Agility

Empowerment: If your employees are allowed to make more decisions, take on more responsibility and act independently, this is a huge advantage for your company! We explain why, how empowerment works and how you can empower your employees.

Empowerment in an agile context: Why empowerment?

Michaela, assistant to the sales manager, is annoyed! She has been providing snacks for the customer event at lunchtime for 15 years. Cost: 130 €. In all these years, there have never been any difficulties with this and Michaela does an excellent job – not only in this area. Nonetheless, she has to get her supervisor Günther to sign off on the sum each time. Trust is good, control is better – after all, there’s no way of knowing whether Michaela will take the lunch money to a tax haven to pop the corks.

No empowerment often means more work

If boss Günther were in his office from nine to five every day, his signature could be obtained without much fuss. But Günther has more responsible tasks to deal with than authorizing the purchase of bread rolls and is therefore often on the road, even outside the office. For Michaela, this means running after Günther:
Every day, she spends a lot of time and energy finding out when Günther is at home, finding him there, leaving him messages if necessary, and getting Günther, a pen and the relevant document together.
Michaela wonders whether she is not trusted to take care of lunch on her own. She is stunned:
“I’ve been here for so long now; I’ve always behaved in the interests of the company and taken responsibility. What do they think? That I’m throwing money out the window? Don’t they trust me to handle €130 responsibly? I don’t spend my entire salary on the first day of the month.”

Empowerment helps employees and companies

Understandable, isn’t it? Unfortunately, we often hear such disgruntled comments from employees. In these cases, empowerment would save employees a lot of time and therefore resources for the company!

Short and sweet

Definition: What is empowerment?

Empowerment means transferring power and responsibility from management to its employees, thereby significantly expanding their autonomy, co-determination and scope for decision-making.

What is empowerment?

We would like to point out that the term empowerment is used both in management and in a psychological or social context:

Empowerment in the psychological and social field

In the psychological and social field, empowerment means encouraging people to go their own way, to take their concerns into their own hands and to support them in developing their own strengths and self-determination.

Empowerment in management and leadership

Here, empowerment means that management grants employees greater decision-making authority, opportunities for co-determination and access to information. This allows employees to decide independently on the use of certain budgets, goodwill benefits, vacation planning and the design of their work processes. This encourages employees to think and act for themselves, reduces bureaucratic obstacles and hierarchies and optimizes processes. This has been proven to boost employee motivation.

Empowerment – The background

Vuca

In today’s world, the wheel is turning faster and faster: one update follows the next, orders have to be delivered to customers the very next day, service has to respond immediately and trends and product ranges change all the time. No one can foresee what comes next. Breathing pauses? Pah!
This general unpredictable activity is called VUCA (volatility/changeability, uncertainty, complexity, ambiguity). In our article VUCA: Change management in our VUCA world, we discussed Vuca in detail.

While it used to be possible to assess developments much better and thus plan for the long term with a steady hand, VUCA poses different challenges for companies today: Agile action, i.e. the ability to react quickly and change rapidly, is now a core competence that ensures the survival of a company.

What is empowerment for? Why is empowerment important?

1. immediate responsiveness

If your company has to react quickly, then it makes sense to let the employee who is confronted with the decision make the decision. – Faster, right? The alternative would be to have the decision request first go through various desks at several hierarchical levels. And that’s really not fast…

2. quality of decisions

It’s not just about the speed of the reaction. Of course, it is also important whether a good, sensible decision is made. It should come as no surprise that the person who is very close to the customer, to the market, i.e. at the point of action, has a much better insight into the situation and all its circumstances than a manager who is some distance away from the action.

3. change in the competence structure

The structure that prevails in many companies is – classically according to Taylor – the following: the manager knows and plans, the employee executes. Nowadays, this so-called management pyramid is being turned on its head. This is because employees are often more technically competent than their managers. In addition, young people often have significantly more expertise in digital matters than long-established employees in management positions. The colleagues “at the top” no longer necessarily know their way around better than those “at the bottom”.

4. war for talents

Job preferences

The zeitgeist in terms of job preferences has also changed significantly; the younger generations have different expectations of their work: they are looking for more challenges and more personal responsibility. Ten years ago, university graduates considered themselves lucky to get a job in a corporation, but today the opposite is the case: Marvin, Ann Sophie and Maximilian prefer to look for a small company, a start-up or start their own business. What is important to them is not too much hierarchy and heteronomy. Of course, this need for freedom collides with the tightly meshed rules of a corporation.

Skills shortage

In addition, demographic change has altered supply and demand on the labor market: where previously hundreds of applications were received in response to a job advertisement, companies are now struggling to attract competent young talent for the position. This means that young people are in the comfortable position of being able to choose their workplace. And the choice clearly falls on companies with flat hierarchies.
So if your company wants to attract young employees despite a shortage of skilled workers, empowerment is recommended.

As you can see, there are many reasons for empowerment.

Why you need empowerment in your company

Apart from general trends and the zeitgeist: people come together in companies to fulfill the needs of other people. Ideally, this will satisfy everyone involved. Unfortunately, this doesn’t always work. And that harms the company!

Why zero empowerment harms your company. One example.

We were standing at a hotel reception to check out. We had successfully conducted a workshop there and had to leave quickly for our next appointment. Now we asked the receptionist to add the €16 for the parking garage to our customer’s total bill. In our experience, our customer had always covered the parking costs in the past; there had never been any problems with this. However, the hotel employee frantically searched through the computer and piles of paper and explained that there were no instructions to this effect. We promised him that we would take responsibility, but that was too hot for him. Not that the company would lose such a sum. To be on the safe side, he wanted to consult his boss. After he had disappeared for 5 minutes and the queue at reception had grown a few meters longer, he appeared and bravely explained, simulating a smile, that his boss was still busy but would be along shortly. We would like to wait, please. After another 5 minutes, we put €16 on the counter, exasperated, and left the lobby with a correspondingly poor impression of the customer orientation in this hotel.

Damage that could have been avoided

All in all, this is not a good result for the hotel: not only do we not want to visit this hotel again, no – as consultants we are multipliers, we recommend hotels for events – or advise against them. If the hotel had provided its employee with a budget, this meeting could have been much more positive and fruitful for all sides. And we would all have said goodbye with a relaxed smile.

Advantages of empowerment

Put yourself for a moment in the shoes of the people who come into contact with your company – your customers, your employees.

Take the customer perspective!

– Imagine comparable customer contact in your company – how would that feel for you as a customer?

Our assessment: the customer feels put off and is annoyed by authority-like permit procurement procedures; after all, other companies are much more customer-oriented. This is certainly not the beginning of a long friendship.
Wouldn’t it be a better customer experience if your employee smiled and said: Yes, sure, no problem – we’ll do that?

Take the employee perspective!

– How would you feel if you were the employee on a short leash? You want to solve the customer’s problem quickly, it would be easy! But: you must not. The customer is getting more and more annoyed and you are the friction surface between the rules and the customer’s displeasure. In the end, you plead with the customer to understand that it’s a stupid arrangement and that you’re really sorry, but there’s nothing you can do. The customer leaves the store shaking his head…

Our assessment: The employee who has to ask for permission every time like a child, is unable to act and has to justify his actions, is certainly not particularly enthusiastic about this. Wouldn’t it increase your employee motivation and your sense of belonging to the company enormously if you could settle the matter quickly and easily and have a few jokes with the customer?

As you can see, empowerment has many advantages. For your customers, your employees, your company. We show you five types of empowerment that will make your company faster, more flexible and better.

The 5 types of empowerment

How does empowerment work?

There are various ways in which responsibility and decision-making authority can be transferred or increased:

From management to the employee
From leadership to the team
Self-empowerment
From the employee to the management (yes, that works too!)
From the employee to his colleagues

Ultimately, all five types of empowerment should be applied in the company.
We describe what this means in detail in the next section.

1. empowerment from the management to the employee

This is what empowerment can look like

Goodwill decision by the customer

If you stay at the Ritz Carlton, you may be able to enjoy a very special service: the hotel staff have $2000 per guest per day at their disposal to make the guest as happy as possible, to create wow experiences for them; in other words, to be able to act quickly and in a customer-oriented manner.
“2000 dollars?!” you think? “Why haven’t they already gone bankrupt?” – Quite simply: because the company’s employees can also think like entrepreneurs. The ability to trade is not the same as putting a new iPad in the hands of every guest. The team also meets monthly to discuss how the budget was used, which wow experiences were created and whether the goodwill decisions were appropriate. This also increases employees’ confidence in their decisions.

Empowerment at Google

Google also believes in its employees and shows them this more than clearly right from the start:
When you start working at Google, you will be given a credit card with a credit limit of €10,000 within the first few days. Yes, that really is the case.
The motto: “If you work for us, we assume that you will make decisions that are good for our company – and that you will not spend money unnecessarily. And so that you are able to act quickly and flexibly to move us forward, we give you the opportunity to do so here.” – Great, isn’t it?

Responsibility makes you responsible

Experience has shown that employees who are given a credit line or a monthly, annual or customer-specific budget handle it very carefully. Nobody throws the company’s money around. The budgets are very rarely fully utilized or used up before the end of their term.
Because:
The more responsibility employees are given, the more prudent their decisions will be, as they are ultimately responsible for them.

What are the risks of empowerment?

Of course, the question arises as to whether this could go wrong. Therefore:

Trust is good, but so is control.

Of course, giving your employees financial leeway does not mean never looking at what they have done with the money. On the contrary:
Ideally, you should agree on an interval in which you sit down together and review the decisions that have been made – and whether they are suitable or not.
These are questions you can discuss with your employee:

What decisions have you made?
How did you come to this decision?
How did you spend the money?
Why?
Why is this good for our company?

What if the employee’s decision doesn’t work at all?

If the employee’s decision doesn’t suit you, talk about it. The important thing here is to communicate objectively and appreciatively what was wrong and why, and to discuss options together as to what the alternatives could be in a similar situation. This allows employees to orient themselves and develop further so that they can make appropriate decisions in the future. Follow-up training is also an option.
However, telling them off would be counterproductive because, after all, the aim is to encourage colleagues to make their own decisions.

If an employee has nevertheless taken a 6-week trip to the Philippines at the company’s expense, he will have to explain why he thinks this is of benefit to the company. Should he not be able to make this credible, then there is certainly trouble to be expected here…

But thank God we have all employed adults in our companies who are able to think for themselves.
Therefore: Give your employees the responsibility that they can represent in terms of their competence and that they must represent in order to be able to act quickly and flexibly with the customer!

The question should not be whether empowerment involves risks, but what risks you run if you fail to empower employees.

2. empowerment from the management to the team

Advantage of empowering the team: relieving the burden on managers

Another form of empowerment is also top-down: the transfer of skills from management to the team. In this case, empowerment solves an ever-growing problem: due to increasing complexity (VUCA), managers are increasingly overloaded; decision bottlenecks and bottlenecks arise.

What to do if managers are overworked?

There are decisions that affect the whole team. In this respect, it is not advisable to assign them to an individual employee; it is better to give them to the team.
If a single employee or manager were to take action here, they would probably put a lot of work into the matter – for example, asking everyone – and in the end they might still come up with an unsatisfactory solution. So why not delegate it to the team right away?

Hand over the task to the team. Example vacation planning

A good example of a team working together to develop and present a solution is vacation planning. The team works out the best allocation in accordance with the rules laid down by management. This can be: there must always be at least three people in the company or a maximum of two people can be away at the same time or vacation is not possible in the high season or a maximum of two weeks vacation can be taken at a time. With such guidelines, the team is usually in a good position to develop a solution that meets all needs without the manager having to deal with it in detail and perhaps even unnecessarily offending one or two employees with their decision.

Another example

One customer’s company switched from individual provisioning to team provisioning. Of course, there were salespeople with varying degrees of success within the team. We wanted to do justice to this fact. The sales manager invited the salespeople into a conference room and gave them the task of not coming out until they had found a satisfactory division for everyone. And lo and behold: after just a few hours, white smoke began to rise; there was a consensus.
The manager probably couldn’t have found a better solution. And if she had given one, there would have been a great risk that some of the salespeople would have projected their dissatisfaction onto the manager. So the manager had nothing to do with it.

3. self-empowerment

Not everyone wants responsibility

As part of our consultancy work, managers often come to us and say: “We want to give employees more responsibility and let them make decisions – but they don’t want that at all!”. – In fact, some employees are not particularly enthusiastic about taking on more responsibility: “That’s more work, so I want more money!”, “That’s the manager’s job – not mine.”, “I want precise rules, what else am I supposed to do?”

Empowerment needs the support of employees, but empowerment is not everyone’s cup of tea. Some have worked for a long time in contexts in which taking responsibility was not rewarded or even negatively sanctioned. This is the case when you get hit on the roof if you make a mistake, when you have a project on your hands immediately after expressing an idea, when deviations from the plan and new solutions are per se the devil…
In contexts like this, you learn that it’s healthier to go with the flow and avoid being conspicuous. Service by the book.
And now we are supposed to throw everything that has been sensible and safe for years overboard and somehow decide for ourselves! What? – What if something goes wrong? – Stress is pre-programmed. Who would not be suspicious of the sudden call for self-organization?

Dealing with rules

There are colleagues who slavishly adhere to every rule, even in an agile transformation. Although they know perfectly well that rule X makes no sense at all, for example because the requirement is no longer up to date, this in no way prompts them to do anything other than simply follow the pointless rule. Sure, there may be situations in which this can make sense – but in modern companies, this behavior is out of place, often even harmful, because it wastes time, work, money and motivation. Who can afford such a thing?

On the other hand, there are also employees who have a much more flexible relationship with regulations and interpret them like a lawyer: with a great deal of leeway. They take the space they need for their task and stand by it.

What is the risk anyway?

In many cases, there is a diffuse fear: “What will happen to me if I don’t follow the rules?”. Realistically speaking, not much to begin with. First of all, someone has to complain about what an employee has done and how exactly. In most cases, this doesn’t even happen. In corporate groups, it takes many years and three warnings before an employee can be dismissed. The fear of sanctions is usually far greater than the actual risk.

In fact, positive reactions are to be expected: those who despondently follow instructions are usually not the ones who go down well with managers, but those who take matters into their own hands and contribute something themselves.

Lean in, have courage – stand up for your wishes!

In the area of empowerment for women, Sheryl Sandberg wrote the book “Lean in”. The tenor here is that it is better to take your own space instead of waiting for it to be allocated to you. Women are usually socialized to hold back politely instead of stepping forward and demanding. When two people speak at the same time, women tend to give priority to the other. If a speaker answers the last question from the audience and a woman is not taken, she tends to react well and put her hand down, whereas men often tend to shout “Please – my question is still important!”
Sheryl Sandberg’s appeal to women “Lean in – dare!” – goes out to everyone, regardless of gender:

Take your place, make decisions, even if they may not be applauded everywhere – and be the one who stands up for your interests!

4. empowerment from the employee to the management? Yes, that too!

In an optimal agile world, the manager trusts the team to solve the tasks at hand independently. The manager’s job, in turn, is to set the framework, ensure that the team has everything it needs to complete the task, represent the team in strategic decisions at higher levels, present the team’s achievements and ultimately stand up for the team.

Example of unsolicited disclosure of information

In order to carry out these management tasks to everyone’s satisfaction, the manager should be aware of the challenges and successes that are currently on the horizon. And who better to provide information than the employees? This is because they are at the point of action, are aware of trends and changes, and know what the current phase is. It is only when employees communicate relevant information to their managers without being asked (!) that they are empowered to lead well.

A division manager of one of our customers put it like this: “Take responsibility, start running! But remember to keep me in the loop. Be sensitive to what I need in order to continue to do my job well.”

5. empowerment from employees to their colleagues – trust and transparency

Empowerment doesn’t just mean that competence is transferred from the top down or that people take space for themselves. Ultimately, empowerment means that each individual in the company ensures that everyone else in the company is empowered to do their job as well as possible. This means that everyone bears responsibility for others and for the company and should be aware of this. What can that mean?

Basically, there are different types of work that employees take on:

Tasks that an employee processes and then passes on to colleagues at the interface
Tasks that are solved together as a team
Things that affect the team that an employee takes on

Everyone is asked to think about each of these tasks:

What can I do so that we can make quick and good decisions at this point and be flexible as a company?
What does my colleague need to be able to act accordingly?
What is needed in terms of flexibility, transparency, information, communication, trust, involvement and resources?

Transparency and trust

Sometimes it’s about providing colleagues with information, sometimes it’s about other resources – and trust is also important so that the colleague can do the job well.

Here are a few examples:

A service employee is informed that the customer has a new requirement or is dissatisfied with something or wants to buy something new, etc. He or she is of course responsible for forwarding this information to the sales employee so that he or she is empowered to act in the interests of the company. Of course, he is responsible for passing this information on to the sales employee so that he is empowered to act in the interests of the company.
A colleague makes suggestions for improvement and offers to implement them. Do colleagues trust him to make improvements in the interests of the team and to get the others on board if necessary?
I am handing over a job that is important to me to a colleague. I let go in the sense of: he’ll do it. Or do I check at every possible point and talk in wherever I can? Do I give him all the authority and framework conditions that enable him to act quickly and flexibly or does he have to report back and wait for my decision?

Implementation: How to empower your colleagues

The highway metaphor

Empowerment does not mean that everyone simply does what they feel like doing. It is important that everyone is capable of acting and knows what needs to be done – in the interests of the company, of course.
We like the metaphor of the highway here:
It needs a common framework – the crash barriers that are far enough apart so that everyone can adapt their driving behavior to the current situation: fast, slow, left, right. The frame should be tight enough so that nobody leaves the road and accidentally jerks across the field. And signs are needed so that not one person goes to Bielefeld, another to Bayreuth and the next to Bregenz, but all to Berlin.

Set the framework for empowerment!

Everyone should be able to drive within the crash barrier without having to stop and ask questions all the time, as this would slow down the journey enormously. That’s why defining the guard rails is so important: the entire team should be familiar with the overall strategic direction, the Why, the Purpose, the Mission, the North Star and the company’s action guidelines, as these define the scope of action for employees. However, the individual situations that arise between the crash barriers cannot possibly all be packed into a detailed set of rules. The guard rails are therefore intended to provide orientation in order to provide guidance even in unforeseeable situations.

Find opportunities for empowerment!

Of course, it makes sense to give your employees as much decision-making authority and leeway as possible. But it’s worth taking a closer look – together with the team – at where work is piling up in the company, where there are waiting times, what are the bottlenecks? What hinders the processes, what makes the company slow?
Once these bottlenecks have been identified, the employees involved can be empowered through increased scope for action. It makes sense to discuss the appropriate guidelines/guidelines for independent action in the relevant area.

Celebrate success!

Let’s talk about the Ritz Carlton again. The mission is satisfied customers. Of course, this means that the customer does not have to wait. Of course, a boss has no way of knowing exactly what the individual customer’s concerns are and therefore cannot draw up rules or checklists for them as a precaution. We remember: In order to provide the customer with the best possible result, employees are given a $2000 credit limit per guest per day. We regularly discuss what the money was spent on. Suboptimal ideas are discussed in a friendly, constructive manner so that the employee can always better position themselves within the guidelines/guidelines. And good ideas are celebrated as a team! This gives employees the courage to try things out. After all, they also want to be the occasion for a small celebration.

Tell empowerment stories!

To give employees guidance, cases are told in which employees have used the budget framework well or less well, so that everyone can learn from mistakes made and successes achieved.

Show role models!

One story that illustrates successful employee engagement at the Ritz Carlton is the following: an important guest, a VIP who repeatedly brings seminar groups to the hotel, casually remarks that he loves the delicious chocolate nightstands at the Ritz Carlton, but is currently unable to eat them because he is running a marathon in May. He is really looking forward to being able to eat them again afterwards. The next time he is at home after the marathon, a surprise awaits him: chocolate sweets are hanging from the ceiling everywhere in his room and he is congratulated on completing the marathon, along with an invitation to a delicious dessert. The customer is delighted! Incidentally, the employee also really enjoyed this campaign. – And it didn’t cost much, although the effect was enormous.

Explain suboptimal decisions!

Another story that defines the guardrail at the Ritz Carlton tells of a time when things didn’t go so well: a hotel guest stalled his train. The young employee bought him a cab to his destination 150 km away. That cost a few hundred euros. Naturally, the customer was delighted, but the question arose as to whether this expenditure was really necessary. During the conversation, the young employee was asked to take an entrepreneurial approach to the matter: would the customer have been less satisfied if he had only called a cab? Or would have selected alternative train connections for the customer? After all, the customer had not reached the train through his own fault. The management teaches the employee to check in each case whether an investment of this amount is really necessary so that the customer has the feeling of being treated specially and customer loyalty is created. What is in the frame? What goes beyond that?

Important aspects for empowerment

The role of works councils: supporters or blockers?

We have encountered this situation more frequently: a larger company wants to become agile. Management wants to give employees greater decision-making authority and responsibility. However, the works council is standing on its hind legs. “No way, that doesn’t correspond to the job description, it’s not in the contract. If the employee is to take on more responsibility, then they must also get more money!”
– Of course, it is the task of the works council to protect employees – for example, from additional, unpaid work. The question here, however, is whether the works council’s objections are actually in the interests of the employees. This is because they are often enthusiastic about having more design freedom.

Works councils do not always act a little old-fashioned as protectors and guardians. There are also works councils that like and support agile transformations. Because of the say, the flatter hierarchies, the improved corporate climate and the increasing motivation, but also because an agile transformation stabilizes the success of the company and thus also the jobs. And because it’s fun!

Make the works council your partner!

We recommend that you involve the works council as early as possible. The more you tell the works council, the sooner they know or can even contribute their own ideas, the more willing they are to get involved. So don’t wait until the last minute to inform the works council with all the necessary information, but make them your partner! Create trust and show that the upcoming measures are good for employees and the company alike. Let the works council have a say. This gives you the chance to work together to find a solution that works for everyone – a world solution.

Legal aspects of empowerment

A little note at the end. Before you transfer responsibility, check which tariffs and contracts are valid. Generally speaking, the larger the company, the more fixed the contract. Find out more! – Some responsibilities should not be delegated! And remember: at the end of the day, the management is always responsible for what the employees do. Responsibility cannot be transferred completely – but tasks and competencies can.

13 steps to empowerment: How do employees take on more responsibility?

Here again briefly and concisely

Not every employee wants responsibility. Both sides are needed! Talk to the employee about what they need in order to enjoy the responsibility!
Check the existing contracts!
The corporate culture has an influence on whether there is a desire for responsibility, whether fear or trust prevails. It is worth turning a culture of fear into a culture of trust. We have written a detailed article on the subject of corporate culture and cultural change.
Involve the works council as early as possible and make it a partner!
Set the guard rails, the direction!
Identify bottlenecks together with the team and work on solutions!
Define clear, meaningful scope for decision-making together!
Pay attention to transparency and passing on information and make your team aware of this too!
Create platforms for exchange, either in short meetings or in other media such as Teams or Slack.
Trust! And encourage you to trust!
Lean in – be courageous and encourage!
Celebrate success!
Discuss suboptimal decisions in a friendly and constructive manner!
Talk about mistakes and successes!

Empowerment helps with problems that you don’t even know about yet…

Michaela’s boss Günther took matters into his own hands. After all, Michaela is not the only one whose docket he has to sign every day. He reached an agreement with his superiors and was given the green light to give his employees greater freedom of action and a budget each. The employees give him credit for this and do their job even better than before – and Günther is no longer chased around the building by employees with notes. Michaela is happy – she has a budget of €1500 a month, which she doesn’t use at all. As always, she handles her company’s money very responsibly. And recently there was even a situation in which Michaela was able to get a bargain thanks to a quick, courageous decision that really saved the company money. She would never have managed that so quickly if she had had to ask Günther.