three year period,

British Gas received more than 11,000 suggestions of which

approximately 10 per cent were implemented for an added

value to the organization of £10 million (Lloyd, 1996). In

order to obtain employee input, the organization must

provide an atmosphere which encourages and rewards employee

participation. Essential in this process is the need for

managers to stimulate, communicate, and encourage employees

to participate in the flatter organization.

Once timing, goals and scope are developed, the process of

empowerment can begin. It is vital to understand that

management commitment is also very essential to achieve

meaningful empowerment and participation. Without top-down

permission or approval, it is almost impossible to gain any

sense of empowerment. This does not mean that those at the

top will eventually approve of the empowerment, or that it

will be a smooth process. It is only when management or

administrators allow participative strategies to work will

the system change to allow optimum level of empowerment.

Kirwan (1995) states that there are four key ingredients

for an empowerment program to succeed. These are:

.Top management must agree to support the program.

.Program inauguration warrants fanfare.

.Rewards must be offered for ideas generated and accepted.

.Training is essential for team leaders, program

coordinators and evaluation committee members.

Empowerment as a process can only take place in an

environment where it is allowed and promoted. For further

details refer to table 2.6. Organizational change is never

effortless, never without conflict or victims. And, no

matter how beneficial change is, no matter how much support

there is in a system for movement towards empowerment,

there is still a threat. Table 2.7 list some of the causes

of resistance to change in organizations. Any change causes

a reshifting in the alignment of people, their jobs or

their survival methods. Empowerment attempted by any group,

whether management or human service administrators, must be

approached cautiously. There is a high level of distrust in

most systems to any attempt at change, a high level of

suspicion that there are hidden agendas coming from those

in control.

Empowerment does not imply that there will no longer be

someone at the top. It implies that more control over

decisions, over issues that affect people’s lives, will be

exercised by those affected. Empowerment does not replace

the hierarchy; it simply changes some of its structure.

Empowerment is a process for helping the right people at

the right levels to make the right decisions for the right

reasons.

Empowering workers has come to mean encouraging them to

share information and participate in management, to

critically reflect about their attitudes, values, and

behavior in the workplace, and to get them to be more self-

directive and better communicators (Kizilos, 1990; Putman,

199). An essential ingredient in this process is to

encourage workers to view the organization not as something

outside of them but as a family or community to which they

belong.

Empowerment involves getting workers to share the same

values and practices as managers and to work with them to

improve competitiveness, quality, innovation, loyalty and,

most of all, productivity and profit (Clutterbuck &

Kernaghan, 1994).

Empowerment is a process by which the role of workers

becomes redefined in order to enable the organization to

achieve new goals and adapt to a changing environment.

One of the most central criticisms in most participative

approaches is that it assumes that workers are committed to

the norms and values of the organization and to

contributing to the generalized capacity to achieve shared

objectives (Parsons, 1951; Alexander, 1983).

Worker empowerment, it is emphasized, is about creating a

different culture. Yet, it is a culture in which structures

and values are not questioned or hierarchies challenged.

Empowerment implies a decentralized structure. Yet

decentralization never really occurs (Dandaker, 1990). The

process of interaction and communication between management

and workers is constituted within existing hierarchical

divisions. The culture of the organization is not something

which emerges through communication, interaction, and

dialogue between equal participants at the negotiating

table. Rather it is something that is created, supervised

and, when necessary, vetoed by management. Empowerment thus

becomes a strategic discourse employed by management to

legitimize changes to increase production and profit which

are often above and beyond the interests of employees

(McCabe, 1996).

Gilbert contends that the old issues of exploitation,

control and deskilling of workers have not gone away;

rather, they have been wrapped up in different management

clothing (Gilbert, 1996). For details of the assumptions

underlying the participative process such as empowerment

see table 2.8. Empowerment, then, is not really about

radical economic, political or social change in the

workplace. It is not about people learning to take control

of their own lives and the environment in which they live.

Empowerment is about encouraging workers to rationally

choose to commit themselves to the values, goals, policies,

and objectives of the organization as a rational means of

improving their life chances.

Implementation of empowerment-based programs may require

particular administrative practices. For example,

empowerment practice is consciously consumer oriented and

driven. Often this practice involves clients or consumers

in the planning, governance, or implementation of programs

and suggests that the successful implementation of

empowerment-based programs may require the use of

participatory management techniques and the creation of an

organizational culture that is based on working in

partnership with others. Various authors indicate that

those organizations that empower workers by creating an

employment setting that provides participatory management,

the ability to make independent decisions about their work,

communication and support from administrators, and

opportunities for skill development will be more capable of

empowering clients (Holland, Konick, Buffum, Smith, &

Petchers, 1981). For further details refer to fig 2.3.

Empowerment has number of benefits for the corporation, its

stockholders, the employees who work in it, its customers

who benefit from its goods and services, and the society

within which it operates, there are, nevertheless, a number

of ambiguities which are associated with empowerment and

which must be well managed if both negative consequences

are to be avoided and morally appropriate behaviors are to

be manifested. These ambiguities could be change and

dislocation, workforce adjustment, irresponsible use of

power, etc.

Empowerment may result in considerable change and social

dislocation within organizations. For empowerment within

traditionally managed organizations represents substantial

change and, while one can argue that the change will be for

the betterment of most people in the long run, there are

often short term dislocations which can be painful for

many.

As business seeks to develop thinking, deciding and self-

managing individuals organized into teams around business

processes, there are many people whose traditional roles

will change. Foremen, whose work was traditionally focused

on enforcing the decisions made by managers will need to

develop new skills as coaches and facilitators of group

processes; managers who may have made decisions will now

find themselves trying to create environments within which

non-managerial employees make decisions, encouraging and

enabling activities which make empowerment work; and

executives who might have seen themselves as planning and

budgeting, organizing and staffing, and controlling and

problem solving, will instead be engaged in the setting of

broad directions, aligning people and tasks, motivating the

whole, and creating the empowered culture (Kotter, 1988).

While some will welcome these changes, others may resist

because they fear (a) diminution of authority, (b) loss of

control, (c) loss of their jobs, (d) exposure of their

previous felt-inadequacies to more senior management, or

(e) simply because they don't understand what is happening

or why it is necessary (Kotter and Schlesinger, 1979).

Even if people throw themselves whole-heartedly into the

empowerment process, they may fail because they don't know

what to do or how to handle it. Behaviors that have been

learned over the years may not be easy to abandon,

particularly if they have been associated with past success

and commensurate rewards. The foreman who has been trained

as an overseer may find it hard to become an effective

group facilitator; a professional engineer who is used to

solving problems and having operators execute her orders

may not take well to listening to the ideas the operators

have for changing her designs. People have to learn new

behaviors, understand new concepts, and develop new

vocabularies.

The resistance of employees is not the only problem. If

empowerment is embraced without a clear understanding of

the mission and vision for the organization, and without

the buy-in and commitment of those who are empowered then

it will be very difficult for the organizations to achieve

its overall stated objectives.

Because empowerment programs often have been associated

with downsizing, workers may resist these innovations. They

may view empowerment as a means to eliminate jobs,

including their own or those of co-workers. In particular

because process empowerment programs are frequently

introduced together with restructuring efforts to flatten

organizational hierarchies, many supervisory personnel may

lose their jobs. These persons may well resist empowerment

programs not simply in order to preserve their positions,

but because they feel the existing patterns of work provide

closer control, better communication, and higher quality of

efforts.

2.11 POWER AND EMPOWERMENT

Empowerment may give rise to the irresponsible exercise of

increased power by employees and work teams thereby

empowered. Will newly formed quality circles or work teams

cooperate with others or will they become small, autonomous

units making continuous demands upon others? Will

individuals take advantage of their enhanced discretion in

order to suit their own ends at the organizations expense?

The questions to these answers must be answered by the

management before initiating any empowerment process.

Empowerment programs may involve arrangements which extend

limited discretion to workers in ways that effectively

strengthen the power and authority of central management.

Participative programs may be token gestures that extend

minimal influence over specific tasks while reducing

effective input over major decision (Selznick, 1949).

Empowerment programs may be used as a manipulative and

potentially paternalistic means of gaining greater

commitment from organizational members. It is doubtful that

whether it is really ever possible for one group to empower

another. Power or influence is by its nature something

which people enjoy to the extent that they seize it or

exert it themselves. When others extend opportunities for

enhanced influence, they do so not to decrease their own

power but rather to reinforce their own positions by

increasing the discretion of others in ways that guarantee

greater chances for uncoerced compliance and cooperation

(Gruber and Trickett, 1987; Simon, 1992).

In an empowerment process there are many people whose

traditional roles will change. Foremen, whose work has

traditionally been focused on enforcing the decisions made

by managers will need to develop new skills as coaches and

facilitators of group processes; managers who may have made

decisions will now find themselves trying to create

environments within which non-managerial employees make

decisions, changing their role to the rather more confused

envisioning, encouraging and enabling activities which make

empowerment work; and executives who might have seen

themselves as planning and budgeting, organizing and

staffing, and controlling and problem solving, will instead

be engaged in the setting of broad directions, aligning

people and tasks, motivating the whole, and creating the

empowered culture.

While some will welcome these changes, others may resist

because they fear (a) diminution of authority, (b) loss of

control, (c) loss of their jobs, (d) exposure of their

previous felt-inadequacies to more senior management, or

(e) simply because they don't understand what is happening

or why it is necessary. Yet others will resist change

because they are not sure that they can manifest the

required behaviors (Mategko and Rubenowitz, 1980; Stewart,

1991; Koob, Cannie and Caplin, 1991). Empowerment does not

come as an easy concept in many cultures in which

management structure is driven by class or status

differences or an ideology of management which determine

the structure of organizations ( Keating and Donnellon,

1990).

Most problematic, it is difficult to predict who will

respond well to empowerment before it takes place and who

will not. After all, most of our assumptions about people

are based on having observed them under old, unempowered

conditions and predicting behaviors under different

conditions is very difficult to do. Critics have attacked

these programs in part because benefits have at times been

disproportionately claimed by senior management (Kotler and

Stonich, 1991).

Empowerment is the result of aligning all of an

organization's systems, processes and people practices

against a new organizational paradigm. The essence of

empowerment is the transfer of decision making and

ownership from managers to those individuals who have the

knowledge and ability to most appropriately make decisions.

It implies trust in other people's abilities, and indeed,

in one's own abilities. It goes beyond the act of

delegating tasks to within the hierarchy, to a new

philosophy of partnership within work groups and between

managers and employees.

Team building or development is very vital in empowerment

process. The development of the behaviors, skills and

processes for working together effectively. It involves

assessment or diagnosis of the team's strengths and

developmental needs, planned activities or interventions

designed to address the team's needs, and facilitation of

those activities to achieve the desired result. Once a team

is performing well together, the next step is empowerment:

the transfer to accountability and management functions to

the team.

There are several pitfalls to empowering a team that can be

avoided by proper planning. Developing and empowering self-

directed work teams is a complex undertaking that requires

a real investment. To do it well requires: 1. a sound

strategy, 2. practical tools for assessing, developing and

empowering teams, 3. sound preparation of those who will

function as team builders, and 4. time and patience.

There is mounting evidence that properly designed,

developed, and empowered teams can achieve significant

breakthroughs in performance and be a significant part of

an organization's competitive advantage. However, there are

numerous examples where empowerment approaches have proved

ineffective. Leading companies such as American Express,

Disney, Ford, General Mills, Hewlett-Packard, and Shell Oil

are using empowerment techniques to increase organizational

effectiveness and employee morale. Recent surveys have

reported up to 70 percent of US companies are employing

some version of self-managed work teams (SMWT) or high-

performance work teams (Dumaine, 1994; McCann & Buckner,

1994; Osterman, 1993). McCann and Buckner found, however,

that only about one-third of human resource professionals

believed that power and decision making were truly being

shifted to lower levels within the organization. They

questioned whether empowerment was being directed from the

top-down without the corresponding movement of power. They

called for additional research to obtain a better

understanding of what actually is occurring in

organizations empowering their employees.

A substantial body of literature suggests that executives,

managers, and first-level supervisors frequently resist

relinquishing their decision making power and authority.

For example, Harley-Davidson encountered difficulty at the

executive level when it began empowering work teams in the

1980s. Not only did the employees and supervisors have

difficulty adjusting, but the senior executives resisted as

well (Bruzzese, 1994; Shipper & Manz, 1992; Stayer, 1990).

Likewise, at Shelby Die Casting, the organization

identified supervisors as the barrier to implementation of

the team concept and terminated them. The company then

trained employees to start managing themselves (Caudron,

1994).

The most important consideration when transitioning an

organization is the evolutionary nature of the team

empowerment process (Francis & Young, 1992). Too often

management has the unstated assumption that employee

empowerment occurs quickly and easily and without any

hindrance. Effectively managing reluctance, clarifying

employee roles, providing training, and defining the

concept itself - all aspects are part of the evolutionary

process of team-based management.

The are variety of skills required both by managers and

workers alike to make empowerment process successful. For

example, the role of the team leader (supervisor) in

empowered culture becomes one of a coordinator,

facilitator, negotiator, communicator, and listener.

Consequently, the skills the team leader needs are

different than those of the traditional manager Likewise,

the skills required to be an effective employee are quite

different from those needed to be an effective team member.

Organizations in the past have provided employees with the

technical training required to perform their jobs.

However, the team approach mandates an additional set of

skills. Skills such as solving problems, conducting

meetings, communicating non-defensively, listening,

performing and resolving conflict now are needed. In

organizations that empower teams, management has to

allocate both the money and time to adequately train

employees in areas beyond the technical. Further,

management has to be prepared to view such training as an

ongoing activity, not a one-time expense. The

implementation of team-based management has been widely

embraced by the academic literature as a useful strategy

for improving employee effectiveness (Easton, 1991;

McGourty, Reilly, & De Meuse, 1994; Overman, 1994; Dunham &

Smith, 1979).

Organizations must provide adequate money to fund training

but likewise must be willing to commit sufficient time to

make the change effective. A larger cost associated with

team-based management is the time needed to (a) hold staff

meetings, (b) communicate schedules across shifts, (c)

engage in problem solving, (d) coordinate inter-unit

activities, and (e) free employees to obtain the process

training needed. These time requirements often are

overlooked and underestimated. Top management must

recognize that the team approach to management will require

additional time resources and must budget accordingly. This

may initially require hiring additional staff to provide

existing employees time to devote to the team concept. In

the long-run, the organization's overall efficiency and

effectiveness will increase to make the move cost-

effective.

Many organizations view the movement toward the team

concept as a method to deal with the changing business

environment facing US industry. The team concept requires

organizations to alter the basic way they approach

business. The barriers to implementation range from the

design of the workflow to the willingness of managers, team

leaders, and team members to fully accept new levels of

power and accountability. A key element to the success of

the team approach is the ability of all organizational

members to adapt to a new employee-management relationship.

Managers, team leaders, and team members often are at

different levels of readiness for change. It is critical

that top management wholeheartedly commit to implementing

the team concept throughout the whole organization. In

order to have a successful implementation of the team

concept, managers must focus on the following: (a)

establishing a clear definition of the team approach, (b)

allocating sufficient monetary and time resources, (c)

improving communication across teams and shifts, (d)

demonstrating (through managerial behaviors) support for

their verbal commitment, and (e) encouraging willingness

(on the part of managers and team leaders) to let go of

decision making and (on the part of team members) to accept

increased responsibility.

Training is a key element and employee involvement in

decisions relating to the training program is essential.

All employees will more fully embrace the movement toward

team-based management if they have meaningful input and

have early positive experiences with the new decision

making process.

Most business buzzwords are over-used and often ill-

defined. The problem is the gap between theory and

practice. Empowerment comes to life via processes. And, as

a result, it requires guidelines, quality measures, and

involvement in its definition. Yet rarely is it treated in

that manner. For performance output model of empowerment

refer to fig. 2.4.

2.12 NEED FOR FURTHER RESEARCH

Empowerment has suffered a maturation process at such a

galloping rate that it is almost impossible to gain any

rational consensus on exactly what it is. The literature

describes empowerment as delegation or devolution or

sharing of power, authority, or responsibility by those

higher in the organizational structure to those at lower

levels of the organization. Empowerment has been glorified

as a many-splendored thing: Training is empowerment

(Cusimano, 1995); making meaningful decisions is

empowerment (Prolman, 1995); letting people do their jobs

is empowerment (Covey, 1995); encouraging risk taking is

empowerment (Story, 1995); allowing subordinate input into

activities is empowerment (Cramer, 1995); sharing resources

and information is empowerment (Blau & Alba, 1982).

Empowerment results from self-actualization (O'Connell,

1995) and from the superior being considered fair (Keller &

Dansereau,1995).

The promised results of workplace empowerment include

better decision making (Howard, 1994), improved

effectiveness (Spreitzer, 1995), increased service or

product quality (Baker, Field, Schroeder, & Sinha,1996;

Gilbert, 1991), improved strategic planning (Wall,1995),

creation of a high-performance organization (Mills, 1994),

better leadership (Bennis & Nanus, 1985; Burke, 1986;

Conger, 1989), increased capacity to handle organizational

change (Kanter, 1983; Morgan, 1988), and innovation

(Osborne & Gaebler, 1992).

Empowerment presumably benefits the empowered employee, the

supervisor, the work unit, the organization, and the

nation. Golembiewski ( 1995) argues that empowerment

creates a generative organizational environment by building

flexibility, emphasizing learning, and enhancing trust and

that empowerment is an appropriate central metaphor serving

to further diversity. However, the meaning of the concept

has blurred from indiscriminate use. The lack of rigorous

conceptualization has made it difficult to verify the

claims of success through empowerment. Nonetheless, the

term continues to be a part of the management vocabulary,

probably because the positive benefits promised by

cultivating an empowered workforce have face validity among

many managers and academics.

Some research has addressed the complex nature of the

concept and has attempted to sharpen the definition. Conger

and Kanungo (1988) emphasize the personality or attitudes

of the manager. They argue that management practices are a

necessary but not sufficient condition for empowering

employees; the subordinate's predisposition toward acting

in an empowered manner needs to be considered.

Thomas and Velthouse (1990) set out the empowerment

dimensions as aspects of a manager's personality: sense of

meaning, sense of competence, sense of self-determination,

and sense of impact., the manager who is empowered is not

distinguished from the competent, unempowered manager.

Empowered is not conceptually distinct from competent, and

operationalizing the concept through self-report on a

questionnaire compounds the challenge of concept validity

as respondents describe themselves in glowing terms.

Consequently, it is not surprising that Spreitzer (1995)

reports consistent, modest correlation between competence

and other empowerment dimensions but that she finds no

relationship between competence and locus of control, which

is an important indicator of willingness to take action

contrary to established rules and norms. Therefore,

empowerment as personality/attitude at present suffers from

the fuzziness generally found in discussions of

empowerment.

The empowerment construct also includes the behavior of the

manager. Empowerment is defined as an active orientation to

the work situation, managerial actions that go beyond the

duties assigned in the employee's job description

(Spreitzer, 1996).2 Empowered behavior can be described as

the ability to expand discretion, a quality Henry Mintzberg

(1982) associates with leadership. The similarity of

empowerment behaviors and leadership behaviors is implicit

in the writing on both topics. However, observing the

behaviors of a manager may not yield valid information. The

behaviors may be aimed at doing what needs to be done to

complete the assigned job, which would indicate

empowerment. Alternatively, the manager's behavior may be

motivated by the desire to comply with the directives of a

superior, which would indicate compliance with authority-

not empowerment. For Quinn (1996), the empowered manager is

distinguished from the competent manager by breaking the

rules and by asking for forgiveness rather than for

permission. This demanding criterion for empowerment may be

difficult to ascertain, for behavior alone is an inadequate

measure of the empowerment construct.

Another aspect of empowerment involves the environment. In

the view of Quinn (1996), empowerment cannot be delegated;

the most management can do is to create a hospitable

environment. Few managers will risk their careers by

challenging authority if their certain fate is punishment

or termination. The organizational environment can squelch

empowerment; or, the environment can challenge employees to

experiment with promising but unproved ideas; or, the

environment can adopt a wait-and-see attitude by neither

encouraging nor discouraging a manager's initiatives.

Burdett (1996) recognizes that the empowered must have:

authority, responsibility and accountability; the skill,

experience and understanding of task requirements;

motivation, commitment, confidence and a willing attitude;

in an environment which does not hinder the transfer of

ownership. It is the voluntary transfer of ownership of a

task or situation to an individual or a group having the

ability and willingness appropriate to that situation, in

an enabling environment.

Nykodym et al., (1992) argue that those now entering the

workforce have much greater expectations of participating

in management decisions, and these will have to be

harnessed by organizations that wish to remain competitive.

The `information age' will be one in which the bulk of jobs

will be cerebral, performed by 'knowledge' workers who are

highly educated and articulate (Bell, 1973). Thus it is not

only the sovereign consumer, but also the self-directed,

sophisticated worker who will force employers to increase

participation in decision making, and to provide a working

milieu which supports self-actualization and self-

development. "One measure of a 'civilized' organization is

the degree to which its employees direct, maintain and co-

ordinate their activities without external coercion"

(Ripley & Ripley, 1992).

Many of the workers of the future information age will be

professionals who will demand autonomy within the

employment relationship, which is part and parcel of the

creation and protection of professional status. "The origin

of professional power stems from the ability to retain

autonomy and occupational control within organizations"

(Sewell & Wilkinson, 1993). But will future organizations

enable the professional to exercise self-control through

the medium of the professional group, with standards

maintained through peer, rather than organizational,

controls.

Even if employers increase the discretion of their

employees, it is recognized that there is still a

concomitant need to monitor performance through `robust

systems' (Ripley & Ripley, 1992) unless the employees

become truly self-directed, in which case the role of the

manager must either change or become redundant.

Another aspect of the literature concerns the view that

empowerment, where it exists, is most likely to be

something that top management creates for other managers,

but is often not extended to lower order workers. Echiejile

(1992) feels that those most needing empowerment are

usually those who are excluded from it, and advocates the

creation of empowering groups representing the

disadvantaged at work.

Cressey and Scott (1992) also found examples in the private

sector that technical change and reorganization had created

advantaged groups who could be said to be empowered, but at

the same time had debased the work of others who were

exposed to more factory-like conditions (`paper-less

factories)', with their performance closely controlled

through computer technology. The question raised is to what

extent these problems are also experienced in the public

sector. that these mechanisms in isolation may serve to

preserve power structures rather than dismantle them if

they are not part of an overall strategy which draws upon

the values of participants in the process .

Empowerment in the workplace has received increased

attention among scholars and practitioners and belief in

the advantage of empowering workers appears to be shared by

workers as well as managers. Empowerment has been shown to

affect managerial and organizational effectiveness, and it

is presently recognized as one means by which managers can

effectively manage today's organizations, which are

characterized by a greater variety of influence channels, a

growing reliance on horizontal structures and peer

networks, a blurred distinction between managers and

workers, and a diminished attachment of employees to

organizations (Pfeffer, 1994).

Critical reviews of the literature, however, have

identified several deficiencies in the research on

empowerment. Until recently, few studies examined the

construct directly, whereas others were based largely on

impressionistic findings or on empirical data using non-

validated measures.

Empowerment has been given a variety of conceptual and

operational definitions and has been analyzed as both a

relational and a motivational construct (Rudolph &

Peluchette, 1993). When viewed as a relational construct,

empowerment concerns an individual's power and control

relative to others, as well as the sharing and transmittal

of power and control from one individual to another with

less power. As a motivational construct, empowerment

comprises individual cognition and perceptions that

constitute feelings of behavioral and psychological

investment in work (Zimmerman, 1990).

Perceptions of empowerment can enhance the value of work

for individuals, increase job satisfaction, and contribute

to work productivity and success (Eylon & Au, 1996; Fulford

& Enz, 1995). Managers and supervisors can help employees

feel empowered by providing them the necessary means,

ability, and authority to achieve success (Donovan, 1994;

Hayes, 1994; Labianca, Gray, & Brass, 1997; Smits, McLean,

& Tanner, 1993) and by delegating authority and allowing

participation in decisions (Burke, 1986; Sashkin, 1984),

although delegation and participation may only create the

conditions necessary for empowerment to take place (Rudolph

& Peluchette, 1993).

If employees have more choice in how their work is

performed, more say and impact in how the organization

behaves, and more opportunity to feel pride in what they

do, they are liable to experience the satisfaction that

comes from a sense of empowerment (Arthur, 1994, Thomas &

Velthouse, 1990). The chance to exercise judgment and

creativity and to feel that what one does is important

(Bowie, 1990) are themselves desirable ends for a great

many people

Theorists of workplace transformation argue that changes in

procedures should be locked in by reinforcing structural

changes that work on the cognitive and motivational as well

as the behavioral level (Seashore & Bowers, 1978).

Growing evidence suggests, however, that empowerment

programs often fail to meet the expectations of either

managers or employees (e.g., Bernstein, 1992; Brown, 1992;

Matthes, 1992; Eccles, 1993; Eccles & Nohria, 1993; Barker,

1993; Parker, 1993; Cullen & Townley, 1994).

Senior managers usually have instrumental reasons for

implementing empowerment programs rarely are they simply to

enhance morale or democratize the organization but,

ultimately, to improve productivity, lower costs, or raise

customer satisfaction (e.g., Bell & Zemke, 1988; Von der

Embse, 1989; Early, 1991; Goski & Belfry, 1991; Eisman,

1991; Schlossberg, 1991; Shelton, 1991). The purpose of

shifting decision making to the employees is not to remove

managers totally from making decisions, or to turn the

operation into a democracy (Odiorne, 1991). Consequently,

empowerment may be part of a broader initiative, such as

continuous improvement (Beatty & Ulrich, 1991), total

quality management (Dean & Bowen, 1994; Spencer, 1994;

Waldman, 1994), and even downsizing (Stopford & Baden-

Fuller, 1990; Feldman & Leana, 1994; Freeman, 1994) that is

intended to improve organizational effectiveness and

enhance competitive advantage (O'Connor, 1993).

Where such changes are made, steps are usually taken to

ensure that subordinates do not use their increased power

to pursue parochial objectives at the expense of the

organization . Employees are typically permitted to take

decisions only within specified policies and procedures set

by management (Brymer, 1991). These controls are normally

referred to as strategic alignment (Belasco, 1989;

Velthouse, 1990; Penzer, 1991).

The approach advocated by many management theorists (e.g.,

Conger & Kanungo, 1988; Thomas & Velthouse, 1990) relies on

empowerment practices that typically involve considerably

less delegation of power; instead, the emphasis is on open

communication and inspirational goal setting to increase

commitment and involvement.

To deal with these issues, and to effectively empower

employees, some prerequisites have to be met. First, the

manager should make an accurate assessment of the

capability of the employee to accomplish the task. Second,

the manager should adopt a leadership style that is

appropriate given the employee's capability. Finally, the

structure in which the employee is to complete the task

needs to be well understood by both manager and employee.

Managers can, at times, feel threatened and resentful

towards change. In empowering employees, managers

experience a loss of power. Traditionally, their authority

came from a hierarchical rather than a democratic position.

Additionally, managers are confused about how to mobilize

and motivate this newly empowered staff. Managers will be

forced to delegate more responsibility to lower levels;

this delegation is yet another blow to hierarchical

authority. Finally, when employees are given greater

responsibility, they become ideally positioned to challenge

traditional authority (Kanter, R. 1989).

Empowerment seems at first to be very logical and very

simple. However, many misconceptions abound, and the issues

that empowerment raises are really more complex than they

seem. Empowerment does not happen all at once. It requires

a carefully orchestrated series of small steps which are

aligned with the culture of the organization.

Empowerment involves far more than giving employees greater

decision-making ability. At its most practical level,

empowerment is recognizing and releasing into the

organization the power that people already have in their

wealth of useful knowledge and internal motivation.

Empowerment clearly involves a high form of leadership. Too

many top managers think that simply announcing their desire

for an empowered work force will make it happen.

Changing an organization's culture to one of empowerment is

a tremendous leadership challenge. For movement to

empowerment to occur, people must understand both the

little and big pictures of the empowerment vision.

* Leadership skills training that expands the range of

styles leaders use is a must for developing a culture of

empowerment -- a supportive leadership style is not always

what is needed.

* The change to empowerment is long and involves

disengagement from the old culture plus "free fall" before

empowerment begins to take hold.

* Managing the change to empowerment calls for continual

assessment of the organization's competence and commitment

for the new culture and application of appropriate

leadership styles.

* The journey to empowerment will almost certainly involve

traversing a leadership vacuum, that is a positive, though

uncomfortable, force for moving to empowerment.

Empowerment is often seen as something that the company

should jump right into, in the manner of taking a leap of

faith. In the real world, it requires a gradual, step-by-

step training process that prepares people to assume more

responsibility and authority.

There is a widely held perception that middle managers and

supervisors have been idle for decades, and the belief that

removing them from the scene will do no harm. While the

argument may have held met in giant corporations like

General Motors and U.S. Steel in the 1980s, it is

considerably less true today, following waves of layoffs in

the name of restructuring or downsizing. Nowadays most

supervisors either do hands-on work themselves or serve as

vital links between different departments and functions. In

addition, they are still the gatekeepers to support

functions, and they provide workers with answers to myriad

questions.

One of the fundamental problem is that empowerment asks

people to change. Line workers are expected to adopt new

duties that resemble closely with managerial tasks and

acquire new responsibilities which are not easy to fulfill.

It's surprising many organizations embark upon the road to

empowerment without first understanding the culture of

their organizations, capability of their employees, and

adopting appropriate leadership style.

2.13 CRITICAL CULTURAL PRECONDITIONS

Organization culture provides an excellent framework for

understanding and assessing the person-environment fit

needed for empowerment to succeed within an organization.

It considers individual attitudes, employee behavior, and

organizational practices as interconnected elements within

organizational life (Martin, 1992). Organizational culture

refers to the shared system of meaning (Smircich, 1983)

that guides organizational members' believing, thinking,

perceiving, and feeling, ultimately directing their

behavior (Schein, 1985). These traditions live in and are

guided by the organizational members' interpretative frames

and the organizational practices that emerge from and

sustain those perceptions (Bartunek & Moch, 1987).

Change initiatives are most likely to succeed when they are

compatible with the existing organizational culture; or

when they are not, significant cultural transformation

occurs to improve this alignment (Schein, 1985). Thus, an

empowerment initiative is more likely to succeed when the

organizational culture contains, or changes to create, the

critical conditions needed for empowerment (Spreitzer,

1995). These conditions would include implications for

individual attitudes and behaviors as well as for the

concurrent organizational practices.

There are two major kinds of critical preconditions for

employee empowerment: (a) conditions concerning power and

control, and (b) those concerning inclusion and trust.

These categories both have organizational and individual

level implications, suggesting that favorable conditions

for empowerment require organizational practices and

employee attitudes and behaviors consistent with an

empowerment philosophy. Through their interaction, these

preconditions create, or fail to create, an environment

capable of promoting increased staff control

(a) Organizational Precondition:

Ability to Change and Expand the Power Structure. Staff

empowerment involves increased staff control in work

domains employees deem important. Such control requires

more than a perception of self-efficacy (Riger, 1993). It

involves having greater access to resources and/or more

discretionary choice in the conduct of one's work (cf.

Kanter, 1977; Pacanowsky, 1988; Rappaport, 1981; Spreitzer,

1995). It involves more opportunities to exercise these new

found prerogatives. Leaders and managers must be willing

and able to expand their structuring of power to provide

staff greater access to resources and increased discretion

(Hollander & Offerman, 1990).

These changes in power structure may not only redistribute

control but also increase the overall amount of autonomy

and influence exerted. Because this restructuring requires

significant system and individual change (Bartunek & Moch,

1987), the organization's capacity to affirm such change is

important. This affirmation is more likely when risk taking

is normative and rewarded, encouraging individuals to

pursue new directions and to acquire new knowledge and

abilities (Senge, 1990). Ultimately, risk taking helps

increase the employees' confidence and capacity, leading

them to seek access to power and resources.

(b) Individual Precondition:

Desire for Increased Control. Concurrently, organizational

members must have a desire for increased control. No matter

how supportive the organization, if employees do not desire

change then individual transformation is unlikely.

In the case of empowerment, desire for gaining more control

over one's working life typically precedes gaining such

control. Individuals who desire greater control are more

likely to engage in new behaviors and pursue empowering

opportunities (Florin & Wandersman, 1990; Zimmerman &

Rappaport, 1988). The individual's willingness to do

something different, to stand up and be counted, is at the

core of the empowerment process. Individual desire for

greater control dovetails with the organization's capacity

to expand its power structure. These organizational and

individual conditions can interact positively to increase

the likelihood of empowerment.

Empowerment endeavors strengthen the linkages between

employees and their work environments by offering

opportunities for influencing organizational operations and

decision making (Zimmerman, 1990). Increasing opportunities

for influence and control complements the redistribution

and expansion of power noted above. These opportunities

lead to meaningful staff involvement when an organization

promotes such inclusion and employees believe that such

inclusion is possible and worthwhile.

Initiatives to involve people psychologically in the

organization promotes a sense of community (Bond & Keys,

1993) and the development of organizational citizenship.

Organizational citizens are invested in and are willing to

act to achieve organizational successes. Organizations with

strong inclusionary norms are more likely to have member

commitment and work-group cohesion and less likely to

experience personnel problems such as turnover and sabotage

(Argyris, 1971). Inclusion can be fostered through

effective communication and opportunities to participate in

decision making (Kanter, 1977; Pacanowsky, 1988). Although

symbolic participation may yield some positive initial

outcomes (March & Olsen, 1976), substantive participation

that involves meaningful influence on important

organizational matters is more likely to promote inclusion

and sustain a sense of community over time. Moreover, the

critical consciousness of leaders and members can develop

as they participate and learn more about how the

organization functions in its environment (Freire, 1968).

2.14 BELIEF AND TRUST CONSTRUCT

Positive beliefs and trust help connect individual

employees to the larger organization, increasing their

willingness to support change (Weick, 1985). Such trust may

emerge as a belief in the positive vision of organizational

leaders and in the support and cooperation of coworkers and

subordinates. In less optimal circumstances, such beliefs

may help foster empowerment even if other preconditions are

not fully present. Positive experiences with inclusionary

organizational practices can lead to greater trust which in

turn may strengthen norms for inclusion (cf. Bond & Keys,

1993). In short, when both organizational and both

individual preconditions for empowerment coexist, a person-

environment congruence necessary for engendering the

empowerment process emerges. When system offerings and

individual desires converge, when legitimate initiatives

are perceived as feasible, there is a greater likelihood

that we will be successful in our efforts to promote the

empowerment of frontline staff and other organizational

members.

Empowerment refers to "the process of gaining influence

over events and outcomes of importance to an individual or

group" (Fawcett et al., 1994). Central to the empowerment

process is a person-environment interaction (Rappaport,

1981; Zimmerman, 1995), a dynamic interplay between

people's desires/capacities and contextual opportunities.

When individual capacities meet environmental demands, when

supports and opportunities for control fit with individual

desires, then the empowerment process is likely to succeed

(e.g., Maton & Salem, 1995). If we ignore this person-

environment interaction and the critical role that both

individual and contextual characteristics play in the

empowerment process, we risk implementing ill-fated

empowerment initiatives, or worse yet, creating

disempowering experiences for the participants (Rich,

Edelstein, Hallman, & Wandersman, 1995).

Trust is a feeling and perception; it takes a long time to

build but is easily destroyed. Recent developments in

management consultancy leading to a culture of abrupt

structural changes and "downsizing" have made it difficult

to retain trustful relations. Kay (1994), in his analysis

of global economic competitiveness, has laid heavy emphasis

on "social institutions which support trust relationships

and the development of tacit knowledge .

It is not enough merely to empower employees, even if a

company goes to extraordinary lengths to grant its people

the freedom to act, to train them and to provide resources

for them to draw on. For empowerment to be vital and

measurable, it must be directly aligned with strategic

goals and individual accountability all the way to senior

management, customers and stock holders, and it must be

measured in a way that clearly shows its impact to all.

For empowerment to be vital and measurable, it must be

directly aligned with strategic goals and individual

accountability all the way to senior management, customers

and stockholders. It must be measured in a way that clearly

shows its impact to all. Empowerment must operate in

harmony with strategic goals and clearly mapped business

processes, with each individual worker a partner in the

business. This kind of empowerment calls for the kind of

courage and honesty-not to mention comprehensive systems

that measure accountability and track strategy.

In order to feel that the system really wants empowered

employees, individuals need a sense of social support from

their bosses, peers, and subordinates. Employee efforts to

take initiative and risk must be reinforced rather than

punished. If this support is missing or weak, employees

will worry about seeking permission before acting rather

than asking for forgiveness in case they make mistakes.

They must believe that the company will support them as

they learn and grow.

Empowerment works only when the exchange of information

includes group-and-individual feedback. The feedback can

come in the mode of continual employee evaluations or the

daily coaching by the management staff. Feedback is a tool

that improves the decision-making ability of an employee

who directly deals with the customer. Moreover, it provides

management with an idea of the more prevalent customer

service related problems, which allows it to empower the

staff to make proper customer service decisions.

The first consideration is whether or not a company is in a

competitive environment. The more competitive the industry,

the more conducive it will be to self-managed teams.

Second, consideration should be given to the management

style that already exists in the organization. If the

company follows an autocratic style of management, it will

be difficult to integrate the self-managed team system

immediately.

Management's response to its employees also plays a key

role in successfully promoting empowerment programs.

Finally, a company should consider what type of technical

capabilities under which they operate. Highly specialized

and automated production technology is designed to function

most effectively with limited intervention by individual

production operators.

In addition to these considerations, there are a number of

other factors that must be considered to help ensure

successful efforts at self-management. The task of setting

up work teams among employees should originate with members

of top management. Trust is a major component in this

process. If top management effectively communicates with

their employees, mistrust between ranks can be avoided.

Employees should be told the objectives for the self-

managed teams, the benefits they can derive from being a

part of these teams, and what will be expected of them.

Self-managed team programs often fail because of tactical

errors made by management. Before employee empowerment

programs can be introduced, management must analyze the

areas that will be overseen by the self-managed teams. They

must prepare for possible problems, evaluate their

objectives, and ready themselves for employee reaction.

Managers must also reorganize long-term management

strategies. Building heterogeneous self-managed work teams

requires reengineering of organizational structure and

management strategies. Structural features should include

formalization, socialization, training, and

decentralization. Management strategies, meanwhile, hinge

on communication, shared values, and trust.

In a competitive environment in which organizations must be

faster, leaner, provide better service, be more efficient,

and ultimately more profitable, an empowered, and proactive

workforce is thought to be essential (Block, 1987; Bowen &

Lawler, 1992; Fulford & Enz, 1995; Sparrowe, 1995). The

empowered workforce is better able to provide high quality

customer service. Thus, a source of competitive advantage

capable of differentiating an organization from others is

its people and how they work. Pfeffer (1994) notes that

achieving competitive success through people means working

with them, not limiting the scope of their activities.

Recent evidence that workers whose managers are perceived

as supportive are more likely to see themselves as

influential (Keller & Dansereau, 1995; Parker & Price,

1994) supports this notion. A new partnership between

management, customers, and employees based on honesty,

trust, caring, support, dignity, and mutual respect is at

the heart of employee experienced empowerment (Melohn,

1994).

It has long been known that the environment people work in

can shape their attitudes and behaviors in either positive

or negative ways (Katz & Kahn, 1978). At the heart of

workers' daily lives are their relationships with the

customers, the organization, and their co-workers. These

relationships create a particular reality that guides and

directs employees. Work environments fostering support-

based relationships, defined here as relationships which

are characterized by helping, participation, trust, and/or

involvement, are argued to result in worker empowerment.

People value "a sense of community" (Schneider, Gunnarson,

& Niles-Jolly, 1994) and cooperation among their co-

workers. From their supervisors and the organization more

generally, people desire consideration and respect (Locke,

Schweiger, & Latham, 1986). They seek mutual commitment in

the form of relationships ruled by more than economic

interests (Grenny, 1993). An environment of fear and

distrust breeds lost pride and self-protective behaviors

among workers (Ryan & Oestreich, 1991). In contrast, when

working in a positive environment based on supportive and

caring relationships with co-workers, the organization and

the customer, it is likely workers will be more empowered.

When employees are denied self-expression the outcomes for

workers are feelings of dependence and helplessness that

make it difficult for them to provide an extraordinary

response to customer needs. In these unsupportive

environments, fear and turnover are both high. Fear of

separation from others is what Harvey (1988) believes

causes people to be suspicious, avoid risks, and withdraw

from responsibility.

It has long been argued that the routinization (Marx, 1844)

and de-skilling of work (Braverman, 1974) strip workers of

the power associated with the thinking and planning aspects

of work. The Industrial Revolution changed the balance of

power in the workplace - work processes were no longer

controlled by skilled craftspeople; managers and machines

took over (Brecher, 1978). Marx (1844) argued that work had

become dehumanized, and workers had become alienated from

their work. Empirical evidence supports the notion that

routinization reduces worker power (Kipnis, 1984).

Empowerment programs as recommended in the management

literature represent a complex set of organizational

changes (Leiba & Hardy, 1994), which are not necessarily

all implemented within the context of an individual program

(Brown, 1990). Even in most liberal empowerment approaches

senior managers often retain control of many important

resources, especially the right to hire, fire, promote,

hand out rewards, and control budgets. In most empowerment

approaches ultimate control usually rests with senior

managers, who set the parameters within which subordinates

may operate (Stewart, 1989). Because senior management also

continues to set the agenda, usually they are the ones who

enjoy the rewards of improved performance and profitability

(O'Connor, 1993), and they are the ones who determine the

strategic direction of the company (McKenna, 1990).

Empowerment it is believed improves performance because

employees, who thrive on stress and are keen to perform

above and beyond the call of duty, will take risks to

pursue new opportunities and mobilize the power delegated

to them for the benefit of the organization (1988; Topaz,

1989/90; Block, 1990; Velthouse, 1990; Humphrey, 1991).

Such practices decentralize power by allowing employees to

take part in decision making (Stewart, 1989; McKenna, 1991;

Lawler, 1992). For example, self-managing teams may be

formed to allow workers to set performance standards and

monitor performance, schedule the work, select their own

equipment, participate in recruitment decisions, and deal

with co-worker discipline and absenteeism (Sherwood, 1988;

Manz, 1990; Schaeffer, 1991; Sheridan, 1991a,b).

Infact, expectations about the extent and achievement of

empowerment strategies have frequently been unrealistic.

There has been a tendency to believe and act as empowerment

initiatives can operate universally, that is to say equally

effectively in all or most situations. There are a number

of contingencies: task, competence, motivation, that are

particularly important. Most participation experiments are

introduced through social engineering as isolated events.

However, research evidence points toward the need for a

holistic systems approach which cannot be confined to a

single level or group. Management literature is replete

with the benefits of empowerment productivity accelerates,

absenteeism falls and job satisfaction increases. However,

once converted to the concept of empowerment, managers

often experience roadblocks in their efforts to increase

the decision making power of their employees.

Despite feelings that empowerment programs can give an

organization differential advantage by enhancing

productivity, proactivity, organizational commitment, job

satisfaction and customer service, and despite the fact

that many managers agree that empowerment is desirable,

companies often run into problems. Infact, empowerment is a

complex concept. It tends to mean different things to

different people.

CONCLUSION

This chapter highlighted some of the prominent beliefs

associated with various empowerment dimensions and how they

help employees to gain improved productivity, proactivity,

organizational commitment, job satisfaction and higher

level of customer service. The chapter covered the

literature spanning over few decades. Critical analysis was

the most important part of this chapter, where possible

weaknesses inherent in various empowerment dimensions were

discussed. At the same time numerous research issues were

explored.

Based on literature review various research issues are

identified in this chapter. Based on this chapter

hypotheses are developed in chapter 3. Five most prominent

empowerment dimensions are identified and how each

empowerment dimension effect productivity, proactivity,

organizational commitment.

CHAPTER 3

While chapter 2 mostly dealt with theory with heavy

emphasis on critical analysis. However, no practical

example was cited in detail from American manufacturing

firms as to how the empowerment process evolved over time.

This chapter presents four cases of American manufacturing

firms where empowerment initiatives helped to achieve

differential advantage.

CASE 1

PACIFIC GAS & ELECTRIC

East Bay Region of Pacific Gas & Electric offer several key

learning lessons for smooth transition to empowerment

process. Since the mid-1980s, PG&E has been dealing with a

huge need for change and has been in the process of moving

to a culture of empowerment.

The past: a regulated monopoly

The world in which PG&E operated prior to 1978 was vastly

different from the world in which it operates today. Prior

to passage of the Public Utility Regulatory Policies Act of

1978 (PURPA), public utilities such as Pacific Gas &

Electric (PG&E) operated as regulated monopolies. Rather

than being concerned with efficiencies, the focus was

primarily on safety and reliability to the customer. If

costs went up, the utility asked the Public Service

Commission for a rate increase to ensure a set return on

the investment of stockholders. There was little downside

risk for investors in the long-run, even though the upside

potential was limited.

The situation was also quite secure for employees. Those

who performed at a modest level and who were loyal to the

company were virtually assured of lifetime employment.

Indeed, many employees with utilities worked their entire

career with the same company. PG&E was a very well-run

company in that stable environment.

The present: a world of competition

With the passage of PURPA in 1978 and the National Energy

Policy Act in 1992, the nature of business changed

radically for Pacific Gas & Electric (PG&E). Now small

players entered the market and were in an ideal position to

compete with big company like PG&E. Both acts require

utilities to buy electricity generated by independent power

producers at a reasonable price. The environment for PG&E

has thus become more competitive, complex, and dynamic,

creating the need for a more flexible organization and more

responsible and empowered employees.

Decisions from the corporate offices of PG&E

Downsizing

In response to the need for greater flexibility and

empowerment, many management jobs at PG&E were eliminated,

primarily through a program of early retirement and the

corporate staff was encouraged to take part in normal

operation. Authority for decisions and analysis of problems

was assigned to the field decisions instead of corporate

office. These realignments resulted in dramatic changes in

the jobs of line managers.

More challenging jobs

The new job of manager required a higher level of expertise

in both technical and people skills. The problem was that

through the downsizing at PG&E many of the most experienced

managers took early retirement. And because of the past,

more controlling and paternalistic form of management,

those who remained had sometimes not been well prepared for

the new job of manager. Managers were now asked to decide

what needs to be done to serve the customer reliably and

also make a profit. At the same time, responsibility for

quality of service and cost control was relocated from the

top of the organizational pyramid to the point of service

delivery -- the employee.

Personnel changes and training

The human resource challenge created by these changes were

addressed by redesigning performance evaluation systems,

training and development strategies. PG&E provided

training for its managers in both customer service and

leadership skills. Managers were taught how to set goals

with their people which focus on measurable results in

customer service and cost control.

The managers were also trained in to assess people in terms

of their present competence and commitment to carry out a

specific job and then provide the leadership to both get

results and develop the employee. The underlying leadership

challenge was for the manager and employee to work together

to reach the point where the employee had both the

competence and commitment to do the job with very little

direction and support from the manager. When this point was

reached, the employee became truly empowered.

The process of change and the leanings at PG&E

The vision

Any organizational change to empowerment, to have a chance

at being successful, must include a vision of where the

company wants to go. PG&E provided this vision. In December

1991, a new "Statement of key corporate goals and

direction" was issued. This document laid out the company's

mission and a set of nine goals designed to lead to

achievement of the mission. Over the next three years, a

study of PG&E's organization was conducted, and in February

1994, a report was issued. This report explained a new

organization design and the focus on customer

responsiveness and cost control. A fact sheet summarized

the changes and stated five key aspects of the vision for

this new divisional design:

(1) Permit timely decision making.

(2) Ensure that as many decisions as possible regarding

service are made by those closest to the communities and

customers we serve.

(3) Improve communication within the company.

(4) Reduce bureaucratic structure within the company which

hinders efforts to become more efficient and productive.

(5) Provide the flexibility to enhance and enrich many

employee career opportunities.

The Training

An analysis of the new vision for PG&E reveals that much

more is expected of the managers in the new culture:

* make decisions they have never before had to make;

* perform analyses they have never before had to conduct;

* deal more closely with the customer; and become

developers of their people.

The problem at PG&E has been that most of the managers:

* had a low tolerance for ambiguity;

* were hesitant to make critical decisions since they had

little experience with such responsibility;

* were fearful of accountability (given the paternalistic

history of PG&E); and

• were locked into old patterns of behavior.

•

Another key learning is that there was a clear need for

leadership training to aid these managers in the change

process. Approximately 400 management and supervisory

personnel, beginning with senior management in the East Bay

Region, went through a two-day training program designed to

teach the skills of goal setting, leadership, and feedback.

At the end of the program, participants were asked to set

application goals and to work with the leadership concepts

back-on-the-job. After a six-week back-on-the-job period, a

one-day follow-up was held focusing on their experiences

and their use of various bases of power.

An overall learning expressed by the managers and

supervisors was that most of them had a tendency to operate

almost exclusively using a supportive leadership style --

high on encouragement and low on guidance. This was a style

which had been compatible with the old culture and

situation at PG&E and many thought it appropriate for an

empowered workforce. But the movement towards the new

culture had created a situation where most of the employees

had only some competence for an empowered job and were low

in commitment, because of concerns of facing a new world of

empowerment and responsibility. To traverse successfully

the change to the new culture at PG&E, the employees needed

to learn many new ideas, and they needed to learn to be

self-confident in a world of accountability and

responsibility. In order to do this, they initially needed

direction and support from their managers so they could

begin to develop the high competence and high commitment

levels where empowerment could occur.

The phases of change

Moving to this world of empowerment was a major cultural

change at PG&E, as it is in most organizations. Initially,

people had to disengage from the old culture. They had to

give up their identity as defined in the old PG&E system.

For example, in the past the regional staff were viewed as

the experts and the division staff were merely the people

out in the field. In the new culture, the division people

are where the action is -- close to the customer and in

control of costs -- whereas the regional staff are there to

help if needed. Such redefinition of identities does not

come easy. At PG&E, the regional staff grieved about the

loss of their prestige, while the division people were

overwhelmed with responsibility and accountability,

creating a state of disenchantment.

In this new environment because nobody really seemed to

know what to do next, including top management. People felt

disoriented. They felt a sense of disintegration of

everything they had known and had nothing new to hang on to

yet. The only positive light was in the new vision, which

was continually reinforced to everyone.

However, gradually the new direction began to take hold,

but it was a slow process. At PG&E, this new direction

stage began when people started to understand the new

corporate vision. Still, the problem remained for employees

and managers to translate that vision into terms that made

sense at the region and division levels, and indeed, at the

level of each and every employee and manager -- not an easy

task, and clearly one that called for solid leadership

throughout the hierarchy.

The leadership vacuum

One of the most important leanings in this analysis of PG&E

is that organizations must continually be analyzed as a

whole for their competence and commitment to take the next

steps needed to keep the change to empowerment moving.

There are many losses which can inhibit the ability and

motivation to make changes. Indeed, the loss of competence-

based identity, such as experienced by the division people

who were asked to take on new responsibilities for which

they were not prepared, was quite profound. The loss of

previous organizational linkages and the loss of meaning as

people disengage from the old world and search for how they

fit into the new can create a sense of loss of a future.

What was called for at this point of low organizational

competence and commitment for empowerment was leadership

that provided both strong direction and support. The basic

problem in PG&E was that the very managers who had to lead

this transition were not always sure of the guidance to

give or the best way to provide the support that was

needed. They, too, were products of the old PG&E system.

Hence, a leadership vacuum developed.

For movement to empowerment to occur, people must

understand both the little and big pictures of the

empowerment vision.

Leadership skills training that expands the range of styles

leaders use is a must for developing a culture of

empowerment.

The change to empowerment is long and involves

disengagement from the old culture.

Managing the change to empowerment calls for continual

assessment of the organization's competence and commitment

for the new culture and application of appropriate

leadership styles. The journey to empowerment will almost

certainly involve traversing a leadership vacuum, that is a

positive, though uncomfortable, force for moving to

empowerment.

Many changes are already evident as the people of East Bay

Region work together to create a culture of empowerment,

but the job is ongoing. Indeed, whenever a change to

empowerment is undertaken, it is important for people to

learn from and enjoy the process, because the journey will

never be completely finished.

CASE 2

EMPOWERMENT PROCESS AT WIGGINS

Empowerment of employees is repeatedly cited as a key to

total quality management success, but those who write about

empowerment and even those who are committed to implement

it have difficulty in describing what it is and how one

achieves it. Wiggins Connectors not only knows what

empowerment is, but has actually reorganized to make it

work.

Wiggins produces high tech connectors for the aircraft

industry. Four years ago, Wiggins embarked on an integrated

TQM training and implementation program as a means to stay

competitive in a shrinking market. Their success has been

remarkable. They have thrown out the old paradigms of

quality management and established a company culture that

allows the people who know the process best to make the

decisions through self-directed work items.

Wiggins' success with TQM has paid off in improvements in

productivity, inventory costs, overhead, cost of quality

and profitability.

* Their cycle time for new orders has dropped by 85

percent...

* Productivity has increased 35 percent...

* Profit before taxes per employee increased 36 percent in

three years...

* Their product line has expanded.

All this occurred in a period of downward trends in the

aviation industry.

Wiggins has eliminated all departments and middle

management and it has effectively assigned responsibility

for running the company directly to its workers. All of

this has been done in the environment of a union shop with

no change in contract, but with full involvement and

cooperation of the union members.

Design and implementation challenges

The company first recognized two major barriers to

successful empowerment, proper implementation by management

and acceptance by the people. Managers had to find a way to

integrate employee suggestions and decisions into the

process and employees had to be willing to accept the

responsibility for making decisions. Wiggins done this by

breaking down the traditional organizational and managerial

boundaries and with all employees participating, and

reorganizing itself into two levels.

Establishing commitment

Two of the most important significant events that had to

fall into place to make the design work and create the

initial momentum for change were full commitment from top

management. Some employees embraced the changes

immediately, while some came around after considerable

training and management's demonstration of support for the

program. A few still haven't made the transition. All

employees have been given full support and opportunity to

voice their concerns.

The teams or cells, which were formed for specific areas,

report to a resource committee which coordinates team

activity and allocates available resources . Decisions are

based upon consensus decision making both at the team and

resource committee level. Managers and supervisors haven't

necessarily left the company, but now play an active role

on various teams within which all members have an equal

voice.

The team structure

Everyone is on a team. The twelve self-directed teams at

Wiggins are organized around specific projects or tasks.

Members team members come from a cross section of

disciplines, giving the group the depth and breadth to

handle every aspect of a project from marketing (customer

satisfaction) to process design to production, inspection

and shipping.

Leaders

Team leaders are chosen by the members and the leadership

rotates. Team leaders meet faithfully with the team

leader's council to briefly review status of commitments

and to entertain requests for process enhancements. Team

process at Wiggins is not an overnight success and still

evolving. It was difficult getting workers and supervisors

to accept their new roles and responsibilities. Wiggins

provided a good deal of training over a four year period to

make participative process work.

Impact on personnel flexibility

On the shop floor and in the office and engineering areas,

replacing departments with teams has resulted in greater

flexibility in staffing. There is virtually no duplication

of effort or redundant functions. Employees at all levels

(including union machinists) adjust their job

responsibilities to move where the work is. If a function

doesn't add value to the process, it isn't done--teams have

authority to eliminate or change any function when it will

result in a higher level of customer satisfaction.

Access to data/information

Most data relative to the operation of the business is

shared with teams. They have access to information that

would normally be known only to higher levels of

management. Typically, this information is used to plan

activities and measure success. Not only does this help

with decision making, but also instills an even greater

sense of ownership and empowerment.

Training

On average, each Wiggins employee has been through over 400

hours of training in TQM, and leadership skills necessary

for productivity and quality improvement. Though much of

the early training and the program's blueprint was provided

by the consulting firm retained by Wiggins, training

responsibility was transferred to internal employees, with

instructors recruited from the most successful teams.

Rewards and recognition

Wiggins maintains an extensive reward and recognition

program that further promotes the positive feedback for

meeting commitments. People are recognized for outstanding

performance at every opportunity.

Driving fear out of the workplace

Wiggins' management has demonstrated their commitment to

the new corporate culture by giving up control, power and

some authority in exchange for an organization that truly

lives and practices continuous improvement on a daily

basis. If a machine malfunctions or a part is assembled

incorrectly, the workers are directly involved to

participate in developing a process change to prevent

recurrence of the problem. This attitude fully empowers

employees who are no longer concerned about reproach as a

result of errors or defects. Employees can't complain about

management because they are management.

CASE 3

TEAM APPROACH AT CORNING PLANT IN BLACKSBURG

The Corning plant in Blacksburg had been empty for four

years before it reopened in 1989. It was decided that

multiskilled, team-based production would be used in

conjunction with advanced technologies to produce a

precision ceramic product. The hiring process involved

screening 18,000 job applications to select 150 people

capable of learning the skills associated with a high-tech

process and working in a team setting. The majority of

those hired had finished one or more years of college.

Several had four-year degrees in business administration or

engineering; and a number of others had two-year technical

degrees. Employees were represented by the American Flint

Glass Workers Union.

The hiring process involved an initial orientation overview

followed by two interviews, each with two team members who

independently assessed the candidate and compared notes.

Applicants invited to return were then subjected to an

assessment of attitudes, education level, and communication

skills. The final activity was a six-hour classroom project

in which a person's ability to contribute, resolve

conflicts, and get along in a team environment was

evaluated. Finally, a hiring decision was made.

Corning makes a strong commitment to its employees. The

first six months consist of extensive training in technical

and interpersonal skills. As much as 25% of all on-the-job

hours are devoted to training. The level of responsibility

increases rapidly. At the end of six months, all new hires,

managers, and associates sign a prominently displayed board

agreeing to abide by Corning's mission, values, and

beliefs. New hires unable to adapt or keep pace during the

first six months are deselected without prejudice. By the

end of two years, all employees are expected to have

mastered three skill modules, or families of skills. Job

security is assured for those who continue to learn new

skills.

Employees at the Blacksburg make all operational decisions,

perform their own statistical process controls, and develop

performance improvement plans affecting fellow workers.

Some of the extensive training received by team members

(known as operations associates, or OAs) takes place during

off-shift hours. Associates are paid for time spent in

training programs both on and off site.

Team members are evaluated during an annual peer review

process which includes an assessment of skills, teamwork,

and progress over the past 12 months. Teams and section

leaders reach a consensus on each member's contribution

before submitting their evaluations. In some cases, a

development plan may be imposed on an associate when

performance is marginal. The plan will include improvement

objectives, a time frame, and review dates. The primary

purpose is to help an individual meet the requirements of

the team. Failure to do so within the time frame

established results in deselection.

Plant-wide performance measurements are maintained in five

critical areas, assuring productivity, quality, and

customer responsiveness. Team members are aware of their

performance at all times and are empowered to make

expenditures for productivity improvements. Any associate

may write a purchase requisition without a countersignature

for up to $500. While it may seem that this authority could

easily be abused, most purchases are for specific tools,

instruments, or fans to help improve the workplace and each

member's ability to perform.

The Blacksburg plant has implemented a pay-for-skills plan

by which employees advance to various levels. Upon

obtaining level-three status, in addition to higher pay,

employees may take up to 18 months off from basic

production to assume a plant-wide responsibility, such as

safety technician, training technician, or work with

engineers on a technical project. A pay-for-performance

plan is also in effect. Employees benefit from effective

use of raw materials, high yield, defect-free product,

energy conservation, and improvements made in mixing,

forming, cutting, and kiln-drying processes. Base pay for

new workers is in the top quartile when compared to that of

other industrial plants in the area.

Corning workers at the Blacksburg plant are entrusted with

enormous responsibility. Employees know that if they give

the customers a quality product they have job security in

this environment. Team members on the plant floor talk in

terms of customer satisfaction and waste elimination. Every

employee has a key to the plant and can come and go at

will. Early in the start-up phase, some thefts occurred,

but management did not revoke the privilege. Instead, they

communicated the losses to the work force and the problem

was solved. Trust is essential to a team-based environment,

and absolutely integral to participative process.

The Corning experience has not gained national (and

international) attention simply because the Blacksburg

plant is using team-based management, which other companies

are also doing. What sets Corning apart is its success with

the bottom line. Blacksburg turned a slight profit in its

first eight months of production, instead of incurring the

loss normally expected during a start-up period. The plant

has continued to profit ever since. Associates are very

proud of the quality of their product, which meets even the

exacting standards of Japanese automobile producers.

IMPLICATIONS

Although this study features developments in only one

plant, the ramifications are far reaching. In addition to

Corning, companies such as IBM, Motorola, Xerox, Ford,

AT&T, General Electric, Boeing, Kodak, Cummins, Polaroid,

and Procter & Gamble operate some teamwork plants (Hoerr,

I. 1990). Juran (1991) cites team management and employee

involvement as the most important contributors of success

emerging from a study of companies receiving the Malcolm

Baldrige National Quality Award.

Corning and other firms are finding that for teams to be

self-managing, members need to learn several different jobs

within their teams and in various parts of the

organization. They have to master certain jobs in

considerable depth and are also expected to develop

organizational and interactive skills typically reserved

for managers (Wellins, R. and J. George. 1991). The

combination of new technologies, team skills, social

skills, operational skills and continuous-improvement roles

places a much higher level of expectation on members of

self-managed work teams.

The Corning experience has gained the attention of

manufacturing companies around the world. Visitors are

coming to Blacksburg from Europe, Asia, Australia, and

other parts of the globe. Despite this extraordinary

interest, it is not likely that the Corning model will be

copied successfully everywhere. Larger firms may find the

process particularly daunting unless they are willing to

allow different units within their organizations to

experiment freely. The success of this small plant may

well serve as a good prototype for manufacturing firms

willing to adopt a similar corporate culture. For that

reason, the Corning experience merits a closer look.

CASE 4

EMPOWERMENT APPROACH AT TENNALUM ALUMINIUM

TENNALUM, a division of Kaiser Aluminum, is located in

Jackson, Tennessee. The plant produces aluminum screw

machine stock and other hard alloy machining stock,

including custom shapes, for automotive and aerospace

applications and other industrial uses. Customers are

primarily stocking distributors of all types of metals,

which they sell to machine shops in any quantity.

Tennalum, a division of Kaiser Aluminum, received the 1995

Shingo Prize for Excellence in Manufacturing. The plant

also received the 1995 Tennessee Quality Achievement Award,

the criteria for which are based on the Malcolm Baldrige

National Quality Award. In 1994, Tennalum received the

Clemson University's 21st Century Organizational Excellence

Award, 33 Metal Producing Magazine's T.O.P. Award, and the

Tennessee Quality Interest Award, and it was a finalist in

Industry Week magazine's Top 10 Plants in America. Tennalum

also earned ISO-9002 certification during that year.

Tennalum functions as an autonomous business unit within

the Extruded Products group of Kaiser Aluminum. Each plant

location is a profit center, with all the responsibilities

and authority of an independent business unit, such as

sales and marketing, accounting, purchasing, and research

and development. Tennalum has gained 21 percent in market

share since 1990 and currently is ranked second in domestic

markets.

The plant culture is built around employee involvement and

empowerment and a strong customer focus. The work force is

salaried, and the levels of pay are based on a pay for

skills system. There is also a plant wide bonus plan based

on Tennalum's return on assets and five key indicators

selected by plant management.

THE ROLE OF WORK TEAMS

Plant operations are managed by salaried, self-directed

work teams with their own team leaders. There are no

supervisors. Teams are process focused, cross-trained, and

multiskilled. The pay for skills system encourages and

rewards learning all aspects of the process. Teams are

empowered to make operational and quality decisions,

perform preventive maintenance, and even design minor

equipment modifications that can be implemented by their

maintenance support teams. All employees are actively

involved in the maintenance and upkeep of the plant and

equipment.

Teams are also empowered to make product quality decisions

and have the authority to put suspect materiel on stop or

to halt the process if they decide inferior product is

being produced. Production processes include indirect

extrusion, solution heat treating, cold drawing, roll

straightening, stretcher straightening/stress relieving,

sawing, and artificial aging. The plant also warehouses

several million pounds of screw machine stock for immediate

shipment as needed. Manufacturing operations are performed

by self-directed work teams in work cells. All

manufacturing equipment is computer controlled through

extensive use of programmable logic controllers. The

controllers are made more user friendly by using personal

computers as interfaces. Personal computers are also used

as uptime recorders at all major centers. One is used in a

fully integrated fashion to maintain raw material

inventory, track materiel through the work cell, monitor

throughput and update operating parameters according to

best output, and maintain tooling inventory. Technicians

evaluate raw material requirements and work directly with

suppliers to order and release product for delivery.

The plant has set six total production volume records since

1990, the most recent being 50 percent greater than the

first. The extrusion operation has undergone many

continuous improvement projects and has increased its

output by 150 percent over the last four years. Downtime

due to setup or changeover has been eliminated in some

areas of the plant. Market share has grown by 21 percent

since 1990. Workers' compensation costs have been reduced

by 96 percent from 1990. Revenues from 1991 to 1995 have

increased 104 percent, while gross profits have risen 226

percent.

• The members of a self-directed work team

• set group and individual goals;

• assume responsibility for productivity, cost, and quality;

• plan, schedule, control, and inspect their own work;

• prepare their own budgets and accept responsibility for

complying with the terms of those budgets;

• select suppliers;

• interview and hire new employees;

• coach and counsel teammates;

• evaluate the performance of teammates;

• monitor and control quality and safety;

• make major changes in their work systems or processes;

• order supplies, maintain inventories, and recommend new

equipment;

• plan their own training and assume responsibility for

orienting and training newly hired personnel;

• perform routine repairs and provide maintenance,

housekeeping, and troubleshooting services; and deal

directly with people at all levels of the organization.

CONCLUSION

These case studies reinforce the fact that changing an

organization's culture to one of empowerment is a

tremendous leadership challenge. First, the process is

long, as it involves defining both the big picture and the

little pictures, and providing significant amounts of

training.

Second, the process can easily result in a leadership

vacuum. The need to change the way organizations conduct

their business has never been greater than it is today. The

previous management model where the manager was in control

and the employee was being controlled just does not work

today. Instead, top-level managers are finding it necessary

to empower the workforce with the opportunity to achieve

high quality, low cost, flexibility, and excellent customer

service. Such shifts in management philosophy create the

need for massive changes in all aspects of an organization,

and these large-scale change efforts are at best difficult.

CHAPTER 4.

THEORY AND HYPOTHESES

Chapter 2 reviewed the literature and identified research

issues which need further investigation. Chapter 3

illustrated how empowerment initiatives influenced

performance outcomes in four American manufacturing firms.

This chapter identifies the specific hypotheses to be

tested.

ANTECEDENTS OF TEAM EMPOWERMENT

From an extensive review of the work team, empowerment, and

group motivation literatures, five job and organizational

characteristics were identified that may act as antecedents

to team empowerment. The search yielded antecedents in five

thematic areas: supervisory support, supportive

organizational environment, delegation of operational &

strategic responsibilities, human resources policies

construct, and pro social structure construct. It is

believed that all five antecedents of empowerment influence

performance outcomes most notably productivity,

proactivity, customer service, job satisfaction and

organizational commitment.

1.SUPERVISORY SUPPORT

When team leaders delegate responsibility, ask for and use

employee input, and enhance team members' senses of

personal control, the team members are more likely to

experience meaning, impact (Hackman, 1987), and autonomy in

their work because they are taking on more responsibility

(Susman, 1976; Thomas & Velthouse, 1990). When team leaders

actually use member ideas, members should become more

confident in their abilities, or experience more potency

(Guzzo et al., 1993).

Team leaders who allow teams to set their own performance

and output goals create more autonomy experiences (Manz &

Sims, 1987) and increase team potency as members decide

which goals should be adjusted and how much effort is

needed in relation to performance (Guzzo et al., 1993).

Members will likely find these goals more meaningful

because they participate in their creation (Hackman &

Oldham, 1980). When leaders have high expectations, team

members are more likely to complete challenging

assignments, further strengthening potency experiences

(Burpitt & Bigoness, 1997).

Recent evidence that workers whose managers are perceived

as supportive are more likely to see themselves as

influential (Keller & Dansereau, 1995; Parker & Price,

1994) supports this notion. A new partnership between

management, customers, and employees based on honesty,

trust, caring, support, dignity, and mutual respect is at

the heart of employee experienced empowerment (Melohn,

1994).

People value "a sense of community" (Schneider, Gunnarson,

& Niles-Jolly, 1994) and cooperation among their co-workers

(Locke, Schweiger, & Latham, 1986). From their supervisors

and the organization more generally, people desire

consideration and respect. They seek mutual commitment in

the form of relationships ruled by more than economic

interests (Grenny, 1993). An environment of fear and

distrust breeds lost pride and self-protective behaviors

among workers (Ryan & Oestreich, 1991). In contrast, when

working in a positive environment based on supportive and

caring relationships with co-workers, the organization and

the employees, it is likely workers will be more empowered.

When manufacturing workers are treated as a cost to be

minimized or avoided, the employment relationship may be

stuck in what Block (1987) calls the bureaucratic cycle. In

these relationships, employees submit to authority and are

denied self-expression. The outcomes for workers are

feelings of dependence and helplessness that make it

difficult for them to provide an extraordinary response to

customer needs. In these unsupportive environments, fear

and turnover are both high. Fear of separation from others

is what Harvey (1988) believes causes people to be

suspicious, avoid risks, and withdraw from responsibility.

One indicator of supportive and strong relationships is the

willingness of employees to help each other. Helping or

prosocial behaviors of interest here are functional or

positive activities, not those that sabotage the

organization (Brief & Motowidlo, 1986). Helping behaviors

are those actions employees are willing to engage in,

beyond their job requirements, that benefit both the peer

target of the behavior and the organization (Dovidio,

1984). As such, helping behavior is a measure of being a

supporter of others.

In their review of the prosocial organizational behavior

literature, Brief and Motowidlo (1986) identified several

contextual and individual correlates of such activity.

Prosocial behavior was found to be associated with

participation in decision making, the perception of

proficiency, and several conditions affiliated with one's

work role. Van Dyne and her colleagues (1994) provide

evidence that covenantal relationships mediate the

relationship between what have typically been viewed as

antecedents of organizational citizenship behaviors, which

are essentially synonymous with prosocial behaviors, and

the citizenship behaviors themselves. Peers who help one

another empower through their support and by providing

others with the opportunity to reciprocate. Covenantal,

support-based relationships, as evidenced by peer helping

behaviors, help humanize the work environment. It is

argued, therefore, that helping behavior is an important

ingredient in the prediction of employee perceptions of

personal influence, self-efficacy, and meaningfulness.

Hypothesis l in subsequent sections is offered in light of

this prediction.

2. SUPPORTIVE ORGANIZATIONAL ENVIRONMENT

Supportive organizational environments are those in which

the organization actively establishes a workplace setting

described as supportive, trusting, caring, participative,

and generally relationship-oriented. Managers who attempt

to engender supportive environments are typically

characterized as humanistic. They believe that an

appropriate work environment allows workers to reach their

full potential (Organ & Bateman, 1991). As such, humanistic

managers endeavor to positively manipulate the environment

so as to increase worker productivity and satisfaction.

Previous research has shown that managerial support is

associated with worker perceptions of influence (Parker &

Price, 1994).

A supportive organizational environment represents

employees' characterizations of the organization vis-a-vis

cultural norms. Previous work in hospitality settings has

found the relationship between the organizational culture

and empowerment to be positive (Sparrowe, 1994, 1995;

Fulford & Enz, 1995). When a work environment is viewed as

supportive, employees are energized and more likely to

experience empowerment. This relationship will be stated

formally in subsequent sections.

3. DELEGATION OF OPERATIONAL/STRATEGIC RESPONSIBILITES

When teams set production schedules and standards, monitor

customer feedback, develop and train for quality

improvement practices, and assume ownership for the

completion of finite units of work, they have high

production/service responsibilities (Kirkman & Rosen,

1997). In practice, team member participation in the day-

to-day regulation of a team's work varies greatly (Cohen &

Bailey, 1997). More participation in goal setting leads to

greater intrinsic motivation and a greater sense of

empowerment (Gulowsen, 1972), but effects on performance

have been mixed (Locke, Shaw, Saari, & Latham, 1981).

Perhaps empowerment mediates the relationship between

participative goal setting and team performance (Campion et

al., 1993; Campion, Papper, & Medsker, 1996). At the

individual level, participative goal setting leads to

higher task comprehension (Latham & Saari, 1979).

Similarly, increased decision making in production

scheduling and job assignments makes team members a

meaningful part of the production process (Manz & Sims,

1993) and creates more autonomy. Team members who make job

assignments have a demonstrable impact on the work flow of

other members (Hackman, 1987). Further discretion exists

for teams created within a total quality management (TQM)

environment (Lawler et al., 1995). Teams responsible for

quality frequently collect data to measure discrepancies

(Ishikawa, 1985), which can allow teams to make adjustments

in their work and lead to more potency experiences (Guzzo

et al., 1993). One of the basic tenets of TQM is that

employees who have increased responsibility for quality

will find their work more personally meaningful (Ishikawa,

1985). Team members constantly update the skills and

knowledge necessary to achieve high levels of

production/service quality (Lawler et al., 1995).

Related to quality and learning is a team's level of

customer contact (Ancona, 1990). Increased customer contact

and feedback should make team members feel more potent

(Guzzo et al., 1993), demonstrate that a team's work makes

a difference for customers (impact; Cummings, 1978),(1)

make the production or delivery of a service more

personally meaningful to team members (Manz & Sims, 1993),

and allow team members to experience more freedom

(autonomy) in handling customer issues (Susman, 1976). Team

members who provide customers with a whole product or

service use a variety of skills that are likely to enhance

meaningfulness (Hackman, 1987; Hackman & Oldham, 1980),

confidence in their team's ability to perform (potency;

Guzzo et al., 1993), and knowledge of how their efforts

affect the overall organization (impact; Griffin, 1991).

Consequently,

4. HUMAN RESOURCE POLICIES CONSTRUCT

Human resources policies for teams, including team-based

rewards, receiving or delivering cross-training, and making

staffing decisions, should support and enhance team

empowerment. For example, Shea and Guzzo (1987b) found that

when highly interdependent teams received team pay, they

were more likely to experience potency. Team incentives

provide motivation that may enhance the meaningfulness of a

team's work (DeMatteo, Eby, & Sundstrom, 1998; Gibson &

Kirkman, 1999; Mohrman et al., 1995). Some team members

receive incentives to cross-train for team jobs or the jobs

of other teams (Wellins et al., 1990). Cross-training

results in higher team flexibility and breadth of

experience, confidence in multiple job-related skills, and

a higher chance that team members will have a significant

impact on their organization (Manz & Sims, 1993).

In addition to cross-training, team members might also

train other team members or assist in their selection,

performance evaluation, discipline, and dismissal (Gibson &

Kirkman, 1999). By demonstrating relevant skills and

behaviors in the training of new team members, members are

more likely to feel confident that their team can perform

tasks (potency; Guzzo et al., 1993), find intrinsic

interest in their work (meaningfulness), have a greater

impact because other team members will be directly affected

by the quality of their training (Hackman, 1987), and feel

more autonomy in carrying out a wider variety of jobs

(Susman, 1976). When assessing fellow members with peer

evaluations (Saavedra & Kwun, 1993), team members will

experience more autonomy in the evaluation process (Susman,

1976), have a greater impact on fellow members' development

and rewards, use the wide variety of skills that are

required in a performance appraisal process

(meaningfulness; Hackman, 1987), and more accurately

perceive how capable their team is by rating its

performance (potency; Guzzo et al., 1993).

5. SOCIO-POLITICAL SUPPORT

Spreitzer (1996) defined sociopolitical support as the

endorsement, approval, and legitimacy obtained from various

constituencies in organizational political networks.

Belonging to a support network increases an individual's

interdependence with important organizational constituents

and, in turn, increases that individual's sense of personal

power (Crozier, 1964). Increased personal power will likely

result in more competence and impact at the individual

level (Thomas & Velthouse, 1990). Manz (1990) argued that

at the team level of analysis, participation broadens team

members' activities in organizational networks and thus,

their sense of potency.

With increased legitimacy and participation in networks

comes a higher degree of access to strategic organizational

information, which in turn can help team members determine

their particular impact on overall organizational

performance (Spreitzer, 1996), enable team members to

experience higher levels of potency (Guzzo et al., 1993),

and enhance the meaningfulness of team tasks (Hackman,

1987). Similarly, access to important resources - from

other teams or departments or even from outside an

organization - will likely enhance the experience of

empowerment (Spreitzer, 1996). Beyond access, some teams

provide resources to other teams, departments, or external

customers. Team members in charge of providing important

information or resources will likely utilize their full

capabilities (potency; Guzzo et al., 1993), have a better

sense of how their actions affect other teams or customers

(impact; Manz & Sims, 1993), heighten their experience of

autonomy (Susman, 1976), and create more intrinsic meaning

in their work (Hackman, 1987).

Team members who develop their own rules and procedures

experience a greater sense of participation in how their

teams function on a day-to-day basis than do team members

who are not able to decide on rules and procedures (Manz &

Sims, 1993). Such teams will likely experience a high level

of autonomy, because they have the authority to design and

enforce their own particular manner of operation (Susman,

1976), a high level of intrinsic caring about the work

(Hackman, 1987), and a high level of impact, because of the

effect of the rules and procedures on fellow members (Manz

& Sims, 1993).

PERFORMANCE OUTCOMES OF EMPOWERMENT

Frequently cited criteria of work team effectiveness

include productivity (Banker, Field, Schroeder, & Sinha,

1996; Cohen & Ledford, 1994; Gladstein, 1984; Hackman,

1987; Pearce & Ravlin, 1987; Shea & Guzzo, 1987a; Trist et

al., 1977; Wall et al., 1986), quality (Banker et al.,

1996; Cohen, Ledford, & Spreitzer, 1996; Hackman, 1987;

Shea & Guzzo, 1987a), low costs (Cohen et al., 1996; Trist

et al., 1977), safety (Cohen et al., 1996; Goodman et al.,

1988; Pearce & Ravlin, 1987; Trist et al., 1977), job

satisfaction (Cordery et al., 1991; Wall et al., 1991), and

organizational commitment (Cordery et al., 1991). We

included productivity, proactivity, and customer service as

performance outcomes and job satisfaction, organizational

commitment, and team commitment as attitudinal outcomes. We

made the distinction between performance and attitudinal

outcomes to be consistent with previous research (Campion

et al., 1993; Campion, Papper, & Medsker, 1996; Gladstein,

1984; Hackman, 1987).

1. PRODUCTIVITY

Empowerment has been associated with productivity at both

the team (Hyatt & Ruddy, 1997; Tesluk, Brass, & Mathieu,

1996) and individual levels of analysis (Spreitzer, 1995;

Spreitzer et al., 1997; Thomas & Tymon, 1994; Tymon, 1988).

Employees who have more complete knowledge of their jobs

(impact) often make better job-related decisions (Miller &

Monge, 1986). Gorn and Kanungo (1980) found that employees

were more productive when they actively participated in

decision making and found their jobs meaningful. Conger and

Kanungo (1988) conceptualized empowerment at the individual

level as self-efficacy, which has been linked to

productivity (Frayne & Latham, 1991; Gist, Schwoerer, &

Rosen, 1991). At the team level of analysis, Guzzo and

colleagues (1991) found that more potent teams were also

more productive than those with less potency.

2. PROACTIVITY

Working at the individual level of analysis, Bateman and

Crant (1993) defined proactive behavior as individuals'

actions effecting environmental change through their

scanning for opportunities, showing initiative, taking

action on and solving problems, and persevering until

changes are made. Spreitzer (1995) argued that empowerment

leads to a proactive orientation toward jobs, management,

and organizations. High levels of self-efficacy lead to

more initiating behaviors and persistence in the face of

obstacles (Bandura, 1997). Deci and Ryan (1985) found that

the more an individual perceived that he or she had

autonomy, the more initiative that person took in work-

related situations. At the team level of analysis, teams

are proactive when they seek continuous improvement, revise

work processes, and seek innovative solutions to work

problems (Hyatt & Ruddy, 1997). Empowered teams have been

found to frequently take action on problems and improve the

quality of their work by initiating changes in the way work

is carried out (Wellins, Byham, & Wilson, 1991).

3. CUSTOMER SERVICE

Company-reported evidence demonstrates consistent links

between the use of work teams and high levels of quality

and customer service (Lawler et al., 1995; Manz & Sims,

1993; Wellins et al., 1990). Empowered teams take

responsibility for handling customer complaints directly

and often diagnose their own quality problems and issues

(Wellins et al., 1991). Guzzo and his associates (Guzzo et

al., 1991; Shea & Guzzo, 1987b) found that more potent

teams also provided higher levels of internal and external

customer service.

4. JOB SATISFACTION

Tymon and his associates (Thomas & Tymon, 1994; Tymon,

1988) and Spreitzer and her colleagues (1997) found

associations between empowerment and job satisfaction at

the individual level of analysis. In addition, employees

working in teams have reported higher levels of job

satisfaction than employees working in traditional settings

in the same company (Cordery et al., 1991; Wall et al.,

1986). Gorn and Kanungo (1980) found that the more

meaningful an employee's job was, the more satisfied the

employee was with his or her job. Typically, employees find

more meaning in their jobs when the scope of their

activities is large (Griffin, 1991), which is often the

case on empowered work teams (Wellins et al., 1991).

5. ORGANIZATIONAL COMMITMENT

Steers (1977) found that work-related experiences and

perceptions, rather than personal, job, or organizational

factors, were the most powerful predictors of

organizational commitment. Thus, an employee's experience

of empowerment may account for more variance in his or her

commitment level than more objective job or organizational

characteristics. Steers also found that a positive attitude

among one's peers was one of the more important experiences

affecting commitment. Empowered teams often generate these

positive peer experiences (Wellins et al., 1991). Finally,

Steer's research showed that if employees perceive that

their organization consistently makes and keeps its

commitments to employees, they are more likely to be

committed. The high level of support and trust inherent in

an empowered team system will likely contribute to higher

commitment levels among team members (Manz & Sims, 1993;

Wellins et al., 1991). At the team level of analysis,

Cordery and colleagues (1991) found that organizational

commitment was higher for employees in autonomous teams

than for those traditionally organized in the same company.

Hackman (1987) suggested that commitment effects may be

stronger for an employee's work team than for his or her

organization. For example, Wall and colleagues (1986) found

no effect of autonomous team membership on employee

organizational commitment, a fact attributed to an

overwhelming team commitment effect. To be consistent with

our theoretical model and these previous arguments, we

included both organizational and team commitment. Thus,

Hypothesis 1.

Helping behaviors from peers will be positively associated

with manufacturing workers' experienced empowerment. The

more team leaders stress on delegation of vital

organizational funcitions for instance, delegating

responsibility to a team members, soliciting and using team

input when making decisions, enhancing team members' senses

of personal control, encouraging team goal setting, self-

evaluation, and high team expectations, and trusting the

team, the more the team's members will experience team

empowerment resulting in higher productivity, proactivity,

customer service, job satisfaction and organizational

commitment.

Hypothesis 2.

A supportive work environment created by the organization

will be positively related to service workers' experienced

empowerment resulting in higher productivity, proactivity,

customer service, job satisfaction and organizational

commitment.

Hypothesis 3.

When manufacturing workers are delegated operational &

strategic responsibilities- the more, for instance, that

team members set their own production or service goals,

make important decisions such as scheduling and work

processes assignments, monitor and train for quality,

handle customer issues and complaints, and work with a

whole, contained product or service - the more the team

members will experience team empowerment resulting in

higher productivity, proactivity, customer service, job

satisfaction and organizational commitment.

Hypothesis 4.

The more that organizations implement team-based human

resources policies, whereby, for instance, team members are

paid on the basis of team membership, at least in part are

cross-trained within and across teams, participate in the

selection, training, discipline, and dismissal of fellow

team members, and formally evaluate the performance of

fellow members, the more the team members will experience

team empowerment resulting in higher productivity,

proactivity, customer service, job satisfaction and

organizational commitment.

Hypothesis 5.

The more that a team's members are embedded in a well-

developed social structure - for instance, have

sociopolitical support, have access to strategic

information and work unit resources, have a high degree of

inter-team coordination and communication, and make their

own rules and policies, the more they will experience team

empowerment resulting in higher productivity, proactivity,

customer service, job satisfaction and organizational

commitment. Figure 4.1 summarizes the hypothesized

relationships and performance outcome model.

CONCLUSION

In this chapter five set of hypotheses were presented and

performance outcome model was developed which will be

tested for further analysis in subsequent chapters. This

model is consistent with previous models of work team

effectiveness (e.g., Campion, Stevens, & Medsker, 1996;

Hackman & Morris, 1975; McGrath, 1964) as well as with

models of job design framed at the individual level of

analysis, such as Hackman and Oldham's (1980) Job

Characteristics Model. Classified as input-process-output

models, these models separate objective job characteristics

from both effectiveness and internal responses to these

characteristics. All these models include a three-stage

process in which organizational leaders take action in

stage one (inputs), those actions affect employee

experiences in stage two (process), and important outcomes

result from positive employee orientations toward work in

stage three (outputs).

CHAPTER 5

METHODOLOGY

To test the hypotheses presented in the previous chapter, a

cross-sectional study that involved mailing questionnaires

to the representatives of the largest manufacturing

corporations in the United States was undertaken. The

variables studied, sample, limitations of the study, and

analyses to be performed are described below.

Sample

The sample of the current study includes the largest firms

in the manufacturing sector identified in Business Week in

March 1997. The Business Week sample includes the largest

firms in the United State selected by scales. The present

study includes all of the firms in the industrial

categories presented in the table 5.1.

Questionnaires were first pretested with very large

American manufacturing firms that are part of the sample.

Then these questionnaires were mailed out to a total 645

corporations in the manufacturing sectors to the Vice

President of Human Resources. For the purposes of

identifying the Vice President of Human Resources of each

company, Standard and Poors Register of Corporations,

Directors and Executives was used.

A cover letter and return envelope accompanied the

questionnaire. The purpose of the cover letter was to

acquaint the respondent with the general purpose of the

study and to assure the respondent that no firm would be

identified by name in the results of the study. Four weeks

following the first mailing, a reminder letter and another

copy of the questionnaire was mailed. Of the 652 firms in

the sample, addresses were found for 645. Of the 645

questionnaires mailed, 159 responded representing a

response rate of 25%. In addition, 48 firms responded they

would not participate in the study, the vast majority

citing lack of time and/or resources to complete the

multitude of questionnaires mailed to their firms.

Measures

Independent (predictor) variables

Antecedents of empowerment

Empowerment was measured using a 12-item scale originally

developed by Spreitzer (1992, 1995), and modified for

service environments by Fulford and Enz (1995). Respondents

recorded their responses to the items on a 7-point Likert

scale ranging from 1, "strongly disagree," to 7, "strongly

agree."

The supervisory support construct was measured with a 18-

item scale. Examples of the items include the extent to

which a respondents agreed or disagreed that he or she gave

a team many responsibilities, asked the team for advice

when making decisions, controlled much of the activity of

the team (reverse-coded), allowed the team to set its own

goals, stayed out of the way when the team worked on its

performance problems, told the team to expect a lot from

itself, and trusted the team.

Supervisory support was made up of four categories

delegating responsibility (four items, [Alpha] = .95),

encouraging risk taking (four items, [Alpha] = .93), peer

respect (3 items, [Alpha] = .98), and mutual cooperation (6

items, [Alpha] = .96). Based on the results of confirmatory

analysis. Overall measure of reliability for this category

was obtained by combining these four variable into one

overall measure of supervisory support.

Supportive organizational environment was captured by

asking employees how accurately their organization was

described by each of four characteristics indicative of

support. The items, measuring perceptions of trust,

participativeness, and employee and relationship

orientations, were scored on a scale ranging 1 to 5.

Supportive organizational environment was made up of three

sub categories of empowerment dimensions (i.e.,

participative environment (3 items), [Alpha] = .97,

relationship oriented environment (2 items), [Alpha] = .96,

and supportive organizational structures (6 items), [Alpha]

= .95. These three sub-categories were combined into one

construct of supportive organizational environment.

The delegation of operational/strategic responsibilities

construct was measured with a 28-item scale. Examples

include the extent to which a team leader agreed or

disagreed that the team he or she led set its own goals,

had the responsibility to decide production/service

scheduling, and had the responsibility for measuring the

quality of its products.

Confirmatory factor analysis for this category was obtained

by measuring four sub-categories (i.e., production and

service goals (6 items), [Alpha] = .93, setting

organizational goal and objectives (8 items), [Alpha] =

.92, quality responsibility (8 items), [Alpha] = .93, and

process scheduling (6 items), [Alpha] = .91. These four

categories were combined into one overall measure of

operational & strategic responsibilities.

Human resource policies (a group construct) was measured

with a 16-item scale. Examples include the extent to which

a respondent agreed or disagreed that empowered teams were

rewarded as a group, were cross-trained to do different

jobs, and formally evaluated the performance of its own

members.

Based on the results of a confirmatory factor analysis four

measures of HR policies construct were obtained rewards (6

items), [Alpha] = .94, cross-training (3 items), [Alpha] =

.91, staffing decisions (5 items), [Alpha] = .93 and

performance evaluation (2 items), [Alpha] = .94. These four

measures were combined into one measure of HR policies

construct.

The pro social structure (group construct) was measured

with an 14-item scale. Examples include the extent to which

a respondent agreed or disagreed that the team he or she

led had access to other teams' resources, got support from

other groups in the company when it needed it, had access

to important information, depended on other teams for

resources or information, and had the responsibility to

make its own rules.

Based on confirmatory analysis three measure of social

structure construct were obtained and measured as social

structure construct. Variable within each sub-category

included (i.e., legitimacy/participation in network (6

items), [Alpha] = .93, rules and procedure development (3

items), [Alpha] = .91, and access to organizational

resources (5 items), [Alpha] = .93. These three measures

were combined into one overall measure of pro-social

construct.

Dependent Variables.

Performance outcomes of team empowerment.

Team-level productivity was assessed with a 11-item measure

developed specifically for this study. Examples include the

extent to which respondents agreed or disagreed that

empowered teams in their firms met or exceeded its goals

and achieved necessary performance.

Three measures of team productivity were collected. Team

productivity was obtained by asking the respondents to rate

productivity level (3 items) [Alpha] = .92, costs related

decisions (5 items) [Alpha] = .95, work processes related

decision (3 items) [Alpha] = .89. Based on a confirmatory

factor analysis supporting a one factor solution and a high

reliability score these three items were aggregated into

one team productivity score.

Team-level proactivity was assessed with a 16-item

adaptation of Bateman and Crant's (1993) measure of

individual proactivity administered to external team

leaders. Examples include the extent to which respondents

agreed or disagreed that their team could fix things it did

not like and was always looking for better ways to do

something.

The respondent rated the proactivity in terms of four

measures initiative (3 items) [Alpha] = .89, taking actions

(4 items) [Alpha] = .91, solving problems (4 items),

[Alpha] = .93 and continuous improvement (5 items), [Alpha]

= .85. Because these four items loaded on a single factor

and internal consistency was high they were aggregated into

one overall measure of proactivity.

Customer service was assessed with a 14-item scale

developed specifically for this study. Examples include the

extent to which respondents agreed or disagreed that their

team produced high-quality products and services and

provided a satisfactory level of customer service overall.

Customer service was measured by the level of customer

complaints (5 items) [Alpha] = .87, diagnosis of quality

problems (3 items) [Alpha] = .91, and level of

internal/external service (6 items) [Alpha] = .89. The

respondent was asked to rate the score in term of these

three measure. Because these three items loaded on a single

factor and internal consistency was high they were

aggregated into one overall measure of customer service.

Job satisfaction was assessed with Thomas and Tymon's

(1994) 17-item measure. The items assessed the extent to

which a team's members agreed or disagreed that team

members were satisfied with their pay (3 items) [Alpha] =

.91, the promotion opportunities possible (5 items) [Alpha]

= .87, the team's relations with other employees and

departments (6 items) [Alpha] =. 92, and the teams’ current

job assignments (3 items) [Alpha] = .86.

Organizational commitment was assessed using a 13-item

measure taken from Shapiro and Kirkman (1999). The items

assessed the extent to which a teams’ members agreed or

disagreed that team members were loyal to their

organization (3 items) [Alpha] = .83, expected to work for

the company for a long time (4 items) [Alpha] = .89, and

trusted management (6 items) [Alpha] = .86.

These measures were based on the Michigan Organizational

Assessment Questionnaire (Cammann, Fichman, Jenkins, &

Klesh, 1983). The measure of loyalty outcomes was drawn

from the short version of Mowday and Steers' commitment

scale (1979).

Following the procedure employed by Schriesheim (1979) and

Podasakoff and his colleagues (Podsakoff, Todor, Grover, &

Huber, 1984), Harman's one factor test (1967) was performed

to determine the presence of common method variance bias.

All ten variables, the five empowerment dimensions and the

five hypothesized performance outcomes antecedents, were

entered into a principal components factor analysis with

varimax rotation. According to this technique, if a single

factor emerges from the factor analysis or one "general"

factor accounts for over 50% of the covariation in the

variables, common method variance is present. Our analysis

revealed a two-factor structure with each factor accounting

for 31% of the variability. Thus, no general factor was

apparent. While this analysis does not completely rule out

the possibility of common method bias, it does provide some

post hoc statistical support for the absence of such bias

in the findings presented below. For details of independent

and dependent variables with performance outcome model of

empowerment see fig 5.1.

Analytical Procedures

In past work using LISREL, researchers who are attempting

to model relationships among a large number of latent

variables have found it difficult to fit such models even

to predictions with strong theoretical support (Niehoff &

Moorman, 1993). The relatively small number of cases for

estimating such a complex model exacerbates this problem

because LISREL requires approximately five cases for each

free parameter in the model (Bagozzi & Yi, 1988).

Therefore, steps are needed that decrease the number of

measures in the model (Joreskog & Sorbom, 1989). Following

the recommendation of Niehoff and Moorman (1993), the study

first employed confirmatory factor analysis (CFA) to assess

the validity of the measurement model of the independent

variables. Then given adequate validity of those measures,

number of indicators were reduced in the model by creating

an index representing each of the latent variables.

For example, delegation of operational and strategic

responsibili5ties index was created from its four

indicators in the measurement model. Then, these index

measures were input into the structural equations modeling

for examining the hypotheses. This process helped to

simplify the complex theoretical model and reduce the

number of latent variables in order that a LISREL

structural model could be estimated. Creating an index for

each latent variable also was important given the

multicollinearity among the manifest measures, particularly

among those manifest measures which compose a given latent

variable. Campion et al. (1994) analyzed a similar set of

variables at the manifest level, but interpretation of

relationships with the dependent variables was difficult

due to bias from multicollinearity.

Confirmatory Factor Analysis.

CFA was used to examine the convergent and discriminate

validity of the measurement model of the independent

variables. Each of the five theoretical perspectives (i.e.,

supervisory support, supportive organizational environment,

delegation of operational and strategic responsibilities HR

policies construct and pro-social structure construct) was

modeled as a latent variable measured by multiple

indicators, or manifest variables (e.g., loyalty to

organization, commitment and trust in case of

organizational commitment). Each manifest variable was

permitted to load on one latent variable. Because of the

multicollinearity among the manifest variables, unweighted

least squares (ULS) is used to estimate the measurement

model (as recommended by James & James, 1989). Traditional

maximum likelihood (ML) is also used to estimate the model.

To maximize the size of the data set for estimating the

measurement model, cases with complete data on all of the

independent variables were included in the CFA.

Structural Equations Modeling

Due to the limited sample size, the index of each latent

variable, rather than the multiple indicators included in

the measurement model, is used in the structural equations

modeling. Because we hypothesize that each independent

variable is related to each dependent variable, our

structural model is saturated (Joreskog & Sorbom, 1989). In

a saturated model, the significance of the individual paths

can be determined, but the overall fit of the model to the

data cannot be assessed because no overall fit statistics

are estimated. Consequently, we are able to test each of

our hypotheses but not the overall structural model.

Limitations

The present study is not without limitations. First, a

larger sample size would have allowed a more fine-grained

analysis of the model. For example, a larger sample would

have made it possible to conduct a multiple group analysis

in LISREL, across self-managing and traditionally managed

teams, in order to test the significance of the differences

in the paths in the structural model. A larger sample would

also have allowed us to model the individual variables

comprising each of the four theoretical perspectives,

rather than just the aggregated construct.

Second, given the cross-sectional nature of the data,

causality cannot be tested directly, although the

hypotheses imply causation. Causal direction may be

reversed on further investigation. For example, HR policies

construct could lead to high productivity etc. Although the

hypotheses developed are well grounded in prior theory,

experimental or longitudinal data are needed for more

definitive results.

Third, the overall fit of the structural models could not

be examined because the model estimated was saturated (that

is, all links were hypothesized). Future research should

estimate models that replicate our results (that is, using

only the significant paths) on a new sample in order to

assess the overall fit of the structural model. Here,

however, research makes a contribution because it permits

future testing of our structural model with a much smaller

number of cases in a different data set.

Prior research has shown that the technology and type of

work performed explains a significant proportion of the

variance in team effectiveness (Hackman & Morris, 1975;

Kabanoff & O'Brien, 1979). The teams in the sample

performed a wide variety of tasks, it is likely that

predictive models for self-managing teams performing

different types of work would systematically vary.

Unfortunately, because test of the comprehensive model of

empowerment dimensions and its relation to performance

outcomes required a large sample, this study was not able

to compare results from predictive models that

differentiated teams by technology or the type of work they

performed.

In addition, organizational level variables such as

culture, structure, and extent of change (e.g., downsizing,

TQM efforts) may also impact the effectiveness measures

examined. However, because samples were collected from one

segment of the industry i.e. manufacturing organizations

only, it is therefore difficult to examine contextual

influences. Further research is clearly needed to conduct

these more fine-grained analyses.

There are also some limitations to the current study in the

areas of generalizability, methodology, and variable

selection. The first is the generalizability of the

findings. As noted previously the sample in the present

study includes only the largest firms in the manufacturing

sector. A range of previous studies have found that larger

corporations have more employees involved in formal

empowerment schemes. Corporations in the manufacturing

sector differ from those in the service sector in several

significant ways. Manufacturing firms tend to be older and

more unionized than firms in the service sector.

There are several other limitations to the study associated

with the methodology used. The present study is cross-

sectional rather than longitudinal and cannot address the

issue of how empowerment changes and shapes firm

competitive position over time.

There are limitations resulting from the survey technique

utilized in the present study. Since the study examines the

perceptions of only one individual per company, there is no

way of testing whether this individual accurately reported

on outcomes of empowerment initiatives on firm's

performance. Another limitation lies in the measures of

participation used. The study examines formal participation

only as reported by the personnel director. It does not

examine informal participation or employee perceptions of

participation.

To preclude the questions of causality often begged by

cross-sectional studies, in our design we only included

organizations in which the relevant job and organizational

characteristics (the team empowerment antecedents) were

present at the site or organizational level - not team-by-

team. As a partial statistical check on whether empowerment

practices were uniform within organizations, an analysis of

variance was conducted, with organization as the predictor

variable and the job and organizational characteristics as

criterion variables.

A cross-sectional design cannot speak to the possibility

that team empowerment experiences are caused by team

effectiveness, rather than vice versa. In fact, researchers

have suggested that effectiveness and empowerment may be

reciprocally related (Spreitzer, 1995) and self-reinforcing

(Thomas & Velthouse, 1990) at the individual level of

analysis. Lindsley, Brass, and Thomas (1995) made the same

argument for effectiveness and potency at the team level of

analysis. Longitudinal studies are needed to explore these

reciprocal effects over time.

A second limitation of this study is the lack of

multimethod operationalizations and measurements of the

response variables, although this too is mitigated in part

by the strong reliabilities of the measured variables.

Future studies would benefit by employing alternative

methods of assessing the dimensions of empowerment and

sampling from organizations with and without formal

empowerment programs. Conceptual replication will lend more

credence to these and past results than would a repetition

using the methods employed herein.

Last, all the constructs are measures of employee

perceptions that may magnify the relationship between

predictor and response variables. Further, it is worth

noting that there is no better source for the perceptions

of workers than the workers themselves. Relatedly, the

problem of common method bias when dealing with self-

report, perceptual data has, at the very least, been

overstated in the literature and may be fictitious

(Crampton & Wagner, 1994; Spector, 1987). Once again, the

inclusion of multiple data locations and organizational

cultures lessen the degree to which our results were

affected. The analyses performed and the results reported

reflect the perceptions of nearly 159 personnel directors

on. The above notwithstanding, the next generation of

studies should attempt to gather information from

alternative sources such as employees who are working at

the shop floor level, customers, and middle managers.

In addition there are, however, important limitations to

drawing conclusions from these analyses. At least two

factors contribute to the lack of significant findings.

First, there are too few cases within each cell to achieve

statistical significance. The small number of cases within

each category may contribute to the lack of significant

findings. Another limitation to drawing conclusions from

the analyses results from the lack of reliability of

measures used.

RESULTS

Confirmatory Factor Analyses

Both the ML and ULS solutions are provided in Table 5.2.

One manifest variable, performance evaluation, a dimension

of HR construct was dropped from the analysis due to strong

correlated error variance with other variables.

Rules/procedures, a measure of social structure construct,

loaded on the HR policies latent variable. Performance

output a measure of production/service responsibilities,

loaded on evaluation latent variable. This probably results

from the conceptual overlap between the meaning recognition

in the production/responsibilities construct and HR

policies construct. The final measurement model is shown in

Fig. below.

The goodness of fit indices for the ULS solution indicated

that the fit of the model to the data was generally good.

Both the GFI and AGFI exceeded .97, and the RMSR approached

the .05 rule of thumb. The chi-square cannot be used to

test the goodness-of-fit for ULS estimations (James &

James, 1989). The ML solution, however, suggests some minor

model misspecifications: the GFI is .88, the AGFI is .82,

and the RMSR is .07. Model misspecification may be due to a

number of reasons, including the substantial

multicollinearity among manifest variables leading to

correlated error variance or the low ratio between cases

and paths to be estimated (in this case 3.5:1 rather than

the ideal 5:1 scenario (Bagozzi & Yi, 1988)).

In cases such as this with minor model misspecification,

the non-centralized norm fit index (NCNFI) can be computed

to obtain an assessment of comparative fit among nested

models. When comparing two models, a large change in chi-

square compared to the difference in degrees of freedom

indicates that the freed parameters constitute a real

improvement in fit. An index greater than or equal to .90

indicates an adequate fit. Here the null solution is

contrasted to a one-factor model (where all independent

variables are hypothesized to load on one latent variable),

a three-factor model (where peer helping behavior and HR

policies context are hypothesized to be one latent

variable), and the four-factor measurement model

hypothesized in this paper. The results suggest that only

the four-factor model achieves an adequate NCNFI (see Table

5.3).

Structural Equations Modeling

As described above, to reduce the number of free parameters

of the structural equations modeling, an index is created

for each of the latent variables. To take into account the

differential loading of the manifest variables on the

latent variables as shown in Table II, each index is

created from the mean of the manifest variables using their

ULS loading as weights.

Descriptive statistics and correlation for all of the

variables included in the structural equations modeling are

provided in Table 5.4.

Table 5.4 shows the descriptive statistics, scale

reliabilities, and correlation matrix for the various

empowerment dimensions which influence performance

outcomes. While the inter correlation for several of the

empowerment dimensions were high, they were not so large as

to raise issues of conceptual overlap.

To explore the connection between five important

empowerment dimensions and their influence on productivity

(for details refer to table 5.3) five independent

regression models were devised. The results of these five

independent linear regression analyses are presented in

Table 5.4. All five models were significant (p [less than]

.001). The variance in the dimensions of experienced

empowerment ranged between 20-30% percent. In general,

then, empowerment initiatives do result in performance

outcomes.

Figure 5.1 displays results of hypotheses testing using

structural equations modeling. Standardized path estimates

are provided to facilitate comparison of coefficients.

Three out of five hypotheses are supported by this data,

for various dimensions of performance outcome. For details

of detailed regression analysis see table 5.5.

Supervisory support is positively related to team

productivity (.444***), proactivity (.30***), customer

service (.44***), job satisfaction (.38**), organizational

commitment (.43***). Thus, supporting hypothesis 1.

Supportive organizational environment is positively

associated with team productivity (.15**), proactivity

(.21***), customer service (.20***), job satisfaction

(.15**) and organizational commitment (.18**). Thus

providing support for hypothesis 2. Delegation of

operational and strategic responsibilities is positively

associated with team productivity (.19**), proactivity

(.22***), customer service (.14**), job satisfaction

(.16**) and organizational commitment (.30***). Thus

providing support for hypothesis 3. Team based HR policies

do not show any significant performance outcomes for

productivity (.06), proactivity (.12), customer service

(.10), job satisfaction (.09*), and organizational

commitment (.06). Thus hypothesis 4 is not supported. Pro-

social dimension do not indicate any positive performance

outcomes for productivity (.07), proactivity (.08),

customer service (.11), job satisfaction (.12), and

organizational commitment (.09). Thus hypothesis 5 is not

supported.

CHAPTER 6

CONCLUSION

This study has tested various dimensions of empowerment and

its affects on performance outcomes. It permits the

examination of the relative strength of predictors drawn

from competing theories of the effectiveness. For each of

five categories of variables, a weighted index of the

scales was defined based on the measurement model of the

independent variables. The study focused on the

relationship between these five indices and a set of

outcomes, not the relationship between specific variables

comprising the indices and outcomes. This study reflects my

initial interest in testing the relative strength of

different theoretical explanations of performance outcomes

in relation to empowerment.

MAJOR FINDINGS

Several conclusions are drawn from the results of the

analyses. First, findings show that supervisory support,

delegation of operational & strategic responsibilities and

supportive organizational environment (important dimensions

of empowerment) are associated with high level of

productivity, proactivity, customer service, job

satisfaction and organizational commitment in large

American manufacturing firms.

Productivity, proactivity, customer service, job

satisfaction and organizational commitment are some of the

few essential ingredients for achieving differential

advantage for manufacturing firms.

However, the results do not support the fact as prevalent

in the literature that pro social construct and HR policies

construct (again important dimensions of empowerment) are

associated with five identified performance outcome models.

These findings further lend support to the critics who

argue that participative schemes are a tool used by

management to manipulate employees into believing that they

exert greater influence. These schemes are sometimes used

to magnify management control over decision making.

In addition these results raise further questions regarding

the conceptualization of performance outcomes and its

relation to empowerment dimensions as presented in the

literature. They fail to support many popular beliefs

present in the literature. However, it should be noted that

much of the interpretation of the statistical results of

this study focuses on the statistically significant

findings.

It is interesting that the bivariate correlation between

the supervisory behavior index and several outcomes are

significant when there is no control for other predictors

(see Table 5.4).

The major surprise in the structural equation model is HR

policies and social structure constructs, which shows no

significant relationship to any dependent variable.

Theoretical Implications

Findings of this study support previous theoretical

arguments for helping behaviors from peers (Culbert &

McDonough, 1986; Cummings, 1978; Denison, 1982) and

empirical studies of supervisory empowerment (Burpitt &

Bigoness, 1997) and self-management (Manz & Sims, 1987).

Similarly, the study found a positive relationship between

operational and strategic responsibilities and team

empowerment experiences, a finding that supports previous

theoretical work in this area (Cummings, 1978; Hackman,

1987; Manz & Sims, 1993).

Findings related to supervisory support, supportive

organizational environment and operational & strategic

responsibilities constructs are consistent with the self-

leadership theory of Manz & Sims (1986, 1987, 1989). Manz

and Sims (1987) found a positive relationship between self-

leadership and coordinator effectiveness.

The link between human resources policies and pro social

construct does not support previous empirical findings

(Blackburn & Rosen, 1993; Frayne & Latham, 1987; Gist et

al., 1991) and theoretical work on teams (Hackman, 1987;

Manz & Sims, 1993). In addition, the fact that the mean

reported in table 5.3 may indicate that organizations adopt

provide legitimacy and opportunities of participation in

organizational networks at a much slower rate than other

team-related changes or perhaps do not adopt them at all

(Mohrman et al., 1995). Changing established organizational

rules and procedures is complex and can be emotional for

change recipients (DeMatteo et al., 1998; Gibson & Kirkman,

1999; Kirkman et al., 1996).

With regard to social structure, this study does not

validate Spreitzer's (1996) findings and previous

empirical (Gladstein, 1984) and theoretical work (Hackman,

1987) on structure at the team level of analysis.

Specifically, work units that provided sociopolitical

support and access to important information and resources

did not any significant level of performance. In summary,

the findings of this study highlight the importance of the

organizational context in creating team empowerment

experiences where some sort of supportive mechanism exist

(Wageman, 1997). Organizations should attend to context at

multiple levels of analysis (from leader behavior to

organization-wide policies) to more fully realize the

benefits of team empowerment (Campbell & Martinko, 1998).

Second implication of this study concerns Spreitzer's

(1995) suggestion that empowerment researchers expand their

research by broadening outcome measures to include

organizational commitment, organizational effectiveness,

and total quality management. Following Spreitzer's

recommendations proved useful; team empowerment was

positively associated with a broad range of positive

employee and organizational outcomes such as commitment,

proactivity, and customer service.

The adoption of empowerment practices has soared as

companies respond to competitive challenges in the current

business environment. The Center for Effective

Organization's study of Fortune 1000 companies found that

27% of firms in 1987, 47% in 1990, and 69% in 1993

implemented various forms of empowerment programs for

performance gains. Most organizations which use these

programs report them to be successful (Lawler, Mohrman, &

Ledford, 1995).

The relationships among outcomes indicate that supervisory

support, supportive organizational environment and

delegating operational and strategic responsibilities to

manufacturing worker leads to higher performance and job

satisfaction. The finding that these three empowerment

dimensions lead to performance may appear inconsistent with

considerable research indicating that employee satisfaction

typically does not cause performance, and indeed the

opposite causal pattern may be more nearly true (Lawler,

1973). Some research has indicated the service

organizations may present a different pattern (e.g.,

Schneider & Bowen, 1985). Employee morale may be reflected

in service organization performance because customer

service is the key performance indicator, and customers can

detect and are affected by the level of employee

satisfaction. This study was carried out on manufacturing

firms which operate in different environment and in many

ways different to service organizations. Further research

is needed using a much larger sample in manufacturing and

other settings.

However, extensive prior research on employee motivation

has found a weak relationship between employee satisfaction

and employee productivity (Bagozzi & Phillips, 1982;

Lawler, 1973).

A recent stream of research by Schneider and his colleagues

(Schneider, Gunnarson, & Niles-Jolly, 1994), particularly

Schneider and Bowen (1993, 1995), has raised new questions

about whether the relationship between employee

satisfaction and performance might not be stronger in many

organizations. Their basic finding in a series of studies

is that positive employee attitudes strongly predict

customer perceptions about service. Moreover, positive

employee attitudes about human resource management

practices (supervision, work facilitation, etc.) are

strongly related to customer perceptions of service

quality.

Wageman ( 1995) argues that the leader must take on the

role of coach rather than director. The author found that

an effective coach is a person who helps design an

appropriate structure for the team. Fisher (1993) argues

that the role of a SMWT leader is multifaceted and includes

being a coach, business analyzer, barrier buster,

facilitator, customer advocate, and living example. This

role requires team leaders to exhibit behaviors that are

both considerate of team members and demanding of high

performance.

Manz and Sims (1987)suggest that a leader of a SMWT must

encourage self management in terms of (a) encouraging self-

observation/self-evaluation so that the team can gather the

information required to monitor and evaluate its

performance, (b) encouraging self-goal setting so that the

team sets performance goals, (c) encouraging self-

reinforcement so that the team recognizes and reinforces

good team performance, (d) encouraging self-criticism so

that the team is self-critical and discourages poor team

performance, (e) encouraging self-expectation so that the

team has high expectations for group performance, and (f)

encouraging rehearsal so that the team practices an

activity before performing it. Regardless, the leader must

play a supportive role to enable the team to manage itself.

Lawler (1986), who asserts that several organizational

design elements must be moved to lower organizational

levels for EI to be effective. The design elements are (a)

power to make decisions about work and business

performance; (b) information about work processes, quality,

customers, business performance, competitors and

organizational changes; (c) rewards tied to performance and

development of capability; (d) training that enables

employees to develop the knowledge required for effective

performance; and (e) resources (i.e., equipment, space,

tools, and materials) that permit employees to accomplish

their work. Lawler's principles of EI design are derived

from motivation theory (e.g., Lawler, 1973). He indicates

that the more employees have power, information, rewards,

training, and resources, the more they will feel ownership

and responsibility for their work, motivating enhanced

effectiveness.

MANAGERIAL IMPLICATIONS

These findings suggest some important implications for

practitioners interested in designing effective

empowerment practices for optimum performance outcomes.

Knowledgeable, informed, and motivated employees are in the

best position to exercise good judgment. Organizations can

create the conditions for employees to exercise good

judgment by providing team members with the power to

influence decisions, performance feedback, training in

interpersonal and technical skills, and rewards linked to

business results. These are the key ingredients of a

competitive organization.

The results indicate that a practitioner interested in

achieving performance outcomes should first focus on

enhancing supervisory support relationship in manufacturing

firms. Supervisory support context has the strongest

relationships to all five performance outcome models.

Similarly delegating operational and strategic

responsibilities and supportive organizational constructs

provide unequivocal support for five performance outcome

models. Other research on teams in knowledge and service

settings has also found that the design of an empowering

organizational context is critical for effectiveness

(Mohrman, Cohen, & Mohrman, 1995; Cohen & Spreitzer, 1994).

Contextual factors may play a more critical role for teams

in manufacturing settings due to the nature of the work.

Practitioners also need to reconsider that employees will

feel ownership and motivation to perform well if they have

responsibility for operational and strategic task. Team

leaders can also ensure that team members have collective

goals for which they are mutually accountable. Finally,

team leaders can influence the design of employee

involvement practices to ensure that they support effective

teamwork.

More specifically, the leader has a key role in providing

team members with necessary training and resources. The

leader needs to make sure that the systems are in place to

provide performance feedback. The team leader also needs to

work with upper-level managers and human resources to

create a team-based, performance-contingent reward system.

Thus, rather than managing the day-to-day functioning of

the team, the more effective role for the team leader may

be in terms of its design.

Work-related variables (e.g., job characteristics, task

responsibilities, process scheduling, perceived control

over rewards) are considered to be important for

understanding work attitudes, such as job satisfaction,

because these variables create an immediate and strong

situational influence (Davis-Blake & Pfeffer, 1989; Zeitz,

1990). Empirical research (e.g., Agho et al., 1993;

Carlopio & Gardner, 1995; Fox, Dwyer, & Ganster, 1993;

Loher, Noe, Moeller, & Fitzgerald, 1985) has shown that

such immediate or "proximal" work-related variables

directly impact on employee job satisfaction.

It is recommended that managers use the team empowerment

scale developed for this research program to assess the

teams they lead. Findings of this study suggest that it is

imperative that managers should take actions in multiple

contextual arenas and at multiple levels in their

organizations to (1) ensure that team leaders receive

training to exhibit appropriate behaviors, such as

encouraging teams to solve their own problems and setting

high team expectations, (2) increase the production/service

responsibilities of teams, such as the production of whole

products or the delivery of integrated services, and allow

team members to set their own goals, (3) alter human

resource policies, for example, increasing the amount of

cross-training and training team members to hire and

discipline fellow teams, and (4) modify social structures

to increase team member access to resources and information

and establish more communication and coordination across

teams.

Can workers perceive themselves as empowered in the absence

of a formal empowerment program? If the behaviors of co-

workers and customers convey support the answer is clearly

yes. Based on the findings of this study, it appears the

probability of success of a programmatic empowerment effort

may be enhanced if workers' relationships with one another

and with customers are supportive and community building.

If an organization seeks to reap the benefits of employee

empowerment such as enhanced quality or productivity, but

cannot afford to develop and institute a formal program,

fostering supportive and helping co-worker and customer

relationships may yield empowerment at relatively low cost

to the organization.

This finding is particularly useful for manufacturing

organizations in which high seasonality of employment, and

thus high turnover, make programmatic efforts more costly

and difficult to implement.

Based on the findings of this study it is recommended that

an environment in which good organizational citizenship is

present contributes to productivity, proactivity, higher

customer service, job satisfaction and organizational

commitment. It is suggested that if an organization seeks

to empower employees and can do only one thing, management

should facilitate the creation of an environment in which

workers are encouraged to assist others and take positive

action beyond the limits of their proscribed organizational

roles.

As members' self-efficacy grows, so does the collective

efficacy of the group (Bandura, 1986). Strong, positive

perceptions of self and collective efficacy may result in

greater effort to succeed and an increased likelihood that

the effort is sustained when barriers to success are

present.

It may be that the relationship between peer helping

behavior and efficacy is symbiotic and feeds on itself. As

one experiences in-role success, feelings of high self-

efficacy result. These feelings may increase the likelihood

that one engages in extra-role helping behavior. The

experience of success, or inactive attainment, influences

positive efficacy perceptions more powerfully than any

other source of information (Bandura, Adams, & Beyer, 1977;

Biran & Wilson, 1981).

Generally, the findings indicate that the psychological

empowerment of manufacturing workers to be higher when

positive and supportive relationships exist with peers who

are helpful. Experienced empowerment is related to

supportive institutional (management focused). It may be

that customers and managers who sincerely engage in

supportive behaviors minimize the social status gap between

the workers and themselves, thereby enabling workers to

experience more meaningfulness, personal influence, and

self-efficacy on the job.

Hence, a reason for the failure of empowerment efforts may

be the lack of attention to creating relationship-based,

supportive, and caring work environments. If so, then

attention to work relationships as precursors to needed

organizational structural changes may be essential.

While many executives talk about their empowered workforces

little if any evidence of psychological empowerment is

offered. Instead, many organizations have downsized middle

managers and added responsibilities to the existing tasks

of first-line workers. In many instances these redesigned

jobs have failed to produce feeling of being empowered, but

instead have created job stress, burnout, and helplessness.

Many so called empowerment efforts are actions to flatten

the organizational hierarchy and are motivated by short-

term labor reduction strategies.

These efforts lack grounding in a philosophical belief in

enabling or empowering employees, and are not reinforced by

strong communities based on supportive relationships.

Efforts to reduce hierarchy and enrich worker jobs may

experience failure if the relationships are unsupportive,

distrusting, abusive, or manipulative. Future studies

should continue to explore the ways in which healthy and

caring relationships can enhance organizational

performance.

CONTRIBUTION TO THE EXISTING LITERATURE

The research on participative management has been fairly

consistent in reporting beneficial outcomes. These outcomes

seem to have been confirmed over time and in a variety of

settings. Positive findings have been reported, for

example, for groups of various size (French, Kay, & Meyer,

1966; Pennington, Haravey, & Bass, 1958), in service-

oriented organizations (Lawler & Hackman, 1969; Neider,

1980), and in manufacturing organizations (French, Israel,

& As, 1960; Safizadeh, 1991).

The first comprehensive review of research on participative

management was undertaken by Locke and Schweiger (1979) who

examined more than 50 studies representing a variety of

types of participative management. Their conclusions, in

stark contrast to much prevailing sentiment, suggested that

participation did not relate to productivity but that it

did increase individual satisfaction, although not

uniformly across the studies.

Using more sophisticated meta-analytic techniques, Miller

and Monge (1986) reviewed participative management studies

from a somewhat different perspective. Although the

conclusion of their analysis suggests a positive

relationship between employee participation and

organizational outcomes, they noted that a variety of

studies were excluded from their analysis either because

participation was not clearly measured or manipulated, or

because of methodological problems within the study.

In a later study by Wagner and Gooding (1987), further

analyses were performed on existing participative

management studies and the results of the preceding study

by Miller and Monge were reinterpreted. In discussing the

analysis of their results, Wagner and Gooding observe that

the findings have important practical implications because

they suggest that the participatory management programs

being implemented with increasing frequency in U.S. work

organizations might fail to yield many of the strong

objective gains in outcomes, other than motivation.

A still more recent review of the literature by Cotton,

Vollrath, Froggatt, Lengnick-Hall, and Jennings (1988) adds

another dimension to the analysis of participative

management by arguing that it is often incorrectly viewed

as a single concept. Employee participation raises a number

of very complex issues. It is practically impossible to say

anything about the potential effectiveness of a program or

about its nature from merely knowing that it is called an

employee participation program.

Although many of the preceding techniques, which fall under

the general heading of employee involvement, are not new to

the study and practice of management (e.g., quality

circles, job enrichment, and suggestion systems), there is

a current resurgence of interest in the overall concept of

participation by both professional managers and

academicians. For example, some of the literature focuses

on the effectiveness of specific interventions (Buller &

Bell, 1986; Wall, Kemp, Jackson, & Clegg, 1986) whereas

other literature views employee participation from a

broader perspective (Belohlav, 1990; Sugarman, 1988).

This increasing interest in participative management

combined with the apparently inconsistent results reported

in the extant literature suggests the need for continued

efforts to clarify existing relationships.

This study makes a number of important contributions to the

literature on empowerment and its relation to performance

outcomes. This study develops and tests a comprehensive,

theory-driven model of team effectiveness. Previous studies

have tried to look at only a subset of predictor variables

and/or components of effectiveness. Even studies that

include multiple criteria of effectiveness tend to examine

only one dependent variable at a time rather than

simultaneously, as is possible with causal modeling. The

use of five dependent variables permits to examine the

differential effects of the predictor variables as well as

the interrelationship among the dependent variables. Prior

studies are vulnerable to omitted variable biases with

respect to both predictor and dependent variables. Thus, a

key contribution of this research is that it simultaneously

examines a more complete set of independent and dependent

variables, thus minimizing the potential for biases.

A second contribution is the use of a diverse sample drawn

form large American manufacturing firms. The sample from

the survey permitted more complex modeling than usually is

possible in similar type of research. The best prior

studies (e.g., Goodman, 1979; Wall et al., 1986) have been

conducted in a single location that uses a single

technology and an essential uniform implementation of

empowered work teams. The diverse sample is less subject to

biases that may arise from the use of a small, relatively

uniform sample.

Third, the samples are constituted of teams from firms in

the manufacturing sector which are considered very large.

Most prior research on empowered teams has focused on the

use of teams in manufacturing organizations in single

location, even though the manufacturing sector is a much

larger part of modern economies and still growing. As noted

in the discussion of the results above, a number of the

predictor variables (e.g., employee involvement variables)

are believed to be more critical in a service or knowledge-

work setting where work is more complex and less routine

than in a manufacturing setting where work is more routine

and pre-specified.

Building and sustaining successful competitive advantage

strategies has been the focus of numerous studies in

management literature spanning a considerable number of

years. These studies provide valuable insights into many of

the factors associated with gaining competitive advantage.

The research project is focused on identifying the

characteristics of successful firms, particularly in terms

of the specific skills that build competitive advantage and

superior performance in manufacturing firms.

While many factors certainly contribute to a firm's

performance - including those related to the underlying

demand for the nature of the service offered the extent and

nature of their competition, the supply and quality of

available labor, other factor and locational conditions,

relationships of firms with their collaborators and

suppliers, and the particular characteristics of the firms'

organization, culture, and leaders - firm performance

within a particular marketplace is ultimately driven by how

the firm give meaning to its philosophy in relation to

socio-political, and HR policies.

Empowerment strategies plays a vital function by maximizing

employee expertise to achieve the main objectives of an

organization. This is done by methods that enable

organizations to compete with the emergent changes in

business strategies.

This study has made significant contribution in indicating

what constitutes key performance indicators for

manufacturing firms and its relation to empowerment

initiatives. In addition the study examined the roles of

participative and empowerment strategies on firm's

performance.

This study adds to the growing body of research that has

examined the effects of empowerment on organizational

effectiveness. However, as indicated earlier, performance

outcome model of empowerment is developed with a relatively

new construct i.e. many predictor and dependent variables

are drawn from competing theories. Previous studies were

not so comprehensive as they included small number of both

predictor and dependent variables. In view of these

findings, it is hoped that managers will attempt to create

empowerment experiences for their work teams. In addition,

it is also hoped that researchers will continue to examine

team empowerment and use the team consensus technique to

assess important team constructs. This study can assist

researchers to identify and assess the conditions necessary

to make work teams optimally effective in manufacturing

organizations specially in U.S.

IMPLICATIONS AND FUTURE RESEARCH ISSUES

The measurement model indicates that there was considerable

empirical overlap between the five indices. This in part

reflects the disparate theoretical concerns of many

prominent researchers. Hackman (1987) has developed

theories of task design and group characteristics; Lawler

(1992) has developed theories of task design and employee

involvement; and so on. Chapter 2 presented an extensive

details of various theoretical constructs. Theorists whose

work has focused on just one of the five predictor domains

examined here also have borrowed from the other domains.

The result is that variables used in one theory are not

always conceptually distinct from those in other theories.

When the focus is on only one explanation of effectiveness,

the theoretical overlap between different frameworks is not

obvious. The predictors in this study are combined into a

more comprehensive model and are tested simultaneously,

however, the degree to which different models share similar

variables becomes clearer. Indeed, the test of this

measurement model will prove useful for future researchers

to revise initial framework to reduce the redundancy of

variables.

All variables in this study are moved to the categories in

which they loaded most heavily. This decision required a

judgment call that others could make differently on

theoretical grounds. Rather than imposing my own

theoretical preferences on the data, I have chosen to let

the data guide the judgment calls about categorizing

variables. Different choices on theoretical grounds would

have weakened the structural model due to increased

measurement error and could have led to a different

structural solution. Also, it is possible that different

measures of the variables in this performance outcome model

of empowerment would have resulted in a different

measurement model and, hence, a different structural model.

Future research using different operationalizations of

variables or different measurement instruments would be

useful in addressing this possibility.

The overall pattern of relationships between independent

variables and dependent variables in the structural

equation model is consistent with the hypotheses. The

general pattern is that there is a significant direct path

between each of the independent variables and one or more

dependent variables for both samples. Because of the

relationships among the dependent variables, however, a

number of other predictor variables are indirectly related

to other dependent variables. Most of the predicted

relationships between independent and dependent measures

hold, directly or indirectly.

I suspect that multicollinearity among the independent

variables is the major culprit suppressing the significance

level of many tested paths between independent and

dependent variables particularly in HR and pro social

behavior construct. The measurement model of the

independent variables indicates that the latent variables

are significantly different from unity, but nonetheless

they are significantly correlated. Multicollinearity

increases the standard errors of the coefficients, making

it harder to achieve significance, especially when the

number of variables within each category are small. Future

research can attempt to overcome these problems by

increasing sample size and by using independent measurement

or different operationalizations that reduce same-source

methods bias.

The present research is based on responses from only

manufacturing firms. Responses from additional companies

are needed to determine if the present findings generalize

to other organizations or in some way are limited to

manufacturing industries. To extend the study to include

other companies would provide an opportunity to determine

the generality of the factor analytic results.

The validation process demonstrated that a subset of the

dimensions can differentiate groups identified as more

empowered from groups identified as less empowered. Because

the degree to which the classification is precise cannot be

determined, developing a more precise procedure is a high

priority for any follow-up to the present study. Such a

procedure would include both definitions of the issues

being rated as well as the assessment of variable

reliability.

The availability of a measure of empowerment opens the way

to research in several directions. There is an opportunity

for comparative analyses. Scores reflective of an

individual's position on the identified dimensions allow

for comparisons of individuals, of their workgroups, of

categories of employees, and of organizational divisions.

It also is possible, where relevant data are available, to

benchmark other companies.

Another direction would be to examine the relationship

between empowerment level and both employee satisfaction

and performance. To do so will require clear definitions

and adequate measures of both satisfaction and performance.

A rationale and hypotheses for how empowerment relates to

these issues are important aspects of such an examination.

Finally, assuming that empowerment does influence both

satisfaction and performance, an understanding of ways to

enhance empowerment is needed. For example, even if goals

are clarified and recognition systems made more

significant, how to encourage employees to make their own

decisions and to improve their decision making skills is an

important consideration. Rationale and relevant hypotheses

that address such issues are needed.

Researchers should continue to examine team-based human

resources policies because findings of this study indicate

that they are integral drivers of team empowerment and,

consequently, of team effectiveness.

Future studies might consider the possibility that

empowerment programs without supportive helping

relationships may fail to yield empowerment. Examining

relationships in concert with empowerment program design

could be a fruitful area for future study.

BENEFITS ASSOCIATED WITH EMPOWERMENT PRACTICES

TABLE 1.1

* reduced costs; * reduced wastage;

* increased productivity; * getting closer to customers;

* fewer layers of managerial bureaucracy; * shorter time to market for products and services; * increased employee motivation and commitment; and * increased recognition of individual employees'

contributions.

TABLE 1.2 RESULTS OF EMPOWERED TEAMS Organization Results Proctor & Gamble 30-50% lower manufacturing costs Federal Express Cut service problems by 13% in one year AT&T Credit Corporation Applications processed per day doubled General Electric Productivity increased 250% Xerox Teams at least 30% more productive Volvo Production costs decreased 25% Honeywell Output increased 280% (Source: Management Review, January 1994)

TABLE 1.3 COMPARISON OF EMPOWERED TEAMS AND TRADITIONAL WORKGROUPS Traditional work groups Self-directed teams Take directions Take initiative Seek individual rewards Focus on team contributions Focus on blame Concentrate on solutions Compete Cooperate Stop at preset goals Continually improve & innovate Demand more resources Work with what they have React to emergencies Take steps to prevent them Spend money Save money to improve quality by improving quality

TABLE 1.4 Why do some empowerment efforts fail? Set of hypotheses Many empowerment efforts have failed over the past ten to fifteen years, mostly due to the following six reasons: H1.Lack of sustained management support and commitment. Management commitment must be effectively communicated on an on-going basis. H2. Empowerment is used as a manipulative tool to ensure employees complete tasks and assignments. Empowerment is not another gimmick intended to motivate employees without giving them any real responsibility or authority. H3. Managers use empowerment to abdicate managerial responsibility or task accountability. The manager assigns responsibility for task accomplishment to others, accepts accolades for success and assigns fault to others for failures. H4. Empowerment is deployed selectively, segmenting the workforce into those who are empowered to use their brainpower and creativity to solve problems and those who are not. Such deployment is destructive and virtually guarantees failure. H5. Empowerment is used as an excuse to not invest in training or developing employee skills. Empowered employees require additional skill and team building training to assure continued success. H6 Managers fail to provide feedback and constructive suggestions and do not recognize achievements. Without proper and consistent management support, empowerment will fail to yield measurable results.

FIGURE 1.1

EMPOWERME�T DIME�SIO�S

Delegation of

operational

strategic

responsibilities

production scheduling

quality improvement

customer

Supportive

environment

workplace settings

humanistic

environment

positive cultural

norms

Supervisory support

------------------------

--------

sharing ideas

employees input

self expression

task autonomy

support and trust

HR policies construct

team incentives

multiskilling

opportunities

reward/pay structure

performance

evaluation

Socio-political

support

legitimacy/participa

tion in networks

rules & procedures

development

control over

resources

Empowerment dimensions Performance outcomes

Fig 1.2

supervisory support productivity

supportive environment proactivity

delegation of operational/

strategic responsibilities customer satisfaction

human resource policies organizational commitment

construct

socio-political support job satisfaction

BEHAVIORAL AND ATTITUDINAL CONSEQUENCES OF EMPOWERMENT

TABLE 2.1

self-efficacy

adaptiveness

freedom of thought

risk taking

quick service delivery

reduced ambiguity

reduced role stress

task autonomy

greater enthusiasm

greater trust

freedom from threat

availability of information

climate of collaboration

rather than competition

discretion over work processes

ESSENTIAL INGREDIENTS OF EMPOWERMENT

FIG 2.1

empowerment blocks

empowerment blocks

authority

responsibility

accountability

skill

experience

task

empowerment motivation

commitment

confidence

knowledge

willing attitude

EMPOWERMENT INTERVENTIONS

TABLE 2.2

SYSTEMATIC EMPOWERING INTERVENTIONS

belief and trust

training in leadership skills

creation of shared values

plan for changing organizational culture

increase in system knowledge

expression of equality

orientation toward task excellence

clarification of organizational values

atmosphere of openness, authenticity, and acceptance

emphasis on positive attitudes

clear ethical cornerstones

EMPOWERMENT INTERVENTIONS

TABLE 2.3

STRUCTURAL EMPOWERMENT INTERVENTIONS

flattening of hierarchy

emergent organic structures

decentralization

team models of task completion

smooth workflow patterns

use of participative structures

networking norms

access to resources

absence of traditional status differences

EMPOWERMENT INTERVENTIONS

TABLE 2.4

PROGRAMMATIC EMPOWERING INTERVENTIONS

planned change program

periodic reviews of organizational structure

employee assistance programs

implementation of reward systems

benefit packages reflecting employee needs

collaborative work designs

peer alliances and mentoring

profit sharing

PROCESS EMPOWERMENT MODEL

FIG 2.2.

trust authority

resources information

Process

empowerme

nt

Customer

satisfaction

higher

productivity

organizational

commitment

job satisfaction

proactivity

Differential

advantage and

overall

organizational

well-being

COMPARATIVE ANALYSIS OF NEW TRENDS IN PARTICIPATIVE CULTURE

AND OLD CULTURE

TABLE 2.5

Old culture New culture

system characterized by modern system with

permanence, hierarchy and transient units, and

division of labor continual reorganization

slow to change, fast-moving, information

static in nature rich, open to change

workers operated within a fluid participative

chain of command from tops patterns, disposable units

down work teams and ad hoc units

primarily concerned about primarily focused on

self interests of corporate social

organization responsibility

functioned well in stable functions best in post

societies, predictable industrial society

problems. Characterized by

accelerating change

vertical power concentrated horizontal disbursement of

at top levels power, responsibility,

sharing of decision

vertical communication circular or lateral

flow communication flow

emphasis on profitability emphasis on people and

plant equipment human resource development

maintenance and capital

expansion

source: Training and Development Journal (34) 10, pp. 45-

50.

ORGANIZATIONAL CHANGE

TABLE 2.6

People accept change if they are:

1. involved in the process of change

2. asked to contribute (knowledge, attitudes, suggestions,

feelings) to the change

3. informed of the reasons for and advantages of the change

4. communicated to with honesty about all facets of the

change

5. given concrete and specific feedback about the change

6. respected for their feelings, whether supportive or

opposed to change

7. asked and given what assistance is needed to deal with

the effects of the change on the job

8. recognized appropriately for their specific contributions

to the implementation of the change

CAUSES OF RESISTANCE TO CHANGE IN ORGANIZATIONS

TABLE 2.7

1. the change is not specified through documentation

2. the purpose for the change process has not been

clarified or substantiated

3. people affected by the change have not been involved in

the planning for change

4. personal appeal has been a primary strategy used to gain

acceptance for a change

5. the operations and patterns of work groups have been

disregarded

6. employees have not been kept informed about change

process

7. excessive work pressure is created during the

implementation phase of the change

8. issues regarding job security and concomitant anxiety

have not bee attended to in open, real ways.

ASSUMPTIONS UNDERLYING THE PARTICIPATIVE PROCESS

TABLE 2.8

1. people to be affected by plans and decisions should have

a part in making these plans and decisions

2. such involvement leads to an investment of interest,

time, and responsibility on the part of the participants

3. this procedure assumes the selection of realistic goals

4. it is a way of working toward something rather than

getting away from problems

5. the brainstorming phases stimulate creativity through

the nonjudgmental, free atmosphere

6. there is no preconceived way of reaching the goals

7. there is an emphasis on alternatives all the way through

the process: alternative views, goals, and actions plans

8. because the work is done in group settings, there is

much opportunity to build on one another’s ideas and to

develop collaboration

9. there is orderly movement from imagining, to goal

selection, to diagnosing the forces in the field, to

beginning initial action steps

PROCESS FOR ENACTING EMPOWERMENT

FIG 2.3

empowerment

____________

access and educate

_____________

establish vision

_____________

access, design

implement change program

______________

install empowerment

manager

_________________

cultural and operational

transformation

_________________

stabilization

___________________

redefinition of empowered

roles

___________________

ongoing assessment

and job enrichment

Management capability technical competency organizations development

process

processes, group dynamics, system

PERFORMANCE OUTPUT MODEL OF EMPOWERMENT

FIG 2.4.

empowerment process

motivation

action taking

productivity

organizational commitment

job satisfaction

proactivity

customer satisfaction

Supervisory support supportive organizational environment

Model of Differential advantage

Operational/strategic construct HR construct socio-

PERFORMANCE OUTCOME MODEL OF EMPOWERMENT

FIG 4.1

stage 1 stage 2 stage 3

(inputs) (positive experience) (outputs)

Empowerment dimensions

*supervisory support

*supportive organizational

environment

*delegation of operational

/strategic responsibilities

*human resources polices

*socio-political support

Higher productivity

proactivity

Customer service

Job satisfaction

Organizational commitment

Performan

ce

outcomes

INDUSTRIES SAMPLED

TABLE 5.1

INDUSTRY TOTAL IN SAMPLE RESPONDENTS Aerospace 10 6 Appliances 7 2 Automotive 22 9 Beverages 10 2 Building Materials 21 3 Chemicals 39 5 Containers 9 0 Drugs 22 6 Electrical, Electronics 59 12 Food Processing 55 15 General Machinery 23 6 Instruments 16 3 Metals and Mining 16 5 Miscellaneous Mfg 73 15 Natural Resources 41 8 Office Equipment 42 16 Oil Service & Supply 22 3 Paper & Forest Products 32 12 Personal Care Products 20 4 Publishing,Radio, & 31 5 Special Machinery 14 9 Steel 17 4 Textiles, Apparel 37 6 Tire & Rubber 9 1 Tobacco 5 2 Unknown 1 _______________________________________________________________ Total 652 159

Table 5.2 Results of the Measurement Model of the Independent Variables

ULS ML

Latent variable loading loading

Supervisory support

delegating responsibility .90 .92

risk taking .68 .75

peer respect .63 .61

mutual cooperation .69 .64

Supportive Organizational Environment

Participative

environment .91 .96

relationship orientation .81 .82

supportive organizational structures .83 .81

Delegation of operational/strategic responsibilities

Quality responsibility .81 .76

production goals .79 .77

process scheduling .80 .82

setting organizational goals .75 .76

HR policies

Training .74 .76

Evaluation .71 .65

Staffing .80 .82

Rewards .93 .91

Pro-social construct

Legitimacy .87 .82

Rules/procedures .91 .96

Access to organizational

resources .89 .86

Goodness-of-fit statistics ULS ML

Chi-square (degrees of freedom) - 151.65 (84)

GFI .98 .88

AGFI .97 .82

RMSR .06 .07

Table 5.3

Nested Measurement Models of the Independent Variables

Model Chi-square df AGFI RMSR NCNFI

Null model 1030.45 105 .279 .327 -

1 factor model 494.58 90 .524 .125 .61

3 factor model 257.91 87 .705 .086 .83

4 factor model 151.65 84 .82 .07 .93

TABLE 5.4 DESCRIPTIVE STATISTICS AND CORRELATIONS Measure Mean SD 1 2 3 4 supervisory support 1. delegating responsibility 5.15 .99 (.92) 2. encourage risk taking 5.70 .85 .29** (.93) 3. peer respect 5.14 .73 .27** .28** (.98) 4. mutual cooperation 4.72 .85 .48*** .29*** .54*** (.96) supportive organizational environment 5. participative environment 4.03 .92 .30*** .24*** .43*** .63*** 6. relationship oriented 5.15 .99 .55*** .54*** .81** .64*** 7. supportive structures 4.72 .68 .24*** .34*** .36** .29** delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 .56*** .28** .32*** .42*** 9. setting organizational goals 5.15 .99 .24** .50*** .36*** .27** 10. quality responsibility 5.21 .83 .39*** .23** .46*** .43*** 11. process scheduling 4.20 .95 .40** .50*** .26** .32*** HR policies construct 12. rewards 4.37 .95 .28** .19* .16 .14 13. cross training 4.27 .87 .29** .55*** .24** .73 14. staffing decisions 4.25 .83 .25** .46*** .21* .28** 15. performance evaluation 4.66 .73 .24** .49*** .21* .80*** Pro-social construct 16. legitimacy/participation 4.15 .73 .26** .18* .32*** .26** 17. rules/procedure development 4.12 .78 .27** .21* .25*** .28** 18. access to resources 4.11 .71 .23** .31*** .28** .24** Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 .19* .25** .26** .32*** 20. cost decisions 4.20 .76 .18* .27** .42*** .15 21. work processes decisions 4.11 .71 .17 .25** .65*** .29** Proactivity 22. taking actions 4.12 .78 .21* .28** .64*** .29*** 23. initiative 4.09 .83 .24** .18* .45*** .25** 24. solving problems 4.08 .72 .28** .19* .37*** .14 25. continuous improvement 4.60 .86 .19* .81** .66*** .10 Customer service 26. customer complaints 4.17 .89 .26** .28** .19* .55*** 27. quality problem diagnosis 4.25 .78 .29** .21* .25** .46*** 28. internal/external service 4.18 .82 .17 .29** .46*** .22* Job satisfaction 29. pay 5.15 .93 .18* .24** .81** .42*** 30. promotion opportunities 5.38 .86 .26** .17* .24** .22* 31. team relations 4.89 .87 .43*** .26** .19* .25**

32. job assignments 5.10 .88 .22* .50** .63*** .32*** Organizational commitment 33. loyalty to organization 5.32 .68 .24** .12 .17* .48*** 34. long term commitment 5.24 .79 .10 .29** .46*** .40** 35. trust in management 4.87 .74 .28** .19* .49*** .24**

Measure Mean SD 5 6 7 8 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 .(97) 6. relationship oriented 5.15 .99 .28** (.96) 7. supportive structures 4.72 .68 .21* .27** (.95) delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 .51*** .26** .68*** (.93) 9. setting organizational goals 5.15 .99 .26** .29** .28** .81** 10. quality responsibility 5.21 .83 .35*** .21** .43*** .41*** 11. process scheduling 4.20 .95 .31*** .81** .26** .27** HR policies construct 12. rewards 4.37 .95 .81** .22* .25** .12 13. cross training 4.27 .87 .27** .28** .21** .13 14. staffing decisions 4.25 .83 .25** .46*** .21* .28** 15. performance evaluation 4.66 .73 .23** .51*** .25** .81*** Pro-social construct 16. legitimacy/participation 4.15 .73 .21** .19* .26** .14 17. rules/procedure development 4.12 .78 .29** .17* .28** .26** 18. access to resources 4.11 .71 .22** .25** .10 .36** Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 .17* .24** .39*** .40** 20. cost decisions 4.20 .76 .29** .36** .29* .13 21. work processes decisions 4.11 .71 .19* .23** .61*** .42** Proactivity 22. taking actions 4.12 .78 .29** .21* .26** .16 23. initiative 4.09 .83 .19* .18* .42*** .17* 24. solving problems 4.08 .72 .25** .24** .81* .32*** 25. continuous improvement 4.60 .86 .12 .36** .53*** .07 Customer service 26. customer complaints 4.17 .89 .29** .30*** .22* .26* 27. quality problem diagnosis 4.25 .78 .24** .26** .30*** .53*** 28. internal/external service 4.18 .82 .14 .32*** .21* .29** Job satisfaction 29. pay 5.15 .93 .17* .29** .32*** .17* 30. promotion opportunities 5.38 .86 .10 .19* .22** .30*** 31. team relations 4.89 .87 .24** .53*** .17* .23** 32. job assignments 5.10 .88 .29** .51*** .36** .24** Organizational commitment

33. loyalty to organization 5.32 .68 .32*** .14 .26** .37*** 34. long term commitment 5.24 .79 .10 .19** .08 .25** 35. trust in management 4.87 .74 .39*** .18* .31*** .29**

Measure Mean SD 9 10 11 12 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 (.92) 10. quality responsibility 5.21 .83 .33*** (.93) 11. process scheduling 4.20 .95 .21** .59*** (.91) HR policies construct 12. rewards 4.37 .95 .80** .19* .23** (.94) 13. cross training 4.27 .64 .28** .26** .11 .32*** 14. staffing decisions 4.25 .83 .21** .16 .81* .24** 15. performance evaluation 4.66 .73 .19* .36** .17* .46*** Pro-social construct 16. legitimacy/participation 4.15 .73 .26** .64*** .59*** .07 17. rules/procedure development 4.12 .78 .27** .16* .36** .17 18. access to resources 4.11 .71 .63*** .18* .11 .68*** Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 .16* .28** .34*** .26** 20. cost decisions 4.20 .76 .31*** .68*** .26** .14 21. work processes decisions 4.11 .71 .53*** .16 .37*** .15 Proactivity 22. taking actions 4.12 .78 .27** .25** .15 .28** 23. initiative 4.09 .83 .29** .17* .30*** .19* 24. solving problems 4.08 .72 .23** .21** .17* .22** 25. continuous improvement 4.60 .86 .25 .26** .29** .19* Customer service 26. customer complaints 4.17 .89 .27** .33*** .21* .24* 27. quality problem diagnosis 4.25 .78 .17 .46*** .29** .24** 28. internal/external service 4.18 .82 .16 .29** .21* .27** Job satisfaction 29. pay 5.15 .93 .39*** .27** .33*** .10 30. promotion opportunities 5.38 .86 .32*** .19* .25** .33*** 31. team relations 4.89 .87 .26** .25** .16 .48*** 32. job assignments 5.10 .88 .53*** .51*** .63*** .21** Organizational commitment

33. loyalty to organization 5.32 .68 .33*** .12 .21** .33*** 34. long term commitment 5.24 .79 .10 .25** .11 .51*** 35. trust in management 4.87 .74 .19* .25** .32*** .28**

Measure Mean SD 13 14 15 16 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 (.91) 14. staffing decisions 4.25 .83 .22** (.93) 15. performance evaluation 4.66 .73 .17* .43*** (.94) Pro-social construct 16. legitimacy/participation 4.15 .73 .25** .49*** .32*** (.93) 17. rules/procedure development 4.12 .78 .25** .15* .23** .16 18. access to resources 4.11 .71 .34*** .51*** .10 .32*** Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 .42*** .24** .50** .22** 20. cost decisions 4.20 .76 .63*** .29** .28** .16 21. work processes decisions 4.11 .71 .55*** .17 .33*** .14 Proactivity 22. taking actions 4.12 .78 .36*** .45*** .13 .25** 23. initiative 4.09 .83 .27** .21* .29** .16 24. solving problems 4.08 .72 .21** .25** .16 .21** 25. continuous improvement 4.60 .86 .59*** .25** .24** .42*** Customer service 26. customer complaints 4.17 .89 .26** .31*** .25** .64*** 27. quality problem diagnosis 4.25 .78 .16 .44*** .30** .26** 28. internal/external service 4.18 .82 .28** .48*** .38** .25** Job satisfaction 29. pay 5.15 .93 .33*** .26** .46*** .14 30. promotion opportunities 5.38 .86 .42*** .31*** .24** .31*** 31. team relations 4.89 .87 .24** .21** .46*** .44*** 32. job assignments 5.10 .88 .43*** .21* .29** .28** Organizational commitment

33. loyalty to organization 5.32 .68 .31*** .27** .28** .46*** 34. long term commitment 5.24 .79 .10 .19** .36** .51*** 35. trust in management 4.87 .74 .42*** .36** .37*** .48***

Measure Mean SD 17 18 19 20 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 14. staffing decisions 4.25 .83 15. performance evaluation 4.66 .73 Pro-social construct 16. legitimacy/participation 4.15 .73 17. rules/procedure development 4.12 .78 (.91) 18. access to resources 4.11 .71 .33*** (.93) Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 .44*** .21** (.92) 20. cost decisions 4.20 .76 .65*** .27** .25** (.95) 21. work processes decisions 4.11 .71 .54*** .15 .34*** .16 Proactivity 22. taking actions 4.12 .78 .33*** .80*** .17 .32*** 23. initiative 4.09 .83 .28** .36*** .27** .14 24. solving problems 4.08 .72 .25** .23** .17* .36*** 25. continuous improvement 4.60 .86 .68*** .22** .29** .44*** Customer service 26. customer complaints 4.17 .89 .27** .33*** .29** .66*** 27. quality problem diagnosis 4.25 .78 .19* .42*** .26** .27** 28. internal/external service 4.18 .82 .29** .24** .66*** .27** Job satisfaction 29. pay 5.15 .93 .48*** .55*** .44*** .16 30. promotion opportunities 5.38 .86 .43*** .33*** .27** .34*** 31. team relations 4.89 .87 .29** .19* .44*** .43*** 32. job assignments 5.10 .88 .48*** .22* .25** .21** Organizational commitment

33. loyalty to organization 5.32 .68 .33*** .29** .21* .44*** 34. long term commitment 5.24 .79 .17 .34*** .29** .40** 35. trust in management 4.87 .74 .44*** .33** .24** .28**

Measure Mean SD 21 22 23 24 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 14. staffing decisions 4.25 .83 15. performance evaluation 4.66 .73 Pro-social construct 16. legitimacy/participation 4.15 .73 17. rules/procedure development 4.12 .78 18. access to resources 4.11 .71 Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 20. cost decisions 4.20 .76 21. work processes decisions 4.11 .71 (.89) Proactivity 22. taking actions 4.12 .78 .31*** (.91) 23. initiative 4.09 .83 .29** .33*** (.89) 24. solving problems 4.08 .72 .23** .25** .19* (.93) 25. continuous improvement 4.60 .86 .66*** .21** .27** .41*** Customer service 26. customer complaints 4.17 .89 .29** .38*** .27** .46*** 27. quality problem diagnosis 4.25 .78 .16 .27** .68*** .44*** 28. internal/external service 4.18 .82 .55*** .29** .69*** .29** Job satisfaction 29. pay 5.15 .93 .44*** .45*** .41*** .19* 30. promotion opportunities 5.38 .86 .31*** .63*** .55*** .22* 31. team relations 4.89 .87 .29** .19* .41*** .46*** 32. job assignments 5.10 .88 .48*** .22* .25** .21** Organizational commitment

33. loyalty to organization 5.32 .68 .32*** .42*** .56*** .10 34. long term commitment 5.24 .79 .19* .31*** .27** .32*** 35. trust in management 4.87 .74 .49*** .30*** .44*** .32***

Measure Mean SD 25 26 27 28 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 14. staffing decisions 4.25 .83 15. performance evaluation 4.66 .73 Pro-social construct 16. legitimacy/participation 4.15 .73 17. rules/procedure development 4.12 .78 18. access to resources 4.11 .71 Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 20. cost decisions 4.20 .76 21. work processes decisions 4.11 .71 Proactivity 22. taking actions 4.12 .78 23. initiative 4.09 .83 24. solving problems 4.08 .72 25. continuous improvement 4.60 .86 (.85) Customer service 26. customer complaints 4.17 .89 .27** (.87) 27. quality problem diagnosis 4.25 .78 .15 .29** (.91) 28. internal/external service 4.18 .82 .54*** .27** .45*** (.89) Job satisfaction 29. pay 5.15 .93 .41*** .44*** .33*** .63*** 30. promotion opportunities 5.38 .86 .19* .48*** .50** .28** 31. team relations 4.89 .87 .27** .42*** .32*** .44*** 32. job assignments 5.10 .88 .44*** .21* .29** .27** Organizational commitment

33. loyalty to organization 5.32 .68 .33*** .25** .55*** .13 34. long term commitment 5.24 .79 .24** .26** .37*** .33*** 35. trust in management 4.87 .74 .39*** .26** .41*** .53***

Measure Mean SD 29 30 31 32 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 14. staffing decisions 4.25 .83 15. performance evaluation 4.66 .73 Pro-social construct 16. legitimacy/participation 4.15 .73 17. rules/procedure development 4.12 .78 18. access to resources 4.11 .71 Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 20. cost decisions 4.20 .76 21. work processes decisions 4.11 .71 Proactivity 22. taking actions 4.12 .78 23. initiative 4.09 .83 24. solving problems 4.08 .72 25. continuous improvement 4.60 .86 Customer service 26. customer complaints 4.17 .89 27. quality problem diagnosis 4.25 .78 28. internal/external service 4.18 .82 Job satisfaction 29. pay 5.15 .93 (.91) 30. promotion opportunities 5.38 .86 .27** (.87) 31. team relations 4.89 .87 .29** .33*** (.92) 32. job assignments 5.10 .88 .41*** .29** .25** (.86) Organizational commitment

33. loyalty to organization 5.32 .68 .31*** .29** .34*** ..17* 34. long term commitment 5.24 .79 .29** .25** .33*** .36** 35. trust in management 4.87 .74 .34*** .43*** .44*** .37***

Measure Mean SD 33 34 35 supervisory support 1. delegating responsibility 5.15 .99 2. encourage risk taking 5.70 .85 3. peer respect 5.14 .73 4. mutual cooperation 4.72 .85 supportive organizational environment 5. participative environment 4.03 .92 6. relationship oriented 5.15 .99 7. supportive structures 4.72 .68 delegation of operational & strategic responsibilities 8. production/service goals 4.17 .96 9. setting organizational goals 5.15 .99 10. quality responsibility 5.21 .83 11. process scheduling 4.20 .95 HR policies construct 12. rewards 4.37 .95 13. cross training 4.27 .64 14. staffing decisions 4.25 .83 15. performance evaluation 4.66 .73 Pro-social construct 16. legitimacy/participation 4.15 .73 17. rules/procedure development 4.12 .78 18. access to resources 4.11 .71 Performance outcomes of team empowerment Productivity 19. level of productivity 4.13 .87 20. cost decisions 4.20 .76 21. work processes decisions 4.11 .71 Proactivity 22. taking actions 4.12 .78 23. initiative 4.09 .83 24. solving problems 4.08 .72 25. continuous improvement 4.60 .86 Customer service 26. customer complaints 4.17 .89 27. quality problem diagnosis 4.25 .78 28. internal/external service 4.18 .82 Job satisfaction 29. pay 5.15 .93 30. promotion opportunities 5.38 .86 31. team relations 4.89 .87 32. job assignments 5.10 .88 Organizational commitment

33. loyalty to organization 5.32 .68 (.83) 34. long term commitment 5.24 .79 .27** (.89) 35. trust in management 4.87 .74 .36** .24** (.86) The alpha coefficients of reliability for scales with more than two items are displayed in parentheses on the diagonal *p < .05 *p < .01 *p <.001

TABLE 5.5

FULL SAMPLE REGRESSION ANALYSES: EMPOWERMENT DIMENSION VARIABLES

REGRESSED ON PERFORMANCE OUTCOME MODEL

EMPOWRMENT DIMENSION PERFORMANCE OUTCOMES

_ββββ ββββ ββββ ββββ ββββ

supervisory team proactivity customer job org. support productivity service satisfaction commitment supervisory .44*** .30*** .42*** .38*** .43*** support supportive .15** .21*** .20*** .15** .18** environment operational .19** .22*** .14** .16** .30*** strategic responsibilities HR polices .06 .12 .10 .09* .06 construct pro-social .07 .08 .11 .12 .09* construct adjusted R2 .30 .25 .21 .20 .24 F 26.32*** 22.17*** 18.16** 19.15** 20.17*** ______________________________________________________________________________

p* ≤≤≤≤ 0.05

p** ≤≤≤≤ 0.01

p*** ≤≤≤≤ 0.001

PERFORMANCE OUTCOME MODEL OF EMPOWERED TEAMS

FIG 5.1

PREDICTOR VARIABLES PERFORMANCE OUTCOME

STRUCTURAL EQUATIO� MODELLI�G:

SUPERVISORY

SUPPORT

*delegating

responsibility

*encouraging risk

taking

OPERATIONAL/STRATEGIC

RESPONSIBILITES

*production/service

responsibilities

*setting organizational

goals

objectives

*quality responsibility

HR POLICIES

CONSTRUCT

*rewards

*training

*staffing decisions

*performance

evaluation

PRO-SOCIAL

CONSTRUCT

*legitimacy/participatio

n

in networks

*rules/procedures

development

SUPPORTIVE ORGANIZATION

ENVIRONMENT

*Participative

environment

*relationship oriented

environment

*supportive

organizational structures

PRODUCTIVITY

*productivity level

*cost decisions

*work processess

decisions

PROACTIVITY

*taking actions

*initiatives

*solving problems

*improvement

CUSTOMER

SERVICE

*customer complaints

*quality problems

diagnosis

*internal/external

service

JOB SATISFACTION

*pay

*promotion

opportunities

*team work (relations)

*job assignments

PERFORMANCE

OUTCOMES

FIG 5.2

BIBLIOGRAPHY

SUPERVISORY

SUPPORT

SUPPORTIVE

ORGANIZATIONAL

ENVIRONMENT

DELEGATION OF

OPERATIONAL

STRATEGIC

RESPONSIBILITIES

HR POLICIES

CONSTRUCT

productivity (.44***) proactivity (.30***)

customer service (.44***)

job satisfaction (.38**)

organizational commitment (.43***)

productivity (.15)

proactivity (.21*) customer service (.20*)

job satisfaction (.15)

organizational commitment (.18)

productivity (.19**) proactivity (.22*)

customer service (.14**)

job satisfaction (.16**)

organizational commitment (.30***)

productivity (.06 proactivity (.12

customer service (.10) job satisfaction (.09*)

organizational commitment (.06)

productivity (.07) proactivity (.08)

customer service (.11)

job satisfaction (.12) organizational commitment (.09*)

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