Employee Empowerment and Organizational Performance in Small and Medium Enterprises
Abstract
This quantitative study examines the relationship between employee empowerment and organizational performance in small and medium enterprises (SMEs) located in Palompon, Leyte, Philippines. A structured survey was administered to 50 SME owners and employees, assessing key dimensions of empowerment—such as autonomy, participation, and access to resources—and their associations with organizational outcomes, including productivity, efficiency, innovation, customer satisfaction, and financial performance. Descriptive statistics and Pearson’s correlation analysis were employed to evaluate the strength and significance of these relationships. The results reveal consistently strong positive correlations between employee empowerment and all five performance indicators, with correlation coefficients ranging from 0.75 to 0.87 (p < 0.01). These findings confirm that empowered employees make a significant contribution to improved organizational outcomes and operational effectiveness. The study reinforces existing literature on the value of empowerment practices in enhancing firm-level performance and provides empirical evidence from a developing economy context. It also underscores the potential of empowerment as a strategic human resource intervention for SME growth, particularly in environments with limited resources. The results offer practical implications for SME managers, policymakers, and development practitioners aiming to foster competitive, resilient, and innovation-driven enterprises. Future research may investigate causal pathways and longitudinal effects to validate further the linkage between empowerment and performance across various sectors and geographic contexts.
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