Employee empowerment has become an increasingly popular business strategy over the past 20 years – in direct contrast to the control and command strategies in play for the last two centuries. However, a recent report shows that the UK comes ninth in a ranking of engagement levels among the world’s 12 largest economies.
The organisation Engage for Success, backed by the heads of some of Britain’s largest businesses, is launching an initiative to persuade others to take employee engagement more seriously and build it into their business strategies, arguing that Britain is losing an estimated £26bn in annual output because of failure to motivate staff.
The chief executives of BAE Systems, PwC, United Utilities, Standard Chartered, WPP, Marks and Spencer, Barclays, Lloyds, Alliance Boots, Whitbread, Prudential, O2 and others warn that two-thirds of the UK workforce is failing to reach its full productive potential.
The Benefits
Jan Carlzon, when CEO of SAS, famously said “Giving someone the freedom to take responsibility releases resources that would otherwise remain concealed.”
- Increased intrinsic motivation: To grant an individual worker some level of freedom is to imply an increased level of trust. This could be for the manager who is asked to give give 15% of his time per week to spend on creativity – as per the 3M model – through to the team of cleaners who are able to determine their own work rota. This will create greater levels of intrinsic motivation and lead to;
- Higher Levels of Trust: The empowered individuals will experience enhanced levels of trust as a result of these new found freedoms, building additional trust networks both internally and, as a result, externally. This will lead to higher levels of commitment and a;
- More Flexible Workforce: that is able to respond quicker and more effectively to both internal and external customers, getting it “Right First Time”, thereby increasing satisfaction levels and reducing rectification costs.
- Increased Knowledge Sharing: The increased levels of trust will lead to a freer sharing of knowledge and greater levels of mutual respect and support, leading to a safer environment in which to work.
- Internal and External Network Creation: These higher levels of trust, commitment, motivation and flexibility will automatically lead to increased networks both internally and externally.
An interesting example of extreme employee engagement and empowerment is that of Semco, a Brazillian engineering and consultancy organisation. Ricardo Semler took over his father’s failing company in 1982 and then did away with all previous controls, taking out all layers of middle management, and allowed employees to determine their own salaries, what they worked on and how they related to the company, either as an employee, a subcontractor or a new company.
The company has gone from strength to strength going from 200 to over 5,000 employees with consistent profit growth. You can see more about what he’s done – and continues to do – in this video.
Costs of Empowerment
One should consider the costs associated with empowering your employees:
- Not all employees want to be empowered. For some, it can have a detrimental effect and lead to an unhappy and demotivated worker. This could have a negative impact on the climate and culture of the organisation and have an adverse effect on all.
- Empowerment encourages debate, potentially leading to delays in decision making.
- The costs of recruiting and training the right people.
- Salaries would be likely to be higher if recruiting a higher calibre of workforce.
- The costs of sharing information.
- Empowered lower managers can reduce the position and power of middle managers having an adverse effect on their authority and, as a result, their intrinsic motivation.
I personally feel the benefits of empowerment far outweigh the costs. From my own experience, allocating time and responsibility to employees, allowing them to develop a project in their own way, invariably gives not only a better result, but also a more motivated and happier employee.
Does your organisation have any successful tactics for motivating employees? We welcome your comments below.
Image by:Olivander