CHAPTER 2

LITERATURE REVIEW

2.1 Introduction

This chapter provides a literature review of other researchers' research into ways to
empower employees and their impact on employee performance. The literature
review provides researchers with an overview of important ideas, theories, and
literature currently being published on relevant topics. The aim of a literature
research is not only to summarize the previous research results, but also critically to
question the thematic research results and then to give a perspective on research in
this area. The first step in conducting research is to review existing literature.
Based on the research topic " Relationship between employee empowerment and
employee performance among selected insurance companies in Sri Lanka". The
literature review is divided into four sections where the first part reviews literature on
employee empowerment, second part reviews literature on employee performance,
third part reviews the literature about impact of employee empowerment on
employee performance and the fourth section reviews literature about impact of
employee empowerment on employee performance for insurance industry.

From the literature above it was possible to learn the appropriate methodology for
further research. At the top of the literature, some already tested methods and
explanations have been suggested for similar types of research. At the end of the
literature search, the research gap and specific objectives were identified on the basis
of the research gap.

1
2.2 Related Concepts

2.2.1 Employee Empowerment

Empowerment has converted to one of the utmost important concepts in the current
practice and theory of management. Although explanations differ, this concept is
defined primarily as the process of giving workers with the required supervision and
skills to permit autonomous decisions (along with responsibility and accountability)
to make those decisions within suitable standards that is a part of the corporate
culture.
According to Vogt (1997), empowerment is defined as a process that allows
employees chance to decision making in the workplace by intensifying their
decision-making autonomy. Similarly, Blanchard (1997) defined empowerment as
breaking of traditional hierarchical structures, and workers who are closely related to
the problem were provided the authority to resolve the problematic situation. The
idea of empowerment has relationships with intercultural and industrial sectors.
Morales (1997) defines empowerment as "training employees to provide support,
trust, respect, motivation and ideas with the aim of developing everyone's abilities."
He also stated that a relevant procedure and long-term commitment must be
integrated into the growth strategy of the company to foster and increase employee
reliability.
Employees with independent decision-making authority acts as partners of the
business, taking profitability into account (Ettorre, 1997). Empowerment gives
employees the opportunity to make customer decisions from the point of view of a
service organization.

In addition, it is necessary to implement the organization's goal of being

environmentally responsible (Enander and Pannullo, 1990). When workers are
considered and treated as main actors in the organization, maximum results can be
achieved (Mohrman et al., 1996). Empowered employees are committed and
motivated to help to improve business performance, while employees who are not
2
empowered are less interested in reinforcing than empowered employees
(Govindarajulu and Daily, 2004). Changing the form of an organization is one way in
which the organization can promote empowerment. A top-down organizational
structure restricts employee involvement, while the horizontal organization can foster
employee engagement. Employees can make a more effective contribution by giving
decision-making powers to employees, giving them the ability and the ability to
gather ideas and make use good work practices (Wever and Vorhauer, 1993).
Researchers Enander and Pannullo (1990) trust that employee engagement can
influence cultural change and significantly reduce harmful substances in the
beginning.
Employee engagement in the form of high-quality circles enables the use of different
abilities, fosters a sense of easy fun, and provides an audience for effective
performance (Storey, 1992).
Each person in the organization should be involved from higher positions to lower
positions, from the office staff to the technical staff and from the headquarters to the
local locations. Employees are the source of new ideas and creative innovation, and
must use their experience, knowledge, expertise and collaboration to implement
these ideas (Dell, 2003: 181).

In addition, the empowerment of employees in an organization is a strategy and

philosophy that allows employees to make decisions about their jobs and helps them
to own their work and take responsibility for their results, in addition to customer
service at the business level where they find the client interface. It is one of the key
factors to implement profitability improvement and other organizational changes and
maintain continuous improvement (Lashley, 2000). Empowering employees has
become a buzzword and a modern management trend in both the public and private
sector organizations (Bates, 2005). Employee empowerment is widely recognized as
an important issue in management departments, mainly because it is considered one
of the essential elements of managerial and organizational effectiveness that
increases when power and control are shared in organizations (Ergeneli, 2007).
Consequently, the empowerment of employees is welcomed as a management
method that can be applied globally in all organizations as a way to deal with modern
global business (Demitriades, 2005). In general, the empowerment of employees
3
includes innovative approaches to work with individuals and a change of authority
from the control of senior management to the lower level management of the
organization (Tzafrir, 2004).

Empowering employees is not just about encouraging them or being nicer to them.
It's about being given them real power. To do this, the bureaucratic controls that keep
workers in place (Osborne and Plastrik, 2000) must be dismantled. The process
addresses several control mechanisms that include highly centralized organizational
structures, excessive levels of management, strict job classifications and "written
silos and rules, inflexible work contracts and complaints" (Osborne and Plastrik,
2000). Therefore, empowerment is not the product of any structure or system, but a
continuous, dynamic and volatile process (Ongori and Shunda, 2008). Thurlakson
and Murray (1996) stated that empowerment urges employees to do what should be
done instead of what they are told and includes delegation, individual responsibility,
independent decision making and feelings of self-efficacy.

2.2.2 Dimensions of Empowerment

The different definitions of empowerment make it clear that aim of this concept is on
redistributing power between management and employees. In positive work
environments, people are empowered to do their job successfully. According to the
principle of progress, people feel happier at work when they feel they are making
steady progress towards meaningful goals. Managers can, therefore, increase the
amount of positive emotions at work by helping people to achieve their goals
(Amabile, 2011). According to Pete (2012), there are three dimensions of employee
empowerment: the first is clarity. The first step in empowering employees is to
clarify objectives and expectations. People can only progress at work if they have a
clear idea of the results they are expected to give. The second dimension is support.
The second step in empowering others is to support them by providing the resources
they need to succeed and remove any obstacles that may hinder progress. Finally,
empowerment requires employee autonomy. Enable people mean giving them the
autonomy they need to do their job.
4
According to Bianca (2012), there are five dimensions of employee empowerment.
Surrender control is the first dimension for employee empowerment. The most
important concept behind empowerment is that you will give up some control over
employee decision making. He observed the second dimension of employee
empowerment in the name of "creating a subscription". This indicates giving people
more responsibility and input in the decision-making processes, which gives them
the opportunity to "participate" in their work. The third dimension of employee
empowerment is "the source of a new idea." This includes obtaining contributions
from employees in as many aspects of the organization as possible, not only in
business processes. The fourth dimension is "get a staff vote." In this case,
employees must vote on decisions that affect everyone in the company. Bianca
mentioned the fifth dimension of employee empowerment in the name of "creating
team decisions." This dimension indicates the empowerment of employees through
teams. For example, team members can set their goals and choose the best way to
achieve them.

2.2.3 Factors affecting Employee Empowerment

Different authors have identified several factors that affect employee empowerment.
Empowerment occurs when corporate culture allows employees to control their
work, decision making and professional development. Organizations are responsible
for creating a work environment that improves the ability and willingness of
employees to act favorably (Rosser, 2012). Organizations with employee
empowerment cultures recognize the importance of their workers and take pride in
seeing employees and their contributions as important business assets (Maxwell,
2005). To foster empowerment, a change in the mentality and commitment of
employees must change the mentality of the employee. This can be done by own
effort and / or by group support. By allowing the employee to contribute more
actively to the group, he / she can begin to develop their self-confidence and then
actively participate in the company (Yazdani, 2011). The organization must create a
positive environment and friendly working relationships between employees and
5
increase trust between managers and employees (Hogman, 2001)

Empowerment will cost additional responsibilities for employees that can cause
frustration (Chan, 2011). Sometimes it is important for companies to provide an
incentive to encourage an employee to take up the challenge. The incentive, such as
credit to be considered for evaluation or bonus, etc., can encourage employees to
take responsibility (Yazdani, 2011). When employees feel they are receiving
compensation which is not enough, or under title of the responsibilities they have,
they notice them, have enough or underestimate, organizations can’t expect
empowerment results. The basic needs of the employees must be met to provide
discretionary energy, that additional effort that people voluntarily invest in the work.
To successfully empower the employee, appreciation plays an important role
(Heathfield, 2005). Organizational support is key to empowering the employee
without the tangible support of the manager, and ensuring the presence of supervisors
and managers in training workshops will be almost impossible. In addition to this, it
will not be expected to plan employee meetings. Therefore, the CEO has a significant
influence and an important role in the successful implementation of the
organization's empowerment project (Herrenkohl, Judson and Heffner, 1999;
Wooddell, 2009).

Communication affects the empowerment of employees. Management can apply

decentralization to resources in objective reality, but if employees are not notified of
the resources available for use, access to resources will have little impact on feelings
of empowerment, and employees will not use these resources. to influence the
desired organizational results (Kaplan), 1991). The organization must include the
communication and access of personnel to managers and supervisors, and the
transparency and clarity of the work community of employees with managers and
supervisors (Hugman, 2001). There is nothing very disappointing for an employee,
except staying in the dark about his job and what is happening in the company
(Kotelnikov, 2007).

2.2.4 Employee empowerment in the service sector

6
The importance of empowering service-providers is linked to several key issues such
as achieving a competitive advantage through improved service quality. It is not easy
to gain a competitive advantage through service quality because it is not easy to
obtain an intangible source, such as: Customer satisfaction, difficulties in
determining a successful service experience, and customer expectations of service
quality are very different (Yarimoglu, 2014). In fact, individual customers can
describe and redefine the requirements of their service organization as their attitudes,
experiences, and expectations change. Frequent customer visits are based on a
successful service assessment. This assessment will be the result of how well their
experience meets their expectations (Voorhees et al., 2017). Although it is difficult to
identify successful encounters, many authors, such as Barbie and Bot, stated in 1991
that employees of the front Line play an important role in the provision of services.
Some of the key factors affects in customer expectations are employee performance,
personal interpersonal communication, delivery of service, support and courtesy. All
of these factors are closely related to customer ratings of the organization's quality of
service (Pakurár et al., 2019)
Unlike other resources used in a company, it is difficult to predict the efficiency,
production and overall efficiency that will be the result of a particular level of work.
Human resources can be uniquely unstable. In other circumstances, employees may
actually leave the company, challenge management claims and oppose them, or they
may not individually provide a "fair day for a fair daily wage." When the service is
provided, these problems become central as they form the front line of the
organization.
Empowered employees are responsible for the service and are more responsive to
needs of customer, customer taste changes and complaints (Baer, 2016). Therefore,
the organization will have less employee leaving and morale of the employees will
be high and staff will be responsible for their improvement as well as performance
(Mayhew, 2019). The inherent skills
and talents of the organization's employees (Rodríguez and Escobar, 2010) are used
to create more satisfied customers and higher profits (Plunkett and Fournier, 1991).

7
2.2.5 Employee Performance

Employee performance is derived from the broader management of the company's

performance. Performance management refers to a process that contributes to the
effective management of people and teams to achieve higher levels of organizational
performance (Foot and Hook 2008). According to Bernandin (2007), employee
performance is a record of results of specific jobs or work activities for a specific
period of time. Cascio (2003) argues that performance ensures that the employee or
individual teams know what is expected of them, and the focus remains on effective
performance. Organizational performance takes many forms that can include greater
productivity, greater diversity in terms of workforce mix, talent retention, greater
satisfaction for both the employee and the client, and a higher quality of service
among many other types (Wilkin, 2006). Managers create decent work situations that
serve two purposes. It facilitates performance and motivates the employee to seek
high performance (Bateman and Zeithami, 1993). Managers facilitate performance
by providing the things that employees need to do their job, such as training, proper
tools and equipment, adequate budget, authority and sufficient information to do
their job well. Performance can only be improved when there are effective processes
for continuous improvement. Individuals, whether as individuals or teams, make a
greater effort to perform if they know and understand what is expected of them and
have been involved in setting these expectations (Lussier, 2009). There are many
factors that can prevent an employee from performing at high levels and, therefore, it
is the duty of managers to ensure that staff performance is at the highest level due to
the fact that managers are responsible for the results. Many goal management
organizations (MBOs) use technology to identify and verify individual performance
goals that are concrete and measurable. The objectives of the individual are derived
or derived from the objectives of the organization, but are limited to their areas of
responsibility. Goal management includes four main phases: goal setting, work
planning, self-control and periodic reviews. Managers should avoid frustrations by
setting goals for employees who do not have the capacity and resources to achieve,
but must create an atmosphere of motivation for people and team members to define
goals they believe they can achieve. An employee who knows exactly what is
expected of them and when these goals should be achieved spends less time asking
8
what to do and doing more actions that lead to success. When an employee does not
drive to a potential level, even when acceptable standards are met, the first step is to
determine the cause. When the ability to control performance training, and when
motivation is lacking, motivation techniques are as essential as praise. When people
in the organization understand how their work contributes to the success of the
company, morale and productivity generally improve (Pascal, 1999). It is important
that the members of the organization know exactly what is expected of them and the
yard stick by which their performance and results will be measured (Byars and Irwin,
2000).

2.3 Relationship between employee empowerment and employee performance

Employee empowerment programs have been widely adopted in many organizations

as a way to improve the performance of organizations. Empowering employees
greatly improves performance by finding innovative ways to correct errors in service
delivery and redesign business processes. Bowen and Lawler (1992) argue that the
insignificant and important path through which employee empowerment affects
performance is through innovative behavior by confrontation personnel, Thomas and
Felthus (1990) say that empowered personnel improves performance by quickly
recovering from errors in the delivery service, learning from those recoveries,
generating and redesigning processes and products. Empowerment practices aimed at
providing employees with access to work knowledge and skills and giving them
discretion to change business practices further encourage performance. Conger and
Kenungo (1988) believe that the most trained employees, their expectations of self-
efficacy will be strengthened, thus increasing the amount of effort and time they
devote to performing the task. Empowered employee first has a higher expectation of
being able to do their assigned work successfully; They make a greater effort and
continue with these efforts when they face adversities. Second, the feeling of
independence at work, in addition to feeling in control of the result, increases the
effort, in addition to exerting more effort or working harder, it seems that empowered
employees perform better when working more intelligently when searching New
9
ways and better things. Empowerment can be understood as 26 processes that include
a set of management practices (shared power, resources, information and reward)
that affect the perception of employees (self-efficacy, motivation and job
satisfaction) that in turn affect performance (effort and productivity) (Bowen and
Lawler, 1992).
Performance management is related to the empowerment of employees in two ways.
First, through the goal setting initiative, the more employees understand their jobs
and how their work contributes to overall performance, they can make better
decisions. Second, empowerment means responsibility along with the freedom to
make decisions. The performance management process helps to establish
responsibility for the results and results of the decisions made by the employee
through continuous communication and performance reviews. Based on the findings
of the Clinton administration, the National Performance Review (NPR) identified the
empowerment of employees as one of the keys to making the government more
efficient and effective. Frontline employees are said to be the source of many
innovative solutions to the problems that public institutions face because they are
closer to the problems and have more knowledge on how to solve them. The
reformers realized that the improved performance could come from allowing
frontline workers to exercise their judgment, giving them the training and resources
necessary to do the job and holding them accountable for the results (Gore, 1993).
Therefore, empowerment supports performance at the expense of people having
more responsibility for how they do their own work and, therefore, increase
efficiency and greater use of each person's contributions (Dulta and Manzoni, 1999).
Consequently, costs are reduced, as fewer and fewer people need to monitor, monitor
and coordinate business operations as institutions strive to be more competitive in
today's challenging business environment, many of which radically observe
processes and Central trading systems that make them successful. With the right
people, job characteristics and 27 organizational environments, empowerment can
have a significant impact on motivation and performance. For example, a study of
bank employees concluded that empowerment improves customer service and tends
to reduce conflicts and supervision among subordinates because empowerment tends
to increase personal initiative because employees recognize and tolerate the
psychological property of work. Improved performance is judged according to the
10
opportunities that empowerment provides for workers to work more effectively.
People develop so that they can take a broader and more active direction towards
their work, and be more willing to suggest new ways of doing things and participate
in meaningful group work (Mary and Robins, 2002).

2.4 Theories and Models

2.4.1 Kanter’s Theory of Structural Empowerment.

The Kanter Theory (1977) uses structural empowerment to explain ideas which is
related to negative work performances such as sales. Kanter (1977) noted that the
work environment structure is closely linked to the behavior and behavior of
employees in organizations, and that informed access to power structures and
opportunities is related to the behavior and attitudes of employees in organizations.
According to Kanter, individuals show different behaviors according to their strength
and opportunity. The first factor, the chance, points to growth and the opportunity to
expand skills and knowledge. The second factor, the structure of authority, denotes to
the capability to reach and mobilize resources and information from the person's
position within the organization, and to mobilize them to successfully perform the
required work (Canter, 1977). The ability to procure the materials, resources,
inventories, and resources needed to achieve organizational goals is defined as access
to resources. Information defines the data, technical knowledge and experience
required for an individual's work. Support refers to instructions and comments from
employees, colleagues, and direct supervisors to improve effectiveness (Kanter,
1977, Laschinger, 1996). Kanter's structural empowerment theory is important
because it provides the structures needed to implement the dimensions of
11
empowerment that will help increase business performance.
Kanter (1977) defines strength as the ability to mobilize information, resources and
support to do things in the organization. The role of management is to provide
employees with the power tools (Kanter 1985) that allow them to increase their
ability to perform their work significantly. Kanter (1977) describes two fundamental
empowerment structures in institutions: the structure of opportunities and the
structure of power. The structure of opportunities is linked to the working conditions
that give people the opportunity to advance within the organization and develop their
knowledge and skills. People in high-opportunity jobs adopt a proactive approach to
solve the problems that arise at work and actively participate in change and
innovation. On the other hand, people in low-opportunity jobs exhibit stagnant
behavior (p. 136). They tend to limit the aspirations of their work, are less committed
to the organization, are more cautious and resist change. The strength structure
consists of access to: information lines, support lines and resource lines. The
information indicates access to the knowledge necessary to carry out work activities
in a meaningful way (Kanter 1977, 1979). This includes technical knowledge and
experience related to the basic roles of workers (for example, nursing knowledge and
skills), as well as information related to what is happening in the larger organization.
Access to lines of resources or supplies means the ability to obtain the materials,
funds and rewards necessary to meet the requirements of the job, as well as provide
sufficient time to complete the job. The support lines are linked to resources that
work to maximize efficiency. The positive feedback of the heads of organization, as
well as support for the exercise of discretion in the individual function, are important
elements of this source of strength. Access to these empowerment structures is
facilitated by formal and informal energy systems (Kanter 1993). Formal power
derives from work activities in which people often feel trapped in their jobs, lack
opportunities for growth and mobility and are excluded from organizational decision
making. They feel frustrated and desperate and can separate themselves from
organizational life beyond the foundations of their professional activities. On the
other hand, authorized employees have control over the conditions that make their
work possible, which improves the overall performance of the organization. Those
who have access to power structures and opportunities within the organization are
highly motivated and can motivate and empower others by sharing sources of
12
strength (Kanter 1979). The amount of control that people have over their working
conditions has been related to people's health and well-being (Karasek and Theorell
1990, Kelloway and Barling 1991, Thomas and Ganster 1995).

2.4.2 Empowerment Model by Mclagan and Nell

McLagan and Nell (1997) presented a multidimensional approach to employee

empowerment. It consists of creating a system of corporate values, a flexible
structure against a hierarchical structure, ease of driving and the fact that anyone is
their own manager. According to him, capable people can assign their
responsibilities to other organizational levels directly through a product or service
that coordinates their colleagues to solve a problem (McLagan et al, 1997).

2.4.3 Empowerment model by Spritzer

According to Spritzer (1995), contrary to the growing trend in the management of

scientific resources towards empowerment, the lack of psychological empowerment
in the workplace has prevented further research in the workplace. According to him,
empowerment is a constant variable in which employees may be exposed to varying
degrees (Moye and Henkin, 2006). Focusing on psychological empowerment,
Spritzer is seeking to develop a legal network for empowerment in the workplace. Its
model consists of four components that measure employees' perception of meaning,
efficiency, impact and self-determination. Meaning is defined as a personal feeling of
the relationship between work and personal standards. This occurs when work
assignments are adapted to personal values, convictions and behaviors. Efficiency is
13
the belief of a person in his ability to do the necessary work. Self-determination is a
personal perception of the right to choose the work to be done. The impact is a
personal feeling about its effect on the results of a particular job (Abtahi and
Abbessi, 2007). In the Spritzers enablers model, empowerment is not only the
process but also the factor that is influenced by environmental factors, efficiency and
individual factors, on the other hand, can be considered a fact that affects
effectiveness, efficiency and creativity of the organization. In this term,
empowerment has an organizational function influenced by the culture of society and
the ability to improve the efficiency and effectiveness of the organization. Spritzer
explains his model as follows (Sprtizer, 1995).

2.4.4 Human Relations Perspective

Satisfied workers are said to be productive workers, which means that productivity
and organizational efficiency are achieved by satisfying workers in the workplace
and observing the physical and social emotional needs of workers. Trust is also
achieved by maintaining a positive social organizational environment and ensuring
independence, participation and mutual satisfaction. It is believed that the
empowerment of employees influences the development of patterns of routine
interaction within organizations.

2.4.5 Vrooms Expectancy Theory

This theory argues that effort is determined by combining individual effort to predict
the performance and expected performance of the results. Increase performance
expectations by improving employee capacity and confidence in the job.
Performance is expected to increase by measuring performance accurately, offering
greater rewards for better performance and showing employees that these rewards are
based on performance (Vroom, 1964).

2.5 Review of empirical studies

14
According to Shields (2016), employee performance has been defined as the degree
to which an employee performs duties and responsibilities. While the performance of
the employees was related to the outcomes and results and achievements of Cardy
(2004) and the collective efforts and behaviors related to the objectives of the
organization, which were controlled by the employees (Lepak et al., 2007). Richard
and Morrison (2009) explain the concept of employee performance from a different
perspective. According to their observations, employee performance is not defined in
the general performance standards and can only be explained in the context of the
organization's situations and perspectives. Ahmed et al,(2015), Nyberg et al. (2016)
Others have also related employee performance problems with the company's
culture. Richardson and Beckham (2015) point out in their study of employee
performance problems in the Canadian banking industry, that the regulatory
performance framework plays an important role in influencing employee
performance. According to them, this performance framework includes opportunities
for professional growth, learning, cultural facilitators and others. As defined in the
conceptual framework, another important component of this research is the
empowerment of employees, which is one of the independent variables. Over the
period of time, many researchers have presented several definitions of employee
empowerment. For example, Conger and Kanungo (2008) linked the concept to the
process of promoting feelings of self-efficacy and eliminating factors that increase
employees' feelings of helplessness, while Burke (1986) emphasized the transfer of
authority to employees as essential for the empowerment of employees. However,
Kirkman and Rosen (1999) identified the same using four dimensions, such as
independence, influence, feasibility and group strength, and this observation was
supported by several subsequent investigations by Ugboro (2016) and others. With
regard to the benefits of employee empowerment in general, the studies by Strauss
(1977) and Haus (1988) have highlighted aspects such as the improvement of self-
control, a sense of self-reliance, the growth of one's own responsibilities etc.
Kenneth, Skye (2010), Shanker and Rao (2011) in their practical document on the
impact of employee empowerment on employee performance in selected
manufacturing organizations in Europe and India, respectively, identified important
connections. According to Nisar and Menon (2014), any impact on the empowerment
of employees on employee performance depends on some behavioral outcomes,
15
which improve the effectiveness of the group, improve the sense of viability, etc.
Some other studies based on empirical results have shown a positive relationship
between these two main phenomena, such as employee empowerment and employee
performance. Ziang and Linchau (2010) conducted one of these studies on port
employees who work in three main ports of China. Sensoca and Philips (2011)
conducted another study on the empowerment of middle management employees in
the health sector in Mexico. Yadav, Verma (2015) and Dash et al (2016) in their
study have been able to revealed some aspects of employee empowerment in
microfinance services in India. In the service industries, Relued (2010), Proteco
(2011), Singh and Aluwalia (2011) have carried out the same types of studies, and
the impact of employee performance has always been positive in research mentioned
above.

Pilar, Angel, Manuela and Maria (2005) found a positive effect on the empowerment
of employees in organizational and performance environments in their study of the
university's R&D unit and discovered that there was a positive relationship between
development and Employee performance.

Abu Bakr (2014) has conducted a study at First Bank Plc, Nigeria and studied how
employee development affects job satisfaction. From the study, he had discovered
that employee empowerment has a significant and positive impact on job
satisfaction, which will ultimately affect employee performance.

16
 CHAPTER 3
METHODOLOGY

3.1 Introduction
This chapter provides a summary of the research methods followed in the study. It
provides information about the participants, that is, the criteria for inclusion in the
study, who the participants were and how samples were taken from them. This
chapter presents the conceptual framework for study, data collection and data
analysis techniques. The tool that was used to collect data and the procedures that
were followed to carry out this study were also described. The researcher also
analyzes the methods used to analyze the data.

3.2 Research Design

The study adopted the descriptive method. According to Shenler and Coopers (2004)
descriptive studies are more formal and generally organized with clear hypotheses or
research questions. The research design is the scheme, plan or plan. It is used to
create answers to search problems. Descriptive search is used to obtain information
on the current state of phenomena to describe "what it exists "with respect to the
variables or conditions in the situation.

17
3.3 Conceptual framework

Employee Empowerment Employee Performance

 Personal Accomplishment  Level of

execution of
 Decision Making duties and
 Recognition responsibilities

 Training and Development  Collective effort

 Space for Innovation  Innovation

 Access to information  Better Performance

 Challenging work place

Independent Variable Dependent Variable

Definition of the
Measurement
Variable Sub Variable variable
2,3,8,10,12,18,
Employee Personal Achievement of
15,12
Empowerment Accomplishment career goals.
Spritzer (1995)

Decision Making
Autonomy to
Kanter (1977)
take relevant 1,5,4,7
  actions.

Remuneration
Recognition
of employee
Vroom (1964)
performance on
  given results. 11
Training and Upgrading
Development employee skills
Kanter (1977) and knowledge. 14
 

Encouragement
Space for Innovation to innovate. 6,9,17
(Dulta and Manzoni, 1999).
 

18
 Access to information Necessary
Kanter (1977) information is
readily
  available. 16
 Level of execution of
duties and responsibilities Increase of
Employee (Dulta and Manzoni, efficiency and 2,3,4,6,9,12,22
Performance 1999). effectiveness.

Collective effort Achieving goals

  Bianca (2012) together.  7,11
Innovation
Kanter (1977) Putting novelty 17,18
  in practice.

Better Performance Improvement in 1,5,8,10,13,14,15

Beth (2012) employee 16,17,18
  performance.
TABLE II : OPERATIONALIZATION TABLE

4.4 Employee Empowerment and Employee Performance

4.4.1 Employee Empowerment

The researcher sought to establish the extent of employee empowerment among

Insurance companies in Sri Lanka. The findings are analyzed in the table X
Mean Standard
deviation
I have confidence about the leadership of my 4.34 0.7
organization. (Kanter’s Theory of Structural
Empowerment.)
Company work provides workers a sense of personal 3.83 0.6
accomplishment. Human relations perspective

Employees have variety in their job at the company 3.49 0.8

Empowerment model by Spritzer

19
Employees worth their employment as important 3.98 0.6
Empowerment model by Mclagan and Nell
Employees have contribution into decisions which is 3.58 0.9
made in their department. Kanter’s Theory of Structural
Empowerment.

The supervisors inspire employees to propose new ways 4.23 0.6

of doing things. Kanter’s Theory of Structural
Empowerment.

Employees are permitted to make decisions 3.52 0.7

regarding their work. Empowerment model by Mclagan and
Nell

Employee empowerment has established a extensive 3.35 0.8

recognition as an significant subject in management
circles. Empowerment model by Spritzer

Line managers inspire new ideas and response from 3.87 0.8
team.
Kanter’s Theory of Structural Empowerment.

Staff have a clear understanding of vision and 3.59 1.2

mission of organization. Empowerment model by
Spritzer

Staff is highly valued and are an essential part of the 3.79 0.9
organization. Empowerment model by Spritzer

Employees exactly know what is expected of 3.41 0.6

them and are able to make decisions about their work.
Empowerment model by Spritzer

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 Employees are continuously trained to develop and 3.25 1.0
improve their skill and knowledge.
Kanter’s Theory of Structural Empowerment.

High degree of trust is greatly encouraged and sustained 4.04 0.5

between Employees and managers and among
employees.

Information needed is readily available to all concerned 2.94 0.7

employees to permit them to make thoughtful decision.
Kanter’s Theory of Structural Empowerment.

Management encourages staff to develop creativity and 4.17 0.6

innovative ideas. Empowerment model by Spritzer

Employees are motivated by being assigned challenging 3.75 0.8

work. Kanter’s Theory of Structural Empowerment.

TABLE X: EXTENT OF AGREEMENT WITH STATEMENTS ABOUT

EMPLOYEE EMPOWERMENT.

The results in the table above reveal that employees in the most insurance companies
know what is expected of them and the decision making ability regarding their work
lies at a moderate extent as shown by a mean of 3.75. Employee empowerment has
received a medium recognition as an important subject in management circles to
moderate extent as expressed by a mean of 3.75. The Employees are allowed to make
decisions concerning their work at a moderate level which is depicted by a mean of
3.52 and at the same time the employees value their job as important to a great extent
as expressed by means of 4.1. Majority of the respondents also revealed that they
have confidence in the leadership of their company by a mean of 4.34. Also
employees have an input into decisions made in their department to a moderate

21
extent as shown by a mean of 3.58 during the study. The mean value for supervisors
encourage employees to suggest new ways of doing things is 4.23. Line managers
encourage new ideas and feedback from team and employees are highly valued and
are an integral part of the organization to a moderate extent as indicated by means of
4.23, 4.17and 3.77 respectively. In addition, the researcher found that to a little
extent the company work gives employees a feeling of personal accomplishment
which is shown by a mean of 3.83, The understanding of staff about organizations
vision and mission is shown by a mean of 3.59 which shows that it is at a high level.
Employees having variety in their job at the company was moderate as represented
by mean of 3.49.

The results in the table above reveal that employees in most insurance companies
know what is expected of them and that the ability to make decisions regarding their
work lies in a medium degree, as shown by a mean of 3.75. Employee empowerment
received moderate recognition as an important issue in management circles as
indicated by an average of 3.75. Employees can make decisions related to their work
at a moderate level, which is indicated with an average of 3.52 and, at the same time,
employees value their work as something as important as expressed by the mean
value of 4.1. Most participants also revealed their confidence in the company's
leadership is at 4.34. In addition, employees have input to the decisions made in their
department to a moderate extent as shown by the mean of 3.58 during the study. The
average value for supervisors encourages employees to suggest new ways of doing
things is 4.23. Line managers encourage new ideas and feedback from the team and
employees who are highly valued and are considered as an integral part of the
organization by mean values as shown by 4.23, 4.17 and 3.77 respectively. In
addition, the researcher discovered that the company's work gives employees a sense
of personal achievement that was demonstrated by the value 3.83, and it is clear that
employees understand the vision and mission of the organization which is depicted
by the mean value of 3.59, which indicates that it is at a high level. Employees
having diversity in their work at the company was moderate as represented by mean
of 3.49.

4.4.2 Employee Performance

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The researcher sought to establish the extent of employee performance among
Insurance companies in Sri Lanka. The findings are analyzed in the table IX

Mean Standard
Deviation
My company permits me to take part in appraising
my performance (self-evaluation). 3.56 0.9
Vroom (1964)
I am punctual in my duty all times. 4.25 0.6
(Bowen and Lawler, 1992).

Always I meet my set work goals. 4.34 0.5

Strauss (1977) and Haus (1988)
Sometimes I support other employees who are 4.27 0.8
facing difficulty with their assignments. Foot and Hook,
2008

I take part in rating of other employees. (peer rating) 2.63 1.0

(Storey, 1992).

I volunteer to take up other responsibilities rather than 3.56 0.8

allocated work. Foot and Hook, 2008

All the time I cooperate with other fellow workers to 4.35 0.7
execute numerous tasks. Mary and Robins, 2002).

Performance evaluation system is in place to rate 3.68 1.0

both team and individual performance.
Vrooms expectancy theory

I strictly follow procedures and rules of the organization. 4.07 0.8

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I use my technical knowledge and skills to 4.44 0.5
complete my tasks.( Dell, 2003: 181).

I maintain good working relationships with my 4.63 0.6

Co-workers. Bianca (2012)

I generally put extra effort to complete an given 4.46 0.5

work on time. Bateman and Zeithami, 1993

I always defend and support my organizational 4.22 0.8

objectives. (Pascal, 1999).
I have necessary skills and knowledge on my job. 4.37 0.5
(Gore, 1993)
My performance is assessed relatively to the pre- 4.02 0.8
established objectives and goals.
Vrooms expectancy theory

Team performance is rated usually by taking into 3.67 0.9

account individual input to the team performance
and performance of the team as one unit. Cardy (2004)

Employee empowerment leads to cost reduction 3.57 0.6

(Dulta and Manzoni, 1999).

Employee empowerment allows efficiency and 4.09 0.7

Innovation (Bowen and Lawler, 1992).

Empowerment of employees has a positive influence 4.11 0.7

on organizational performance. (Lepak et al., 2007).

Failure of organizations to pay more attention to 3.95 0.8

employee empowerment affects overall
organizational productivity. (Foot and Hook 2008)

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Training improves my work performance and permits 4.02 0.8
me to achieve my set targets. Thomas and Felthus
(1990)

Employee empowerment helps in meeting strategic 3.81 0.7

objectives. (Lepak et al., 2007).

Employees are encouraged to take quick action to 4.05 0.6

increase quality or to correct quality issues in their
professions. (Pakurár et al., 2019)

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