The Moderating Effect of Agility on The Relationship Between Employee Empowerment and Performance of Manufacturing Firms in Nairobi County
Main Article Content
Keywords
Agility, manufacturing firms, performance, empowermen, employee, Nairobi County
Abstract
In the past decade, the manufacturing sector in Kenya has experienced significant challenges, with several enterprises issuing profit warnings and some shutting down operations due to an unfavorable operational environment. This has raised concerns about the sector's ability to sustain growth and remain competitive. Employee empowerment, recognized as a driver of organizational performance, has been widely adopted by firms to improve employee engagement, productivity and innovation. However, despite the implementation of empowerment strategies, many manufacturing firms in Nairobi County continue to underperform. This raises the question of whether other factors influence the effectiveness of employee empowerment in enhancing performance. Organizational agility, the capacity of firms to adapt quickly to market changes and operational challenges, may play a moderating role in this relationship. Therefore, this study seeks to investigate the moderating effect of organizational agility on the relationship between employee empowerment and the performance of manufacturing firms in Nairobi County. The study was anchored on the Resource Based View Theory. A positivist research paradigm and an explanatory research design were adopted in the study. The target population was 561 registered manufacturing firms in Nairobi County. A sample size of 234 manufacturing firms were obtained using Taro Yamane formula, and the respondents were managers of firms selected through simple random sampling technique. Primary data were collected using closed-ended questionnaires and a pilot study was conducted in Eldoret Town. Reliability of the research instrument was tested using a Cronbach’s Alpha coefficient of 0.7, while validity was tested using factor analysis. Data was analyzed using SPSS version 26 employing both descriptive and inferential statistical techniques. The study results indicate that employee empowerment (β=0.354, p<0.05) have a significant effect on firm performance. Moderation results indicated that agility significantly moderates the relationship between employee engagement (β= 0.088, p>0.05) and firm performance. This suggests that while agility contributes to firm performance, its direct influence in moderating the empowerment-performance relationship may not be as impactful. To optimize the performance of manufacturing firms, it's imperative to prioritize the refinement of system procedures while concurrently empowering key human resource elements.
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