Lesson Learned From The Covid-19 Pandemic: Employee Empowerment As A Key In Service Businesses – UII Management Study Program

Lessons learned from the Covid-19 pandemic: Employee empowerment as a key in service businesses

Dr.rer.soc.oec Jaya Addin Linando SE, MBA

May 24, 2023

"We believe that if we treat our employees right, they will treat our customers right, and in turn that results in increased business and profits that make everyone happy," – Southwest Airlines.

In Indonesia, 2 March 2020 denoted the 'official' date for the first case of Covid-19. The Covid-19 pandemic stood an immense challenge for the Indonesian government and citizens. Particularly for the business sector, the data from Statistics Indonesia (BPS) in 2020 showed that more than 90% of service businesses earned less and more than 85% stated that business demands decreased during the pandemic.

Furthermore, service workers were among those severely impacted by the challenges of working during the pandemic. During the Covid-19 pandemic, they have to juggle numerous thoughts about working. Like the uncertainty of the company's existence in the future, the risk of being infected by Covid-19 if they persist in working at the office, the threat of mental health upon prolonged work from home (WFH), and the demands to keep delivering professionally services as if the Covid-19 pandemic is not a thing.

At the end of 2020, I conducted studies on service workers in Indonesia. My colleagues and I focus on whether or not the pandemic influences Indonesian service workers' emotions and well-being. If it does negatively affect the workers, what company's policy might help?

Our empirical study revealed several findings, among them are 1) it is hardly surprising, the pandemic indeed affects the emotional state of the service workers, 2) the pandemic makes service workers tend to perform fake emotions at work, and 3) employee empowerment might be one of the ways to minimize the risk of emotional adversity for Indonesian service workers during the pandemic.

I would like to focus on the third finding, that the employee empowerment policy will help cope with the crisis. Empowerment involves a huge sense of trust where the employee may work independently on behalf of the company's name. Empowerment may turn into 'a big gamble' in service businesses where a company's whole reputation lies on the delivered services

Nevertheless, the Covid-19 situation, by nature, forced companies to gamble. Especially for the companies that applied the WFH policy, it seems there were no other options but to trust the employee. During the WFH period, there will be no or minimal supervision and a restricted mechanism to ensure the workers follow the Standard Operationalized Procedures (SOP). Hence, the best bet a company could make was to empower their employees and hope they could manage the work independently.

However, that peculiar situation forcing companies to empower the workers could be a blessing in disguise. Slightly before the pandemic spread worldwide, a research report from Harvard Business Review (HBR) in early 2020 suggested that empowering frontline workers to make important decisions boosts all aspects of business results: increased satisfaction of customers and employees, better service quality, and improved business efficiency.

in early 2021, an article from Forbes suggested that empowerment amidst Covid-19 means being less 'corporate' and enhancing more humanist approaches like empathy and open communication. In the mid of 2020, an article from the Society for Human Resource Management (SHRM) emphasizes that among the keys to enabling employee empowerment is to let go of the details and focus on outcomes

Long ago, in a seminal paper about employee empowerment for service businesses, Lashley (1999) suggested that empowerment is not only about the trust-oriented culture and high discretion to perform tasks. Lashley stated that empowerment involves five dimensions. Along with the two previously mentioned dimensions (culture and task), task allocation, power, and commitment characterize employee empowerment.

The task allocation for the empowered employee should characterize responsible autonomy. The company should first decide the border of do's and don'ts, what employees can and cannot do to satisfy the customers. For example, can employees offer discounts on their own? Can they offer further technical assistance beyond the SOP to calm angry customers? And so on

The power dimension hints that being empowered does not mean the employees can deny the objectives set upon them. Managers should strongly affirm that empowered employees have a high degree of power to construct how they perform. However, the targets from the company should be treated as a given condition. Many misconceptions on this part make the practice of empowerment backlash the overall positive aims both for the company and the employee. The key is a clear 'rule of the game' from the beginning.

Last but not least, empowerment should enhance moral commitment among employees. Managers may explain the 'gambling' company did by giving more freedom to the employees. Make them understand that they better reciprocate the trust the company gave to them with a moral commitment.

My another recently published study also conveyed an important point on this matter. Employee empowerment will only be effective if the employees are satisfied with their jobs and are committed to the organization. If these two conditions are not fulfilled, the outcome of employee empowerment may harm the business

The takeaway from the Covid-19 pandemic concerning empowerment policy is no longer to ask whether or not we should empower our employees. Nor to ask whether or not we trust our employees enough to give them the freedom to act. Now, it is time to ask how we can best empower our employees

In any way empowerment is designed, remember the message from the opening quote of this article that empowerment should focus on making employees happy as happy employees generate a profitable company.

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Dr.rer.soc.oec Jaya Addin Linando SE, MBA

is a lecturer and researcher at the Department of Management, Faculty of Business and Economics, Indonesian Islamic University (UII), Yogyakarta. His primary expertise is in Organizational Behavior and Human Resource Management subjects.

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