The effect of empowering leadership practices on employees performance with the mediating role of work engagement: the case of ethio-telecom

Abstract

The main purpose of this study was to examine the effect of empowering leadership practices on employee performance, and the mediating role of work engagement, as emphasized at Ethio-Telecom. Drawing on social exchange theory and self-determination theory, this study reports the responses of 214 participants from Ethio-telecom sales representatives operating in Addis Ababa, Ethiopia. This thesis is structured around a quantitative research approach with a simple probability sampling technique. Structural equation modeling (SEM) with AMOS was used to test the hypothesized relations. The descriptive result showed that there is a lack of empowering leadership practices and that the work engagement level of employees is at its lowest level. Besides, the results of the hypothesized relationships revealed that empowering leadership practices have a significant positive effect on employee performance. It has also been found that empowering leadership has a significant positive effect on work engagement. Moreover, the results of the bias-corrected bootstrapping iteration showed that work engagement partially mediates the relationship between empowering leadership practices and employee performance. Finally, the practical and theoretical contributions, limitations, and future studies are discussed.

IMPACT STATEMENT

Nowadays, business leadership is moving from the traditional structure to empowered, self-managing work teams to increase the flexibility and efficiency of their operations. The goal of empowerment leadership is to enable workers to make decisions for themselves through empowerment rather than through micromanaging or direct management. Under this approach, workers and teams have greater autonomy and a stronger sense of togetherness from their leaders, who accept the good and bad implications of their actions. Company leaders need to make work more meaningful by empowering their teams through delegation, efficacy support, inspiration, and coordination, encouraging them to take ownership of their work and make independent decisions, which enables them to boost employee job performance. Moreover, leaders need to consider letting their employees be engaged in their work, which contributes to much better employee job performance, which is a predictor of company performance.

Keywords:

• Coordinating
• delegation
• employee performance
• empowering leadership
• work engagement

REVIEWING EDITOR:

• Pablo Ruiz, Universidad de Castilla-La Mancha, Spain

SUBJECTS:

• Social Sciences; Economics, Finance, Business & Industry; Finance; Business, Management and Accounting; Industry & Industrial Studies

1. Introduction

In this challenging, fast-paced global competition, empowering leadership has emerged as the major intangible asset of a company and the basic determinant of its competitive advantage, especially in human-intensive firms that contribute an increasing share of economic activity, including the telecom sector (Diamantidis & Chatzoglou, 2019). For this reason, many businesses have switched out their old hierarchical management structures with empowered (semi-autonomous or self-managing) work teams to increase their operations’ overall flexibility and efficiency (Gao & Jiang, 2019). Moreover, business organizations are compelled to compete in a complex and operationally uncertain environment as a result of globalization and rapid economic development (Ali et al., 2018). Because of the complexity of the industry, they must make swift changes to remain competitive (Alotaibi et al., 2020). It is crucial for businesses, including the telecom service, to have a competitive workforce that is prospering and eager to grow in the fast-paced, competitive market before implementing these changes and remaining sustainable in the competition (Alotaibi et al., 2020).

Empowering leadership (EML) is a promising approach for leaders to confidently shape employee skills, knowledge, attitudes, and behaviors (Kim & Beehr, 2020). EML is a technique for creating a setting where it is practical to share power among the workforce (Alotaibi et al., 2020). Power-sharing techniques include emphasizing the value of a worker’s accountability, allocating decision-making autonomy, demonstrating faith in a worker’s abilities, and granting autonomy to act following the circumstances (Kim & Beehr, 2020). Moreover, EML is connected to the perspective on job design because leaders can affect the work design of their own followers by providing them with different assignments or greater latitude, as an example. After all, empowering leadership is related to the job design perspective, giving authority and responsibility to subordinates while utilizing high-involvement management techniques can be viewed as empowering leaders (Gao & Jiang, 2019).

Scholars claimed that EML builds employee confidence in their capacity to execute collective goals, creates better engagement, establishes crucial trust in an organization, and helps to increase performance outcomes (Fong & Snape, 2015; Gao & Jiang, 2019; Kim & Beehr, 2020). In this thesis, it was argued that empowering leadership could affect employees’ performance directly and indirectly through the work engagement of employees. Work engagement (WOE), is a typical construct in work relations and it has received great attention among the academic community and business consultants (Christian et al., 2011; Mishra et al., 2014). Researchers define WOE as a positive, fulfilling, job-related state of mind characterized by vigor, dedication, and absorption (Chhetri, 2017; Sundaray, 2011). Vigor refers to cognitive resilience and a high level of energy while at work, the readiness to invest discretionary energy, and tenacity in the face of difficult situations. Dedication explains undergoing a sense of significance, inspiration, enthusiasm, pride, and challenge while in our work, while absorption is being fully focused and strongly fascinated with one’s work, being intensely engrossed and not easily abstracted by diversions (Christian et al., 2011; Mishra et al., 2014; Schaufeli et al., 2006).

As for Employee performance (EMP), it established the most consideration from researchers of business, HRM, strategy, and organizational behavior (Armstrong, 2010). EMP is how a staff worker performs the responsibilities of their position, completes necessary tasks, and acts in the workplace. EMP includes actions that are explicitly related to the tasks assigned as part of the job description (Ramdani et al., 2019). In other words, task performance focuses on employees’ fundamental job duties and is frequently referred to as “in-role mandated conduct” (Koopmans, 2014). Pradhan and Jena (2017) claim that performing a job is a multifaceted activity rather than a single action. Several researchers point out that employee performance has three dimensions: task performance, contextual performance, and adaptive performance (e.g., Koopmans, 2014; Pradhan & Jena, 2017; Ramdani et al., 2019).

There is a lack of evidence in examining the effect of empowering leadership practices on employee performance with the mediating role of work engagement and other outcome variables in the leadership discourse. Furthermore, among the research that looked at this relationship (e.g., Aboramadan et al., 2022; Ahmed et al., 2022; Gao & Jiang, 2019; Kim & Beehr, 2020; Lee et al., 2017; Rayan et al., 2018), none considered the criterion variables of employee performance and the effect of the mediating variable of work engagement. Though these studies are significant first steps, there is a general dearth of scientific studies, particularly in developing countries, including Ethiopia, on the cause-effect relationship and interaction of empowering leadership, work engagement, and employee performance. Additionally, studies have focused on the direct effect of Empowering leadership on performance (Albrecht & Andreetta, 2015; Helland et al., 2020; Zhang, 2010), the interaction of empowering leadership, and work engagement, on employee performance constructs has been overlooked.

Besides, recent research indicates that different forms of leadership (e.g., servant leadership, authentic leadership, transformational leadership, charismatic leadership) are related to work engagement and performance outcomes (Aboramadan et al., 2022; Cai et al., 2018; Zhou et al., 2022). On the contrary, Tuckey et al. (2012) stated that a lack of empowering leadership does not essentially always lead to a poor level of employee performance as other variables may compensate for it. A research result by Rayan et al. (2018) did not support the direct relationship between leadership-empowered behavior and work engagement. Thus, previous research has found inconsistent results regarding the relationship between empowering leadership, employee performance, and work engagement. Moreover, previous studies have tried to test the direct effect of empowering leadership on performance outcomes (like Albrecht & Andreetta, 2015; Ali et al., 2018; Gao & Jiang, 2019; Helland et al., 2020). Nevertheless, this study was aimed at the direct and indirect effect of EML on employee work performance through work engagement.

It is argued that, due to foremost changes in the Telecom industry and other service sector practices, such as liberalization, deregulation, technology development, and globalization, it is vital to focus on the view of empowering leadership. When the service organizations in general, and Telecom sectors in particular, are engrossed in enhancing empowerment issues in a way that aligns with their larger system, the better they will be able to harness employee involvement, and performance for competitive advantage (Alotaibi et al., 2020).

Ethio-telecom is a very good context to study the Empowering leadership, work engagement, and employee performance relationship, for some reasons. First, Ethio-telecom is the largest telecom business industry in the country. It is widely recognized that service organizations, like telecommunication, contribute more to the country’s economy. Without a doubt, the effectiveness of their leadership, and level of engagement, measure the performance of the telecom industry. Second, the current government of Ethiopia is undertaking various transformations of the service organizations, including the telecom sector, like liberalization, (like Safari-com) due to the pressure from its citizens for better service performance. Third, the telecommunication industry is very dynamic and highly competitive. Hence, providing efficient and effective telecommunication service to customers is closely tied to employee performance and competitiveness (Rajasekar & Al Raee, 2013). The Ethiopian telecommunication sector grew rapidly over the last decades even though the ICT sector remains underdeveloped compared to neighbors Kenya and Sudan, (Adam, 2012). Finally, the telecom sector is one of the most labor-intensive industries in the country.

With this tenet in mind, this study was designed on examining the effect of the effect of empowering leadership practices on employee’s performance with the mediating role of work engagement at Ethio-telecom.

2. Literature review and hypothesis development

2.1. Empowering leadership

According to Juyumaya (2022), empowerment is a process of enhancing self-efficacy among organizational members by identifying conditions that foster powerlessness and removing them through both formal organizational practices and informal techniques of providing efficacy information. Empowerment in the place of work is a great way to advance employee engagement and retain your top talent (Aboramadan et al., 2022). Empowerment is founded on the notion that giving employees the tools, power, chance, and drive to complete their work while also holding them responsible for their actions would result in happier and more effective workers (Albrecht & Andreetta, 2015; Ali et al., 2018; Gao & Jiang, 2019; Helland et al., 2020).

Empowering leadership denotes a set of manners of the leaders who allocate responsibilities, encourage initiatives: efficacy support, shares power and autonomy with his or her followers through articulating confidence in better performance promoting the meaningfulness of work, enhancing participation in decision making, and providing autonomy from administrative constraints (Amundsen & Martinsen, 2014; Arnold et al., 2016; Juyumaya, 2022, Qian et al., 2018). Leaders that empower their teams encourage them to take ownership of their work and make independent decisions (Aboramadan et al., 2022). This management approach can increase employee motivation and engagement, which can improve work output and job satisfaction. One distinctive method to leadership is empowerment, which involves assisting followers via knowledge sharing, coaching, training, and emotional support in addition to delegating and encouraging them (Alotaibi et al., 2020; Kim et al., 2018). Thus, Employees are more likely to have a sense of meaning in their jobs and feel capable of implementing job activities on a self-managed basis.

Empowering leadership (EML) is a promising strategy for leaders to constructively shape employee behaviors and attitudes, including work engagement, and other positive work outcomes (Juyumaya, 2022). According to Ahmed et al. (2022), empowering leaders share power with their followers, giving them the authority to decide. They also prompt confidence in employees’ abilities to accomplish their jobs autonomously. Leader actions that promote empowerment include letting workers participate in decision-making, stressing the value of their work, showcasing their abilities, and getting rid of bureaucratic roadblocks (Juyumaya, 2022). Employees who perceive autonomy, significance, competence, and good influence in their work also experience psychological empowerment.

It can be noted Putting employees’ needs first includes empowering leadership. Therefore, empowered leadership creates a platform for people to discuss original ideas and works to put them into action when it is feasible. In identifying the empowering leadership in Telecom sector, this study is focused on Dimensions of EML such as delegation, encourage initiatives, encourage goal focus, efficacy support, inspiring, coordinating. modeling, guidance, a model tested by some scholars (Albrecht & Andreetta, 2015; Amundsen & Martinsen, 2014; Arnold et al., 2016).

2.2. Work engagement

Work engagement (WOE) has emerged nowadays as a potentially important theme (Bhatnagar & Biswas, 2013; Tripathi & Sharma, 2016; Zulkifli & Ali, 2017). Work engagement as the participation and enthusiasm of workers in their work and workplace. WOE came from recent research on burnout and first attracted academics’ attention about 20 years ago (Zulkifli & Ali, 2017). WOE is the term for an employee’s cognitive, emotional, and interpersonal energy that is focused on achieving successful organizational outcomes (Gottman et al., 2016). According to Wollard and Shuck (2011), the key elements of WOE—attention and absorption—involve the employees’ psychological presence during job roles. It is an company instrument to attempt for a better competitive advantage over others (Anitha, 2013). In addition, it simultaneously promotes welfare enhancement and preserves workers’ commitment to the goals, principles, and drive of the business (Zulkifli & Ali, 2017). Previous studies have pointed out that WOE has three dimensions: vigor, dedication, and absorption (Christian et al., 2011; Schaufeli et al., 2006; Wollard and Shuck (2011). According to these authors, vigor indicates spending constant effort, power, and mental resilience of the job. Vigor also suggests mental elasticity, high levels of energy, and better levels of persistence while working even when faced with difficulties. Dedication denotes being inspired, keen, and highly concerned about your job. Work can provide someone a sense of purpose, as well as feelings of enthusiasm, pride, and challenge. Absorption describes a lack of awareness of time passing on the work, a high level of alertness, and a sensation of detachment from your surroundings.

2.3. Employee performance

Employee performance specifies the general financial or non-financial result of the employee that has a direct relationship with the organization’s performance and success (Armstrong, 2010). According to Chang and Chen (2011), in an organizational context, performance is typically defined as the degree to which an organizational member (employee) contributes to achieving the goals of the organization. Employee performance is the outcome of executing defined responsibilities, meeting deadlines, employee competency, and effectiveness and efficiency in doing work (Pradhan & Jena, 2017). Researchers point out that employee performance has three dimensions: task performance, contextual performance, and adaptive performance (e.g., Koopmans, 2014; Pradhan & Jena, 2017; Ramdani et al., 2019). Task performance is about the basic job responsibilities of workers and is mostly called “in-role prescribed behavior” (Koopmans, 2014). Adaptive performance, on the other hand, is the extent to which an individual employee adapts to changes in the job role or work environment (Koopmans, 2014; Pradhan & Jena, 2017). Along with task and adaptive performance, efforts have been made to determine the importance of non-job performance components to create a better workplace. Scholars defined this as contextual performance, which refers to employee voluntary actions that benefit businesses intangibly (Crook et al., 2011; Pradhan & Jena, 2017). According to Koopmans (2014), contextual performance signifies “discretionary extra-role behavior.” It is reflected in actions such as coaching colleagues, consolidating social networks within an organization, and going into and working extra jobs for the specified organization.

It should be noted that employee job performance can be divided into two categories: in-role job performance and extra-role job performance. Extra-role performance refers to behavior that is not required for formal organizational duties and responsibilities but is still important for organizational effectiveness.

2.4. Theoretical foundations

This study suggests that social exchange theory (SET) best explains how EML affects employee performance through work engagement. The foundation of social exchange theory is the notion that social behavior is the outcome of an exchange process. This theory holds that people balance the possible advantages and disadvantages of their social connections. They will end or leave the relationship when the risks become too great for them to bear. The goal of this trade is to reduce expenses and maximize gains (Lavelle et al., 2007). Besides, Cropanzano and Mitchell (2005) contended that employees who look for tangible benefits of the organization view employment as the trade-off between effort and faithfulness. This theory further argued that resources gained from others are more greatly valued if they are based on discretionary options rather than situations beyond their control (Lavelle et al., 2007). Moreover, the macro theory of human motivation and personality known as self-determination theory (SDT) focuses on people’s natural growth inclinations and psychological requirements (Ryan & Deci, 2002). Various forms of unethical leadership are associated with a wide range of negative organizational outcomes. The scholars found that personal growth and satisfaction mediated the negative impact of unethical supervision on the intention to stay. SDT emphasizes the satisfaction of the basic need of workers for autonomy, competence, and relatedness as key drivers of engaged behavior. The self-determination and motivation of human conduct are the main topics of SDT. Empirical studies evidenced by using SDT contributed positively to the worker’s basic needs for autonomy, engagement, competence, and relatedness (Albrecht & Andreetta, 2011).

In the present study, the SDT perspective was applied to examine the employees’ needs that influence their performance. With the existence of EML, employees become engaged and willing to deliver their jobs in meeting performance expectations.

2.5. Linking EML practices, WOE and employee performance

Previous empirical studies focused on the driver and outcomes of empowering leadership, mainly the influence of intrinsic motivation, and creative process engagement (Zhang, 2010), employee productivity, and thriving at Work (Ali et al., 2018), employee organizational commitment (Kim & Beehr, 2020). Furthermore, prior research demonstrated that empowering leadership has a positive influence on performance, psychological empowerment, firm performance, employee involvement, intrinsic motivation, and creative process engagement (Helland et al., 2020; Zhang, 2010). Albrecht and Andreetta (2015) revealed that empowering leadership has a positive impact on engagement practices, employee turnover intentions, and affective commitment. On the contrary, Rayan et al. (2018) found that there is no direct relationship between leadership-empowered behavior and work engagement. Thus, inconsistency in previous research findings calls for further study.

Recent research indicates that different forms of leadership (e.g., servant leadership, authentic leadership, transformational leadership, charismatic leadership) are related to work involvement and performance outcomes (Aboramadan et al., 2022; Cai et al., 2018; Zhou et al., 2022). Moreover, previous studies have tried to test the direct effect of EML on performance outcomes (like Albrecht & Andreetta, 2015; Ali et al., 2018; Gao & Jiang, 2019; Helland et al., 2020). Nevertheless, this study article was aimed at the direct and indirect effect of EML on employee work performance through employee engagement. Research by Lee et al. (2017) found that empowering leadership enhances work engagement via work meaningfulness. However, we were unable to find support for the view that the direct effect of empowering leadership on work engagement. Moreover, Tabche (2018) revealed that EML positively affects open innovation. As a result, EML encourages adherents to look for, incorporate, and share fresh concepts and information to enhance the results of open innovation. Ahmed et al. (2022) uncovered the positive influence of EML behaviors on goal clarity, self-efficacy, and employees’ job performance. Moreover, self-efficacy mediates EML behaviors’ influence on workers’ job performance. Consequently, it can be inferred that empowering leadership is significantly related to employees’ job performance (Zhang et al., 2018). Accordingly the following hypothesis is forwarded.

Hypothesis  

#1: Empowering leadership has a direct positive effect on employee performance.

Empowering leadership can enhance intrinsic motivation to motivate work engagement. Empowering leader encompasses granting employees a fair amount of autonomy, which can make workers feel responsible for their jobs and be stimulated to achieve their goals (Helland et al., 2020). Especially, a delegation of responsibility and participation in decision-making can enhance employees’ capability for self-determination and workers’ feelings of mastery, which can improve the employees’ motivation for work engagement (Albrecht & Andreetta, 2011). Through these behaviors, employees can produce sufficient possessions to handle job demands and feel more meaningfulness, which has constructive effects on employee work engagement. In support of this, (Locke) indicated that psychological meaningfulness was helpful to have better work engagement. On the other hand, I propose that empowering leadership can offer employees with sufficient resources, which allow follower to engage in their works. Stated differently, empowering leaders can support employees in meeting their basic needs for competence and achieving their work goals for enhanced performance by providing individual coaching and development for the workplace (Alotaibi et al., 2020).

When driven by successful leadership, effective delegation develops into a collaborative, coordinated, and all-encompassing managerial strategy for empowering, inspiring, and assessing employees’ performance (Ugoani, 2020). It lessens unnecessary power gaps and gives workers the self-assurance they need to ask supervisors for feedback to complete tasks more effectively. By fostering the essential organizational climate, speaking on behalf of the organization, establishing the organization’s fundamental policies, and monitoring progress, leadership drives effective delegation (Ugoani, 2020). The organization’s overall effectiveness; the leader is unable to outsource his responsibility. Based on the literatures stated above the following hypothesis is stated.

Hypothesis  

#2: Work engagement has a direct positive effect on employee performance.

Diamantidis and Chatzoglou (2019) concluded that, by fostering the essential organizational climate, speaking on behalf of the organization, establishing the organization’s fundamental policies, and monitoring progress, leadership drives effective delegation. Employees with high initiative feel better to perform their jobs in such a way that is identified with the firm’s goals, while employees with low initiative feel no such obligation to support the firm’s goals (Martin et al., 2013) Research by Tian et al. (2019) shows that self-efficacy has an impact on all aspects of human activity. An individual’s confidence in their ability to take the actions required to accomplish a goal is known as efficacy support. Self-efficacy has a significant impact on both the ability one has to handle issues competently and the decisions one is most likely to make by identifying the beliefs one holds regarding their ability to influence conditions. Moreover, results showed that work engagement acted as a partial mediator in the self-efficacy–work performance association. These findings highlight the role of work engagement as a key factor in work-related well-being that can change the effects of self-efficacy on work performance.

Coordination supports avoiding conflict between the employees’ individual goals and increases employee job performance. It brings about synchronization between the employees’ individual goals and organizational objectives (Alotaibi et al., 2020). According to some studies (Alotaibi et al., 2020; Gao & Jiang, 2019), empowering leadership is a set of actions that superiors take to transfer authority and responsibility to groups or individuals. These actions include encouraging employees to voice their opinions, promoting decision-making participation, fostering information exchange, and facilitating team decision-making. Empowering leadership include fostering bottom-up decision-making and delegating authority to lower levels of the organizational structure enhances employee involvement and performance (Helland et al., 2020). By using these characteristics, leaders hope to increase their team members’ levels of engagement and self-management so that they develop into self-leaders and actively participate in everyday activities (Albrecht & Andreetta, 2015; Ali et al., 2018; Gao & Jiang, 2019)

From an Ethiopian perspective, Tegegne (2020) found that leadership styles, i.e., transformational, transactional, autocratic, and laissez-faire have a positive significant impact on employees’ performance. Moreover, Kebede and Lemi (2020) revealed that leadership brings about desired changes in the working environment by inspiring and motivating workers to create and innovate, to go beyond what they think they can do, and by rewarding staff and making recognition in exchange for the work they perform. Giving close instructions and guidance also has a significant and positive effect on promoting the performance of workers.

A study by Park et al. (2022) found that leadership was the key catalyst in encouraging the effective task performance of employees throughout the mediation role of work engagement. Accordingly, companies need to create a positive environment that promotes work engagement and should offer interventions for leaders to build skill sets for proper leadership.

Although there are studies on the mentioned variables, there is almost no research on the effect of empowering leadership on employee performance with the mediating role of work engagement, particularly in developing countries such as Ethiopia.

Based on the empirical findings and the underpinning theories discussed above, the following hypothesis is forwarded:

Hypothesis 

#3. Work engagement positively mediates the relationship between empowering leadership and employee performance

3. Research method

3.1. Approach, sample and procedure

A quantitative research approach with explanatory and descriptive design was used to provide empirical evidence about the effect of empowering leadership on employee performance mediated by engagement at Ethio-telecom. The study employed a self-administered survey questionnaire to test its hypotheses, allowing for statistical confirmation of the research model and its corresponding construct variables (Creswell, 2014). By the end of 2022, the number total number of managerial and non-managerial employees at Ethio-telecom as of March 2023 is 10,501, 1105 are working as sales permanent representative employees at a country level, of which 598 are working in Addis Ababa, Ethiopia. The data was collected from sales representative employees operating in Addis Ababa, Ethiopia.

The sample was selected via simple random sampling. Simple random sampling is a statistical technique in which each of the population members has an equal chance of being selected from the sample, which helps eliminate bias in selecting research participants for the study (Creswell & Plano Clark, 2018; Quick & Hall, 2015). Simple random sampling was performed using a process that included getting the total sales representatives of Ethio-Telecom operating in Addis Ababa, Ethiopia, from the human resources department. Then, we used the Kothari (2004) formula and got 251 as a representative of the population. After that, we reached the selected sample based on the samples all over the branches.

Besides, permission was obtained from each bank’s relevant body to collect data after a written explanation of the research’s goals, suggested data collection techniques, and request for a copy of the research questionnaire. A self-addressed envelope was also given to each respondent for their completed survey. Upon distribution of the questionnaires, respondents were informed of their rights to confidentiality, anonymity, and withdrawal from the study.

To determine the sample size, the following proportional sample size formula was used (Kothari, 2004). From 598 target population, 251 are regarded as a sample size. Out of the 251 paper questionnaire surveys distributed, 214 were returned. This signifies an overall response rate of 85.25%, which can be considered a very good rate (Corbetta, 2013).

According to Cleff (2019), in multivariate analysis, outliers can be identified with the “Mahalanobis Distance Measure,” which is a measure to evaluate the position of each observation compared with the center of all observations in a set of the specified variable. Accordingly, in this paper using IBM SPSS v.25, multivariate outliers were detected by running Mahalanobis Distance. According to Morgan and Rubin (2017) a large Mahalanobis distance value indicates the case as having extreme values for one or more variables. It is advocated that a very statistical test of significance at 0.001 is the threshold rule. Hence, in this thesis, by comparing calculated probabilities and checking against 0.001, a total of 18 of the response items were cleared because their Mahalanobis distance measure was less than the accepted threshold probability of p a = 0.001 (Morgan & Rubin, 2017). After eliminating missing values and outlier cases, 185 responses remained for the data analysis, thus it is considered proper for further analysis.

Of the total respondents (224), male employees numbered 99 (44.43 percent), while female employees were 125 (55.57%). More than half of the total sample, 73.51% of the respondents, were 30 years old or younger. A total of 24.86% were diploma holders or below. More than half of the total sample of 63.78% holds a bachelor’s degree. 11.36% are master’s degrees (post-graduate degrees). Of the total 224 employees, at the end of March 2023, about 52.97% of the respondents served for 5 years or less, 40% had experience of 6 to 10 years old, and 7.03% had 11–15 years of work experience, while none of the respondents had working experience of 15 years.

3.2. Instruments

Empowering Leadership: For measuring Empowering Leadership, a scale contains 24 items to measure delegation, encourage initiatives, encourage goal focus, efficacy support, inspiring, coordinating, modeling, and guidance adopted from Amundsen and Martinsen (2014); Arnold et al. (2016). The questions include “My leader conveys that I shall take responsibility”, “My leader conveys that I shall take responsibility” and “My leader encourages me to take initiative”. To measure employee engagement, this study adapts the measurement instrument, developed by Schaufeli et al. (2006), which consists of 9 items, and involves 3 aspects of employee engagement; vigor (3 items), dedication (3 items), and absorption (3 items). Sample questions include: “I find the work that I do full of meaning and purpose” and “I am immersed in my work”. As related to employee performance, the dimensions of the task, contextual and adaptive performance are adapted. That is 5 high-loading items on aspects of task performance, 5 high-loading items on contextual performance aspects, and 6 items for adaptive employee performance (Koopmans, 2014; Pradhan & Jena, 2017). The scales encompass statements, such as “I used to maintain a high standard of work,” “I used to perform well to mobilize collective intelligence for effective teamwork,” and “I used to extend help to my co-workers when needed.”

Overall, respondents are required to indicate the extent of their agreement with each item on a five-point Likert scale, presented as strongly disagree, disagree, Neural, agree, and strongly agree. The main Constructs, proxy variables, and sources are detailed in the following table.

4. Data analysis and results

This paper focuses on the effects of empowering leadership on employee performance. In addition, it tests the mediating role of WOE as mediating variable. The 25th version of SPSS and the 23rd version of Amos were used to analyze the data. Harman’s single-factor proposed by Mackenzie and Podsakoff (2012) were applied to test common method bias (CMB), and as statistical remedy for it. With Harman’s single-factor test, principal component factor analysis with an un-rotated solution. The factor of multiple eigenvalues explains 32.71% of the variance. A single factor extracted 32.71% of the total variance. Thus, it is far less than 50% (Podsakoff et al., 2003), hence, it is determined the CMB is improbable to be a thoughtful problem.

From the construct level descriptive statistical results, it can be seen that there are three construct variables: namely, empowering leadership, work engagement, and employee performance. The mean value of the five-point Likert scale intervals was determined using the decision rule (1.00 - 1.80) strongly disagreed; (1.81 - 2.60) disagreed; (2.61 - 3.20) medium; (3.21 - 4.20) agreed; (4.21 - 5.00) strongly agreed as recommended by Pihie and Akmaliah (2009). From the observed variables, the scale was from 1 to 5. The mean of all data was in the range of 2.52 to 3.51. The average mean of the empowering leadership construct is variable 3.35 (agreed). Moreover, the mean value of work engagement is 2.52, which falls on the disagreed continuum, and Employee Performance was 3.51, which signifies the majority of respondents agreed. Hence, despite the other variables the perceived level of performance is good (Table 1).

Table 1. Construct level descriptive analysis result.

Construct variable	Mean	Std. dev
Empowering leadership	3.35	.995
work Engagement	2.52	.841
Employee Performance	3.51	.794

Source: Own computation-using SPSS, (2023).

Correlation analysis: to measure the correlation between empowering leadership, work engagement, and employee performance, the researcher used Spearman’s correlation, since it is more suitable for ordinal scale and measure of association between variables. The results of the Correlation analysis postulate that there is a positive significant and positive relationship among factor variables. This shows that the study variables correlate with each other sufficiently and they can be reviewed adequately. Multicollinearity does not exist in the study variables because the correlation levels are less than 0.7 (Hair, 2009) (Table 2).

Table 2. Means, standard deviations, and correlations between variables.

	Mean	Std. dev	Empowering leadership,	work Engagement,	Employee Performance
Empowering leadership,	3.35	.995	1
Work Engagement,	2.52	.841	.0.496**	1
Employee Performance	3.51	.794	.0.576**	0.601**	1

**p < .05.

Source: Own computation-using SPSS, (2023).

Confirmatory Factor Analysis (CFA): The CFA measurement model describes how each latent variable is operationalized or measured by corresponding observed indicators (Hair et al., 2014). The construct latent variables in this research consist of empowering leadership, work engagement (vigor, dedication, absorption), and employee performance (task performance, adaptive performance, and contextual performance) are the latent constructs of this study. As a measurement model, confirmatory factor analysis (CFA) was performed using AMOS v.23 with maximum likelihood estimation to spot the pattern through which every item loads on a specific factor (Hair et al., 2014; Kline, 2011). Standardized factor loadings and modification indices were used to evaluate it. The observed indicators of the construct are thought to be caused by the designated latent constructs in the author’s reflective model of confirmatory factor analysis with construct variables.

During CFA analysis, factors with a loading lower than 0.5 are worth excluding. Thus, deleting the item with low factor loading improved the overall fit indices. Measures of goodness-of-fit were applied to evaluate the structural fit of the proposed model. There were 31 observed variables, measuring empowering leadership, work engagement, and employee performance constructs loaded more than 0.5. The factor loadings of items and the underlying construct variables ranged from .5207 to .9554. This CFA measurement model for empowering leadership practices and work engagement, and employee performance appears to represent the data quite well (Figure 1).

Figure 1. Test of overall final measurement model.

In the test of the measurement model, the chi-square (CMIN/DF) value is 2.609, which is less than the generally suggested value of 3 (Hair et al., 2014), which strongly specifies a good fit for the model. The GFI, CFI, and TLI values are 0.943, 0.957, and 0.951, which are above the general cutoff for the goodness of fit (0.90) (Hair et al., 2014; Kline, 2011). Additionally, the RMSEA is 0.059, signifying an acceptable model fit (Kline, 2011). Henceforth, the measurement model looks to represent the data quite well (Table 3).

Table 3. Model fit measures: re-specified final measurement model.

Measure	Estimate	Threshold	Interpretation
CMIN/DF	2.609	>3	Excellent
Goodness‐of‐Fit Index (GFI)	0.943	>0.90	Acceptable
comparative fit index (CFI),	0.957	>0.90	Excellent
Tucker Lewis Index (TLI)	0.951	>0.90	Excellent
Root Mean Square Error of Approximation (RMSEA)	0.059	<0.07	Excellent

Sources for the Threshold (Hair, 2009; Kline, 2011).

Source: Own computation-using SPSS and Amos (2023).

4.1. Convergent and discriminate validity

Hair et al. (2014) claimed that, once a good measurement model fit is achieved, it is then need to continue with assessing the reliability and validity of measures. The convergent validity was assessed by assessing the degree of factor loadings of observed variables on the proposed latent construct-variables. According to Kline (2011), the average variance extracted (AVE) can be applied with a threshold of above 0.5 to measure convergent validity. Table 4 showed the AVE exceeded 0.5 and the factor loadings for all the items were above 0.5, as suggested by Hair (2009). The degree of factor loadings of observed variables on the proposed latent variables was used to investigate convergent validity. According to Hair (2009), in convergent validity, the average variance extracted (AVE) must be greater than 0.5. Table 4 showed that AVE exceeded 0.5 and the factor loadings for all the questionnaire items were above 0.5. In order to demonstrate sufficient discriminant validity, the square root of the average variance for each variable should be greater than the correlations between latent constructs (Byrne, 2010). In Table 3, the AVE square root is shown. The discriminant validity of the model is verified by checking that values are greater than correlations between latent constructs (Kline, 2011).

Table 4. Convergent and discriminate validity test.

Constructs	Items	Sta. Loading	Square of SL	Sum of SL	No of items	AVE	Square of AVE
Empowering Leadership	EML_11	0.6662	0.4438
	EML_9	0.877	0.7691
	EML_1	0.8127	0.6605
	EML_2	0.919	0.8446
	EML_3	0.9003	0.8105
	EML_4	0.9121	0.8319
	EML_6	0.9312	0.8671
	EML_7	0.834	0.6956
	EML_19	0.7584	0.5752
	EML_20	0.7402	0.5479
	EML_24	0.6854	0.4698
	EML_21	0.7248	0.5253	8.0413	12	0.6701	0.818
Work engagement	WOE_3	0.9433	0.8898
	WOE_4	0.9117	0.8312
	WOE_6	0.8499	0.7223
	WOE_8	0.6081	0.3698
	WOE_9	0.6613	0.4373
	WOE_1	0.7331	0.5374	3.7879	6	0.6313	0.795
Employee Performance	EMP_18	0.7331	0.5374
	EMP_24	0.7518	0.5652
	EMP_23	0.9493	0.9012
	EMP_22	0.9368	0.8776
	EMP_21	0.9314	0.8675
	EMP_20	0.8875	0.7877
	EMP_19	0.6853	0.4696
	EMP_15	0.727	0.5285
	EMP_13	0.6643	0.4413
	EMP_1	0.6165	0.3801
	EMP_17	0.8095	0.6553	7.0114	11	0.6374	0.798

Source: Own computation-using SPSS and Amos, (2023).

4.2. Hypothesis testing

The first hypothesis posits that there is a positive direct effect of empowering leadership (summed effect) on employee performance. The results demonstrated that empowering leadership has a significant positive effect on employee performance (standardized path coefficient β = .1277, t = 5.3715, P < 0.001). Hence, hypothesis 1 was supported. Hypothesis 2 proposed the positive direct effect of the empowering leadership (summed effect) on work engagement. The result shows that empowering leadership has a significant positive effect on work engagement (standardized path coefficient β = .1319; t = 8.4237, p < 0.001), hence providing support for Hypotheses 2. Overall, the results from this section are shown in Table 4. 17 below, and they reveal that, as predicted, are supported (Table 5).

Table 5. Summary of Hypotheses on the direct effect.

			Standardized Estimate	t-Value	P	Decision
Employee Performance	<—	Empowering leadership	.1277	5.3715	***	Supported
Employee Performance	<—	work engagement	.1319	8.4237	***	supported

****p <.000.

Source: Own computation-using SPSS and Amos, (2023).

The mediation effect of work engagement on the relationship between empowering leadership and employee performance, was analyzed by using an AMOS bootstrapping iteration as suggested by Preacher and Hayes (2008). According to Collier (2020), bootstrapping is a procedure for determining the confidence interval of an indirect effect by drawing many samples with replacement. Besides, bootstrapping would provide much more statistical power compared to the normal theory approach (Preacher & Hayes, 2008). The results from the bias-corrected percentile method show that the lower bound confidence interval via the bootstrap is .0194 and the upper bound is .0802. If the range for the upper and lower bound estimates does not cross over zero, then the indirect effect is considered significant (Collier, 2020), p. 176). Therefore, we have a significant indirect effect. Additionally, the findings revealed that the indirect effect of empowering leadership on employee performance was positive and significant (β = .0542 t = 6.471, p < .001), supporting hypothesis 3, and the direct effect of empowering leadership in the presence of the mediator was also significant. Hence, we can conclude that work engagement partially mediated the relationship between empowering leadership and employee performance (Table 6).

Table 6. Summary of Hypotheses on the mediation effects.

Relationship	Direct effect	Indirect effect	Confidence Interval
			Lower Bound	Upper bound	P-value	Decision
empowering leadership→ work Engagement → Employee Performance	.1002 (6.342)	.0442	.0194	0802	<.001***	Partial Mediation

Note: Unstandardized coefficients reported. Values in parentheses are t-values.

Bootstrap sample = 5,000 with replacement.

Source: Own computation-using SPSS and Amos, (2023).

5. Discussion and conclusions

The main objective of this study was to examine the effect of perceived empowering leadership on employee performance and the mediation role of work engagement. This study was carried out in the Ethio-Telecom context, operating in Addis Ababa, which is a knowledge-based business sector, and it needs better empowering leadership practices. The results of the current study are encouraging as they provide further support for the positive effects of the contemporary concept of empowering leadership on the stated study constructs. The present study uses social exchange and self-determination theories to examine the stated relationships.

This study was to assess the perceived empowering leadership practices in the study area. Despite the fact that there are effective methods for empowering leadership, the leader does not provide employees with enough authority or encouragement to take the initiative to begin tasks. Leaders’ lack of concern for working with employees in a goal-directed manner, their lack of optimism about the future, their low level of enthusiasm about what employees can achieve, and their low practice of communicating a bright view of the future can all have an impact on their performance and work engagement. This will likely influence the engagement and performance of workers at all levels of the Ethio-telecom. Empowering leadership, as an effective leadership style allowing companies to efficiently deal with complex situations, has been increasingly emphasized (Ahmed et al., 2022; Alotaibi et al., 2020; Juyumaya, 2022; Kim et al., 2018). This type of leadership consists of supervisors enhancing subordinates’ motivation and engagement, psychological empowerment, and performance levels by sharing power with or granting more autonomy to their followers. Further, there is a lack of work engagement levels in the study area. Research shows that disengaged employees are less likely to feel motivated, work hard, or meet expectations, and they cause more errors and defects in work performance (Armstrong, 2010). Besides, disengaged employees have the power to lessen a company’s output and morale, damage customer relationships, and obstruct the company from reaching its corporate goals (Chang & Chen, 2011; Pradhan & Jena, 2017).

Consistent with previous studies (for instance, Fong & Snape, 2015; Qian et al., 2018; Juyumaya, 2022) established a positive effect of perceived empowering leadership on employee performance. The value of this study lies in the fact that it reveals the importance that leaders need to have proper empowering leadership practices strategies and techniques if they desire better engagement, performance, and competitiveness. According to SET empowering leaders are prospective to develop high-quality social exchange relationships with followers, which enhance their performance levels. From the findings of this study, it can be concluded that the more empowering leadership practices the better will be the employee’s performance level. According to self-determination theory, leaders support competence by creating a positive learning setting and providing opportunities for others to use their skills and further progress them through optimally challenging tasks. The findings from this study provide scientific knowledge of self-determination theory by demonstrating the relationship between empowering leadership and employees.

The sought to examine the direct effect of perceived empowering leadership on work engagement. It was found that perceived empowering leadership has a direct positive effect on work engagement. The findings of this study corroborate previous studies (for instance Helland et al., 2020; Juyumaya, 2022; Sahar, 2017). Thus, enhancing work engagement by way of empowering leadership may provide a range of positive outcomes for the workers of Ethio-telecom. Engaging employees is crucial for retaining top talent and is an important piece of the employee performance puzzle, as disengaged employees are more possibly to leave their jobs. According to Truss et al. (2013), employees engaged in their job are more likely to be motivated and boost their performance. SET suggests that employees choose their engagement level at work based on their perceived leadership support from their employer. empowering leadership can predict work engagement and employee success, including the performance of customers’ perceived quality of service, profit, and productivity.

Finally, proposed to investigate the mediation effect of work engagement on the relationship between empowering leadership and employee job performance with the use of a bootstrapping approach. It is concluded that work engagement partially mediates the relationship between empowering leadership and employee job performance. Thus, it can be concluded that empowering leadership has an indirect effect through the mediation role of work engagement. Put differently, it can be concluded that, the more empowering leadership practices the better work engagement which in turn boosts employee performance at work.

6. Theoretical implications and practical implications

This paper advances the body of knowledge in the field in many ways. First, it emphasizes how crucial it is to concentrate on empowering leadership because the academic study only treats it at a contemporary level. Second, a new theoretical model on the relationship between empowered leadership, work engagement, and employee performance is developed in this research by integrating variables and factors that have not previously been linked. Third, this study proposes the mediating influence of work engagement in the relationship between empowering leadership and employee job performance. Finally, the results of this study also provide evidence for using social exchange theory and self-determination theory to understand the stated relationships. In short, this study tried to fill in any knowledge gaps discovered by earlier research, resolve inconsistencies found in earlier studies, reveal any unrecognized problems, and serve as a resource for academics interested in related construct variables.

From a practical point of view, it contributes to increasing the concern of leaders and business managers about the significance of proper empowerment so that the company can have better work engagement and positive performance results. Leaders need to make work more meaningful. By showing confidence in a good performance, encouraging participation in decision-making, and granting followers freedom from bureaucratic restraints, a leader can distribute authority or give followers additional responsibility and autonomy. The findings of this paper also contribute to increasing the concern of leaders and business unit managers about the importance of a proper empowering leadership activity, that the company can have better work engagement, empowering leadership and employee job performance value for the company.

7. Limitations and future research

This study has limitations, although it adds to the body of knowledge on empowering leadership, workplace engagement, and employee performance. To begin with, the cross-sectional design of the data collection for this study may limit the implications of causality. Future researchers are therefore urged to carry out a longitudinal investigation. Second, the outcomes of this study are only applicable to Ethiopian telecom; subsequent studies should apply the same methodology to other sectors of the economy. Finally, future researchers could add more outcome variables and other empowering leadership elements to the model.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Notes on contributors

Abel G. Medhn Desta

Dr. Abel Gebremedhn Desta is an assistant professor of leadership at Ethiopian Police University, College of Leadership and Governance. His research and teaching interests are in the areas of human resource management, strategy planning and implementation, leadership, work engagement, organizational support and other management fields. He has published several good-quality research in international reputable journals.

Hailemichael Mulie

Dr. Hailemicael Mulie is an assistant professor of management at the Faculty of Business and Economics, Kotebe University of Education. His research and teaching interests are leadership, management information systems, quantitative analysis for management, and other management fields. He has contributed to more research publications and presented several papers at international and national conferences and workshops.