Employee empowerment: the Rourkela steel plant experience.

AuthorChoudhury, Anuva


The fast moving global economy has necessitated that organizations learn and adapt quickly to the increasing pace of change, and turbulence of the environment. Organizations today require more cross-functional working, more cooperation between areas, and more integration in their processes if they are to meet the customers' needs. Such co-operation can be achieved only when organizations reorient themselves towards people-based systems that focus on motivation, involvement, development and empowerment. It is a fact that employees are the most strategic resource of any organization. As contrast to technologies, product and processes, the knowledge, skills and abilities of the employees cannot be imitated by their competitors. As such, retaining its most valuable assets while utilizing the employees' individual capacity to improve and enhance organizational performance is a daunting task for any organization. Achieving performance in these new circumstances requires that employees take and exercise much greater responsibility. Thus, empowerment is a strategy, a philosophy, a concept of giving employees responsibility, power, and autonomy to make decisions about their jobs. It is a process which has evolved in response to a trend towards a greater responsibility and involvement amongst employees in running their organizations. This trend has emerged as most organizations have realized the importance of people involvement and recognized the capacity of their human resources to improve and enhance business performance (Pattanayak, 2001:221).

Bowen and Lawler (1992:32) defined empowerment as "sharing with front-line employees four organization ingredients: [the first being] information about the organization's performance.... [another is] knowledge that enables employees to understand and contribute to organizational performance". The other two ingredients they note were: "rewards based on the organization's performance [and] power to make decisions that influence organizational direction and performance. Later the authors concluded that "empowerment exists when companies implement practices that redistribute power, knowledge, and rewards throughout the organization. ..." (Bowen & Lawler, 1995:73-74). The authors further went on to note that "if any of the four elements is zero, nothing happens to redistribute that ingredient, and empowerment will be zero". Spreitzer (1995:1442) defined psychological empowerment "as a motivational construct manifested in four cognitions: meaning, competence, self-determination, and impact. Together, these four cognitions reflect an active, rather than a passive, orientation toward a work role." Spreitzer noted that "The four dimensions are argued to combine additively to create an overall construct of psychological empowerment. In other words, the lack of any single dimension will deflate, though not completely eliminate, the overall degree of felt empowerment." This additive construct is distinct from Bowen and Lawler's (1995) construct noted above which is multiplicative, indicating that the absence of any one of their four elements (power, information, knowledge, and rewards) will completely eliminate empowerment.

From the above definitions, it may be discerned that in order to achieve empowerment of employees, managers must be sure that employees at the lowest hierarchical levels have the right mix of information (about process, quality, customer feedback and events), knowledge (of the work, the business and the total work system), power (to act and make decisions about the aspects of work) and rewards (tied to business results and growth in capability and contribution), to work autonomously or independently of management control and direction (Lawler, 1992; 1994; Lawler et al., 1989). Thus, the competitiveness of an organisation depends to a large extent on the presence of the above four elements: Information-sharing/open communication, knowledge development, autonomy, and rewards. Their presence will indicate the overall degree of empowerment prevailing within it, among other things. The present paper examines the validity of this generalisation by analysing the empowerment practices prevailing in Rourkela Steel Plant (RSP), which has the distinction of being one of the leading public sector steel producing units in the country. As empirical studies on employee empowerment in the steel industry in India are few and far between, the present study assumes significance. Before discussing the employee empowerment practices of RSP, the meanings of the dimensions that are operationalised for the study are discussed. Further, as a backdrop to the analysis, a brief profile of the RSP is given.

Employee Empowerment

The concept of employee empowerment includes mainly: information-sharing, knowledge development, autonomy and rewards.

Information-sharing: The existing literature on employee empowerment is unanimous regarding the need for increased information-sharing or open communication though their way of describing the importance is different. "The first key is to share information with everyone. ... People without information cannot act responsibly" (Blanchard, Carlos & Randolph, 1996:34). According to Ginnodo (1997:8), information-sharing "involves articulating a vision, values, strategies and goals; aligning policies, practices and business plans; improving processes; organizing, communicating and 'walking the talk' of total quality. ... and removing barriers that prevent outstanding performance." For Fox (1998:19), information-sharing involves, sharing of information about the goal to be achieved and why it is important to the organization as a whole.... mentoring the employees such that they absorb both the organizational culture and the value of empowerment. "Empowerment must be placed in a context of responsibility to the larger whole" (Mohrman, 1997:16). Managers must help employees understand that their work is, "directly aligned with strategic goals and individual accountability [is maintained] all the way along the line to senior management, customers and stockholders." Empowered employees will only understand these bottom line implications if organizational information is shared with them (Ettorre, 1997:1).

Sharing information about goals and, "Effective communication about the organization's plans, successes, and failures" (Byham, 1997:27) may seem commonplace; however its importance cannot be undervalued. Randolph informs us that, "people who have information about current performance levels will set challenging goals and when they achieve those goals they will reset the goals at a higher level" (Randolph, 1995:22). Open communication tends to flatten out the organization and de-emphasize the hierarchy. ... Nevertheless, open communication was found to be very closely related to worker empowerment, and both, among other conditions, were found to be important to ensure the success of the modern firm (Zollers & Callahan, 2003). "To make employee empowerment work, not only do we need to give them information about their own work, we must give employees information about the business and demonstrate how their work fits in.... Everyone wants to feel they do something of value. When you demonstrate the value individuals bring to the business, people want to grow" (Caudron, 1995:29).

Knowledge Development: Development of employees' knowledge and skills is becoming increasingly important in the face of globalization, technological change, trade liberalization, deregulation, growing tendency towards an empowerment culture, and other pressures on organizations today (Bloom & Lafleur, 1999). Knowledge refers to efforts on the part of management to enhance employees' access to job related knowledge and skills through training and job-embedded learning such that the same will enable the employees to develop new ideas and creativity. "Training and professional development activities help to diffuse innovations, as employees learn about and introduce ideas applied successfully in other organizations. They also expose employees to a broader palette of ideas that can be brought to bear on new problems" (Damanpour, 1991; Thompson, 1965; Katz & Tushman, 1981). When employees learn that high-quality work is crucial to the success of the organization and to their own job security, they are likely to become more conscientious. Once they become fully aware of what is expected of them and how their efforts fit into the big picture, and then receive the skills to meet those demands, the quality of their work generally rise (Bloom & Lafleur, 1999).

Autonomy may be defined as the degree to which one may make significant decisions without the consent of others. At various levels of analysis we may look at the autonomy of individuals within an organization or the autonomy of organizations or subunits thereof ... an employee, a manager or any other organizational member is relatively autonomous if he can make most of the important decisions relevant to his job without requiring permission from other people in the organization (Brock, 2003). And giving front-line employees more decision-making autonomy was found to help the competitiveness of the firms (Nielsen &amp...

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