Employee Participation in Decision-making (PDM) and Firm Performance

Abstract

<p>The objective of this study is to examine the influence of employee participation in decision-making on firm performance in Saudi Arabia’s manufacturing sector. Data were collected through pre-validated, piloted questionnaires, which were e-mailed to 341 manufacturing firms. The questionnaires asked about employee involvement in decision-making and performance variables. The response rate was 63.4 percent. Dimensions of PDM were rendered into 20 statements in the form of a five-point Likert scale. The scale, ranging from no involvement to substantial involvement, measured the degree of PDM. Additionally we used a five-point Likert scale to determine the extent of the firms’ performance in terms of the 10 criteria. The scores of the 10 items were summed and averaged to establish the mean index of the firms’ performance. An index of less than 4.0 was regarded as low firm performance; an index of 4.0 and above was considered to represent high firm performance. Statistical tools were used in analysis. Through product–moment correlation, we examined whether a relationship existed between employee participation in decision-making and firm performance. Regression analysis provided the extent of variation in the dependent variable and Z-test (approximated by the independent samples t-test). Findings showed a significant positive relationship exists between PDM and firm performance, suggesting that PDM is an essential component influencing firm performance. The higher the level of employee participation in decision-making, the higher the level of firm performance.Future studies involving the service industry would shed light on PDM in industries besides manufacturing.</p>

Can high performance work practices and satisfaction predict job performance?An examination of the Malaysian private health-care sector

“…As such, their job performance will improve in line with the suggestion made by Hellriegel et al (1998). A study by Alsughayir (2016) found participation to be positively related to employees' performance.…”

“…According to them, these practices serve to motivate talents and are considered increasingly salient in enhancing the productivity of the health-care workforce in private hospitals. Therefore, in view of our preliminary findings and the need for parsimony, as well as in harmony with the approach taken by other researchers (Alsughayir, 2016;Leggat et al, 2011), we selected these three practices in predicting nurses' job performance through the mediating role of job satisfaction. A review of the literature on the role of these three HPWPs on job performance has been wellestablished as shown in the following section.…”

“…Participation will provide employees with the opportunity to influence the management's decision and contribute to organizational performance (Abdulkadir et al, 2012). Bhatti and Qureshi (2007) and Alsughayir (2016) reported that there is a direct and significant positive impact between participation and job performance. On a similar note, employees' participation in their organization's strategic planning processes was associated with high levels of job satisfaction (Kim, 2002).…”

Empirical Assessment of the Link Between Participatory Decision-Making and Firm Performance in Nigeria

“…Studying SMEs in Lagos state of Nigeria Ojokuku and Sajuyigbe (2014), find a robust positive significant relationship between employee participation in decision-making and organisational performance. In the same direction, Alsughayir (2016) using the regression analysis technique examine employee participation in decision-making in manufacturing companies in Saudi Arabia. The results show a significant and positive relationship between PDM and firm performance.…”

The Effect of Coaching on Employee Performance

“…Study on employee performance has been done by many researchers such as in the manufacturing industry [11][12][13][14][15][16]. A study conducted by Hanantoko and Nugraheni regarding the performance of employees in the manufacturing industry states that companies engaged in the manufacturing sector rely on the high quality and employee performance [13].…”