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The consequences and limits of empowerment in financial services

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  • Nielsen, Jørn Flohr
  • Pedersen, Christian Preuthun

Abstract

Empowerment may be one of the answers to the growing competition and increasingly demanding customers in the financial retail sector, but the relation between empowerment and profit-oriented behaviour at the service encounter has been only sparsely documented. This article offers a comparative empirical analysis of the conditions and impact of empowerment and related activities in Danish financial institutions, with a focus on semi-standardised front-line jobs. The results indicate that granting decision-making authority and autonomy to the individual front-line employees has often been a powerful step in the efforts of the financial service companies to increase their competitiveness. In the change process, formal participation has only a moderate supportive impact on performance while changes initiated at the branch offices and the linking of rewards with performance, both have a notably positive impact on the competitiveness and profit-oriented behaviour of front-line employees.

Suggested Citation

  • Nielsen, Jørn Flohr & Pedersen, Christian Preuthun, 2003. "The consequences and limits of empowerment in financial services," Scandinavian Journal of Management, Elsevier, vol. 19(1), pages 63-83, March.
    • Handle: RePEc:eee:scaman:v:19:y:2003:i:1:p:63-83
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    Cited by:

    1. Munawar Javed Ahmad & Norzieirani bt. Ahmad & Nazlina Zakaria, 2018. "Service Recovery Performance: A Critical Review of Literature," Pakistan Journal of Humanities and Social Sciences, International Research Alliance for Sustainable Development (iRASD), vol. 6(3), pages :390-411, September.
    2. Nisar Ahamad Nalband & Saad Alkelabi & Dafieah Awad Jaber, 2016. "Innovation Practices in Saudi Arabian Businesses," International Journal of Business and Management, Canadian Center of Science and Education, vol. 11(4), pages 136-136, March.

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