Implementation of Employee Empowerment Practices

A Seminar Paper on Contemporary Issues in Management

Submitted by:
Yashoda Paudel
Himalayan White House International College
PU Regd. No.: 034-2-3-00132-2021

Submitted to:
Office of the Dean, Faculty of Management
Purbanchal University, Biratnagar

October 2023
Kathmandu, Nepal

Submitted in partial fulfillment of the seminar course requirement for the degree of Masters
of Business Administration (MBA)
 DECLARATION

I, Yashoda Paudel declare that this seminar paper entitled “The Implementation of
Employee Empowerment Practices on Financial Sector of Nepal” submitted in partial
fulfillment of the MBA Degree, the faculty of Management, Purbanchal University is my
original work carried out under the guidance of Dr. Ajay Khadka, Vice Principle and has not
been submitted anywhere for the award of any other degree or commercial purpose. In
keeping with the ethical practice in reporting scientific information, due acknowledgements
have been made wherever the finding of others have been cited.

Yashoda Paudel
P.U Registration No: 034-2-3-00132-2021

i
APPROVAL LETTER

ii
 ACKNOWLEDGEMENTS

First, I would like to express my sincere gratitude to our Purbanchal University and White
House International College for providing such influential seminar course. This report is
prepared for the completion of partial seminar series for Master of Business degree. I am
grateful to Dr. Uttam Kumar Regmi our course convener. I am also thankful to Dr. Ajay
Khadka and Mr. Manoj Subedi for always being there to help us in preparing this report with
the valuable guidelines.
Finally, I am thankful to our colleagues and all the staffs of Himalayan White House
International College for the valuable guidelines, and devotion time for bringing this report
in complete form.

Yashoda Paudel
October, 2023

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 EXECUTIVE SUMMARY
This study focuses on the implementation of employee empowerment practices within the
financial cooperative sector of Nepal. It explores how empowering employees within these
institutions can enhance organizational performance, employee satisfaction, and overall
efficiency in the financial cooperative sector.
The study employed a multi-dimensional approach, encompassing literature review, surveys,
and interviews with key stakeholders, and data analysis. Extensive research was conducted
to understand the current landscape of employee empowerment practices in financial
cooperatives in Nepal. Interviews and surveys were utilized to gather insights from
employees and management, providing a comprehensive understanding of the existing
practices and their impact on organizational dynamics.
The key findings of the study revealed that successful implementation of employee
empowerment practices positively correlates with heightened employee morale, improved
job satisfaction, increased productivity, and better organizational outcomes. Financial
cooperatives that integrate employee involvement, skill development, and decision-making
processes witnessed enhanced operational efficiency and a stronger sense of ownership
among employees.
In conclusion, this study underscores the critical importance of implementing employee
empowerment practices in financial cooperatives. By fostering a culture of empowerment,
these institutions can optimize their human resources, foster innovation, and adapt to
dynamic market conditions. The findings highlight the need for tailored strategies to
enhance employee engagement and ensure the sustainability and growth of financial
cooperatives in Nepal.
Based on the study, it is recommended that financial cooperatives in Nepal actively invest in
training and development programs for employees, fostering a culture that encourages
participation, collaboration, and autonomy. Establishing clear communication channels and
involving employees in decision-making processes will further enhance their sense of
ownership and commitment. Additionally, continuous monitoring and evaluation of these
empowerment initiatives should be a priority to adapt strategies and ensure their
effectiveness over time.

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 TABLE OF CONTENTS
CHAPTER/ CONTENTS PAGE
DECLARATION.....................................................................................................................i
APPROVAL LETTER...........................................................................................................ii
ACKNOWLEDGEMENTS..................................................................................................iii
EXECUTIVE SUMMARY...................................................................................................iv
TABLE OF CONTENTS.......................................................................................................v
LIST OF TABLES................................................................................................................vii
LIST OF FIGURES.............................................................................................................viii
LIST OF ABBREVIATIONS...............................................................................................ix
CHAPTER I: TOPIC INTRODUCTION............................................................................1
1.1 Background of the Study.........................................................................................1
1.1.1 Introduction.......................................................................................................1
1.2 Objectives of the Study............................................................................................2
1.3 Study Methodology..................................................................................................2
1.3.1 Study Design......................................................................................................2
1.3.2 Source of Data...................................................................................................2
1.3.3 Presentation and Analysis Techniques...........................................................3
1.4 Organization of the Project Report........................................................................3
CHAPTER II: OBSERVATION AND FINDINGS.............................................................4
2.1 Current Situation of Employee Empowerment in financial institute in Nepal. .4
2.2 Methods of Employee Empowerment....................................................................4
2.2.1 Training and Development:.............................................................................4
2.2.2 Delegating Authority:.......................................................................................5
2.2.3 Clear Communication and Transparency:....................................................5
2.2.4 Setting Goals and Expectations:......................................................................5
2.2.5 Recognition and Rewards:...............................................................................5
2.2.6 Cross-Functional Teams and Collaboration:.................................................5
2.2.7 Feedback and Performance Reviews:.............................................................5
2.2.8 Encourage Problem-Solving and Innovation:................................................5
2.2.9 Trust and Autonomy:.......................................................................................6
2.2.10 Education on Financials and Organizational Structure:..............................6

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 2.2.11 Mentorship and Coaching:..............................................................................6
2.2.12 Employee Involvement in Decision-making:..................................................6
2.3 Benefits of Employee Empowerment.....................................................................6
2.3.1 Improved Decision-Making:............................................................................6
2.3.2 Increased Productivity and Efficiency:..........................................................7
2.3.3 Enhanced Employee Morale and Job Satisfaction:.......................................7
2.3.4 Stimulated Innovation and Creativity:...........................................................7
2.3.5 Better Problem-Solving:...................................................................................7
2.3.6 Increased Employee Engagement and Retention:.........................................7
2.3.7 Customer Satisfaction and Loyalty:................................................................7
2.3.8 Adaptability and Agility:.................................................................................7
2.3.9 Developed Leadership Skills:...........................................................................8
2.3.10 Team Collaboration and Cooperation:...........................................................8
2.3.11 Cost Savings and Operational Efficiency:......................................................8
2.3.12 Positive Organizational Culture:.....................................................................8
CHAPTER III: CONCLUSIONS........................................................................................9
2.4 Conclusions...............................................................................................................9
REFERENCES.......................................................................................................................1
0

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 LIST OF TABLES

TABLE NO. TABLE NAME PAGE

vii
 LIST OF FIGURES

FIGURE NO. FIGURE NAME PAGE

viii
LIST OF ABBREVIATIONS

ix
 1 CHAPTER I: TOPIC INTRODUCTION

1.1 Background of the Study

Employee empowerment in financial institutions involves granting employees the autonomy,
authority, and resources to make decisions and take actions that align with the organization's
goals and values. This empowerment cultivates a culture of trust, collaboration, and
innovation within the institution. Empowered employees feel a sense of ownership and
responsibility, leading to improved job satisfaction, productivity, and overall performance. It
encourages them to contribute innovative ideas, engage with customers effectively, and
adapt to dynamic market conditions swiftly. Effective communication, continuous training,
and a supportive leadership style are vital components of fostering employee empowerment
within financial institutions.

1.1.1 Introduction
A financial institution is an organization that manages and facilitates financial transactions
and services for individuals, businesses, and governments. These institutions, such as banks,
credit unions, investment firms, and insurance companies, play a vital role in the economy
by offering services like deposits, loans, investments, insurance, and financial advice. They
act as intermediaries, connecting those with surplus funds to those in need of capital, thereby
promoting economic growth and stability. Regulated by various governmental bodies,
financial institutions uphold strict compliance and security standards to ensure the safety and
integrity of the financial system.
Employee empowerment is a management strategy that involves granting employees the
autonomy, responsibility, and authority to make decisions and take ownership of their work.
It fosters a sense of ownership, motivation, and innovation among employees, ultimately
leading to increased job satisfaction, productivity, and organizational success. Empowered
employees are more engaged and better equipped to contribute to their organization's goals
and adapt to changing circumstances.
Implementing employee empowerment in a financial institution involves decentralizing
decision-making authority, encouraging open communication, and fostering a supportive
work environment. This can be achieved through training programs that enhance skills and
knowledge, providing clear guidelines for decision-making, and establishing feedback
mechanisms. Leaders should emphasize trust, promote a culture of collaboration, and

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acknowledge and reward employees for their contributions. By empowering employees to
make informed decisions and take ownership of their work, financial institutions can boost
employee morale, enhance customer service, and drive organizational efficiency and
effectiveness.

1.2 Objectives of the Study

 Current Situation of Employee Empowerment in financial institute in Nepal.
 Methods of Employee Empowerment
 Benefits of Employee Empowerment

1.3 Study Methodology

This study is based upon the qualitative and quantitative research approach where secondary
source of data was taken for studies which include websites, reports and literature review on
published statistics. Basically, study methodology is the process used to collect information
and data for the purpose of making business decisions.

1.3.1 Study Design

A study design is a comprehensive plan that outlines the procedures to be followed in order
to collect and analyze the required data. As a result, the researcher’s convenience had a role
in website research and study the report as available on website for this study.

1.3.2 Source of Data

There are two method of data collection for this research report i.e. primary data and
secondary data. It is considered to be more trustworthy, in that they have greater validity
than other sources of data. The data is collected by the researcher itself, so the data will be
more accurate and reliable. There are different methods of primary data collection which
includes interview, observation and questionnaire. Likewise, I collect data through
secondary sources includes:
 Websites
 Internet Articles
 Internet Reports

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1.3.3 Presentation and Analysis Techniques
Content analysis was done to extract the information from secondary source. MS word is
used to present the information.

1.4 Organization of the Project Report

The report consists of three chapters. They are organized in three chapters, Introduction
followed by observation and findings and lastly conclusion. In chapter one, introduction part
to the study which comprised introduction, background of the study, topic introduction,
objective of the study, research methodology and organization of the project report . The
chapter two included the past reviews of the relating study. The final part includes the
conclusions of the report.

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 2 CHAPTER II: OBSERVATION AND FINDINGS
Employee empowerment involves granting employees the authority, autonomy, and
resources to make decisions and take actions that directly impact their work and the
organization. It's about fostering a culture where employees feel trusted, engaged, and
supported to contribute their unique skills and knowledge.

2.1 Current Situation of Employee Empowerment in financial institute in Nepal

In Nepal's financial sector, employee empowerment initiatives have been gaining
importance in recent years. Financial institutions, including banks and other financial service
providers, have been recognizing the significance of empowering their workforce to improve
customer service, stimulate innovation, and boost overall organizational performance.
Efforts to empower employees often involve providing training and development programs
to enhance skills and knowledge, encouraging employees to participate in decision-making
processes, and establishing clear communication channels. However, the extent and
effectiveness of these initiatives may vary based on the specific institution, its leadership,
and the industry norms prevalent in Nepal.
Regulatory and cultural factors can influence the pace and approach of employee
empowerment. Compliance with regulatory requirements while promoting employee
autonomy is a delicate balance that financial institutions strive to achieve.
For the most current and accurate information regarding the state of employee empowerment
in Nepal's financial sector, I recommend referring to recent publications, government
reports, industry publications, or directly reaching out to relevant organizations in Nepal.

2.2 Methods of Employee Empowerment

Employee empowerment involves providing employees with the authority, resources,
information, and opportunities to take ownership of their work and make decisions. Several
methods can be employed to empower employees within an organization:

2.2.1 Training and Development:

Provide comprehensive training programs to enhance employees' skills and knowledge.
Offer workshops, seminars, and access to online learning platforms to enable continuous
learning and growth.

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2.2.2 Delegating Authority:
Delegate decision-making authority to employees based on their roles and responsibilities.
Allow them to make choices and take ownership of their tasks, projects, or specific areas of
their work.

2.2.3 Clear Communication and Transparency:

Foster an open communication environment where employees are well-informed about
organizational goals, strategies, and performance. Encourage sharing feedback, suggestions,
and concerns, and ensure transparency in decision-making processes.

2.2.4 Setting Goals and Expectations:

Collaboratively set clear and achievable goals with employees. Define expectations, provide
them with the necessary resources and support, and allow them to determine the best
approach to achieve these goals.

2.2.5 Recognition and Rewards:

Recognize and reward employees for their contributions and achievements. Acknowledge
their efforts publicly and tie rewards to performance to motivate and reinforce desired
behaviors.

2.2.6 Cross-Functional Teams and Collaboration:

Form cross-functional teams and encourage collaboration among employees from different
departments. This promotes a diverse range of perspectives and allows employees to
participate in decision-making processes that impact the organization.

2.2.7 Feedback and Performance Reviews:

Conduct regular feedback sessions and performance reviews to provide constructive
feedback on employees' strengths and areas for improvement. Engage in open discussions to
identify opportunities for growth and development.

2.2.8 Encourage Problem-Solving and Innovation:

Create an environment where employees are encouraged to identify problems and propose
innovative solutions. Implement feedback loops and suggestion programs that allow
employees to share their ideas and be part of the decision-making process.

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2.2.9 Trust and Autonomy:
Demonstrate trust in employees' abilities to make decisions. Provide them with the
autonomy to execute their tasks and projects, allowing them to showcase their skills and
judgment.

2.2.10 Education on Financials and Organizational Structure:

Educate employees about the organization's financials, structure, and how their roles
contribute to the overall success. Understanding the bigger picture fosters a sense of
responsibility and empowerment.

2.2.11 Mentorship and Coaching:

Establish mentorship programs that pair employees with experienced mentors. Offer
coaching to guide employees in their professional development, helping them navigate
challenges and make informed decisions.

2.2.12 Employee Involvement in Decision-making:

Include employees in relevant decision-making processes that affect their work and the
organization. Seek their input, perspectives, and ideas when making key decisions.

By implementing these methods, organizations can create an empowering workplace culture

that nurtures employee growth, engagement, and overall organizational success.

2.3 Benefits of Employee Empowerment

Employee empowerment offers a wide range of benefits that positively impact both
employees and the organization as a whole. Here are some key benefits of employee
empowerment:

2.3.1 Improved Decision-Making:

Empowered employees are given the authority and responsibility to make decisions within
their roles. This leads to quicker and more informed decision-making, as employees are
closer to the issues and possess valuable insights.

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2.3.2 Increased Productivity and Efficiency:
When employees are empowered to make decisions and take ownership of their work, they
are more motivated and committed. This often leads to increased productivity and efficiency
as employees are invested in the outcomes of their efforts.

2.3.3 Enhanced Employee Morale and Job Satisfaction:

Feeling trusted and valued in their roles boosts employee morale and job satisfaction.
Employees appreciate having a say in their work and contributing to the organization's
success, resulting in a positive work environment.

2.3.4 Stimulated Innovation and Creativity:

Empowered employees feel encouraged to share their ideas and propose innovative
solutions. By involving employees in decision-making processes, organizations tap into a
diverse pool of perspectives, fostering innovation and creativity.

2.3.5 Better Problem-Solving:

Employees empowered to make decisions are better equipped to address challenges and
solve problems independently. They are more proactive in finding solutions, which
ultimately benefits the organization's problem-solving capabilities.

2.3.6 Increased Employee Engagement and Retention:

Empowerment promotes a sense of ownership and involvement among employees. Engaged
employees are more likely to stay with the organization, reducing turnover and associated
hiring and training costs.

2.3.7 Customer Satisfaction and Loyalty:

Empowered employees are well-positioned to provide exceptional customer service. Their
ability to make decisions and solve problems promptly leads to improved customer
satisfaction and loyalty, driving business growth.

2.3.8 Adaptability and Agility:

Empowered employees are more adaptable to change and capable of responding quickly to
evolving circumstances. They can readily adjust their approach, contributing to
organizational agility and competitiveness.

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2.3.9 Developed Leadership Skills:
Employee empowerment allows employees to develop and refine their leadership skills, as
they are entrusted with decision-making responsibilities. This nurtures future leaders within
the organization.

2.3.10 Team Collaboration and Cooperation:

Empowerment encourages a collaborative work environment, where employees work
together and support one another. This leads to stronger teamwork, cooperation, and a sense
of collective achievement.

2.3.11 Cost Savings and Operational Efficiency:

Empowered employees often identify cost-saving opportunities and operational
improvements within their areas of responsibility, contributing to the organization's financial
health and efficiency.

2.3.12 Positive Organizational Culture:

Employee empowerment contributes to building a positive organizational culture based on
trust, transparency, and respect. Such a culture attracts top talent, enhances the employer
brand, and creates a fulfilling work environment.

Incorporating employee empowerment strategies can lead to a more engaged, productive,

and satisfied workforce, ultimately resulting in improved organizational performance and
long-term success.

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 CHAPTER III: CONCLUSIONS

2.4 Conclusions
The current situation of employee empowerment in financial institutions in Nepal is
gradually evolving, albeit at a moderate pace. Many institutions recognize the importance of
empowering their workforce to enhance customer service, drive innovation, and improve
overall organizational performance. However, there is a need for more comprehensive and
systematic approaches to employee empowerment, including robust training programs, clear
guidelines for decision-making, and a supportive culture that encourages employee
involvement. Additionally, integrating technological advancements and aligning
organizational policies with empowerment goals can accelerate progress in this crucial
aspect, ultimately leading to a more engaged, motivated, and efficient workforce within
Nepal's financial sector.
In conclusion, methods of employee empowerment encompass a range of strategies aimed at
granting employees greater autonomy, involvement, and decision-making authority within
their roles. These methods include providing training and skill development, fostering a
culture of open communication and collaboration, encouraging employee participation in
decision-making, recognizing and rewarding contributions, and establishing clear goals and
responsibilities. By implementing these approaches, organizations can cultivate a motivated
and engaged workforce, driving innovation, productivity, and ultimately achieving enhanced
overall performance and success.
In summary, the benefits of employee empowerment are significant and multifaceted.
Empowering employees leads to increased job satisfaction, higher morale, and a sense of
ownership and responsibility. This, in turn, boosts productivity and efficiency within the
organization. Empowered employees are more innovative, proactive, and engaged, leading
to improved problem-solving and decision-making at various levels. Furthermore, it fosters
a positive work culture, enhances employee retention, attracts top talent, and ultimately
contributes to the organization's growth and competitiveness in the market.

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 REFERENCES

Gautam, P.K. (2018). Training Culture and Employees Performance in Nepali Banking
Industry. Retrieved from
https://www.researchgate.net/publication/330002951_Training_Culture_and_Employees_P
erformance_in_Nepali_Banking_Industry

Heibutzki, R. (2019). The Effects of Employee Resignations on Productivity. Retrieved

from https://work.chron.com/effects-employee-resignations-productivity-11269.html on
April 6, 2019

Honold, L. (1997), "A review of the literature on employee empowerment", Empowerment

in Organizations, Vol. 5 No. 4, pp. 202-212. https://doi.org/10.1108/14634449710195471