Perceived Relationship Between Employee Empowerment and Organizational Performance Among Commercial Banks in Kenya

Abstract

The banking industry builds competitive advantages by providing exceptional customer service. To achieve this, every institution must have an empowered workforce. Employee empowerment is a strategy and philosophy that enables employees to make decisions about their jobs and helps employees own their work and take responsibility for their results as well as serve customers at the level of the organization where the customer interface exists. It is one of the keys to implementing profitability improvement and other organizational change and maintaining continuous improvement. The objective of the study was to establish the perceived relationship between employee empowerment and organizational performance of commercial banks in Kenya. The study adopted a descriptive approach. The population of this study comprised of all licensed commercial banks in Kenya; which are 43 in total. The primary data was collected by use of a questionnaire which was used to record respondents’ responses. After data collection, the filled-in and returned questionnaires was edited for completeness, coded and entries made into Statistical package for social sciences (SPSS version 20). Descriptive analysis was conducted, which involved the use of frequencies in their absolute and relative forms. Percentage, Mean and standard deviations were also be used as measures of central tendencies and dispersion respectively. The researcher found that employee empowerment positively and significantly influences organizational performance of commercial banks in Kenya to a very great extent. The study concludes that employee empowerment positively and significantly influences organizational performance of commercial banks in Kenya to a very great extent. Empowered employees equipped with tools, information, and support, people’s skill base will improve, will increasingly make informed decisions and overall accomplish more, thereby benefiting the organization as a whole. The study concludes that employee empowerment improves the relationship between the employee and the customers to a greater extent and has a positive impact on organizational performance. The study also concludes that training enhances work performance and enables employees to meet their set targets to a very great extent. The study recommends that commercial banks should increase the level of employee empowerment because contributions by empowered employees are believed to have a significant impact on business productivity, revenue and the organization's overall effectiveness.