Chapter 3

1
Introduction

Employees performance is an essential component to the overall success of any

company. There is a significant connection between having a pleasant
environment at work and having people who are productive. The reduction in
absenteeism that results from improved working conditions is directly
proportional to an increase in both productivity and profitability. Because of
this, it is of the highest significance to determine what factors of the working
conditions cause for the performance of employees. (Abualoush, S.2018)

Job performance can be defined as the employee's actions and beliefs that enable
them to carry out their duties, as well as the outcomes that are emphasised as
indicative of appropriate job performance. Another way to look at job
performance is as an indicator of whether or not appropriate job performance
has been achieved. It is important for companies that seek great performance
from their teams to pay attention to the part that the environment of the
workplace plays in that performance. The type of the organisation in which one
operates has a significant bearing on how successful one is in any given sector.
If employees are not motivated to do their jobs to the best of their abilities, they
will become unsatisfied with their jobs and look for work elsewhere. The
company is going to be responsible for bearing the costs associated with
employee absences and turnover. claimed that employees who were more
involved in their job would be more devoted to the success of the organisation,
which would result in increased levels of productivity. The performance of
employees is a dependent variable that may be impacted by the culture of the
organisation as well as the HRM practises that are in place in order to attain the
desired outcomes. (Abualoush, S.2018)

As was just said up above, the upbeat organisational culture of the firm
contributes to increased levels of worker productivity. As a consequence of this,

2
the researcher has been able to identify the problems associated with the topic of
"Impact of Organizational environment on the job performance of the team
members at the ABC Apparel Company." In light of the new opportunities in the
country, the organisation had to motivate its workers by presenting them with
fresh points of view in order to keep them on board. Training is offered to
workers as a way of acquiring the knowledge and skills necessary to put out
maximum effort in pursuit of organisational goals. Employees are also
encouraged to do so. According to Halepota (2005), inspiration is defined as "a
driving force behind one's activities," which motivates a person to "inspire"
themselves to take the measures required to achieve their objectives. However,
by paying attention to the aspects of the organisational environment that have
been discussed so far, it is possible that the performance of the organisation may
be significantly enhanced. It is the responsibility of managers to motivate their
employees to complete their work. If employees lack motivation, it will have a
huge negative effect not only on their productivity but also on the bottom line of
the company. In addition, it will result in a significant loss for the company.
When leaders fail to consider the factors that motivate their workers, they
cannot reasonably expect those individuals to cooperate in the pursuit of a
common goal. Because of this, it is very necessary for the company to give its
employees with a more suitable working culture so that they can carry out their
responsibilities in the most effective manner possible. (Al-Dmour, R., Yassine,
O., & Masa’deh, R. E. 2018)

Workers are able to provide their very best when they are psychologically and
physically prepared for the task they are doing. They also said that in the
modern corporate environment, which is very focused and active, it is essential
to have a healthy working atmosphere since it assists in reducing absenteeism.
The layout of a workplace has clear effects, some of which are positive while

3
others are negative, on employee assurance, profitability, and devotion.
Chnadrasekar explains further that there is always the possibility of both
positive and negative results stemming from it.

The basis of their success are knowledge and abilities in technically complicated
goods, an openness to change, and a team motivated by a shared feeling of
resolve towards the completion of the firm. Pioneering innovation in design and
development via Design; creating world-class garment solutions by utilising
synergies throughout its worldwide design network; supporting the functional
brilliance, strong systems and processes, and technical experience of our
employees. As ABC Company enters a new era of digitalization, we anticipate
and design complicated commodities using cutting-edge technology, then see
them through from conception to wholesale manufacturing and distribution.
This company is expanding into the field of technology manufacturing, namely
in the area of wearable electronics. (Coggburn, J. D., Battaglio Jr, R. P., &
Bradbury, M. D. 2017)

The ABC Company is shifting its attention more and more toward achieving
operational excellence. Companies that make an effort to keep their workplaces
pleasant are more likely to see increased profits and better customer service. The
ABC Company has been around for longer than most of its competitors, giving
it a better chance to create waves in the market. Roughly 2000 people are
employed there. This ABC firm operates in a highly competitive industry where
workers have endured significant hardships. Furthermore, the research provides
strong support for the idea that an organization's success might hinge on its
workers' performance on the job, which in turn is affected by the nature of the
workplace. (Albasu, J., & Nyameh, J. 2017)

The organisation should maintain its staff by inspiring them with new points of
view in light of the new chances in the nation. said that motivation is the

4
willingness to expend significant effort in pursuit of the organization's
objectives and the satisfaction of certain personal needs via the application of
learned skills. describes inspiration as "a driving force behind one's actions" that
"inspires" them to take the necessary steps to reach their goals. However, the
organisational climate is crucial for the firm to improve productivity. Managers
are accountable for inspiring their staff to do their tasks. If workers lose their
drive, it will have a significant impact on both their productivity and the bottom
line. And it will cause the business a substantial loss. Management fails to create
a good connection amongst itself to accomplish the company's shared purpose
because they are too focused on individual performance rather than the
organization as a whole. That's why management has to find new ways to
inspire workers into action. (Lee, C., Huang, G. H., & Ashford, S. J. 2018)

The Concept of Employee Performance

Getting employees to effectively carry out the tasks assigned to them is one of
the most challenging components of operating a business. Every management
need to make increasing an organization's productivity and efficiency their
primary objective, in addition to making the organisation more competitive in its
industry. It is widely agreed upon that the employees of a business are that firm's
most important resource since they are necessary for the company to run
efficiently. However, in order for businesses to be successful, they need to place
a strong emphasis on the performance of their employees, seeing it not just as an
indicator of financial or other consequences for the person, but also as having a
direct connection to the achievements of the firm. (Bhatti, M. A., Hussain, M.
S., & Al Doghan, M. A. 2018) (Al-Dmour, R., Yassine, O., & Masa’deh, R. E.
2018)

As a direct consequence of this, quality performance, operational performances,

and customer pleasure all increase quickly as a direct result of the productive

5
labour of satisfied, inspired, and motivated human resources who come up with
original ideas for new products or services. When we discuss the performance of
an employee, we are talking to the many ways in which that person's activities
contribute to the overall success of the company. Employee performance may be
defined as a set of activities made by workers that can be assessed against
organisational objectives. Employees are essential to an organization's success
because of the skills, knowledge, and competencies they bring to the table
during strategy implementation and planning. It is possible to define employee
performance as the degree to which an employee strives to carry out his or her
assigned tasks successfully, with positive consequences in terms of both output
and conduct. In other words, employee performance can be thought of as an
indicator of how well an employee performs his or her job. .( Ahmad, S., &
Shahzad, K. 2011)

An employee's performance on the job may be attributed to at least two factors:

the employee's own talents and capabilities, as well as the motivation to put such
attributes to use in the workplace. In addition, employees are an invaluable asset
to the firm, and the success or failure of the organisation is directly related to the
efforts that employees put out. (Al-Dmour, R., Yassine, O., & Masa’deh, R. E.
2018)

Employee Performance

achieving assessed objectives. It's important to consider both what and how
someone performs. Exemplary performance involves meeting set requirements
for quality, timeliness, cost, and completeness. Achieving an organization's
vision and objective needs peak performance. An organization's performance
depends on each employee's effort. Businesses require high-performers to
market their specialised goods and services to customers. (Guan X., Frenkel S.
2018)

6
A company's success depends on performance management. Performance
tracking shows employers whether they're getting their money's worth.
Performance indicators include revenue, shareholder value, sales growth, size,
share price, and market price. Share price and size matter.

Profit and gain sharing boost morale, productivity, and individual effort,
according to employees. However, the link between both is not automatic,
therefore employers should not take their employees' commitment for granted.
Performance increases work happiness and performance. Employee dedication
boosts output and performance, benefiting the company. Thus, human resource
management and the company's concept must be leveraged to motivate
employees.(Diamantidis, A. D., & Chatzoglou, P. 2019)

Aptitude, work awareness, and effort contribute to an employee's performance.

Motivation, skill, and financial benefit determine how hard employees work.
Competence and drive determine performance. The working environment has
the greatest effect on employee motivation and productivity. Representatives'
efficacy depends on many factors, according to several studies. Consider
physical factors, instruments, meaningful actions, expected and actual feedback,
and system defects. He believes that companies must ensure that workers'
initiatives advance the company's goals to attain average output. Imran &
Tanveer (2015)

That employment performance is closely related to openness and desire to fulfil

tasks. He believed that honest and open workplace communication would boost
productivity and performance.

To ensure consistency in production, businesses must ensure personnel follow

the processes that will provide the desired outcomes. It's simpler to evaluate

7
personnel and provide feedback when a task or activity is done consistently and
predictably. Al-Dmour, Yassine, and Masa'deh (2018)

There should also be a performance-based reward scheme. Invigorating the

workforce will boost production. Albasu & Nyameh (2017)

Several variables have improved labour performance. The physical work

environment, equipment, related tasks, expectations, feedback, incentives for
good and poor systems, standard operating procedures, knowledge, and attitude
are all important. (Lee, C., Huang, G., & Ashford, S. J. 2018)

Performance driven by internal motives despite external factors like skills,

intellectual ability, and resources needed to complete the activity. Thus,
businesses must create suitable working circumstances to guarantee that workers
work hard.

Work results determine employee performance. Another perspective is

behavioural. Staff efficiency is measured against predetermined targets.
Performance metrics are summarised here. Productivity, efficiency,
effectiveness, quality, and profitability are among these measures. Profitability
is the capacity to earn consistent profits over time. It may be calculated as a
percentage of gross profit compared to sales or as a rate of return on capital
invested. Personnel's effectiveness and efficiency are measured by how well
they achieve their goals. Imran & Tanveer (2015)

Productivity is output divided by input. It measures how effectively a person,

corporation, or industry converts raw materials into finished products.
Conversion rate measures efficiency. output against input. High-quality products
and services are more likely to succeed. Better quality may be produced at lower
expense.

8
Business managers must always optimise their companies. (Guan X., Frenkel S.
2018)

Managers establish performance targets for the right timeframes. They may use
objectives and criteria to assess staff performance to attain this purpose. (Lee,
C., Huang, G., & Ashford, S. J. 2018)

Performance management helps companies produce high-quality goods and

services. This boosts company morale. This management approach gives
workers a voice in the company's development, motivating them to work hard.
Performance management ensures that business objectives are met regularly and
effectively. Performance management may focus on personnel, departmental,
and product development process performance. Happy workers are more
productive and loyal, research shows. Happiness boosts productivity. Happy
employees are more productive and loyal. Add supporting information that
shows how companies benefit from happy, contented workers and how
management finds it simpler to motivate top performers to accomplish or
surpass corporate objectives. This should show how happy, contented workers
help businesses. (Haddad, A. E., Al-Dmour, H., & Al-Zu’bi, Z. M. F. 2012)

Employee Performance Appraisal and its effectiveness in an

organization

A performance assessment assumes that an employee's work helps the

organisation succeed. Thus, performance assessment may measure corporate
success. Performance assessment may boost employee performance and help a
business reach its objectives. Bhatti, Hussain, and Al Doghan (2018)

Performance assessment affects employees' salaries, promotions, demotions,

termination, training, and career progression since managers continually observe
and evaluate employee behaviour. Businesses continuously seek innovative

9
performance assessment methodologies. Microsoft's compulsory distribution
programme was abandoned following management and employee concerns.
Ford's contentious approach was established after its predecessor was
discontinued due to its apparent success in finding and firing unproductive
workers. Albasu & Nyameh (2017)

Performance management involves a dynamic performance assessment that

considers workers' learning, progress, and new goals. Dynamic performance
evaluations emphasise goals, feedback, and improvement. Strong performance
improvement feedback is necessary for a goal setting programme to assist
employees assess their performance and create new goals. Goals help workers
understand and accept expectations, which boosts performance.

The evaluation process's main purpose is to allow managers and employees to

discuss performance and improve it. A additional purpose is to let employees
estimate their future career possibilities. Finally, remuneration, which
employees value most, is linked to the other objectives. Adetayo, Ajani, and
Olabisi (2014)

For fruitful performance review sessions, HR professionals must follow a few

basic, evidence-based criteria. First, concerns should be addressed openly and
honestly as criticisms and challenges. Only with the manager's help can
problems be fixed and workers improve. Second, the management shouldn't
attempt to modify the employee's character during the evaluation, but rather
persuade them to open up. After this dialogue, set explicit performance
objectives with a focus on changeable characteristics, since feedback is most
beneficial when applied to activities the employee can change. Finally, the boss
must remain calm and not harass the employee throughout the conversation.
Open conversation without criticism helps resolve disagreements and set mutual
goals. (Haddad, A. E., Al-Dmour, H., & Al-Zu'bi, Z. M. F. 2012)

10
Conversations like these level the playing field so workers may boldly speak
their professional ideas and progress.

Explains that performance assessment conversations need three key elements:

1. Management's understanding of the employee's role and performance.

2. Worker management assistance

3. How much management influence the worker had into the dialogue.

A performance appraisal interview is most effective when the supervisor and

employee have a productive conversation in which they discuss the employee's
responsibilities, performance, and goals.(Al-Dmour, R., Yassine, O., &
Masa’deh, R. E. 2018)

Effect of training on performance

Many external factors affect an organization's growth in real life. Recent studies
show that staff training is essential for a company's performance and efficiency.
Businesses may now compete and stay on top. Thus, firms who spend in
employee training are far ahead of those that don't. Bhatti, Hussain, and Al
Doghan (2018)

Training and development boost workplace productivity. Some study has

examined personnel performance, while others have examined the organisation
as a whole. Employee performance influences organisational performance, thus
they go together. Staff training may change skills. Thus, it increases
organisational performance by improving workers' knowledge, skills, and
attitudes needed for future employment, as well as their ability to do their
current jobs. (Beutell, 2010)

Training and occupational performance studies have yielded surprising findings.

Training improves employee knowledge, skills, talents, competencies, and

11
behaviour, which boosts workplace performance. Some studies also suggests
using training to narrow skill gaps and improve employee performance.
Targeted training may help employees reach their potential. (Haddad, A. E., Al-
Dmour, H., & Al-Zu'bi, Z. M. F. 2012)

Training helps firms recognise failing individuals and modify their skills,
attitudes, and knowledge. Employees must be proficient in their professions.
This is not enough; employees must adapt to changing job requirements. Thus,
training and retention programmes shouldn't wait for skill and performance
gaps. (Beutell, 2010)

Staff training may change skills. It improves workplace performance and

prepares workers for the future. The company gains overall. Training gives
employees the skills they need to succeed in a competitive market and help their
organisations grow. When employees can immediately experience the joy of
achievement and the knowledge that they are improving their abilities,
complaints, absences, and departures will decrease..( Afsana, J., Afrin, F., &
Tarannum, T. 2015)

Work Environment impact on employees' performance

As said, a workplace is the individual's physical surroundings, job description,

culture, and market standing. Every perspective affects worker productivity. The
working environment has the biggest effect on employee performance and
inspiration. The fundamental workplace is where people work. It's simple to
grasp since it depicts the operation's real surroundings (including temperature
and tools) (e.g. workload, task complexity). It also considers culture, history,
and even the organization's external position (e.g. local labour market
circumstances, industry division, work life stability)

12
Employees will always fight back if they think their current condition matches
their promises. Representatives' working conditions impact company success.
Psycho-social circumstances include working conditions, role congruity, and
social support, whereas physical conditions include the workplace and structure.
Physical considerations include working environment, structure, and others.
Various company setups include workplace factors. Workplace improvements
may boost employee performance (Coggburn, J. D., Battaglio Jr, R. P., &
Bradbury, M. D. 2017)

Employees in many companies are citing workplace issues related to corporate

culture and physical conditions. To address the rising number of workers who
quit, it's crucial to build workplaces that affect employees. Employee
productivity is increasingly linked to workplace comfort, which is largely
controlled by the company's environment. In today's fast-paced and fiercely
competitive business industry, a healthy workplace makes financial sense. The
board of directors shouldn't only concentrate on employee pay based on
performance. Companies with good workplaces will be more competitive.
(Bhatti, M. A., Hussain, M. S., & Al Doghan, M. A. 2018)

Psychological Empowerment and employee performance:

Empowerment, in the context of management philosophy, most often refers to

the practise of delegating decision-making authority to workers in lower-level
positions (Daft, 2014). The concept of empowerment is based on decades' worth
of research on themes such as participative management, worker happiness, and
isolation on the job. Sprockier and others, etc (1999). According to Spreitzer, an
individual's feeling of psychological empowerment is mirrored in four separate
ways of thinking about their respective professional tasks. These ways of
thinking are as follows: meaning, competence, self-determination, and
influence. It is essential to be aware that there is a difference between a person's

13
real amount of autonomy and their perceived level of autonomy. It is essential to
have an understanding of psychological empowerment as a motivating
construct. This construct is based on an employee's belief in his or her own
competence to do the job well, in his or her own ability to initiate and control
actions, in his or her own ability to affect the environment, and in the
significance of his or her work. Peers, organisations, and other social institutions
may each play a part in laying the groundwork for a person's ultimate emotional
and mental autonomy, and this groundwork may be important. List of
References: (Spreitzer, 1995; Thomas & Velthouse, 1990).

Both academics and politicians have shown interest in the concept of

psychological empowerment as a subject of discussion in recent years. Many
businesses choose this strategy, which entails providing their employees with
more latitude in the workplace, in order to extract the most amount of value
from their human resources. Researchers in a variety of fields have come to
similar conclusions (Imam & Hassan, 2015; & Randolph, 1995). Workers who
are given this level of autonomy perform better (Degago, 2014), come up with
creative solutions to problems (Nawaz, Hassan, Shaukat, & Assadullah, 2014),
are more resilient to changes in their environment (Dess & Picken, 2000), and
ultimately contribute to the growth of both their organisation and themselves as
individuals. Meyerson and Dewettinck both contributed (2012). According to
Ghani, Hussin, and Jussof (2009), the idea of psychological empowerment may
mean a variety of different things depending on the context in which it is seen."
(Zimmerman, 1990) [cited in This concept is referred to as "psychological
empowerment "refers to the feeling of control, self-assurance, influence, and
significance that a person has in their position at their place of employment.
"Motivational experience" is what Spreitzer (1995) refers to as the process of a
person becoming more confident in their own skills to do their work duties.

14
As a person's level of competence improves, so does their self-assurance in their
capacity to carry out their responsibilities in an efficient manner. A high degree
of individual freedom will have far-reaching implications not just on the level of
the person, but also on the level of the community. Furthermore, a person's self-
motivating variables, also known as their psychological views on empowerment,
represent their ideas about interpersonal interactions, particularly a set of
perceptions that emphasises a motivating feature of self-efficacy, personal
control. This is because self-motivating variables represent a person's ideas
about how they interact with other people. One of the numerous elements that
contribute to an employee's success on the job is the employee's feeling of
autonomy. [Case in point:] [Case in point:] (Bester et al., 2015). When people
are psychologically empowered and have the freedom to make their own
decisions (the "self-determination" sub-factor of psychological empowerment),
and when workers believe that they are able to make a positive impact on the
working environment at their place of employment (the "impact" sub-factor of
psychological empowerment), and when workers have the competence and
ability they need to carry out their tasks (the "competence" and "ability" sub-
factors of psychological empowerment), then people are said to be
psychologically empowered (the "competence" sub-factor of psychological
empowerment). Therefore, in order for a person to provide their best effort at
work, it is necessary for them to have a good picture of themselves. Both the
capacity to establish one's own views (known as self-empowerment) and the
building of power via collaboration with others are meant to be included under
the umbrella word "empowerment" (Vogt, 1990).

According to Beach (1996), the desire for autonomy that individuals have is
built into them and cannot be modified by management or law. The process that
takes place when formal organisational procedures and informal means of

15
information distribution are used to remove any situations that favour
powerlessness is referred to as psychological empowerment. The goal of this
process is to increase a person's sense of control over their own lives. Thomas
and Velthouse (1990) pioneered this concept and discovered that a number of
factors, including significance, autonomy, competence, and impact, may
naturally encourage workers. According to the description offered by (Spreitzer,
1995), psychological empowerment is a process or circumstance that is
characterised by four various ways of thinking. These ways of thinking are as
follows: competence, impact, self-determination, and meaning. For someone to
be considered competent, they need to have full faith in their ability to carry out
a certain task.

By investing one's work with significance, one may foster a stronger emotional
connection to their work. Self-determination refers to a state in which an
individual has the freedom to make their own decisions and to act in accordance
with those decisions. The degree to which a certain job or behaviour changes the
environment of the workplace is the measure of that behavior's or job's effect on
the workplace. Despite the fact that they are separate, each of them contributes
to the phenomenon that is recognised together as psychological empowerment.
Employees who feel that they have some degree of control over their work
environment are more likely to participate in group ideation and brainstorming
sessions (Newman et al., 2017). The paradigm that Wu and Lee (2017) provide
claims that when the leader-member exchange theory is paired with perspectives
of good organisational behaviour, the outcome is employees who are
empowered and who share and learn from one other in a substantial manner.
When employees are given the ability to make decisions on their own, they also
develop a strategy in which they assume complete responsibility for the
outcomes. Beliefs that employees have in themselves will result in a diverse

16
array of attitudes and behaviours, and they, in turn, will have impacts that
reverberate through the rest of the workforce. It is also possible to ensure
equitable distribution of power, resources, and outcomes (Kirrane et al., 2019).
The objective of this study is to give empirical data on the moderating and
moderating-mediating features of psychological empowerment. This is because
there has been a dearth of research in this area in the past (Solansky, 2014).

An example of psychological empowerment is when an employee is able to self-

regulate and take initiative in the execution of their work obligations. Starting in
2011, (Seibert et al.). Previous research on the subject of psychological
empowerment has shown that workers who feel empowered have greater levels
of effectiveness, job satisfaction, and loyalty to their respective firms (Seibert et
al., 2011).

Because it may be difficult to create empowering working circumstances for an

employee, a high degree of psychological empowerment among employees may
lessen the likelihood that they would look for other employment, hence
minimising turnover. The favourable work environment that is generated by
psychological empowerment makes it less probable for employees to think
about quitting their present employment.

Interactions with other workers provide a cognitively perceived sense of

empowerment in workers, which in turn pushes those workers to behave in a
proper and goal-oriented way. It is a state of mind that drives people to do their
best work for the benefit of their organisation by improving their awareness of
four important criteria that are crucial to the success of the firm. Psychological
empowerment is a process that begins when a person realises good things are
happening to them and changes their perspective in a manner that motivates
them to take an active role in completing activities related to their work. The
process continues when the person feels motivated to take an active role in

17
completing work-related activities. The cultivation of psychological
empowerment is dependent on the following four interconnected processes: the
acquisition of a feeling of significance; the growth of one's talents; the
assumption of control over one's own life; and the making of an influence.

The experience of direction was developed further by prolonged engagement

with the meaning domain. The art is a reflection of the views and ideals of
individuals who were engaged in creating it. Perspectives that, on their own,
couldn't be farther apart are brought together via a common sense of mission.
When people believe that their contributions to a firm are making a difference,
they are more likely to form emotional ties to that organisation. Self-efficacy,
also known as the belief in one's own ability to complete a task effectively given
one's present level of knowledge, is closely connected to the concept of
competence. Self-efficacy may be defined as the idea that one can execute a task
successfully given one's current degree of expertise. Employees who are
competent have a greater chance of realising their full potential, making
contributions that are significant to the success of the firm, and internalising the
concept that their job is, in the end, their responsibility.

It is possible that it may encourage you to give your whole effort. Self-
determination in the workplace refers to the autonomy that comes with being
able to choose one's own choices. In order to be successful in one's job, it is
essential to have the freedom to make choices on one's own volition and with
one's own judgement. Employees believe that having the ability to determine or
modify their own work schedules is beneficial to the organisation, thus they
appreciate having that flexibility. The influence that an individual has on their
place of employment is referred to as their "impact" on the workplace. There is a
correlation between feeling like one has some control over one's surroundings
and putting in more effort and taking more ownership over one's work. When

18
employees feel psychologically empowered, it encourages them to produce their
best work, which benefits both the employee and the business.

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