Empowerment

by Phil Manington

Why is empowerment important?

An empowerment culture offers many benefits – both for you and for your organisation.

Benefits for the business

When you go into a business where the employees are empowered, you can feel the difference in the atmosphere. People are enthusiastic, positive, creative and willing to help others.

Empowered employees develop loyalty and trust – they are proud to be working for the company and are eager to contribute to company success. They understand and believe in the company vision and generate ideas directly aimed at improving products and services.

Empowered employees have increased self-confidence, are keen to develop their own skills and also to find ways to make use of those skills to the company’s benefit.

As a result, businesses benefit from

  • Increased productivity
  • Reduced production costs
  • Increased quality
  • High levels of internal cooperation and motivation
  • High levels of flexibility.
Case study

Described as perhaps the world’s most unusual workplace, Brazilian company Semco perhaps takes empowerment to its ultimate. Ricardo Semler, CEO says:

‘When I took over Semco from my father 12 years ago, it was a traditional company in every respect, with a pyramidal structure and a rule for every contingency. But today, our factory workers sometimes set their own production quotas and even come in on their own time to meet them, without prodding from management or overtime pay. They help redesign the products they make and formulate the marketing plans.’

Other significant features of working life at Semco are,

  • Everyone knows everyone else’s salary
  • Everyone is taught how to read balance sheets and cash flow statements so that they can understand how well the company is doing
  • There are no receptionists or secretaries (‘We don’t believe in cluttering the payroll with ungratifying, dead-end jobs ...’)
  • Employees are encouraged to learn each other’s jobs and to suggest changes in any department
  • Workers review supervisors’ performance.

Semler comments: ‘I think we’re proving that worker involvement doesn’t mean that bosses lose power. What we do is strip away blind, irrational authoritarianism that diminishes productivity. We’re thrilled our workers are self-governing and self-managing. It means they care about their jobs and about their company, and that’s good for all of us.’

Semler’s belief in empowering his workforce delivers tangible benefits, with the company often growing at between 30 and 40 per cent a year. It now has a turnover of $212 million, compared to $4 million when Semler first joined the company. Staff turnover is currently less than one per cent per year.

Benefits for the manager

As manager of an empowered team, you will gain significant benefits for yourself.

  • Your people will be keen to be co-operative and build consensus, making it easier (and quicker) for you to get things done.
  • They will be willing to be involved in decision-making, helping you to improve the quality of your performance.
  • They will be honest with you, delivering bad news if necessary, instead of hiding things.
  • Members of your team will want to help each other, reducing problems and saving you time.
  • People will feel able to take the initiative and act.
  • They will welcome change and see it as an opportunity, making it easier for you to implement new ideas.
  • Your team members will be willing to handle and resolve internal conflicts, reducing the need for you to get involved.
  • They will be more creative and innovative.
  • They will be eager to apply their knowledge and skills to reduce costs and improve performance.
  • They will want to identify and correct defects in business processes.