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Effect Of Employee Empowerment On Employee Job Satisfaction 1

ABSTRACT

According to our research on The Effect of Employee Empowerment on Employee Job

Satisfaction, we found a significantly positive relationship of employee empowerment

on employee job satisfaction. This means that if an employee is empowered he/she is

more satisfied with his/her job as compared to an underpowered employee. While doing

this research we use convenient method of non-probability sampling. Data collection is

through questionnaire. We perform Regression Analysis & Descriptive Statistics test on

our research data. We focused our research on Private Banks located in Lahore, Pakistan.


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CONTENTS

Chapter no 1 ............................................................................................................................................. 3

1.1Introduction ......................................................................................................................................... 3

1.2 PROBLEM STATEMENT ........................................................................................................................ 8

1.3 SIGNIFICANCE OF STUDY ..................................................................................................................... 8

1.4 OBJECTIVE OF STUDY: ......................................................................................................................... 9

1.5 HYPOTHESIS/ RESEARCH QUESTION ................................................................................................... 9

1.6 RESEARCH METHODOLOGY: ............................................................................................................. 10

1.7 LIMITATION OF STUDY: ..................................................................................................................... 10

1.8 DELIMITATION OF STUDY .................................................................................................................. 10

1.9 DEFINITION OF KEY TERMS ............................................................................................................... 10

CHAPTER NO: 2 ....................................................................................................................................... 12

2.1 LITERATURE REVIEW: ........................................................................................................................ 12

Chapter no 3 ........................................................................................................................................... 29

METHODOLOGY ...................................................................................................................................... 29

3.1 RESEARCH DESIGN: ....................................................................................................................... 29

3.2 POPULATION OF THE STUDY: ........................................................................................................ 29

3.3 SAMPLE OF STUDY: ....................................................................................................................... 29

3.4 TOOLS OF DATA COLLECTION: ...................................................................................................... 30

3.5 DATA COLLECTION: ....................................................................................................................... 30

3.6 DATA ANALYSIS: ............................................................................................................................ 30

CHAPTER NO. 4 ....................................................................................................................................... 32

4.1 ANALYSIS OF DATA ............................................................................................................................ 32

Chapter no 5 ........................................................................................................................................... 42

5.1 FINDINGS: .......................................................................................................................................... 42

5.2 CONCLUSIONS ................................................................................................................................... 43

5.3 RECOMMENDATIONS........................................................................................................................ 43


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5.4 REFERENCES ...................................................................................................................................... 44

CHAPTERNO:1

1.1INTRODUCTION

Empowerment is about pulling 200 levers rather than one big one!

(Station Manager)

In this global banking era employee empowerment is that phenomenal factor which is

mostly stressed upon. Globalization requires that every organization must consider the

fact that empowered employees are more loyal and committed to their organizations.

Employee empowerment is therefore necessary to compete with others companies.

Competition in globalization requires the organization to be proactive in term of decision

making, to provide quick solutions of the problems.

The scope of empowerment is multi-dimensional. It is difficult to define it with accuracy,

but we can say that it gives an employee the discretionary power, the power to make

decisions; it creates sense of belongingness with the organization; it motivates the

employee to work in the best interest of the organization. Empowered employees are

more satisfied with their jobs and therefore perform their duties with diligence.

The concept of empowerment is defined by many authors & writers in different aspects

as; Psychological empowerment involves motivational processes. Situational

empowerment involves decision making. Employees are psychologically empowered


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when perceive their work as allusive & worthwhile and they are liberalized & competent

to perform their allocated work & duties.

When Employees are free in making decisions and they have discretion to handle the

critical situations timely, they are said to be situational empowered employees. Working

empowerment is one in which employees are given freedom to respond to any complaint,

by the customers of the organization, promptly. The concept of empowerment is

described well by greater degree of autonomy and purposeful job with greater perceived

control.

In other words empowerment can be described as having discretionary power, decision

making power, and job enrichment, delegation of duties, liberalization and motivation to

perform the job. Employee empowerment is the most positive concept and reflection of

modern management style. Employee empowerment is important because it affect other

elements of job like job commitment, job satisfaction, and loyalty towards organization

and employee productivity.

Employees are considered as most important assets of an organization, they must be

retained by way of increasing their capabilities, influence strength, communication and

sharing of information. Employee empowerment is one of the modern management

practices that reflect autonomy, leadership and motivation of an employee.

In todays globalized era every organization is facing competition, to combat this

competition, organizations must have competitive advantage over other organizations.

For this, the organizations must have ability to take right decision at right time, in other

words they must be empowered to make decision.


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The success of every organization is depends upon employee empowerment and many

companies are adopting it. But many organizations are still following the traditional

management style which is highly centralized. Every organization is dependent on its

workforce and the workforce in 21stcentury is more demanding in terms of employee

empowerment.

Research proved the fact that empowered employees work with dedication and

motivation. Empowerment is essential for maintaining competitive advantage.

Empowerment is a difficult concept and different people take different meanings of

empowerment. Decentralized structures provide room for improvement, development and

empowerment of employees as everyone is aware of his/her goals and ultimately is more

focused to achieve his/her goals. Empowerment leads to efficiency, effectiveness,

innovation and change.

Empowerment means autonomy, flexibility, experience, purpose, responsibility and

accountability for the results. Lawler, Mohrman, & Benson, 2001) have empirically

demonstrated the positive growth of empowerment practices in the last 15 years. Today,

more than 70 percent of organizations surveyed have adopted some kind of

empowerment initiative for some portion of their workforce. Empowerment is practiced

by these organizations because it is helpful in eliminating the debilitating and bad effects

of traditional bureaucracies through high employee involvement.

Empowerment is a process whereby a culture of empowerment is introduced, information

is shared, competency and capability is developed, and resources and support are

provided for achieving goals. Empowerment reflects sense of self-determination, sense of


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impact and sense of belongingness and loyalty. The notion of empowerment is derived

from job enrichment.

In the words of Murrell(1990) empowerment as an act of building, developing and

increasing power by working with others, which he terms interactive empowerment,

and of having the ability to influence ones own behavior, which he calls self

empowerment.Empowerment is the act of strengthening an individuals beliefs in

his/her sense of effectiveness, a process of changing the internal beliefs of people

(Conger and Kanungo, 1987, 1988).

A pleasurable or positive emotional state resulting from the appraisal of ones job or job

experiences (Locke, 1976, p. 1304).The extent to which a persons hopes, desires, and

expectations, about the employment he is engaged in, are fulfilled.

Job satisfaction means how much an individual is contented with his/her job and what is

his/her attitude towards his/her job. Methodologically, we can define job satisfaction as

an employees affective reaction to a job, based on a comparison between actual

outcomes and desired outcomes (Mosadeghrad, 2003b).

Job satisfaction includes different aspects regarding the job which includes pay,

compensation, promotion, work condition, supervision, organizational environment, and

co-operation with the co workers. Job satisfaction is of two types affective job

satisfaction and cognitive job satisfaction. Affective job satisfaction is an emotional

feeling that an individual have about his/her job on the other hand cognitive job

satisfaction is to have particular facets of his/her job like pay, working hours, pensions

and other things that are concerned with job. Job satisfaction in financial institution is as

critical as in other areas of economy.


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Sources of less satisfaction are associated with working with untrained or not properly

skilled staff, laborious tasks such as documentation, repetition of duties, tensions within

role expectations, role ambiguity, role conflict, job/patient care, feeling overloaded, the

increasing need to be available for overtime, relations with co-workers, personal factors

and organizational factors.

Job satisfaction is much important in any organization. Highly empowered personnel are

more satisfied with their jobs they are highly innovative and have low turnover. They are

more productive and took active part in decision making.

Edwin A. Lockes Range of Affect Theory (1976) is arguably the most famous job

satisfaction model. The main premise of this theory is that satisfaction is determined by a

discrepancy between what one wants in a job and what one has in a job. Further, the

theory states that how much one values a given facet of work (e.g. the degree of

autonomy in a position) moderates how satisfied/dissatisfied one becomes when

expectations are/arent met.

When a person values a particular facet of a job, his satisfaction is more greatly impacted

both positively (when expectations are met) and negatively (when expectations are not

met), compared to one who doesnt value that facet. Job satisfaction is a factor by which

employee likes or dislikes his/her job.

Job satisfaction may be studied as a dependent variable that changes with the quality of

working conditions. On the other hand, it may be viewed as an independent variable that

determines a variety of consequences such as irregular work attendance


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1.2PROBLEMSTATEMENT

Problem statement is also known as the thesis topic/statement of thesis or the problem on

which research/thesis is based. It usually specifies the relevant area of research. The

problem statement on which our research is based is to measure The Eff ect of Employee

Empowerment on Employee Job Satisfaction. If an employee is given empowerment

how much he/she is satisfied with his/her job. Problem statement is the central idea of

research. There are many factors on the basis of which we can say that employee is

empowered and is satisfied with the job he/she is performing. There are many

organization in which empowerment is not practiced. An employee may face many

problems on the job if his job demands quick decision making. So in this research we will

focus on the role empowerment plays in satisfying an employee with his/her job.

1.3SIGNIFICANCEOFSTUDY

Our topic is related to the banking sector of Pakistan. So the significance of our topic is

related to banking sector Pakistan. There are many kinds of banks working in Pakistan

which includes nationalized and privatized banks. Private Banks are of many types like

commercial banks, specialized banks, Islamic banks, micro finance banks, foreign banks

and development banks.

Total no of banks working in Pakistan are 44 which includes 31 Pakistani banks and 13

foreign. Our area of study is private banks which are 22 in number. We will collect our

data from their 22 private banks. Composition of overall liabilities and assets of private

bank was 9797.9 billion rupees in June 2012.

Yearly growth rate is 10.96%. We have seen that employees of head offices are more

empowered that working in branches. If the employees are more motivated they are more


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satisfied with their jobs. If they are not motivated they are less satisfied with their work.

Work environment salary and other factors are also involved in job satisfaction.

In the modern competitive environment organization must provide faster solution and

better quality, which the customers expect from them, require the organization employee

empowerment in terms of decision making, autonomy, creativity and delegation of

authority.

1.4OBJECTIVEOFSTUDY:

The main purpose of our study is to find out the reality behind our selected topic. We

want to find out the answer of our questions that we have in our minds related to the

research. The main focus is on the hidden truth which has not yet been discovered. Our

object is to find the impact of employee empowerment on employees job satisfaction in

private banking sector of Pakistan. We want to know that either the employees are

satisfied with empowerment or not. According to their perception what is empowerment

and job satisfaction?

1.5HYPOTHESIS/RESEARCHQUESTION:

Our research questions are as follows:

Are employees satisfied with their jobs when they are empowered? Are employees satisfied with their jobs when they are not empowered?

We will try to give proper answers of the above questions. We will try our best to defend

our research questions in such a way that they are useful for further research. We have

two variables in our study one is empowerment that is independent variable and the other

one is job satisfaction which is dependent.


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1.6RESEARCHMETHODOLOGY:

The nature of our research is causal. We used convenience sampling method which is a type of

non probability sampling. Our population is private banking sector of Pakistan. Our sample size is

200 private banks of Pakistan. We collect our related data through questionnaires. We have taken

direct interviews from the different employees of banks.In our research topic/study we used

last 20 years data for collecting data based on our research.

1.7LIMITATIONOFSTUDY:

We can define limitations as the problems/hurdles faced during data collection. We face

following limitations;

Limited Time Load shedding Health Problems Non availability of internet

1.8DELIMITATIONOFSTUDY:

Our population size is selected randomly. Data is collected only from private banking sector. Data is collected only from Lahore.

1.9DEFINITIONOFKEYTERMS:

Empowerment: Amanagementpractice of sharinginformation,rewards,

andpower withemployees so that they can takeinitiative and makedecisions.

Giving employees the permission and ability to make decisions and act autonomously for

the good of the company. Empowerment is based on the idea of giving employees skills,
http://www.businessdictionary.com/definition/management.htmlhttp://www.businessdictionary.com/definition/practice.htmlhttp://www.businessdictionary.com/definition/information.htmlhttp://www.businessdictionary.com/definition/reward.htmlhttp://www.businessdictionary.com/definition/power.htmlhttp://www.businessdictionary.com/definition/employee.htmlhttp://www.businessdictionary.com/definition/initiative.htmlhttp://www.businessdictionary.com/definition/decision.htmlhttp://www.businessdictionary.com/definition/decision.htmlhttp://www.businessdictionary.com/definition/initiative.htmlhttp://www.businessdictionary.com/definition/employee.htmlhttp://www.businessdictionary.com/definition/power.htmlhttp://www.businessdictionary.com/definition/reward.htmlhttp://www.businessdictionary.com/definition/information.htmlhttp://www.businessdictionary.com/definition/practice.htmlhttp://www.businessdictionary.com/definition/management.html


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resources, authority, opportunity, motivation & make them responsible & accountable for

outcomes of their actions.

Job Satisfaction: The extent to which a person's hopes, desires, and expectations about

the employment he is engaged in are fulfilled. Contentment arising out of interplay

ofemployee'spositive and negative feelings toward his or herwork.
http://www.businessdictionary.com/definition/employee.htmlhttp://www.businessdictionary.com/definition/work.htmlhttp://www.businessdictionary.com/definition/work.htmlhttp://www.businessdictionary.com/definition/employee.html


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CHAPTERNO:2

2.1LITERATUREREVIEW:

Empowerment as an act of building, developing and increasing power by working with

others, which he terms interactive empowerment, and of having the ability to influence

ones own behavior, which he calls self empowerment. (Vogt, J.F. and Murrell, K.L.,

1990).

Vogt identify six dimensions to empowerment:

Educating

Leading Mentoring/Supporting Providing StructuringEmployee empowerment from this perspective is a cognitive state of perceived control,

perceived competence and goal internalization. (Menon, S.T., 1995). Menon (1995)

define the Empowered State/Empowerment as;

Control of ones own work, Autonomy on the job, Variations of teamwork, and Pay systemsAccording to him empowerment levels can be increased by way of increased decision

making and changing aspects of job. In a survey to determine the effect of empowerment

he found that;


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Perceived uncertainty of the job, formalization, centralization, poorcommunications, non contingent/arbitrary reward systems, role ambiguity, and role

conflict in the work environment lead to decreased perceptions of control and lower

empowerment.

Greater job autonomy and meaningfulness of the job lead to greater perceivedcontrol and greater empowerment.

Consulting, recognizing, inspiring, and mentoring behaviors of the immediatesupervisor lead to greater perceived control and greater empowerment.

The greater the empowerment, the higher the internal work motivation, the higherthe job satisfaction, the lower the job stress, the greater the job involvement & greater the

organizational commitment.

(Spreitzer, G.M, 1996). He 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. He defined

empowerment as the degree to which an individual desires or feels able to influence his

or her work role and context.

A study (Martin, L.A.C., 1994) researching conditions that facilitate or impede employee

empowerment, suggested that personal empowerment demanded self confidence and a

strong work ethic.

(Parker, M. and Slaughter, J., 1995). They 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.


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A complicating factor in defining empowerment is that in order for empowerment to be

successful, each organization must create and define it for itself. Empowerment must

address the needs and culture of each unique entity. Without this self-reference, employee

empowerment invariably fails because the commitment, or the sense of ownership of the

concept, is not created. He also focuses on the role of the manager in empowering

employees. (Sullivan, K. and Howell, J.L., 1996)

According to study (Linda Honold, 1997) empowerment is a multi-dimensional approach,

which cannot only be described in one dimension; it covers wide variety of concepts like

Leadership, Teams and collaborative working arrangements, Job autonomy, Control over

decisions, Job Enrichment and Information sharing.

Empowerment also leads to employees becoming more adaptive. (Scott, S.G.,& Bruce,

R.A., 1994).

(Conger, J. and Kanungo, R., 1988) . They viewed empowerment as a motivational

construct. They suggested that, empowerment refers to a process whereby an

individuals belief in his or her self-efficacy is enhanced. Empowerment is generally the

process of delegating or the decentralization of decision-making power. Empowerment is

a key determinant of quality of service and customer satisfaction. Empowered employees

use their discretion to take care of the customers needs and solve their problems so that

service quality and customer satisfaction are enhanced. Empowerment leads to important

behavioral outcomes. Empowerment enhances the self-efficacy of employees. They

suggested that empowerment should be viewed as a multi dimensional construct. They

defined empowerment as increased intrinsic motivation manifested in four cognitions that

reflect an individuals orientation to his or her work role.


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The four cognitions include

Meaning Competence Choice ImpactEmpowerment becomes a process of enhancing feelings of self-efficacy among

organizational members through the identification of conditions that foster powerlessness

and through their removal by both formal organizational practices and informal

techniques of providing efficacy information.

Empowerment means creating an environment in which employee receive more authority

for accomplishment of their work tasks in exchange for work outcomes. Empowerment

means to share management power with employees, which is done in the organizations

for two reasons i.e. to generate improved employee & organizational performance.

(Lawson K. Savery, J. Alen Luks, 2001)

Describe empowerment as based on four task assessments, which are influenced by

individual differences in cognitive interpretations. (Thomas, K.W. and Velthouse, B.A.,

1990).

The purpose of employee empowerment is not only to ensure that effective decisions are

made by the right employee but to provide a mechanism by which responsibilities for

these decision is rested in individual & teams. (Ford, R. & Fottler, M., 1995)

(Melinda J. Moye and Alan B. Henkin, 2006). Empowerment is an enabling rather than a

delegating process. Enabling, from this perspective, involves creating conditions for

enhancing motivation for task accomplishment through the development of a strong sense


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of personal efficacy. This paper explores the associations between employee

empowerment and interpersonal trust in managers. Trust is a critical element in

constructive human relationships.

Interpersonal-level trust refers to the extent to which an employee is confident in, and

willing to act on the basis of the words, actions, and decisions of his or her

manager/supervisor (McAllister, 1995).

Empowerment has been widely seen as the missing piece in the puzzle formed by

growing global competition, organizational restructuring, and the increasing importance

of service quality and customer satisfaction (Sewel, G. and Wilkinson, B., 1992).

Empowerment has become especially important for services and hospitality, where

frontline employees need the authority to respond promptly to the individual needs of

the increasingly demanding consumer in increasingly unpredictable service situations

(Hartline, D.M. and Ferrell, O.C., 1999).

(Antonis Klidas, Peter T. van den Berg, Celeste P.M. Wilderom, 2007). This paper aims

to test four potential predictors of the behavior of empowered employees during the

delivery of service to customers. The research findings indicate that management style is

crucial in employee empowerment. Managers willing to empower employees need to

encourage them to make decisions on their own, trust them and support whatever

decisions they make, praise them when they succeed and forgive, teach and coach them

when they make a mistake.

Empowerment has been regarded as an important concept because it potentially affects

outcomes that benefit individuals and organizations. (Han, Sang-Sook., Moon,

Sook.Ja.,&Yun, EunKyoung, 2009).


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Empowerment has been discussed from two different perspectives; organizational

attribute and individual psychological attribute (Baker, C.M., McDaniel, A.M.,

Fredricson, K.C., & Gallegos, E.C., 2007).

(Kay, G., Bryman, A., Dainty, A., Price, A., Naismith, N. and Soetanto, R., 2008)

Claimed that employee empowerment is essentially a perceptual matter. Individual level

analysis of employee empowerment is important to facilitate successful empowerment.

Empowerment is the the process of gaining influence over events and outcomes of

importance to an individual or group ((Fawcett, S.R., White, G.W., Balcazar, F.E. and

Suarez-Balcazar, Y., 1994). Thus, empowerment is fundamentally a motivational process

by which an individual experiences a sense of enablement.

(Jean-Se bastien Boudrias, Patrick Gaudreau, Andre Savoie, Alexandre J.S. Morin,

2009).Employee empowerment can be conceived in two ways:

(1) As a set of managerial practices aiming at increasing employees autonomy and

responsibilities &,

(2) As an individual proactive work orientation.

Most of the researchers have described the concept of empowerment, in terms of

proactivity, on individual level, in teams. Individual-level proactive behavior refers to

self-starting, future-focused action in which the individual aims to change the external

situation, such as improving work methods, or to change some aspect of his/her self, such

as improving ones performance by actively seeking feedback from a supervisor

(Parkeret al., 2006).


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For the advocates of empowerment, empowered employees willingly take responsibility

for the service encounter, they respond more quickly to customer needs, complaints and

changes in customer tastes. (Barbee, C. and Bott, V., 1991)

Empowerment practices decentralize power by involving employees in decision making

Empowerment involves giving employees the autonomy to make decisions about how

they go about their daily activities, (Carless, S.A., 2004)

Types of Empowerment:

1. Psychological Empowerment:

(Sprietzer, G.M.,Kizilos, M.A.,&Nason, S.W. , 1997) Psychological Empowerment as a

motivational construct manifested in four cognitions: specifically, meaning, competence,

self-determination, impact. They believe that employees have experience of the nature of

empowerment that is called "psychological empowerment".

Meaning addresses the fit between the needs of ones work role and the collectionof individual beliefs, values and behaviors (Spreitzer, 1995; Denton & Kleiman, 2001).

Competence, orself-efficacythat is specific to ones work, is a belief in onescapability to perform work activities with skill and is similar to the concepts of agency

beliefs, personal mastery, or effort-performance expectancy (Spreitzer, 1995; Denton

&Kleiman, 2001).

Self-determinationor autonomyinvolves exercising control over the methodsused to perform work activities, the scheduling of those activities, and the standards used

to judge performance (Spreitzer, 1995; Denton &Kleiman, 2001; Breaugh, 1985).


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Impactis the degree to which one can influence strategic, administration, oroperating outcomes in ones department or work unit (Spreitzer, 1995; Denton

&Kleiman, 2001).

According to this conceptPsychological Empowermentas a group of psychological states

essential for a person to feel that he or she can control the relationship to his or her own

work. Instead of focusing on managerial practices which share power among employees

at different levels, the psychological vantage point focus on employees experience of

their own work and the nature of that unique experience. (Vacharakiat, Marayart, 2008).

(RahmatollahAllahyari, Behzadshahbazi, SeyedMohamadMirkamali, Kamal Kharazi.,

2011), The aim of this research was to investigate the relationship between the

empowerment and organizational learning. They explain that psychological

empowerment based on organizational learning. There is a significant relation between

empowerment dimensions and its elements with organizational learning. Among

empowerment dimensions, incorporation has the greatest relation with overall

organizational learning.

(Spreitzer, G. M., 1992) Empowerment is a continuous variable; people can be viewed as

more or less empowered, rather than empowered or not empowered. She argues that

psychological empowerment extends job enrichment theory in several ways. She stressed

that individuals may have a voice in their organization to drive influence (impact).

Psychological empowerment is a cognition that complements the job characteristics in

the organizational environment. Empowerment is at the individual level of analysis

versus job enrichment which has been aggregated.


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(Spreitzer, G. M., 1992) . She has helped define PE as a global mindset including four

cognitions reflecting a proactive orientation with regard to ones role in the organization.

Empowered individuals:

(1) Find meaning in their work role.

(2) Feel competent to perform their work role.

(3) Have a feeling of self-determination with regard to specific means to achieve

expected results.

(4) Believe that they can have a real impact on organizational outcomes.

2. Work Empowerment:

Work empowerment is resultant concept developed from Expectancy Theory.

(Vroom, V.H., 1995) Expectancy theory recognizes the forces within individuals in the

environment which affect an individuals behavior. It assumes that the employee can

decide how much effort he puts in, depending on his motivation.

(Conger, J. and Kanungo, R., 1988) Examines work empowerment as a relational

construct and as a motivational construct. As a relational construct, work empowerment

concerns influences of managerial practices on employee participation. Empowerment

occurs when power of the superior is relinquished to subordinates, and with it authority

and responsibility.

(Anita M.M. Liu and W.M. Chiu, Richard Fellows, 2007) .When reviewing work

empowerment as a motivational construct, it refers to the perception of employees on

their power, autonomy and control. Work empowerment is, therefore, multi dimensional

in nature, involving delegation of power by managers and how individuals perceive and

internalize such power. Work empowerment is an antecedent of commitment, i.e. the


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individuals perceived extent of work empowerment may increase/decrease the sense of

organizational commitment. Such changes in commitment may ultimately affect

organizational performance; hence, an understanding of the relationship between work

empowerment and commitment is desirable. Work empowerment enhances self-efficacy

and, through motivation and commitment, leads to increased performance and

effectiveness.

3. Behavioral Empowerment:

BE was defined as relatively self-determined behaviors aimed at securing work

effectiveness or at improving work efficiency within the organization.

Approaches to Empowerment:

Many researchers have defined empowerment in different ways:

1. Situational Approach:

Situational approach concerns passing power from higher-level management to

employees by involving them in decision making. This approach is also known as

relational or management practice approach. (Conger, J. and Kanungo, R., 1988).

According to (Kay, G., Bryman, A., Dainty, A., Price, A., Naismith, N. and Soetanto, R.,

2008) the situational approach is a dilemma for managers as its success depends on their

ability to reconcile the loss of control with the need for goal congruence. They also point

out that the situational approach failed to address the cognitive state of employees.

2. Psychological Approach:

Psychological approach puts less emphasis on delegation of decision-making. Instead,

this approach stresses motivational processes in workers. The psychological approach


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views empowerment as various psychological cognitions that contribute to enhanced

intrinsic motivation. (Conger, J. and Kanungo, R., 1988).

3. Structural Approach:

Empowerment is deeply rooted in job design and occurs through objective and, often,

formal organizational changes that grant individuals greater latitude to make decisions

and exert influence regarding their work. (Liden, R.C. & Arad, 1996)).

(Mills, P. K. and Ungson, G. R., 2003), however, argue that the structural perspective of

empowerment represents a moral hazard dilemma for managers, as its success or

failure depends on the ability of managers to reconcile the potential inherent loss of

control with the fundamental organizational need for goal congruence. This perspective

of empowerment is also criticized for its failure to address the cognitive state of those

being empowered.

Dimensions of Empowerment:

(Petter, J., Byrnes, P., Choi, D.-L., Fegan, F. and Miller, R., 2002). He Presented seven

dimension model of empowerment. This study identified four dimension of

empowerment:

Autonomy Responsibility Information Creativity.The study (Thomas, K.W. and Velthouse, B.A., 1990) explains that the psychological

cognitions of employee empowerment include;

Meaningfulness


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Competence Choice ImpactThe study of (Seung-Bum Yang, Sang Ok Choi, 2009) identified four dimension of

empowerment:

Autonomy Responsibility Information CreativityJob satisfaction is a positive mood resulting from the evaluation of the works and work

experiences of the employees' (Brief, A. P., 1998). Job satisfaction, as a constitutional

concept, contains the features of the job and the features of job-related environment.

(Churchill, 1974).

(Silva, P, 2006). He defined job satisfaction as pleasurable feeling that arises from ones

workplace. (Price, J. L., 2001).They added job satisfaction as the affective orientation

employee has towards their work.

(Ros Intan Safinas Munir, Ramlee Abdul Rahman , Ariff Md. Ab. Malik , & Hairunnisa

ma'moar, 2012 ). They studied the Relationship between Transformational Leadership

and Employees Job Satisfaction among the Academic Staff and suggested that

transformational leadership plays important role in influencing job satisfaction.

Job satisfaction is often determined by how well the outcome meets or exceeds

expectations and it represents several related attitudes such as work itself, pay, promotion


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opportunities, supervision and coworkers which are most important characteristics of a

job about which people have effective response. (Luthans, F, 1998).

(Umit Alniacik, Esra Alniacik, Kultigin Ackin, Serhat Erat, 2012). This study examines

the relationships between the components of career motivation, employees effective

commitment & their job satisfaction. Employee job satisfaction is defined as a

pleasurable emotional state resulting from the valuation of his/her work (Locke, E, 1976)

This definition is very broad, as it includes characteristics relating to the job itself (wages,

promotion) and work environment. Some studies consider employee job satisfaction as an

overall variable, while others consider its different dimensionssatisfaction with the

work, supervisor, and pay, opportunities for promotion, workmates and customersand

examine them separately. (Brown, S. and Peterson, R., 1993).

(Schaufeli, W.B. and Salanova, M., 2010) argued that the more an employee is

satisfied with the company, the more likely customers are to show loyal behaviors

including a repeated visit showed that when an employee is satisfied with the job

and the service environment, he or she is likely to perform better, and induce

greater customer loyalty.

Among determinants of job satisfaction, leadership is viewed as an important predictor

and plays a central role. Leadership is a management function, which is mostly directed

towards people and social interaction, as well as the process of influencing people so that

they will achieve the goals of the organization. (Skansi, D., 2000)

Approaches to Job Satisfaction:

Various approaches have been developed about job satisfaction. These approaches

discuss about job satisfaction and organizational factors affecting job satisfaction.


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Classical Approach:

Classical approaches describe two theories in relation to job satisfaction:

1. Theories of Needs:

This theory acts in accordance with the needs of the individual. (Brief, A. P., 1998).

2. Theor ies of Value:

The leading theory among the theories of value (expectation) is the Cornell Model

developed by (Smith, P. C., Kendall, L. M. and Hulin, C. L.).

Modern Approach:

1. Social I nformation Processing Approach:

One of the most prominent modern approaches that examine job satisfaction is the Social

Information Processing Approach of (Salancik, G. R. and Pfeffer, J., 1978). This

Approach examines job attitudes in comparison to the theories of needs and expectations.

2. Theory of I ndividual Di ff erences:

Another modern approach is the Theory of Individual Differences in Job Satisfaction by

Motowidlo. According to this theory, job satisfaction is a perception created by the

individual about the degree of the job environment to satisfy the individual.

Based on this perception, the talented employee tries to determine the job satisfaction

thanks to the relationship he/she has created between the things experienced in the

workplace and the individual features (Brief, A. P., 1998).

Factors of Job Satisfaction:

There are various variables that effect job satisfaction in various ways. These variables

affect job satisfaction by interacting with each other. These variables grouped under two

categories as under; (Mehmet Altinoz, Demet Cakiroglu, Serdar Cop, 2012).


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1. Environmental Factors:

Environmental factors that affect job satisfaction could be mentioned as follows:

Wage Promotion Opportunity Control Communication Organizational Reputation and Operating Conditions Organizational Reputation and Operating Conditions2. I ndividual Factors:

Individual factors that create job satisfaction reveal the need to meet the requirements

like autonomy and personal development of the individual. Motivational impact of the

job characteristics is an important job satisfaction factor for the people who have high

need for improvement. The talented employees who prefer the hard works concentrate

more when they are given complex works and they get job satisfaction more than the

results they have acquired.

Job Satisfaction & Empowerment:

(Lawson K. Savery, J. Alen Luks, 2001) . This paper explores that through empowerment

of employees it is possible to:

Reduce the amount of perceived stress Increase ProductivityFurther this paper also explores that employee involvement is directly related to job

satisfaction.


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According to study by (Lynn Holdsworth & Susan Cartwright, 2003) empowerment at

the workplace is introduced to reduce the job related stress and to increase the job

satisfaction.

Low levels of empowerment are strongly related to mental distress and excess chronic

diseases (Johnson, 1997).

(Sprietzer, G.M.,Kizilos, M.A.,&Nason, S.W. , 1997). They examined each of the four

dimensions of empower and their relationship to job satisfaction and the psycho-

physiological outcomes of job stress. Meaning self determination and competence were

all associated with job satisfaction. The most powerful association was found with

meaning, suggesting that to feel satisfied with work employees need to feel energized by,

and put their hearts into, and their work. Job stress was negatively related to meaning as a

sense to competence suggesting that employees, who feel they have influence within the

organization and the necessary skills, may be buffered from experiencing job related

stress.

They considered employee job satisfaction to be positively related to the development of

employee OCB. (Jose Varela Gonzalez and Teresa Garc a Garazo, 2006).

Two theories have been presented in this regard.

Theory of social exchange (Konovsky, M. and Pugh, D., 1994) Theory of the psychological contract (Robinson, S. and Morrison, E., 1995)In both, the base of the relationship lies in the reciprocity rule: a satisfied employee

reciprocates Organization Citizenship Behavior towards those who have benefited

him/her (Bateman, T. and Organ, D., 1983).


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(Dana Yagil, 2006). The results show that the empowerment of service providers is

related to customer satisfaction. Conceivably, empowerment affects such characteristics

as service providers attitudes toward service, their sense of control and the repertoire of

service options they are allowed to perform. He proved that employee satisfaction results

in customer satisfaction. Empowerment acts as a buffer for such service providers

motivation & job satisfaction.

(Sut I Wong Humborstad & Chad Perry, 2011). Employees accept empowering

management practices to demonstrate stronger job satisfaction and organizational

commitment, and so help empowerment to lead to lower turnover intention.


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CHAPTERNO:3

METHODOLOGY

It is a key map which includes the procedures and techniques for gathering and analyzing

the data. It is a way to conduct a research in a proper manner.

3.1RESEARCHDESIGN:

A research design is a systematic procedure in which we study the problem. The design

of study tells us which type of research we are conducting. The nature of research we are

working on is causal. If the purpose is to find out which variable might be causing a

certain behavior, i.e. where there is a cause and effect relationship exist

between variables, causal research is being conducted. Like in our study we want to

know the effect of empowerment on job satisfaction so empowerment is a cause and we

have to check its affect oh job satisfaction.

3.2POPULATIONOFTHESTUDY:

A populationis a set of bodies concerning whichstatistical inferences are to be drawn,

often based on arandom sample taken from the population. The population of our study

consists ofPrivate Banking SectorofPakistan.

3.3SAMPLEOFSTUDY:

Samplssse is the part of population which is randomly selected for gathering information

about the topic. The sample size of our sample size is 200.
http://en.wikipedia.org/wiki/Statistical_inferencehttp://en.wikipedia.org/wiki/Random_samplehttp://en.wikipedia.org/wiki/Random_samplehttp://en.wikipedia.org/wiki/Statistical_inference


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3.4TOOLSOFDATACOLLECTION:

There are different methods of data collection are used all over the world that may be

primary and secondary. We will use secondary data from different ways. This includes;

Books Journals Articles Internet Survey

We have collected our data from private banks. We have studied different articles and

journals to find out facts and figures.

3.5DATACOLLECTION:

Data collectionis the process of collecting and measuring information of related

variables, in an established systematic form that enables one to answer stated research

questions, test hypotheses, and evaluate the results. We have collected out data through

questionnaires we have conducted personal interviews and surveys for in depth study.

3.6DATAANALYSIS:

Data analysis is statistical techniques to describe and evaluate the data. The data we have

collected is passed through different tests, which includes;

Descriptive Analysis Regression Analysis


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In descriptive statistical analysis we check that how many times a particular answer is

given by particular group of people or respondents.

Liner regression analysis estimates the coefficients of a liner equation, involving one or

more independent variables that best predict the value of the dependent variable.

Regression analysis is done to check the effect of independent variable on dependent

variable.


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CHAPTERNO:4

4.1ANALYSISOFDATA

DESCRIPTIVE STATISTICS:

In descriptive statistical analysis we check that how many times a particular answer is

given by particular group of people or respondents.

TABLE OF FREQUENCIES

Table No: 4.1

N Min: Max: Mean Std. Dev:

Employee

Empowerment

200 1.43 3.00 1.9436 0.34346

Employee JobSatisfaction

200 1.25 3.88 2.1606 0.30654

Gender 200 1 3 1.32 0.476

Age 200 1 6 3.34 0.822

Qualification 200 6 7 4.23 0.800

Salary 200 1 6 2.82 1.089

Frequency Percentage

Gender Male 138 69

Female 62 31

Age Below 20 year 6 3

20-25 year 10 5

25-30 year 109 54.5

30-35 year 64 32

35-40 year 8 4

Above 40 year 3 1.5Qualifications Metric 1 0.5

Intermediate 3 1.5

Graduation 28 14

Post Graduation 87 43.5

Ms/M. Phil 80 40

PHD 0 0

Others 1 0.5


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Table No: 4.2

DEMOGRAPHICS

Figure: 4.1 Genders

Interpretation:

Above graph shows that majority of our respondents were male with frequency of 178 &

percentage of 69, while female respondents are 31 % with the frequency of 62.

Figure: 4.2 Age

Salary Up to 20,000 14 7

21,000-40,000 79 39.5

41,000-60,000 50 25

61,000-80,000 50 25

81,000-100,000 1 0.5

100,000 & above 6 3


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Interpretation:

In the above graph majority of respondents were in age group between 25-30 years old

with the percentage of 54.5%. 32% respondents were between age group 30-34 year old,

5% respondents were between age group 20-25 year, 4% respondents were between age

group 35-40 year old, 3% respondents were below 20 year old & 1.5% respondents were

above 40 year old.

Figure: 4.3 Education level

Interpretation:

Above graph shows that mostly respondents were Post Graduate with percentage 87%,

80% were Ms/M. Phil, 28% were Graduate, 5% were Intermediate & 3% respondents

were Metric.


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Figure: 4.4 Salary Range

Interpretation:

Above graph shows that most of the respondents had salary range of 21,000-40,000 with

39.5%. 25% respondents had salary range of 41,000-60,000 & 61,000-80,000.

TABLE: 4.3 EMPLOYEE EMPOWERMENT

Employee

Empowerment

Strongly

Agree%

Agree

%

Neutral% Disagree

%

Strongly

Disagree%

Total

%

1 Empowermentclosely related

to self

determination.

58 30.5 11.5 0 0 100

2 Empowerment

based on trustof seniors.

33 60 3.5 1.0 2.5 100

3 You haveaccess to

information &

resources.

19 65.5 8.5 7.0 0 100

4 Lack of control

is the reason for

empowerment.

13.5 63.5 16 6 1.0 100

5 Due to

empowermentemployee

became

27 58.5 12.5 2.0 0 100


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motivated.

6 You have

control on yourjob related

work.

41 39 18 2.0 0 100

7 You haveauthority to

correct theproblem within

the

organization.

48 33 13.5 4.5 1.0 100

8 Empowerment

provides a clear

path for careeradvancement.

40.5 49.5 9.0 1.0 0 100

9 You have the

authority tomake decision.

10.5 66 15.5 6.5 1.5 100

10 You have

involvement indecisions thataffect your

work.

12 65 17.5 5 0.5 100

11 You have the

responsibility to

monitor thetasks.

21 47 29.5 2.5 0 100

12 You make thedecision about

the

implementationof policies.

34.5 44 16 5 0.5 100

13

You have theopportunity for

professional

growth.

16.5 53.5 28.5 1.5 0 100

14

Empowerment

influence

quality of work.

35 47 15 3 0 100

Graph:


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Interpretation:

58% respondents strongly agree that empowerment is most closely related to self

determination,30.5% are agree with this phenomenon while 11.5% are neutral, 0%

disagree with this thought and 0 % also strongly disagree with this.33% respondents

strongly agree that empowerment is based on trust of seniors while 60% agree, 3.5% are

neutral and 1.0 disagree with this, 2.5% respondents are strongly disagree with it.19%

respondents strongly agree and 66.5% agree that they have access to organizational

information and other resources, 8.5% are neutral,10% are disagree and 0% are strongly

disagree with this. 13.5% respondents strongly and 63.5% are agree that lack of control

provide a room for empowerment within an organization. 16% are neutral, 6% disagree

and 1.0% are strongly disagree with this. 27% strongly agree and 58.5% agree that due to

empowerment employees became more motivated, 12.5% are neutral, 2.0% are disagree

and 0% are strongly disagree with this. 41% respondents are strongly agree and 39% are


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agree that they have control over their jobs, 18% are neutral, 2.0% are disagree and 0%

are strongly disagree with this. 48% respondents are strongly agree and 33% are agree

that they have authority to correct the problems, 13.5% are neutral,4.5% are disagree and

1.0% are strongly disagree with this.40% respondents are strongly agree and 49.5% are

agree that empowerment provides a clear path for career advancement, 9% are neutral,

1% are disagree and 0% are strongly disagree with this.10.5% respondents are strongly

agree and 66% are agree that they have the authority to make the necessary decisions for

accomplishing the assigned tasks, 15.5% are neutral, 6.5% are disagree and 1.5% are

strongly disagree with this. 12% respondents are strongly agree and 65% are agree that

they have enough involvement in the decision that affect their work,17.5% are neutral,5%

are disagree and 0.5% are strongly disagree with this.21%respondents are strongly agree

and 47% are agree that they have given the responsibility to monitor the tasks, 29.5% are

neutral, 2.5% are disagree and 0% are strongly disagree with this.34.5% respondents are

strongly agree and 44% are agree that they can make decisions about implementation of

new policies in the organization, 16% are neutral, 5% are disagree and 0.5% are strongly

disagree with this.16.5% respondents are strongly agree and 53.5% are agree that they

have the opportunity for professional growth, 28.5% are neutral, 1.5% are disagree and

0% are strongly disagree with this. 35% respondents are strongly agree and 47% are

agree that with the empowerment they have to influence the quality of their work,15%

are neutral,3% are disagree and 0% are strongly disagree with this.

TABLE: 4.4 JOB SATISFACTION

EmployeeEmpowerment

StronglyAgree%

Agree%

Neutral% Disagree% StronglyDisagree%

Total%

1 Decision-making is 4 71.5 13 1.5 0 100


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associated with jobsatisfaction.

2Information sharing

results in job

satisfaction.

7.5 76 14 2 0.5 100

3Power sharingresults in job

satisfaction.

10 35.5 39 1 14.5 100

4

Employee

involvement indecision making

helps in job

satisfaction.

22.5 47 30 0.5 0 100

5

Freedom to use

judgment helps in

decision making.

20.5 67.5 8 2.5 1.5 100

6Empowerment

contributes to job

satisfaction.

8 46 45 0.5 0.5 100

7

Communication to

management helps

in job satisfaction.

4 90 4 1.5 0.5 100

8

Career development

opportunity helps injob satisfaction.

13 83.5 3.5 0 0 100

Chart:


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Interpretation:

4% respondents are strongly agree and 71.5% are agree that decision making is positively

associated with job satisfaction, 13 % are neutral, 1.5% are disagree and 0% are strongly

disagree with this. 7.5% respondents are strongly agree and 76% are agree that

information sharing results in job satisfaction, 14% are neutral, 2% are disagree and 0.5%

are strongly disagree with this.10% respondents are strongly agree and 35.5% are agree

that power sharing results in job satisfaction, 39% are neutral, 1% are disagree and 14.5%

are strongly disagree with this. 22.5% respondents are strongly agree 47% are agree with

that employee involvements in decision making helps in job satisfaction, 30% are neutral,

0.5% are disagree and 0% are strongly disagree with this. 20.5% respondents are strongly

agree 67.5% are agree with that freedom to use your own judgment helps in job

satisfaction, 8% are neutral, 2.5% are disagree and 1.5% are strongly disagree. 8%

respondents are strongly agree 46% are agree with that enhancing employee service

capability through empowerment contributes to employee job satisfaction, 45% are

neutral. 0.5% are disagree and 0.5% are strongly disagree with that. 4% respondents

strongly agree and 90% are agree that communication to the upper and lower

management helps in job satisfaction, 4% are neutral, 1.4% are disagree and 0.5% are

strongly disagree with this. 13% respondents are strongly agree and 83.5% are agree with

that career development opportunities help in job satisfaction, 3.5% are neutral, 0% are

disagree and 0% are strongly disagree.

Regression Analysis:


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Liner regression analysis estimates the coefficients of a liner equation, involving one or

more independent variables that best predict the value of the dependent variable.

Regression analysis is done to check the effect of independent variable on dependent

variable.

Independent

variable

Standardized

coefficient

T Sig

Beta

Employee

Empowerment

0.196 3.172 0.002

R 0.220

R

0.048

F 10.062 0.002

Interpretation:

Linear regression analysis estimates the coefficients of a linear equation, involving one or

more independent variables that best predict the value of the dependent variable. In the

above table R is the Pearson Product Moment Correlation Coefficient. In this case the

value of R is .220. R is the square root of R-Square and is the correlation between

observed and predicted values of dependent variable. The value of beta tells us the

variance/effect that employee empowerment has on job satisfaction which is 19.90 in this

study. It means our independent variable has almost 20% effect on employee job

satisfaction. In other words we can say that employees are 20% satisfied with their jobs if

they are given empowerment. Our results show that Employee Empowerment has

significant positive effect on employee job satisfaction.


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CHAPTERNO5

5.1FINDINGS:

From this study we find that 69% of our respondents were male & 31% werefemales. Our 54.5% respondents are between age group 25-30 years 32% were

from age group 30-35. Most of our respondents having qualification of Post-

Graduation with the percentage of 43.5% & Ms/M.Phil with the percentage of 40.

Majority of respondents who answered the questionnaire having salary range of

21,000-40,000 with the percentage of 39.5%.

According to data analysis we found that 58% respondents said empowermentismost closely related to self-determination. 63.5% people agree that in most of the

organization empowerment is introduced to eliminate lack of control.


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60% respondents agree that empowerment is based on trust of seniors &leadership quality. 58.5% people agree that employee empowerment results in

motivation of employees to work wholeheartedly.

65% respondents agree that 65% employees are involved in decision-making dueto empowerment. 66% people agree that they have given the authority to make

necessary decisions.

71.5% people agree that decision-making is positively associated with job-satisfaction. 67.5% respondents agree that freedom to use own judgment helps in

job satisfaction. 83.5% people agree that career development opportunities help in

job-satisfaction.

In data analysis we find that employee empowerment shows a significant positiveeffect on the job-satisfaction of employees.

5.2CONCLUSION

It can be seen from the results that if employees are given empowerment then they are

much satisfied with their jobs. Further from the results it is proved that empowerment has

almost 20% direct positive effect on employee job satisfaction. Empowerment together

with its various dimensions like autonomy, decision-making, independence, self-

determination and delegation contributes positively towards employee job satisfaction.

5.3RECOMMENDATIONS


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CHAPTER NO: 6

APPENDIX

Respected Sir/Madam,

This research is being conducted to investigate the effect of employees empowerment onemployees job satisfaction. Your response will be kept confidential and only be used for

academic purpose. Your precious time in filling the questionnaire is highly appreciated and

acknowledged.


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You are requested to check the appropriate box

from the given below as:

Strongly

Agree

Agree Neutral Disagree Strongly

Disagree

Strongly Agree=1,Agree=2,Neutral=3,

Disagree=4,Strongly Disagree=5

1 2 3 4 5

Employees Empowerment

1 Empowerment is most closely related to self-

determination.

2 Empowerment is based on trust of seniors and

leadership quality.

3 You have access to organizational information

and other resources.

4 Lack of control within the organization provides

a room for empowerment.

5 Due to empowerment employees became

more motivated.6 You have a control on your job related works

7 You have the authority to correct the problem

within the organization.

8 Empowerment provides a clear path for career

advancement.

9 You have the authority to make the necessary

decisions for accomplishing the assigned tasks.

10 You have enough involvement in decision that

affects your work.

11 You have given the responsibility to monitor

the tasks.12 You make decisions about the implementation

of new policies in the organization.

13 You have the opportunity for professional

growth.

Job satisfaction

14 With the empowerment you have to influence

the quality of your work

15 Decision-making is positively associated with

job satisfaction.

16 Information sharing results in job satisfaction.

17 Power sharing results in job satisfaction.18 Employees involvement in decision making

helps in job satisfaction.

19 Freedom to use your own judgment helps in

job satisfaction.

20 Enhancing employee service capability through

empowerment contributes to employee job

satisfaction.

21 Communication to upper and lower

management help in job satisfaction


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22 Career development opportunities help in job

satisfaction.

thesiz is final

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