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146 APPLIED

WALL, CORDERY AND


PSYCHOLOGY: AN CLEGG
INTERNATIONAL REVIEW, 2002, 51 (1), 146–169

Empowerment, Performance, and Operational


Uncertainty: A Theoretical Integration
Toby D. Wall*
Institute of Work Psychology, University of Sheffield, UK

John L. Cordery
Department of Organisation and Labour Studies, University of
Western Australia

Chris W. Clegg
Institute of Work Psychology, University of Sheffield, UK

L’accession au pouvoir est présentée comme une recette universelle pour


améliorer la performance au travail. On défend ici l’idée qu’il existe déjà des
arguments forts pour penser que cette conviction est des plus discutables, et
que l’impact de la participation dépendra du degré de l’incertitude opérationnelle
qui prévaut. Notre point de vue s’appuie sur une analyse des idées qui émergent
conjointement de cinq domaines, à savoir les théories des organisations, la
structuration du travail, le management “zéro défaut”, le management des
facteurs humains et celui des ressources humaines. On met en évidence les
conséquences théoriques et pratiques de nos investigations et certaines des
pistes à suivre pour approfondir la réflexion.

Empowerment is being promoted as a general recipe for enhancing work


performance. We argue that there are already strong grounds for suggesting
that this universalistic assumption is flawed, and that the effectiveness of
empowerment practices will be contingent on the degree of operational uncer-
tainty that prevails. This argument is supported by an analysis of ideas in
common emerging from five different areas of inquiry, namely those concerned
with organisational theory, work design, total quality management, human
factors, and human resource management. We identify the theoretical and
practical implications of our analysis, and some of the lines of investigation
required to develop the ideas further.

* Address for correspondence: Toby D. Wall, Institute of Work Psychology, University of


Sheffield, Mushroom Lane, Sheffield S10 2TN, UK. Email: T.D.Wall@sheffield.ac.uk

© International Association for Applied Psychology,


Psychology, 2002.
2002. Published by Blackwell Publishers,
108 Cowley Road, Oxford OX4 1JF, UK and 350 Main Street, Malden, MA 02148, USA.
EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 147

CURRENT INTEREST IN EMPOWERMENT

In recent years, “empowerment” has become a popular term in management


circles, within which it has two broad uses. The first, sometimes referred to
as “psychological empowerment”, denotes a motivational state character-
ised by an employee’s feelings of competence, meaningfulness, choice, and
impact in their job or work role (e.g. Conger & Kanungo, 1988; Kirkman &
Rosen, 1999; Spreitzer, 1995; Thomas & Velthouse, 1990). The second use
of the term refers to the set of managerial practices (e.g. work redesign,
leader behaviour) which it is believed gives rise to such employee reactions
(e.g. Mankin, Cohen, & Bikson, 1997; Quinn & Spreitzer, 1997; Thorlakson &
Murray, 1996). In essence, empowerment as management practice repres-
ents the antithesis of traditional Tayloristic thinking (Wilkinson, 1998). The
latter emphasises the creation of narrowly defined, low discretion jobs; and
the concentration of decision making in the upper reaches of the organisa-
tional hierarchy. In contrast, the practice of empowerment entails the delega-
tion of decision making responsibilities down the hierarchy; which, for lower
hierarchical levels, incorporates well-established principles of job redesign in
terms of affording employees more autonomy or control over their work.
For this reason, empowerment practices are also sometimes described as
“high involvement” management (Lawler, 1986; Spreitzer, 1996), and include
such initiatives as job enrichment, self-management, teamwork, quality circles,
and total quality management (Hunter, 1998; Osterman, 1994). It is this sec-
ond use of the term empowerment, the practice of giving employees increased
decision making authority in respect of the execution of their primary work
tasks, that we adopt in this paper.
Though use of the term empowerment is a recent phenomenon, the idea is
not new. The history of I/O psychology and related fields reveals persistent
advocacy of empowerment in various forms as reflected, for example, in:
McGregor’s (1960) preference for Theory Y over Theory X; Likert’s work
on “new patterns of management” (1961); the socio-technical systems prin-
ciple of control of variance at source (e.g. Cherns, 1976); Herzberg’s (1966)
proposals for job enrichment; Hackman and Oldham’s (1976) Job Charac-
teristics Model; and the Quality of Working Life movement of the 1970s
(e.g. Davis & Cherns, 1975; Walton, 1973). All prescribe empowerment, in
one form or another, as a means of enhancing effectiveness at work. A core
assumption of this advocacy of empowerment as management practice is
that developing organisations and jobs in this way will release the motivation,
initiative, implicit knowledge, flexibility, involvement, and commitment
required from employees to respond to increasingly competitive conditions
(see also Block, 1986; Foy, 1994; Lawler, 1992; Malone, 1997; Pfeffer, 1994).
In other words, empowerment is seen as the route to improved work and
organisational performance.

© International Association for Applied Psychology, 2002.


148 WALL, CORDERY AND CLEGG

There is little doubt that empowerment is now being taken more seriously
than ever before by practitioners, and that it has become a core theme in
contemporary strategic thinking as well as a prescription for good manage-
ment practice. This is illustrated by the view of a CEO cited by Argyris
(1998): “No vision, no strategy can be achieved without able and empowered
employees” (p. 98). More systematic evidence comes from a recent survey of
modern manufacturing practices (Waterson, Clegg, Bolden, Pepper, Warr,
& Wall, 1999). Data from a representative sample of 564 UK firms showed
that 72 per cent had adopted empowerment initiatives, typically had intro-
duced these within the last few years, and planned to develop them further.
Survey research carried out in the United States by Lawler and colleagues
(Lawler, Mohrman, & Ledford, 1992, 1995) and Osterman (1994) provides
additional evidence of the rapid rise in such initiatives. As Hardy and Leiba-
O’Sullivan (1998) observe, “the popularity of this latest approach has led
some writers to hail the 1990s as the ‘empowerment era’ ” (p. 452).

QUESTIONS ARISING
The current interest in empowerment raises many questions. One concerns
why it should be so popular with practitioners at this point in time. Explana-
tions that have been offered point to several factors, including: the need
for empowerment as an adjunct to other contemporary initiatives such as
downsizing and delayering; its compatibility with yet other modern organ-
isational practices such as total quality management, just-in-time, lean pro-
duction, and Business Process Re-engineering; the need for flexibility in the
face of more variable and faster changing operational requirements; and the
increased education and expectations of the workforce (e.g. Wilkinson, 1998).
Other questions focus on whether current interest in empowerment is mainly
at the level of rhetoric rather than reality (e.g. Argyris, 1998), and whether
in practice it involves any meaningful transfer of power to staff at lower
levels within organisational hierarchies or simply an increase in demands
and responsibilities (e.g. Hardy & Lieba-O’Sullivan, 1998).
An especially important question, however, concerns the general applic-
ability of empowerment as a mechanism for achieving improved work system
performance. In common with many other popular change movements,
from scientific management through human relations, T-groups, TQM, and
JIT (Sitkin, Sutcliffe, & Schroeder, 1994), empowerment is advocated as a
near-universal recipe for organisational success (Wilkinson, 1998). Our thesis
in this essay is that there are already strong grounds for suggesting that this
universalistic assumption is incorrect; that the effectiveness of empowerment
practices will be contingent on context, and more particularly on the degree
of operational uncertainty that prevails. Moreover, we argue that this pro-
position generalises across the various levels of analysis and areas of applica-

© International Association for Applied Psychology, 2002.


EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 149

tion of empowerment, from its use as an overall principle for organisational


design (e.g. as in decentralisation), through its manifestation in work design
(e.g. as in job enrichment or self-managing teams), to its application as part
of other initiatives (e.g. as part of total quality management). Should this
be the case, but remain unacknowledged, the consequences may be quite
severe. Many organisations persuaded to follow the zeitgeist will achieve
disappointing results; and research on the effectiveness of empowerment will
yield inconsistent findings. More importantly, the potential of empowerment,
under conditions where it is appropriate, will be undermined. Thus, in this
paper we attempt to draw together the various, and at present disparate,
strands of existing research and theory that lead to the conclusion that the
effectiveness of empowerment will be contingent on operational uncertainty;
and to delineate some of the lines of inquiry required to develop this theoret-
ical perspective more fully.

CAUTIONS FROM PREVIOUS RESEARCH


As indicated above, one implication of a contingency view is that empower-
ment initiatives will have variable success. There is ample evidence that this
is the case. For example, Kelly’s (1992) analysis of 31 of the most methodo-
logically rigorous job redesign studies showed performance change ranging
from −17 per cent to +50 per cent, with clear evidence of an increase of
10 per cent or more in performance in only 13 instances. Research into team
effectiveness shows equally variable results, with modest and inconsistent
relationships being found between team interventions and performance
(Goodman, Devadas, & Griffiths-Hughson, 1988; Hackman, 1990; Cohen
& Bailey, 1997). Similarly, Waterson et al.’s (1999) survey of UK companies
found that of the 406 (out of 564) with empowerment strategies, 22 per cent
reported little or no benefit in terms of reduced cost, improved quality and
greater flexibility, 32 per cent claimed moderate gains in these respects, and
only 46 per cent reported more substantial benefits.
Clearly, such evidence does not demonstrate the existence of organisational
contingencies in general, or of uncertainty in particular, with regard to
empowerment initiatives. There are many other possible explanations for
variable effects, including differential success in implementation. Neverthe-
less, it is the pattern of findings one would expect from a contingency view
of empowerment, and one that is consistent with arguments within a number
of disparate theoretical traditions.

INSIGHTS FROM ORGANISATION THEORY


The view that uncertainty provides the link between organisational structure
and processes on the one hand and performance on the other is most fully

© International Association for Applied Psychology, 2002.


150 WALL, CORDERY AND CLEGG

articulated within organisation theory. The argument has its roots in the work
of Burns and Stalker (1961, 1994). They proposed that mechanistic structures
are appropriate for organisations operating in relatively certain or predictable
environments; but that more organic approaches are required under more
uncertain and complex conditions. Since “mechanistic” structures are defined
as those involving formal relationships, centralised decision making and
routinised tasks, and “organic” structures as those characterised by more
flexible, decentralised, and informal practices, the argument bears directly
on contemporary views of empowerment.
Like other early theorists (e.g. Galbraith, 1977; Mintzberg, 1979;
Thompson, 1967; Woodward, 1965), Burns and Stalker took an evolutionary
perspective. They were attempting to explain the existence of different
organisational forms as adaptations to prevailing levels of environmental
uncertainty. However, this developed to the more general argument that
there is choice, and failure to match the form of the organisation to its
context would result in sub-optimal performance (Clegg, 1984; Gilbert, 1996;
Lawrence & Lorsch, 1969; Perrow, 1967). Thus the basic argument is that em-
powerment strategies are effective under conditions of greater uncertainty,
but that more bureaucratic, routinised, and low discretion forms of work
organisation will be effective under more predictable operating circumstances.
It is interesting to record that it is not only within organisation theory
that this contingency view has been put forward. Aoki (1990), building on
Williamson’s (1985) new economics, distinguishes between two forms of
organisation: the H (hierarchical) and J (Japanese) modes (see Taira, 1996).
The H-mode corresponds to traditional mass production, whereas the J-mode
reflects lean production (see Womack, Jones, & Roos, 1990), which incor-
porates much stronger elements of empowerment. Aoki’s theory concerns
the relative effectiveness of the two modes under different conditions. The
traditional, low empowerment, H-mode is predicted to be relatively better:

When environments for planning (e.g. markets, engineering process, develop-


ment opportunity) are stable, (because) learning at the operational level may
not add much value to prior planning, and the sacrifice of economies of spe-
cialisation in operational activities may not be worthwhile. On the other hand,
if environments are extremely volatile or uncertain, decentralised adaptation
to environmental changes may yield highly unstable results. In both these two
contrasting cases, the H-mode may be superior in achieving the organisational
goal. (Aoki, 1990, pp. 8–9)

But:

In the intermediate situation, however, where external environments are


continually changing, but not too drastically, the J-mode is superior. In this
case, the information value created by learning and horizontal co-ordination

© International Association for Applied Psychology, 2002.


EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 151
at the operational level may more than compensate for the loss of efficiency
due to the sacrifice of operational specialisation. (Aoki, 1990, p. 9)

Assuming that extremely volatile environments are the exception rather than
the rule, Aoki’s position equates to that of the more familiar organisation
theorists.
Returning to the literature on organisation theory, it should be noted that
subsequent elaboration of this basic contingency view focused mainly on
different sources and kinds of uncertainty, such as those stemming from
market demands, technology, materials, or the inherent nature of the task
(e.g. Brass, 1985; Duncan, 1972; Galbraith, 1977; Lawrence & Lorsch, 1969;
Mintzberg, 1979; Thompson, 1967). This diversity of definitions and foci of
uncertainty within the literature served to mask the underlying commonality.
When looked at from the point of view of how uncertainty is manifest within
the organisation, however, they all have the same implication: whatever the
source, uncertainty results in variability and lack of predictability in work
tasks and requirements, including what has to be done and how to do it.
This core component to the notion of uncertainty is well captured by
Perrow’s (1967, 1970, 1979) analysis. He proposed that the market environ-
ment, raw materials, technology, and other factors may all be considered
in terms of their effect on the extent to which tasks can be programmed or
“routinised”. Where there is frequent change to products, variability in raw
materials, and unreliability in the technology, the opportunity to routinise
work will be low because of the “number of exceptional cases” encountered.
Correspondingly, there will be low “problem analysability”, in the sense that
task requirements will be difficult to specify precisely and fully to understand.
Perrow’s perspective has its parallel in the concept of “variance” as used
in socio-technical systems theory. Cherns (1976) defined a relevant variance
as “any unprogrammed event” that “critically affects performance” (p. 787).
The “socio-technical criterion” then formulated was that “variances, where
they cannot be eliminated, should be controlled as near to their source as
possible” (p. 787). It is at this level of analysis, concerned with processes
internal to the organisation, that the various perspectives on uncertainty
evident in the literature coalesce. We use the term “operational uncertainty”
to denote this common core.
Thus a long tradition of organisation theory, and associated empirical
work, already informs us that, at the organisational level, the effectiveness
of empowerment is contingent on operational uncertainty.

LESSONS FROM WORK DESIGN RESEARCH


For many commentators, the hallmark of empowerment is its focus on devel-
opments at lower hierarchical levels. Wilkinson (1998), for example, states:

© International Association for Applied Psychology, 2002.


152 WALL, CORDERY AND CLEGG

Empowerment schemes tend to be direct and based on individuals or small


groups (usually the work group), a clear contrast to industrial democracy and
participative schemes, such as consultative committees, which are collectivist
and representative in nature. (p. 41)

At this level, work design theory has sought to identify important elements
of individual and group tasks, duties, and responsibilities that give rise to
employee psychological empowerment, and thus we now consider how
operational uncertainty has been treated in this domain.
The initial point to make is that leading work design theories do not
explicitly include uncertainty as a contingency. For example, the concept
does not feature at all in the Job Characteristics Model (Hackman & Oldham,
1976), where only individual differences (ability, growth need strength, and
context satisfactions) are considered as moderators; and uncertainty is only
implicit (i.e. the concept of “variance” and “the socio-technical criterion”)
within socio-technical systems theory (Cherns, 1976). These theoretical
approaches, concerned with individual and group work design respectively,
are universalistic in nature, assuming that enhanced autonomy, feedback,
or other work design characteristics will promote performance irrespective
of external circumstances. In turn, this has encouraged an undifferentiated
application of these theories in different technological and organisational
contexts.
Over the years, experience with frequent failure in implementing theory-
specified work redesign, and the observation that the relationship between
job redesign and job satisfaction is found more consistently than between
job redesign and performance (Mitchell, 1997), has led to a broad acknow-
ledgement that features of the organisational context play a central role in
the success of empowering work redesign strategies (e.g. Oldham & Hackman,
1980; Cohen, Ledford, & Spreitzer, 1996; Cohen & Bailey, 1997). Some of
this literature has specifically identified operational uncertainty (or similar
construct) as a key contextual variable (e.g. Clegg, 1984; Cummings &
Blumberg, 1987; Herold, 1978; Pearce & Ravlin, 1987; Slocum & Sims, 1980).
Thus, Pearce and Ravlin (1987) identify “process uncertainty” as a precondi-
tion for effective self-managing teams, while Cummings and Blumberg (1987)
argue that jobs need to be designed for external control when “technical
uncertainty” is low, but for devolved decision making where such uncertainty
is high. These arguments have run in parallel to the mainstream literature
on work redesign and empowerment, and have had little impact on work
design research. Recent empirical findings, however, suggest operational
uncertainty is indeed a key contingency in work redesign. In a study of
individual job redesign for operators of advanced manufacturing technology,
Wall, Corbett, Martin, Clegg, and Jackson (1990) showed that increasing
“operator control” resulted in substantial performance gains for systems

© International Association for Applied Psychology, 2002.


EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 153

characterised by high operational uncertainty, but had no discernible effect


for those with low operational uncertainty.
Parallel findings have been found for group work redesign. Cordery,
Wright, and Wall (1997) investigated the effects of the introduction of
self-managing work groups in water treatment plants on their success in
controlling residual levels of solids in the water and minimising phosphates.
They showed that this empowerment initiative resulted in clear performance
gains for plants facing higher levels of operational uncertainty (due to vari-
ability in pollutants and in the technology itself), but not in those plants
where requirements and processes were more predictable and stable.

ARGUMENTS FROM A TOTAL QUALITY


MANAGEMENT PERSPECTIVE
A recent theoretical analysis of total quality management (TQM) provides
yet further support for the argument that operational uncertainty is a key
factor linking empowerment to performance. Sitkin, Sutcliffe, and Schroeder
(1994) distinguish between two forms of TQM, namely total quality control
(TQC) and total quality learning (TQL). They characterise the former as
being concerned with finding and implementing standardised solutions to
frequent and relatively easily analysable quality problems, through the use
of systematic and quantitative procedures (e.g. statistical process control).
This naturally involves elements of learning in identifying problems and
determining how to deal with them, but the process is typically undertaken
outside the job (e.g. through quality circles) and solutions then become part
of standard job requirements. Thus from the point of view of the employee,
TQC offers little empowerment, and may even reduce autonomy or control.
TQL, in contrast, is described as “an exploration-oriented aspect of TQM”
(p. 544), in which the opportunity to experiment, make mistakes, learn, and
pursue novel solutions is emphasised.
The core of Sitkin et al.’s (1994) thesis is that these two forms of TQM
will be differentially effective according to prevailing levels of operational
uncertainty. TQC, they argue, is appropriate where there is “a certain degree
of task routineness and a moderate to high amount of certainty to understand
cause–effect relationships” (p. 544). However, this also implies that it is “less
appropriate in situations of high uncertainty” (p. 544), where TQL should
be emphasised:

In settings in which the task is poorly understood, it may not only be imposs-
ible to specify appropriate measures, but it may also be impossible to conduct
the necessary exploratory, high-risk work without making an irreducibly large
number of errors. . . . In these fundamentally uncertain contexts, continuous
improvement should focus on experimentation rather than on decreasing error
rates. (p. 545)

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154 WALL, CORDERY AND CLEGG

INDICATIONS FROM THE HUMAN FACTORS LITERATURE


Within the human factors literature, a major field of inquiry focuses on “a
systems design problem that concerns assigning system functions to human
and machine agents” (Sharit, 1997, p. 302). Termed the “allocation of func-
tion” problem, it is concerned with deciding whether humans or machines
get to undertake particular tasks in complex systems. It has largely been the
concern of system designers and ergonomists, and there has been a long
tradition of work in this domain. One strand of thinking has been, and
remains, particularly influential. This was first articulated by Fitts (1951) who
argued that humans appear to surpass machines with respect to a number
of activities including: the ability to improvise and use flexible procedures;
the ability to reason inductively; and the ability to exercise judgment. In
contrast machines are better at completing routine, well-defined repetitive
tasks, which they can typically execute faster and with greater consistency.
While this comparative approach to performance has been criticised for a
number of reasons (Jordan, 1963; Price, 1985; Rouse, 1988), the underlying
logic is pervasive and so-called “Fitts lists” remain in use by system developers
today (Older, Waterson, & Clegg, 1997) and the decision to allocate func-
tions to people rather than machines may be seen as a particular form of
empowerment.
More recent thinking, however, has taken a more systemic and contingent
perspective, and considered the circumstances under which particular alloca-
tion decisions may be optimal (e.g. Older et al., 1997; Grote, Weik, Wafler,
& Zolch, 1997). Clegg, Ravden, Corbett, and Johnson (1989), for example,
argue that task execution responsibilities should be allocated to humans
when the requirements of the tasks themselves are uncertain and when they
are critical to system performance. Uncertainty here includes a lack of pre-
dictability over such matters as the timing of, and demand for, a particular
task, the meaning of stimuli or inputs that trigger the need for a response,
and the nature of the actions or responses that are required. Criticality refers
to the importance of the task to the effective performance of the system,
recognising that some tasks may be trivial and not unduly affect overall
performance, while others may be central to it. The “allocation of function
principle” is that tasks which are critical to system performance but cannot
be fully anticipated and pre-programmed, should remain the responsibility
of the human operator. The reason for this allocation decision is similar to
that articulated by Fitts (1951), that is that humans tend to perform particu-
larly well at improvising, at being flexible, at using certain kinds of reason-
ing and problem solving, and at exercising their judgment. While they may
be provided with computer support, for example to process information
(something machines are very good at), decision making under conditions of
high uncertainty and high criticality should remain with the human operator.

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EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 155

DIRECTION FROM THE HUMAN RESOURCE


MANAGEMENT LITERATURE
Within the relatively young literature dealing with strategic human resource
management, considerable recent effort has been directed at testing the
relationship between different human resource management policies and prac-
tices and organisational performance. Early research was able to demonstrate
that certain HR policies and practices were differentially associated with
improvements in employee productivity and organisational performance (e.g.
Huselid, 1995; MacDuffie, 1995). Youndt, Snell, Dean, and Lepak (1996)
note that:

several themes emerge across the studies. At their root, most of the studies
focus on enhancing the skill base of employees through HR activities such as
selective staffing, comprehensive training, and broad developmental efforts
like job rotation and cross-utilisation. Further, the studies tend to promote
empowerment, participative problem solving, and teamwork with job redesign,
group-based incentives, and a transition from hourly to salaried compensation
for production workers. (p. 839)

Strategic human resource management theorists have begun critically to


examine such universalistic assumptions. Specifically, it has been suggested
that those HRM policies which promote empowerment are likely to prove
most beneficial where the organisation is pursuing quality and flexibility
strategies, but not cost reduction (Schuler & Jackson, 1987; Youndt et al.,
1996). In other words the empowerment–organisational performance rela-
tionship will be moderated by the company’s overall strategic orientation.
The notion that levels of operational uncertainty within a firm will moderate
the effectiveness of empowerment-oriented HRM practices has also received
support from a study by Snell and Youndt (1995). They found that where a
firm’s approach to HRM was based on output control (i.e. devolved respons-
ibility for decision making), firm performance was greatest where executives’
knowledge of causal mechanisms associated with effective performance was
low. Conversely, behaviour control HRM strategies were more effective than
output control where knowledge of cause and effect in system functioning
was high.
Operational uncertainty is also implicitly treated within a recent theoret-
ical examination of notions of fit and flexibility in strategic HRM. Wright
and Snell (1998) argue that firms may need to simultaneously address needs
for HRM practices to be congruent with business strategy, while maintain-
ing a degree of potential adaptability to change (flexibility). The participative
infrastructure that empowerment practices generate is seen as central to
maintaining an organisation’s responsiveness to unpredictable aspects of
its operating environment.

© International Association for Applied Psychology, 2002.


156 WALL, CORDERY AND CLEGG

Finally, some further pointers towards the relationship between uncertainty


and empowerment as embedded within human resource management prac-
tices may be gleaned from agency theory. In its typical application to human
resource management, agency theory deals with how monitoring and com-
pensation systems are structured within the employment relationship, such
that risk- and effort-averse employees are encouraged to act in ways consist-
ent with the objectives of the organisation (Eisenhardt, 1989). According to
agency theory, where uncertainty is high, managers’ opportunities effect-
ively to monitor and directly control employee performance are reduced
and so the balance of responsibility (risk) associated with the regulation of
performance needs to shift to employees themselves, in the form of outcome-
oriented employment contracts (Eisenhardt, 1988; Gerhart & Milkovich,
1992). This analysis is consistent with our perspective on empowerment
practices. Agency theory would further suggest that the resultant increased
risk and effort on the part of employees, as well as risk on the part of the
organisation, needs to be offset by modifying compensation systems (e.g.
performance incentives), or other aspects of employment contracts, such as
employment security and stability of responsibilities (Bloom & Milkovich,
1998).

HYPOTHESES 1 AND 2
So far we have shown how disparate literatures converge in suggesting
operational uncertainty to be a generic contingency variable affecting the
relationship between empowerment and performance. Our arguments to
date can be summarised in the form of the following general hypotheses:

Hypothesis 1: Where operational uncertainty is high, the implementation of


practices characterised by high empowerment will promote work performance.
(Corollary: where operational uncertainty is high, there will be performance
losses associated with the use of low empowerment practices.)

Hypothesis 2: Where operational uncertainty is low, there will be little or


no performance gain from the implementation of practices involving high
empowerment.

MECHANISMS
In a sense, the above hypotheses are the outcome of an exercise in document-
ing the prevalence of the view that the relationship between empowerment
and performance is contingent on operational uncertainty. The argument
becomes that much more credible if one can also explain why this should be
the case. If we consider empowerment at the level of the individual or work
group, several complementary mechanisms can be identified. For our purpose,

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EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 157

Blumberg and Pringle’s (1982) conceptualisation of performance as being a


function of motivation, ability and opportunity (see also Peters & O’Connor,
1980) provides a particularly useful framework. We use this framework first
to consider how empowerment by itself is likely to affect performance, before
addressing the issue of why such an effect will be contingent on operational
uncertainty.

Links between Empowerment and Performance


The suggestion that motivation provides a link between empowerment
practices and performance is the least contentious aspect of Blumberg and
Pringle’s framework. The assumption of such a link is built into job design
theory (e.g. Herzberg, 1966; Hackman & Oldham, 1976), and there is plenty
of supporting empirical evidence. We take that element for granted. The
key point made by Blumberg and Pringle, however, is that motivation on its
own, though a necessary factor, is not sufficient to account for performance
effects, and that one has also to consider ability (i.e. competence, know-
ledge) and the opportunity to put this into practice. Moreover, it is the link
between knowledge and opportunity that is especially important, with
opportunity representing the circumstances in which it is both possible to
apply existing knowledge and to further develop that knowledge.
The idea that empowerment practices promote both the use and devel-
opment of knowledge has surfaced in many different areas. As early as the
1960s, for example, Herzberg (1966) argued that job enrichment led to
“psychological growth”, which was defined as “knowing more, seeing more
relationships in what we know, being creative, being effective in ambiguous
situations” (p. 70). Essentially the same argument is at the core of Action
Theory (Hacker, 1985, 1986, 1987), a general cognitive approach which for
several decades was a leading influence in I/O psychology in the former East
Germany, and which more recently has been made more widely accessible
elsewhere. Frese and Zapf (1994) describe its implications as follows:

Action Theory’s arguments are not based on the grounds that control is a
prerequisite for democracy at work. Nor is the basis a humanistic type of
psychology. It is also not a motivational theory as the one by Hackman and
Oldham (1980). Rather, Action Theory’s idea is that people who have control
can do better because they can choose adequate strategies to deal with the
situation. For example, they can plan ahead better and are more flexible in the
event that something goes wrong. Skills can only be acquired in a lifelong
process where there is control at work. (p. 319)

Susman and Chase’s (1986) insightful socio-technical analysis of the


integrated factory reflects the same theme. They reasoned that “aside from

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158 WALL, CORDERY AND CLEGG

any motivational benefits they may derive from having enriched jobs . . .
employees are in a better position to see the relationships between specific
actions and their consequences” (p. 268). Lawler (1992) offers the same
general argument, suggesting that empowered forms of work design are
effective:

because employees have a broader perspective on the work process and as a


result can catch errors and make corrections that might have gone undetected
in more traditional work design in which employees lacked the knowledge
to recognise them. And because they have the autonomy to make ongoing
improvements, employees can also fine-tune and make adjustments in the work
process as they become increasingly knowledgeable about how their work can
best be done. (p. 85)

Others have offered similar views linking empowerment to performance


through knowledge and related mechanisms (Cummings & Blumberg, 1987;
Karasek & Theorell, 1990; Majchrzak, 1988; Walton & Susman, 1987).
Moreover, within the closely related area of participation, it has been sug-
gested that the real potential of this practice “might lie not in its power to
motivate employees, but rather in its ability to facilitate cognitive growth
and awareness through the transfer of knowledge among individuals who
might not otherwise share information” (Wagner, Leana, Locke, & Sweiger,
1997, p. 50). In Blumberg and Pringle’s (1982) terms, empowerment repres-
ents the opportunity structure within which knowledge can be applied and
developed.
Within the various analyses described above three distinguishable mech-
anisms are being proposed. The first is that of knowledge application. Essen-
tially, the argument is that empowerment promotes performance because
it allows employees to use pre-existing knowledge more effectively. This has
two aspects. One is to make available otherwise untapped resources. The
other, a particular case, is the “quick response mechanism” (Wall, Jackson,
& Davids, 1992). If employees are empowered to deal with problems which
otherwise they would have had to call on others (e.g. supervisors or engineers)
to solve, then, assuming they can manage them equally well, they eliminate
lost production time.
The second mechanism being proposed is that empowerment facilitates
the development of new knowledge which promotes performance, as explicit
in Action Theory and Lawler’s (1992) description of employees becoming
“increasingly knowledgeable”. Finally, there is the suggestion that empower-
ment promotes a “broader perspective” (Lawler, 1992) or more proactive
orientation among employees.
Recent empirical studies offer support for all three of these mechanisms.
In a longitudinal study, Wall, Jackson, and Davids (1992) examined the

© International Association for Applied Psychology, 2002.


EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 159

impact of empowerment (increased “operator control”) on the performance


of a robotics system. They reasoned that a “knowledge application” mechan-
ism would be reflected in a relatively immediate reduction in the time taken
to deal with operational faults, whereas a “knowledge development” mechan-
ism would be shown by a reduction in the incidence of faults which would
develop more slowly. They found clear evidence for both mechanisms. Sim-
ilarly, in a study of employees operating sophisticated technology to manu-
facture photographic film, Leach (1998) examined the performance and
cognitive effects of empowerment augmented through enhanced feedback.
The findings were that system performance improved considerably following
empowerment, and this was accompanied by a greater use of knowledge by
already expert operators, and an increase in knowledge and its use among
less expert operators, with that knowledge showing more differentiated cog-
nitive structures (as measured by knowledge elicitation techniques).
Finally, Parker, Wall, and Jackson (1997) describe a study relating em-
powerment to the development of more “proactive orientations”. Their findings
suggested that acceptance by employees of the implications of total quality
management principles for their own work (as opposed to acceptance as
a general company policy) occurred only where employees also had more
empowered forms of work design. This result is consistent with the work
by Frese, Kring, Soose, and Zempel (1996) on the development of personal
initiative.
Thus, a considerable amount of informed opinion, and an as yet limited
amount of empirical evidence, suggests that knowledge application, know-
ledge development, and proactive orientations are all mechanisms which
link empowerment to performance. Moreover, it is not unreasonable to
assume that these mechanisms are interrelated, in the sense that knowledge
application facilitates knowledge development, and that both foster more
proactive orientations. They form a virtuous circle.

Operational Uncertainty and the Link between


Empowerment and Performance
We can now return to our central question of why, given these proposed
mechanisms, the effect of empowerment practices on performance should be
contingent on operational uncertainty. The argument is relatively straight-
forward. At a psychological level, operational uncertainty may be defined
as a lack of knowledge about production requirements, of when problems
will be met and how best to deal with them. In other words, operational
uncertainty represents a lack of understanding about cause and effect, or
action and outcome, within the system (Jackson, 1989). Where such uncer-
tainty is high, knowledge is incomplete and problem solving requirements
are high. Thus there is both the opportunity to empower employees, in terms

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160 WALL, CORDERY AND CLEGG

of giving them important areas of decision making, and scope for learning.
Conversely, where there is little uncertainty, the knowledge requirements
of the work are low, and there is consequently little scope for knowledge
development and less opportunity to offer employees real empowerment. It
follows that the effects of empowerment on performance will increase as the
degree of production uncertainty increases.

HYPOTHESIS 3
From the above arguments we can propose a third hypothesis:

Hypothesis 3: Where operational uncertainty is high, the positive impact of


the implementation of high empowerment practices on performance will be
explained by enhanced knowledge application, knowledge development and
proactive orientations among employees.

THE CENTRAL HYPOTHESIS IN A WIDER CONTEXT


It is useful both to further elaborate on and delimit our core hypotheses (1
and 2), concerning the differential impact of empowerment on performance
as a function of operational uncertainty.

Elaboration
The elaboration concerns levels of performance under conditions of high
compared with low operational uncertainty. Operational uncertainty is
defined in terms of the number and difficulty of problems, key variances or
exceptions, that have to be accommodated. It follows that where these prob-
lems are high, performance will suffer, in that a greater proportion of the time
will be spent on overcoming operational difficulties and less on output per
se. Thus the effect of empowerment under conditions of high operational
uncertainty will be to reduce the underlying performance deficit which is
characteristic of work under these conditions relative to work under low
levels of operational uncertainty. In other words, the interaction between
empowerment and uncertainty represented within Hypotheses 1 and 2 is of
a particular ordinal form rather than being a disordinal one.
The value of this elaboration is that it provides a more specific and thus
more readily refutable hypothesis in the special case of studies where per-
formance can be directly compared across different conditions of operational
uncertainty, such as where organisations keep the same production technology
but change to making a greater diversity of products.
More generally, this elaboration helps to explain the apparent contradic-
tion between the traditional simplification approach to work design and more

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EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 161

recent positions on work redesign and empowerment. The former hold that
the route to high performance is through simplifying work and disempowering
employees, whereas the latter take the opposite view. In fact they can be seen
to be addressing different issues. The simplification approach, exemplified
by Taylor’s (1911) Scientific Management and by Henry Ford’s development
of the production line, focuses on structuring the situation so as to minim-
ise operational variability and uncertainty. This is well illustrated by Ford’s
often-mentioned comment to the effect that customers may have any colour
of car as long as it is black. In contrast, those recommending empowerment
appear to be focusing on conditions where operational uncertainty is high,
and recommending ways to deal with this more effectively. The consistency
between these positions is implicit in the socio-technical principle mentioned
earlier that “variances, where they cannot be eliminated, should be con-
trolled as near to their source as possible” (Cherns, 1976, p. 787).

Delimitations
Our discussion so far has taken a particular view of empowerment, which
can now usefully be made more explicit. We have defined empowerment
practices in terms of the decision making authority, or autonomy, of em-
ployees over the execution of their primary tasks. Clearly, it is also possible
to empower employees in other respects, for example by expanding their
responsibilities for production scheduling in their own work area, in the
allocation of tasks, or in the selection and training of staff. Our hypotheses
relate to the former circumstance, which may be termed “core task empower-
ment”, not to the latter which we call “role empowerment”.
This leads us into another delimiting factor, concerned with performance.
Our focus throughout has been on performance of the core task. This should
be distinguished from wider views of effectiveness which incorporate notions
of productivity and employee attitudes. Let us take productivity first, defined
as the total unit cost of output. It is quite likely that core task empowerment
initiatives will produce some productivity benefit even under conditions of
relatively low operational uncertainty, to the extent that they reduce the call
on support staff and thus save costs in that domain. We anticipate such
gains to be relatively modest, however, since, where there is low operational
uncertainty by definition the opportunities for such empowerment are limited
and pre-existing demands on support staff are low. The key point is that
although core task empowerment may have little direct impact on perform-
ance per se under conditions of low operational uncertainty, it is unlikely
to have a negative impact and may have marginal benefits for productiv-
ity. Role empowerment, in contrast, offers potential benefits regardless of
the level of uncertainty, to the extent that it involves employees taking on
self-managing tasks that otherwise would require the services of more

© International Association for Applied Psychology, 2002.


162 WALL, CORDERY AND CLEGG

costly support staff. Thus empowerment more generally may enhance pro-
ductivity, even though we hypothesise that the performance effects of core
task empowerment will be limited to circumstances of high operational
uncertainty.
Finally, we should not avoid the question of employee attitudes. There is
already considerable evidence that more empowered forms of work, be this
concerned with the core task or the wider work role, promote satisfaction
and well-being at work (e.g. Parker & Wall, 1998). Nevertheless, we should
not neglect recent evidence suggesting that even in this respect the effect of
core task empowerment on employees’ affective reaction is moderated by
operational uncertainty (Wright & Cordery, 1999).

IMPLICATIONS FOR RESEARCH AND PRACTICE


The arguments and hypotheses we have put forward suggest a rather differ-
ent research agenda and set of priorities than that which has been pursued
to date. Three lines of development are of particular importance. The first is
to clarify and develop the concepts of both empowerment and uncertainty.
In reviewing the literature on empowerment for this paper, a particular
difficulty we encountered was to determine the extent to which different
authors were addressing a common issue. Empowerment is variously defined
and operationalised and, conversely, different terms (e.g. high involvement,
autonomy, control) are sometimes used to refer to apparently the same
underlying idea. Analysis and clarification of the meanings of empowerment,
and the development of a taxonomy, or typology, would be of considerable
value. In this respect, a clear distinction has already been made between
empowerment as an organisational or management practice, which is our
concern here, and empowerment as a psychological construct (e.g. Spreitzer,
1995, 1996). As indicated above, future work needs to include greater differ-
entiation between (organisational) empowerment as directed at the core
tasks and that involving wider roles.
The same difficulty exists with regard to uncertainty. From the perspect-
ive of this paper we consider a focus on operational uncertainty to be
particularly useful, and serves as a common basis for integrating the diverse
treatments of this construct in the literature. Nevertheless, we recognise
the need to take a wider view of uncertainty for other purposes. Where the
focus, for example, is on how to reduce uncertainty rather than to cope with
it, then differentiation according to its source (e.g. materials, technology,
customer requirements) is essential.
Such conceptual advance would provide the foundation for the second
requirement, which is for the development of widely applicable measures of
both empowerment and especially of operational uncertainty. Theory in this
domain, as represented by our hypotheses, relates to high and low levels of

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EMPOWERMENT, UNCERTAINTY AND PERFORMANCE 163

operational uncertainty. To test such propositions empirically one needs the


means of determining the level of uncertainty in a given context. Simply
conducting research in which high or low conditions of operational uncer-
tainty are identified relative to one another within the confines of a particular
study is far from ideal. There is no way of knowing whether in fact one is
comparing high with very high, or low with very low—either of which
would greatly weaken, or even invalidate, the investigation.
The third line of development for research, which perhaps presents the
most radical challenge, is that concerned with investigating the hypothesised
mechanisms relating empowerment practices to performance. Here the
path indicated involves directly studying the role of knowledge application,
knowledge development, and employee orientations, as both outcomes
of empowerment and as variables mediating the impact of empowerment on
performance. Operationalising these constructs, and those concerned with
knowledge especially, will not be easy. Nonetheless, there are several leads
to follow from within human factors and cognitive psychology, where differ-
ent approaches focus on factual knowledge, context-specific knowledge, pro-
cedural knowledge, cognitive strategies, or mental models (Anderson, 1987;
Dorner, 1990; Moray, 1990; Rasmussen, 1987; Rogers, Rutherford, & Bibby,
1992). Many of these require development to be applied in work settings, but
the challenge is worthwhile.
Allied to this, the opportunity exists for greater theoretical integration
between the current perspective and existing psychological perspectives on
empowerment. Empowerment as managerial practice can clearly be seen as
an antecedent of empowerment as a motivational state (Kirkman & Rosen,
1999) though, as indicated above, we would suggest that motivational mech-
anisms are not of themselves sufficient to explain the relationship between
empowerment and performance. The literature on psychological empower-
ment also suggests that there may be other moderators to consider in build-
ing a more complete and fine-grained theory of the impact of empowerment
practices on performance. For example, Spreitzer (1996) identifies sociopolit-
ical support and access to information and resources as factors influencing
the level of perceived empowerment. Ironically, high levels of operational
uncertainty may interact with empowerment practices to reduce perceived
empowerment, since role ambiguity has been hypothesised to constrain
empowerment cognitions, particularly the efficacy component (Spreitzer,
1996). Psychological empowerment may also be directly influenced via the influ-
ence of leader behaviour on employee efficacy beliefs (Manz & Sims, 1991).
Individual differences that may moderate the empowerment–performance
relationship, as mediated by psychological empowerment, would most
likely include individual growth need strength and context satisfaction
(Oldham, 1996). Satisfaction with pay, in particular, suggests itself as an
important moderator. Interestingly, however, though agency theory suggests

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164 WALL, CORDERY AND CLEGG

the need to link pay to performance outcomes under conditions of uncer-


tainty, some evidence exists to suggest that other aspects of the employment
contract (e.g. job security) may be as important in influencing employee
reactions to increased decision making authority in their job (Bloom &
Milkovich, 1998). There is thus considerable scope for extending the current
argument into a more complete model of the empowerment–performance
relationship.
Finally, what can we say about the implications of our analysis for
practice? The answer must be a tentative one since empirical evidence for
our propositions is as yet unavailable. If we are substantially correct, however,
there is a clear message. Where the focus is on performance, initiatives to
empower employees with respect to the execution of their core task are likely
to be effective given a high level of operational uncertainty, but will be of
much less value (and perhaps none) where work processes are more predict-
able and well understood. In contrast, initiatives to empower employees with
regard to wider role responsibilities are likely to yield productivity benefits
irrespective of the prevailing levels of operational uncertainty.

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