VOLUME 2 NUMBER 3
1994
Employee Empowerment
Nick Nykodym, Jack L. Simonetti, Warren R. Nielsen and Barbara Welling
Employee Empowerment: A study of employee
participation (empowerment) in promotion,
evaluation, job content, technological change,
work standards, financial policies, cost control,
organization structure, work force size, safety
programs, work methods, and pricing.
Employee empowerment or participative
decision making is neither a new or simple
management concept. Employee participation
is a complex management tool that over 50
years of research has proven that, when
applied properly, can be effective in
improving performance, productivity and job
satisfaction[1].
The purpose of this article is to provide a
general review of what has been written about
employee empowerment or participation.
This review contains a history of
participation, areas, methods, and forms of
participation and factors essential for
effective participation. Also, there are
appropriate situations that call for the use of
participation, since not every employee can
participate in every decision. In addition,
participative decision making carries certain
ramifications with it affecting the
organization and employee. Finally, the
effectiveness of participative decision making
is examined noting that studies have produced
mixed to moderate results with the final
assessment being that if certain guidelines are
followed, participative management can be
successful.
Empowerment in Organizations, Vol. 2 No. 3,1994, pp. 45-55
© MCB University Press, 0968-4891
45
History of Participation
Worker participation has been a popular topic
of studies of organizational behavior since the
1940s and 1950s. Those who entered the field
early were far more successful in creating a
field for academic study than establishing a
link with practical application. Even the
earliest findings suggested that great potential
existed for improving job satisfaction and
performance through the use of worker
participation. However, researchers in the
academic field had little success in interesting
management in this concept[2].
After World War II, the United States was
known around the world for its superior
management methods, and productivity teams
came to the United States from Europe to
learn them. US managers did not feel there
was any reason to change their current
thinking on management. Since at that time
their methods were so successful, they were
not receptive to ideas about participative
management[2].
During the period after World War II, a
number of Japanese professors and managers
came to the United States. The Japanese read
the literature published by the academics and
assumed they were reading about the actual
policies and practices of US companies. They
picked up the ideas provided to them by these
human relations researchers and returned
home to redesign and reinterpret these ideas
This research was made possible by a
Management Academic Challenge grant from the
University of Toledo, Ohio.
 ORGANIZATIONS:
AN INTERNATIONAL JOURNAL
to rebuild their organizations. For example,
the origin of quality circles can also be traced
to the United States. In 1951, W. Edwards
Deming spent several weeks in Japan
lecturing and demonstrating methods of
quality control. The Japanese, well aware of
their reputation for poor quality products,
eagerly accepted Deming’s suggestions[2].
About the same time the Europeans and
Japanese were invading the United States to
gain managerial knowledge, Sears instituted a
survey program designed to measure
workers’ and supervisors’ reaction to human
relations in the company and various aspects
of their jobs. Sears also developed a way to
report the results back to the managers. Soon
more and more companies began developing
their own internal survey programs and began
exchanging ideas with each other[2].
n developed. Any combination of these
Japanese management style
placed a high emphasis on
human relations
n Participation
By the 1960s and 1970s worker participation
programs were on the rise in the United
States. Quality circles used in the United
States had been readapted to our culture from
that of the Japanese. Rather than having the
management in control, as in Japan, the
United States programs were administered
jointly by leaders of management and
labor[2]. In the United States, participative
management was often confined to a task or
special project and as soon as the problem
was solved or the goal achieved, participation
ceased instead of being supported as a
continuous management practice[2]. During
this time, participative management ideas
began to create a considerable amount of
interest among management theorists and
46
practitioners, and workshops and courses on
these management techniques began to
appear[3].
As we moved into the 1980s, it became
clear that we were no longer competing
effectively with the Japanese. Japanese
management style placed a high emphasis on
human relations, and as a result, by the mid-
1980s arguments for participation became
even stronger[3]. Today, it is likely that
participative management will increase in the
1990s because of the complexity of decisions
that will need to be made in a changing
environment and the increasing pressure of
world competition[3].
History has shown that organizations have
taken these management ideas and adapted
them to their own culture. As a result four
broad areas of employee participation and
three methods of application have been
determines the form of participation used.
Areas, Methods and Forms of
One of the four areas of participation is goal
setting. Employees can take part in
establishing a goal for a task, designing a job
or even the speed at which the work should
take place. Next, employees can take part in
making choices among alternative courses of
action presented to them such as working
hours, placement of equipment or simply
choices between set alternatives to complete a
routine task. Third, employees can take part
in solving problems, which involves defining
the issues and setting the alternative courses
of action. Finally, participation may involve
making organizational changes, such as
setting company policies that might involve
hiring, layoffs, profit sharing or investments.
Employees may participate in any or all of
these four areas at any one time[1,4].
 VOLUME 2 NUMBER 3
1994
Three primary methods of participation
apply to all areas of participation. Employees
can participate as individuals, making their
own decisions and setting their own goals, or
they may pair up with a manager to form a
decision-making team. All employees may
participate in a decision-making group with
other members of the group being managers
or co-workers[1]. This participation may be
formal as in quality circles or may be
informal with members of a group expressing
opinions in order to reach some consensus.
Employees may participate directly in
decision making or indirectly through a
representative elected to present employee
ideas or concerns to a group[4].
There are several combinations of methods
and areas of decision making, but as a result
of testing, six basic forms have emerged.
These forms can be best classified by how
much influence organizational members have
in making a decision[4].
Participation in work decisions and
consultative participation both focus mainly
on work issues, such as what is to be done,
how it is organized, and who will do what.
Both of these types of participation are of the
formal, direct and long-term type. The only
difference between these two types of
participation is the amount of influence that
the employee has. Participation in work
decisions carries much more influence, where
employees have the final say. In consultative
participation, employees may give their
opinions but have no final decision making
power. Some studies have found that
participation in work decisions generates a
more positive attitude toward supervisors and
the company. Also, though results of some
studies are mixed, there seems to be a
positive trend toward job satisfaction when
consultative participation is used. Quality
circles and Scanlon plans fall into this group.
Scanlon plans provide monetary bonuses for
productivity suggestions, while in contrast,
47
quality circles concentrate on small groups
but do not pay the monetary rewards[4].
Like participation in work decisions and
consultative participation, short-term
participation is formal, direct and focusses on
work issues, and workers have a high degree
of influence on the decisions made. The only
difference is in the duration, which can range
from a single laboratory session to training
sessions of several days. Studies of this type
of participation show either mixed results or
no effect on job satisfaction, performance or
motivation, but show a positive relationship
to perceived influence[4].
Some organizations do not have groups
established for formal participation, but do
engage in participative decision making
through informal participation. This would
occur through interpersonal relationships
between managers and subordinates and
revolve around issues directly concerning the
subordinate’s work. Studies have found this
type of participation to be positively related
to job satisfaction, including the supervisor
and the work itself, and motivation and
commitment[4].
n
Some employees may
even participate directly
in decision making
n
Both formal and indirect participation are
found in employee ownership. It is formal
because the employees have the right to
participate as stockholders, and indirect
because even though the employees own the
company, it is run by managers who make the
strategic decisions. Employees have a high
level of influence through stockholder
meetings and election of the board of
directors. Some employees may even
 ORGANIZATIONS:
AN INTERNATIONAL JOURNAL
participate directly in decision making.
Employee ownership has been found to have
a positive relationship with organizational
performance. Thus it appears that the degree
of ownership has a direct relationship to
higher profits[4].
Similar to employee participation, is
representative participation, which is formal,
indirect, but of medium to low influence.
Employees do not participate directly but
through representatives elected to a board or
governing body. Representative participation
through worker councils or a board of
directors can focus on any issue instead of
just worker issues. Unlike employee
ownership which has high influence,
representative participation can range from
having a vote on the board of directors or just
having an advisory voice on the worker’s
council. This type of participation seems to
result in increased satisfaction at least for the
representative[4].
All of these areas, methods and forms of
participation further illustrate the fact that
participative management is a
multidimensional concept. In addition, there
are contingent factors that affect the success
of participative decision making, and also,
there are certain situations in which
participation works best.
Contingent Factors and Appropriate
Situations for Participation
Certain conditions exist that affect the success
of participative management, and unless these
conditions are managed skillfully, an attempt
at participative management may fail. One set
of conditions is composed of the values,
attitudes, and expectations of an
organization’s members. Some workers do
not want to participate in decision making,
and any attempt to force them to do so would
fail[1]. For participation to be effective, an
organization must maintain a corporate
48
culture that emphasizes participative
management[3]. Another factor is the design
of the actual work to be done. If workers are
mutually dependent on each other to get the
work done, encouraging autonomous
individual participation would be
counterproductive. Also, if employees do not
trust their managers, it is unlikely that
participation from pairing workers and
managers would succeed. The last set of
contingencies is concerned with the
environment. With rapidly changing
technology, governmental regulations, and
intense competition, group participation may
prove to be the most effective when members
have the technical skills necessary and are
currently up to speed on the latest issues.
These groups must also be able to work
effectively together to reach a decision[1].
Not only must organizations be able to
manage these contingency factors skillfully,
but they must have an understanding of the
mechanisms for participation to work best.
According to Locke et al.[5], motivational
and cognitive mechanisms are the most
important mechanisms in participation. They
say, “Motivational mechanisms include
actions such as trust, greater control of the
work, more ego involvement on the job,
increased identification with the organization,
…and the setting of higher goals and/or
increased goal acceptance”. They also stated
that cognitive mechanisms include more
upward communication and better utilization
of information by supervisors who do not
have the knowledge or enough information to
make a high quality decision on their own.
Also, employees begin to understand their job
better and the reasoning behind decisions.
In an effort to clarify when and to what
extent participation in decision making
should be used, Victor Vroom and his
colleagues at Yale developed a
decision-making model[5]. The model
defines five options for employee
participation and seven rules that determine
 VOLUME 2 NUMBER 3
1994
the conditions under which each of the five
options are effective. The five options are:
(1) make the decision yourself using
available information;
(2) obtain the necessary information from
subordinates, but make the decision
yourself;
(3) get ideas and suggestions from
individuals separately, then make the
decision which may or may not reflect the
subordinate’s input;
(4) share the decision with the group, and
make a decision that may or may not
reflect their input; and
(5) share the decision with the group and
together make the decision.
Next, the best option is then chosen based on
the use of seven decision rules. These are:
(1) whether the decision has a high-quality
requirement;
(2) whether the leader has sufficient
information to make a high quality
decision;
(3) whether the problem is structured;
(4) whether acceptance of the decision is
essential for effective implementation;
(5) whether an authoritative decision would
be accepted if made;
(6) whether conflict among subordinates is
likely in the decision; and
(7) whether subordinates share organizational
goals to be attained in making a decision.
Vroom’s own research supports that decisions
made following these guidelines are of higher
quality than those made when not following
these rules[5].
Although participation cannot always be
the preferred decision making method, there
are certain situations when participation
seems the most advantageous. Rosabeth Moss
49
Kanter[6] provides the following list of
situations when participation works best:
● to gain new sources of expertise and
experience;
● to get collaboration that multiplies a
person’s effort by providing assistance,
backup, or stimulation of better
performance;
● to allow all of those who feel they know
something about the subject to get
involved;
● to build consensus on a controversial
issue;
● to allow representatives of those affected
by an issue to influence decisions and
build commitment to them;
● to tackle a problem that no one “owns” by
virtue of organizational assignment;
● to allow more wide-ranging or creative
discussions/solutions than are available by
normal means (for example, getting an
unusual group together);
● to balance or confront vested interests in
the face of the need to change;
● to address conflicting approaches or
views;
● to avoid precipitous action and explore a
variety of effects;
● to create an opportunity and enough time
to study the problem in depth;
● to develop and educate people through
their participation: creating new skills,
new information, and new contacts.
In summary, the psychological attitudes of
employees and managers, the climate of the
organization, the environmental conditions,
the issues, the situation, and the kind of
problem to be addressed determine first if
participation is the method to use, and if so,
these factors will have an effect on its
success. Even when participation is the
 ORGANIZATIONS:
AN INTERNATIONAL JOURNAL
chosen mode of decision making, it does not
come without ramifications.
Dilemmas of Participation
Managing participation does not come
without potential problems in the areas of
initiation, structure and management, choice
of issues, teamwork, and evaluation.
Frequently, when organizations decide to
begin a program of participation, someone at
a higher level directs others to get involved in
setting up task forces and teams. Additionally,
the managers who are directed to carry out
this activity will be evaluated on the success
of their teams. These middle managers have
very little to say about the start-up of these
programs, and top level managers are
certainly not modeling the behavior they wish
to see in their organization. Another problem
in the beginning stages of participation is the
manner in which the organization presents the
program to the employees. Leaders
sometimes present participation as a gift
rather than a results-oriented tool. Presenting
participation as a luxury is insulting to
employees. However, introducing
participation along with clear explanations of
what management hopes to gain from this
concept is more readily accepted by
employees. Finally, the last dilemma in the
start-up stages is which employees to get
involved. If participation relies on volunteers,
it is not representative, if it does not, it is
coercive. It is important to have people with
appropriate skills and enthusiasm on teams,
but it is also equally important not to assign
people to teams without letting them have any
say in the decision. Also, it is important not to
have peer and management pressure that
would make an employee afraid to say no
even if they are asked formally to
participate[6].
In addition to potential problems in
initiating participation, there may be
50
dilemmas surrounding the structure and
management. A clear structure is important
for making an empowering process like
participation work. From the beginning,
ground rules and boundary conditions need to
be established. Too many choices can be
frustrating, and the fewer constraints placed
on a team, the more time they will spend
defining their structure than accomplishing
the task. In short, the existence of people who
can mobilize others and set constraints is an
essential part of making participation work.
Another issue related to structure and
management is that the manager not only sets
the constraints, but also remains involved
enough to coordinate activities, support
employees and review the results. He/she
does not simply delegate the task to a team
and walk away without monitoring the
progress. Last, it is important to find and
manage the time needed for participation.
Workers must feel that attending the group
meetings is worth their time and effort so
worker apathy does not develop[6].
Next, is the issue of choice, or which issues
are to be involved in participative decision
making. Studies have shown that workers
prefer to be involved in issues most closely
related to their primary job function.
Participation in local issues that are daily
annoyances is more enthusiastically received
by workers. However, it is very important not
to make assumptions about which issues are
most important to workers; they should be
asked. Visible results are most likely to be
seen when teams approach local issues, and
employees will feel that their time was well
spent if they can see tangible results.
Participatory mechanisms that simply set
agendas rather than produce action are
regarded as a part of the organization’s
control system and not an empowering
device. Visible results eventually evolve into
some type of reward system. Once
participation has passed the experimental
stage, employees may want compensation or
 VOLUME 2 NUMBER 3
1994
recognition for their time and ideas. People
need to feel they can benefit from
contributing to the effectiveness of the
organization[6].
n
Lower status
people may
feel intimidated
n begin forming subgroups, and blaming each
Furthermore, once the team is established,
members need to feel that they are a
necessary part of the whole group. Teams
formed with individuals at different levels of
the hierarchy of an organization sometimes
fall into a pattern of duplicating the
organizational hierarchy in miniature.
Comments from those who come from higher
status positions are treated most attentively.
Lower status people may feel intimidated and
be afraid to contribute to group discussions,
particularly if they do not agree with the
higher status person. Moreover, if they feel
too dominated, lower status people may drop
out of the group. Another factor may be that
the member with the most knowledge of the
subject under discussion may be the most
effective participant. Often organizational
position can create this difference on the
team. Those less well informed members will
have little to contribute and may respond by
dropping out, or they may be forced to
support a decision of the group that they had
little part in making[6].
For whatever reason, whether it be lack of
knowledge, intimidation, or fear of separation
from the group, some groups frequently take
actions in contradiction to what they really
want to do, and therefore, defeat the very
purpose they are trying to achieve. This is
more popularly known as the “Abilene
Paradox”. Members agree privately as
51
individuals as to the nature of the problem,
and steps to solve the problem, but do not
communicate their opinions to the rest of the
group. Thus they lead one another to
misperceive collective reality. With
misperceived information, which is
inaccurate, members make collective
decisions contrary to what they really wanted
to do, and that may be destructive to the
organization. As a result of these actions,
members feel frustrated and angry. They
other. If corrective steps are not taken, the
cycle will repeat itself with greater
intensity[7].
Also, all members of a group vary in
personality and personal resources. Some
have personalities that seem to “fit right in”,
and some are better communicators than
others. Each member brings different skills,
needs and interests to the group. From this
team politics can arise[6]. Sometimes this
progresses to the point that the group staying
together as a united team becomes the most
important concern and the real reason or
mission of the team becomes secondary.
These groups become victims of
“groupthink” which results in seven major
defects of problem solving. They are:
(1) There is an incomplete survey of
alternative courses of action.
(2) There is an incomplete survey of
objectives to be fulfilled.
(3) There is failure to re-examine the
preferred choice for non-obvious risks
and drawbacks.
(4) There is failure to reconsider any
previously rejected alternatives.
(5) There is little or no attempt to consult
experts.
(6) Members only show interest in facts or
opinions that support their preferred
choice.
 ORGANIZATIONS:
AN INTERNATIONAL JOURNAL
(7) Members fail to work out contingency
plans to deal with unforeseeable
setbacks[8].
Finally, there are dilemmas involved in the
evaluation of participation. Regardless of how
well participation works, it will not solve all
of an organization’s problems. It is merely a
technique to seek more involvement and input
in a changing environment with a more
sophisticated workforce. Disappointments for
leaders and employees are likely to be
proportional to the amount initially promised.
Management clearly needs to communicate in
the beginning what will and will not come out
of the participatory process, and how the
results will be measured along with how
employees will benefit. Employees will then
set their goals accordingly. Last, the final
point to consider is the question of whether
participation is appetite stimulating or
appetite satisfying. Depending on the
employee and the outcome of the experience,
the answer could be either[6].
Effectiveness of Participation
Several studies have been done over the years
that produced mixed results as to the
effectiveness of participation on job
satisfaction and performance. There are
several variables to consider: role conflict and
ambiguity; expectancy perception; stress;
goal setting; job level; personality; and task
characteristics.
Researchers have concluded that
participation has at least a moderately
positive affect on job satisfaction and
productivity. Miller and Monge[9] reported a
positive correlation between participation and
job satisfaction in studies conducted in
organizational settings that incorporated
measures of multiple-issue participation. A
correlation between participation and
productivity was revealed when they
averaged the results of field studies lacking
52
goal-setting interventions[10]. Wagner and
Gooding[10], in studies that contrasted
directive versus participative processes, found
a correlation between participation and
satisfaction when participants were asked to
perform simple tasks. This is important
because it helps support the suggestion that
participation helps enrich simplified
work[10]. Smith and Brannick also speculate
that participation causes greater job
satisfaction because the employee feels more
valued and trusted by management, and
because the worker gains a better
understanding of management difficulties by
dealing with some of the same problems[11].
n
It is not participation
per se that increases
job satisfaction
n
Some researchers suggest that it is not
participation per se that increases job
satisfaction and performance, but rather an
improvement in employee expectancies,
effort-performance expectancy and
performance-reward expectancy, that
influences satisfaction and performance[12].
Schuler[12] suggests that participation is
related to the employee role perceptions of
conflict and ambiguity, and therefore, the
more participation in decision making, the
lower the levels of role conflict and
ambiguity. Role and expectancy perceptions
may be influenced by psychological,
organizational and environmental contingent
factors. Most participation research of this
type has dealt with issues directly relating to
the employee. Participation in decision
making is related to the employee’s
 VOLUME 2 NUMBER 3
1994
perception of the performance-reward
expectancy because it allows a chance for the
employee to verify the actual performance
contingencies in the organization with his or
her supervisor and fellow employees. Also,
the more participation an employee has with
his or her supervisor, the more chances there
are for role clarification and conflict
awareness and resolution[12].
Also, both role conflict and ambiguity have
been predicted to affect emotional strain. One
frequently suggested method of reducing job
strain has been participation in decision
making. Some theorists have argued that the
mere belief in one’s ability to influence the
environment will help reduce frustration and
strain. Therefore, participation in decision
making gives workers a vehicle to overcome
obstacles to effective performance[13].
Past research has indicated that attitudes
toward participative decision making can
vary across different levels of job
involvement or to the extent of how closely
one identifies with his or her work.
Participation is considered less effective
among uninvolved workers since such
workers are assumed to be less receptive to
participative practices. However, with these
employees, such programs have proved to be
most successful. In addition, participative
practices are often a natural part of higher
level managerial positions. Employees in
lower level routine jobs, who traditionally
have had little input in the decision-making
process, are often the most receptive to
participative programs; thus the greatest
impact is often at the lower level[11].
Another factor to consider in evaluating
participation is the motivational effect of
participation versus goal setting on
performance. Meyer et al. in 1965[14] found
that to improve performance – how a goal
was set, participative or directive – was not as
important as the fact that a goal was set.
53
Studies have shown that hard goals lead to
higher performance than easy goals,
regardless of the method by which they were
set[15]. A series of studies provides strong
support for Locke’s theory that specific goals
lead to higher performance than generalized
goals. Also, there is a linear relationship
between goal difficulty and performance.
Participation in task strategy from a
motivational standpoint affects performance
only to the extent that it includes the setting
of specific goals that are more difficult than
those assigned by the supervisor. In short,
motivational effects of participation on
performance appear to be minimal[15].
Next, early studies on the effects of
participation focussed on the subordinate’s
personality characteristics, primarily the need
for independence. Participative decision
making was hypothesized to have a more
positive effect on subordinates with a high
degree of independence. However, the path-
goal theory suggests that both task and
personality characteristics interact to
determine effects of participation on job
satisfaction and performance. Schuler
discovered in 1976 that participation in
decision making was satisfying to low
authoritarian subordinates regardless of the
degree of task repetitiveness, but was
satisfying to high authoritarian subordinates
only if the degree of task repetitiveness was
low[16]. The-high-need-for-independence
subordinate shows significant differential
responses in terms of job satisfaction and
performance to participation under different
degrees of task repetitiveness. The path-goal
theory predicts that low-need-for-
independence subordinates are the ones that
should exhibit such a response. The path-goal
theory suggests that when the task is highly
repetitive, and subordinates are not allowed to
make their own work decisions, participation
would be of little value because it would not
 ORGANIZATIONS:
AN INTERNATIONAL JOURNAL
be required for effective task performance
[16].
In summary, the effectiveness of
participation in decision making has no
simple answer but varies with the form of
participation and the criteria for effectiveness.
Overall, years of study produced results that
are not overly encouraging. Therefore, we are
left with the conclusion that sometimes
participation in decision making has a
positive effect on job satisfaction and
performance, and sometimes it does not[3].
Conclusion
Participation in decision making, or employee
empowerment, is a management concept that
has been the subject of over 50 years of
research. Participation can be used in several
areas, methods and forms which are all
subject to psychological, organizational and
environmental factors for success.
Participation is not appropriate for every
decision-making situation, but if it is the
chosen method for dealing with a task or
problem, it must be managed skillfully.
Participation must be managed to avoid
potential dilemmas that can arise in initiating
the program, structure, choice of issues, and
the decision-making teams involved. Finally,
if certain guidelines are followed and its
limitations are understood, participation can
be an effective tool.
As we move through the 1990s increasing
emphasis will be placed on participative
management mainly because decisions are
becoming more complex and managers will
be required to integrate the knowledge of
specialists in different functional and
technical areas. Moreover, those that are
entering the workforce today have higher
expectations of being involved in
management decisions. Finally, with the
pressure of worldwide competition,
54
organizations who wish to remain
competitive must use the potential of all their
members[3].
n
References
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Nick Nykodym, Jack L. Simonetti and
Barbara Welling are in the Management
Department, College of Business
Administration, University of Toledo, Ohio,
USA. Warren R. Nielsen is in the Department
of Management, Illinois State University,
Normal, Illinois, USA.