Employee empowerment practices

1. By
H. S. ABZAL BASHA
Research Scholar
Under the Supervision of
Dr. B. KRISHNA REDDY
Professor
Sri Krishnadevaraya Institute of Management
Sri Krishnadevaraya University
Ananthapuramu

2. Introduction
Today’s increasing complex and volatile business-
environment characterized by Liberalization, Privatization
and Globalization.
The global foray too ensures that managing would not be
the same again. As we are in the 21st century,
competitiveness in the universal market place gives the
ultimate challenge to policy-makers, business leaders and
entrepreneurs in any industry including banking.
Challenges such as fluctuating environment, sophisticated
technology, the need for quick decision-making and the
importance of frequent changes have established the need
among organizations to change their traditional management
practices (i.e., Command and Control) into democratic
structures that offer employees a greater autonomy,
confidence and freedom to make decisions.

3. Statement of the Problem
The astonishing development of the banking and financial
services across the world has led to consider as one of the
imperative contributor of the world’s GDP.
In the last two decades with rising Indian economy, a significant
progress has taken place in Indian banking sector. In spite of
development and opportunities in this sector, it also faces various
HR issues which admit key challenge for the industry in India.
These include issues such as increasing employee turnover,
stressful work environment and poor career development. In India
there is an increasing demand and supply gap for professionals.
Despite the large number of students graduating every year, there
is now an increasing scarcity of appropriate skills gained through
the education system, which is low on quality and relevance.

4. Research Gap
There are only a few studies carried out on
Employee Empowerment Practices in Banking Sector.
But, there is no specific study on “Employee
Empowerment Practices for Organizational
Effectiveness”. Hence, in order to fill this gap, the
present study is undertaken. It is an attempt to offer
new insights in formulating HR strategies, especially in
the areas of employee empowerment in banks. This
study has been undertaken by selecting two major
banks, i.e., State Bank of India (Public) and ICICI Bank
(Private), located in Rayalaseema region of Andhra
Pradesh.

5. Need and Significance of the Study
Indian banking sector emerged from strong global
financial turmoil and proved its mettle when the
developed economies were shaking.
Today’s unstable public and private sectors,
require management to seek out, evaluate and embrace
new planning, organizational and operating techniques
to remain on track in pursuit of their long-term goals. The
need for Employee Empowerment gained great
importance in service-oriented institutions like banks.
As employees in a service organization have
frequent contacts with the customer, they usually serve
as representatives for both the organization and their
products and services to the customer at contact point.

6. Empowerment-Organizational Effectiveness
 Autonomy
 Communication
 Training
 Rewards
 Organisational Culture
Development
oriented
Behaviour
 High Productivity
 Quality work performance
 Employee Efficiency
 Work Motivation
 Job Satisfaction
Empowerment Practices Organizational EffectivenessEmployee
Behaviour
Source: Developed by Researcher
Scope of the Study

7. Objectives of the Study
1. To study the impact of Employee Autonomy on
Organisational Effectiveness in select banks.
2. To analyze the role of Communication on
Organisational Effectiveness in select banks.
3. To examine the effect of Employee Training on
Organisational Effectiveness in select banks.
4. To identify the role of Employee Rewards on
Organisational Effectiveness in select banks.
5. To critically evaluate the affect of Organisational
Culture on Organisational Effectiveness in select
banks.
6. To suggest measures for sample organizations based
on the study results.

8. Hypotheses
 H1: There is a significant difference between the two banks
regarding the role of Employee Autonomy that affect
Organisational Effectiveness.
 H2: There is a significant difference between the two banks
regarding the communication system that affect Organisational
Effectiveness.
 H3: There is a significant difference between the two banks
regarding the training and development practices that affect
Organisational Effectiveness.
 H4: There is a significant difference between the two banks
regarding the reward management process that affect
Organisational Effectiveness.
 H5: There is a significant difference between the two banks
regarding the Organisational culture that affect Organisational
Effectiveness.

9. Research Design and Methodology
The present study is an empirical research in nature. The
descriptive research procedure is also used for describing the
current scenario in SBI and ICICI bank.
Sources of Data
For the present study, the data have been gathered from
both primary and secondary sources. The primary data have been
collected by administering a Structured-Questionnaire from the
employees of non-executive level (Clerical Cadre i.e., Assistant,
Senior Assistant, Special Assistant and Senior Special Assistant)
of select public and private sector banks.
The secondary data have been gathered from internet,
books, research articles, previous research reports, survey reports,
newsletters, journals, magazines etc.,

10. Sample Size and Design
As on March 2014, altogether there are total 1864 non-
executive employees on the rolls working in 228 branches of
SBI and ICICI bank in Rayalaseema Region. For the purpose
of the present study all the branches of two banks and all
non-executive employees were selected.
For collection of primary data a structured
questionnaire was designed and mailed to all the non-
executive employees. 721 questionnaires were received, it is
unfortunate to state that only 397 received questionnaires
were duly filled in all respects from respondents of both the
banks. Hence, all these 397 (Table No: 3.2) non-executives
were purposefully selected and their responses were the form
basis for analysis, interpretation and empirical findings of the
study.

11. Table-3.2
Total Sample Size
Name of the Bank
Employees Strength
(No. of Non-Executives)
No. of Respondents
(Primary Data)
State Bank of India. 1664 247
ICICI Bank 200 150
Total 1864 397
Source: Primary Data

12. Table-3.3
Employee Empowerment Parameters
And Measurement Techniques Selected
S.No. Parameter
No. of statements
included
Techniques
adopted for
measurement
A Dependent Variable
Organisational Effectiveness
B Independent Variable
Scale
developed
1 Autonomy 19 ,,
2 Communication 13 ,,
3 Training 15 ,,
4 Rewards 13 ,,
5 Organisational Culture 12 ,,
Source: Developed by Researcher

13. Statistical Tolls and Techniques
The present study is a qualitative analysis of the
response and results based on observations. The
gathered data is analyzed and interpreted by using
Frequencies, Weighted Averages, Correlation
Coefficient Analysis and Independent t-test with the
help of Microsoft Office Excel software and Statistical
Package for Social Sciences (SPSS-20 Version).
Reliability test also used for ensuring validity of the
primary data.

14. Limitations of the Study
1. This research study is limited to SBI and ICICI Bank
in Rayalaseema region of Andhra Pradesh only.
2. The present study is confined for only non-executive
level of the employees.
3. The results of the research cannot be generalized to
other commercial banks or other category banks
like; foreign, regional, urban and rural cooperatives.
4. The accuracy of given information may owe to
change from time, workplace and individual factors.

15. Table- 4.1: Demographic Profile of SBI and ICICI Bank Employees
Demographic Aspects
Bank Wise Respondents
SBI (%) ICICI Bank (%)
Age
20-25 years 3.7 22.0
26-30 years 39.0 68.0
31-35 years 28.9 10.0
36 years and above 28.3 22.0
Total 100 100
Educational Qualifications
Intermediate 2.7 0
Graduation 40.1 12.0
Post Graduation 33.2 78.0
Professional Degree 24.1 10.0
Total 100 100
Marital Status
Married 81.3 34.0
Unmarried 18.7 66.0
Total 100 100
Job Experience
Less than 5 years 26.7 90.0
5-10 years 42.8 6.0
10-15 years 2.1 4.0
15 years and above 28.3 0
Total 100 100Source: Primary Data

16. Table- 4.21: Job Autonomy and its Results
S.No. STATEMENTS
SBI
(MEANS)
ICICI Bank
(MEANS)
1
Do you have Job Autonomy in your Bank
2.22 2.72
2
How many Decisions have you made Without Referring to Higher
Authorities 1.75 1.34
3
How often you Participate in Problem Solving
2.60 2.50
4
Is your bank effectively utilizing the Bank’s Staff Suggestion Scheme
2.40 2.64
5
Have you got any chance to Participate in Branch Strategy Preparations
2.26 1.92
6
Have you any Control over the Work Schedule
2.29 2.82
7
Is Your Opinion is Asked before Changes are Made in the Way You
Work 2.56 2.68
8
Is your Superior tries to Solve Your Work Related Problems
2.72 2.74
9
Can you Promise the Customer on Behalf of Management
2.71 2.08
Source: Primary Data

17. Table- 4.22: Correlation Coefficient B/W Job Autonomy-
Employee Effectiveness
Variables
Emp. Effectiveness Job Autonomy
Employee
Effectiveness
Pearson Correlation 1 0.056**
Sig. (2-Tailed) 0.000
N 397 397
Job Autonomy
Pearson Correlation 0.056**
1
Sig. (2-Tailed) 0.000
N 397 397
**. Correlation is significant at the 0.01 Level (2-
Tailed).

18. Table- 4.23: Job Autonomy Differences
B/W SBI and ICICI Bank
Group Statistics
Bank Name N Mean Std. Deviation
Std. Error
Mean
Job Autonomy
Differences
Between SBI
and ICICI Bank
SBI 247 2.22 .93903 .06867
ICICI Bank 150 2.72 .66676 .05444
Source: Primary data
It is evident from table-4.5 and 4.16 and very clear that the majority of the SBI employees are in a
position to take operational level decisions and provide assurance to their customers’ behalf of the
management. But in ICICI bank, majority of the respondents still depends on their superiors

19. Table- 6.14: Employee Communication
and its Outcomes
S.No. STATEMENTS
SBI
(MEANS)
ICICI Bank
(MEANS)
1
I am getting Prompt Information to make Quick and
Suitable Decisions 4.35 3.54
2
I have Observed Boost-up in My Morale with Present
Communication 4.06 3.76
3
If I have a Problem I can Speak Directly to My Superior
4.21 4.32
4
I am able to give an Open Feedback on My Subordinates
and Superior 3.23 4.10
5
Employee’s Weaknesses are communicating in a Smooth
Manner 3.80 3.74
6
Hierarchy and Cross Culture are the Barriers in
Communication 2.99 3.34
Source: Primary Data

20. Table- 6.15: Correlation Coefficient
B/W Communication -Performance Quality
Variables Performance Quality Communication
Employee
Performance Quality
Pearson Correlation 1 0.057**
Sig. (2-Tailed) 0.000
N 397 397
Employee
Communication
Pearson Correlation 0.057**
1
Sig. (2-Tailed) 0.000
N 397 397
**. Correlation is significant at the 0.01 Level (2-Tailed).

21. Table- 6.16: Communication
Differences B/W SBI and ICICI Bank
Group Statistics
Bank Name N Mean Std. Deviation
Std. Error
Mean
Communication
Differences
Between SBI and
ICICI Bank
SBI
247 4.3529 .72106 .05273
ICICI Bank
150 3.5400 .90212 .07366
It is evident from the table-6.1 and 6.4 and very clear that the SBI employees are
getting more prompt information compared to ICICI bank, which improves employee
morale.
Source: Primary data

22. Table- 5.16: Employees Training and its Outcomes
S.No. STATEMENTS
SBI
(MEANS)
ICICI Bank
(MEANS)
1 How many Training Programmes have you Attended in Your Career
3.37 1.56
2
I have observed Enrichment in My Decision-Making Skills due to
Training
3.98 3.78
3 Training Programmes has Improved My Performance Quality
4.36 4.08
4
Training increases My Confidence and helps to Tackle Conflict
Situations 4.11 4.08
5
Training has Enhanced My Discipline and Motivate me to achieve
Benchmarking 3.73 4.14
6 Bank provides Latest Training whenever New Technology Adopted
3.32 3.86
7 My work Relation with Peers has become Healthy due to Training
4.00 3.76
Source: Primary data

23. Table- 5.17: Correlation Coefficient
B/W Employee Training - Productivity
Variables Productivity Training
Employee Productivity
Pearson Correlation 1 0.018**
Sig. (2-Tailed) 0.000
N 397 397
Employee Training
Pearson Correlation 0.018**
1
Sig. (2-Tailed) 0.000
N 397 397
**. Correlation is significant at the 0.01 Level (2-
Tailed).

24. Table- 5.18: Employee Training
Differences B/W SBI and ICICI Bank
Group Statistics
Bank Name N Mean
Std.
Deviation
Std. Error
Mean
Employee Training
Differences Between
SBI and ICICI Bank
SBI 247 4.3636 .62765 .04590
ICICI Bank 150 4.0800 .39323 .03211
Source: Primary data
It is evident from table-5.1 and 5.7 and very clear that the majority of the respondents in SBI are having
more experience in terms of training, while the majority of the respondents in ICICI bank ahead in
participating latest training.

25. Table- 5.33: Employee Rewards
and its Impact on Employee Performance
S.No. STATEMENTS
SBI
(MEANS)
ICICI Bank
(MEANS)
1 I believe Our bank is Practicing a Fair and Equitable Reward System 3.56 3.98
2 I Feel Satisfy, when My work is Recognized in the form of Rewards 4.70 4.44
3 Reward has creates My Unique Identity in Organization- “big picture” 4.14 4.62
4 I got more Opportunities for Personal Growth due to Rewards 3.58 4.00
5 Monetary and Non monetary Rewards help me to improve Morale 3.86 3.96
6 Rewards increase My Responsibility towards Organizational Goals 3.53 4.20
7
I am satisfied with the Transparency, Quality and Quantity of My
bank’s Reward system
3.24 3.74
Source: Primary data

26. Table- 5.34: Correlation Coefficient
B/W Employee Rewards -Work Motivation
Variables Work Motivation Rewards
Work
Motivation
Pearson Correlation 1 0.031**
Sig. (2-Tailed) 0.000
N 397 397
Employee Reward
Pearson Correlation 0.031**
1
Sig. (2-Tailed) 0.000
N 397 397
**. Correlation is significant at the 0.05 Level (2-Tailed).

27. Table- 5.35: Employee Reward
Differences B/W SBI and ICICI Bank
Group Statistics
Bank Name N Mean Std. Deviation Std. Error Mean
Employee Reward
Differences Between
SBI and ICICI Bank
SBI 247 3.2353 1.0717 .07837
ICICI Bank 150 3.7400 .65977 .05387
It is evident from the overall analysis of table-5.21 and 5.30 and very clear that the
ICICI bank practicing better reward system compared to SBI.
Source: Primary data

28. Table- 6.31: Organisational Culture and its Results
S.No. STATEMENTS
SBI
(MEANS)
ICICI Bank
(MEANS)
1
I believe Ethics and Honesty is the only Policy of our
Bank’s Culture 4.55 3.72
2
Customer Delight is our only Motive to Provide and
Improve New Services 4.22 4.22
3
Conflicts are resolved through Discussions and Control
Interventions 2.89 2.86
4
Decisions are made at the Prompt Facts and Information
without Bias 2.74 2.76
5
Every Employee Ideas are Concerned while making
Important Decisions 3.17 4.02
6
Our organizational Culture makes Employee to feel Pride
be a part 4.18 3.24
7
I feel Positive and Fun workplace is the Sign of our
Organizational Culture 3.02 4.16
Source: Primary Data

29. Table- 6.32: Correlation Coefficient
B/W Organisational Culture – Employee Job Satisfaction
Variables Job Satisfaction Organisational Culture
Employee
Job Satisfaction
Pearson Correlation 1 0.034**
Sig. (2-Tailed) 0.000
N 397 397
Organisational Culture
Pearson Correlation 0.034**
1
Sig. (2-Tailed) 0.000
N 397 397
**. Correlation is significant at the 0.01 Level (2-Tailed).
Source: Primary Data

30. Table- 6.33: Organisational Culture
Differences B/W SBI and ICICI Bank
Group Statistics
Bank Name N Mean Std. Deviation
Std. Error
Mean
Organisational Culture
Differences Between
SBI and ICICI Bank
SBI 247 4.0214 .65548 .04793
ICICI Bank 150 4.1600 .41901 .03421
It is evident from the overall analysis, especially from table-6.26 and 6.27 that the SBI gets
succeed to establish a strong inner sensation in employees regarding their culture, but in reality
ICICI bank is given more priority for employees’ ideas while making important decisions.
Source: Primary data

31. Suggestions
Based on the findings arrived as above, the following suggestions
are offered to enhance employees’ effectiveness through job
autonomy.
 Both the banks should provide more job autonomy to reduce
dependency, while making certain urgent decisions without
referring to their higher authorities.
 Guide and assist the employees to handle, participate and solve
work-relate issues.
 Exploit the staff suggestion scheme at a maximum mode in
branch level. And, provide more opportunities to the employees
to offer suggestions, ideas and participate in branch strategy
preparations.
 ICICI bank should guide and train their frontline employees to
become effective in providing customer assurance.
 Maximum utilize periodical job rotation techniques to make
employees complete understanding the various management
functions and improve personal efficiency.

32. Suggestions
 ICICI should revise their present communication channels in
order to provide prompt and constant information to their staff
to make suitable effective decisions.
 Provide swift new information on changes happen in and around
the organization.
 In SBI create an environment, where lower level employees can
able to provide an open feedback about their superiors and
subordinates.
 Improve the present smoother approach of feedback on
employees’ performance and offer a realistic response to
generate factual performance of the employees.
 ICICI Bank should try to reduce hierarchy and cross-cultural
barriers among superior and subordinates and create a healthy
environment in practice.

33. Suggestions
 ICICI bank should redesign and adopt new training methods,
which pertinent to support all the employees and to remove
existing deficiencies in the employees and improve
productivity.
 SBI should provide successive latest training programmes to
their employees on new technology adoption, which could
exceed employee skills and make them ready to face
imperceptible future challenges.
 Make employees do not only attend the programmes, but fully
participate in the training sessions to remove their inferiority
and enhance their potentiality.
 Create an environment, where every employee can share their
experiences of training with others to remove employees’
negative feelings about training.

34. Suggestions
 Create a clear picture about the bank’s present reward system
in the minds of employees, because most of the existing
employees have no idea.
 As per study analysis try to appraise the employee's
performance on behalf of their colleagues and bestow with
tangible or monetary rewards at work place.
 SBI should review their bank obsolete reward system and try to
make essential modifications in association to offer fair and
equitable contemporary rewards.
 The suggestions given by the select employees during the study
unveil that most of them opined to promote performance
based individual rewards instead of group or branch rewards,
because most of the time it leads to employee dissatisfaction.

35. Suggestions
Make employees be conscious of banks mission, vision,
objectives and their roles.
Improve an environment where the employees can relay more
on discussions and interventions to deal with and resolve their
conflicts in a right away.
Take reliable decisions on the basis of genuine facts and
information without bias.
SBI should fabricate a healthy environment, where employees
mutually can feel fun to work, be optimistic and be pride as
part of their organizational culture.
Give preference to every employee’s idea while makes
imperative decisions.

36. Conclusions
The present study confirms that there is a significant
relationship among employee empowerment practices
and organizational effectiveness. In current scenario both
SBI and ICICI banks are practicing employee
empowerment practices, but in prescribed areas each
one of them are effective.
Here, ICICI bank is practicing better Autonomy
practices, where SBI is ahead in practicing better
Communication and Training. While in terms of Rewards
and Organisational Culture ICICI bank is ahead comparing
to SBI. Moreover, the overall research analysis shows that
public banks are ahead in practicing better
communication and training where private banks ahead
in autonomy, rewards and organisational culture
practices

37. Scope for Future Research
The present study has been only concentrated to assess
the impact of employee empowerment practices on
organizational effectiveness in the banking sector; especially
select SBI and ICICI Bank located in Rayalaseema region.
Further, there are chances to extend this to many other
banks, i.e., co-operatives, regional and foreign banks in
Andhra Pradesh, South India and India.
However, structural aspects are touched on the
conceptual basis to notice the changes that have taken place
after the implementation of empowerment practices. But,
psychological aspects are remained untouched due to time
constraint. For financial development and growth, banking
sector needs to focus more on improving the quality
standards of available human source. It is essential to take
certain useful actions for improving organizational
effectiveness by establishing effective participation,
communication and culture among employees.

38. Thank You