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“Organizational Effectiveness as a Function of Employee Engagement”.

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 SOUTH ASIAN JOURNAL OF MANAGEMENT

Organizational Effectiveness as a
Function of Employee Engagement
Aakanksha Kataria*, Renu Rastogi** and Pooja Garg***

The paper reviews the organizational paradigms of employee engagement in context of its
organizational outcomes and aims to unlock the relationship between engagement and perceived
organizational effectiveness. The study was designed to generate and test two hypothesized models
colligating between engagement and the constituents of organizational effectiveness. The results of
structural equation modeling suggest that engagement is significantly associated with perceived
organizational effectiveness in that it also entails a positive impact upon the organizational
effectiveness. The results encourage organizations to consider the potential significance of employee
engagement towards organizational effectiveness and also exemplify the role of HR managers in
delineating the psychological fabric of the organization and conditions for high engagement. The
paper adds useful insights while articulating that engagement is an expedient phenomenon that
drifts organizational effectiveness.

INTRODUCTION
The notion of employee engagement has marked its critical presence in organizational
sciences for more than over 20 years. The research on engagement is flourishing lately
and witnessing a remarkable increase in the number of empirical studies more frequently
than ever (Sonnetag, 2011; and Rurkkhum and Bartlett, 2012), while noting its positive
linkages to several bottom line organizational outcomes for instance, productivity, profits,
business growth, quality, customer satisfaction, employee retention, job performance,
and low absenteeism (Buckingham and Coffman, 1999; Coffman and Gonzalez-Molina,
2002; Buchanan, 2004; Hewitt Associates LLC, 2005; Fleming and Asplund, 2007;
Lockwood, 2007; Bakker and Bal, 2010; Demerouti and Cropanzano, 2010;
Xanthopoulou et al., 2009; and Sundaray, 2011). In addition, it has also been observed
that engaged employees report less absenteeism, stay with the organization longer, and
are happier being proactive, and more productive (Harter et al., 2002; and Sonnentag,
2011). This might be due to the fact that engaged employees being enthusiastic (Pitt-

* Research Scholar, Department of Humanities & Social Sciences, Indian Institute of Technology, Roorkee
(IITR), Roorkee. India. E-mail: [email protected]
** Professor, Department of Humanities & Social Sciences, Indian Institute of Technology, Roorkee (IITR),
Roorkee, India. E-mail: [email protected]
*** Assistant Professor, Department of Humanities & Social Sciences, Indian Institute of Technology, Roorkee
(IITR), Roorkee, India. E-mail: [email protected]

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 ORGANIZATIONAL EFFECTIVENESS AS A FUNCTION OF EMPLOYEE ENGAGEMENT

Catsouphes and Matz-Costa, 2008), dedicated, and psychologically involved in their

work, are willing to invest their active physical strength and emotional energy towards
the fulfilment of organizational goals.
Accordingly, from a practical point of view, the relevant literature recommends
employee engagement as “an individual employee’s cognitive, emotional, and behavioral
state directed toward desired organizational outcomes” (Shuck and Wollard, 2010).
Further, it is suggested that engagement ‘goes beyond’ satisfaction or commitment and
is an enhanced state of thinking and acting that brings both personal fulfilment and
positive contributions for the organization.
Given the primacy of employee engagement in the context of its beguiling
consequences for organizations, engagement has increasingly been viewed as a vital element
in elevating organizational effectiveness (Saks, 2008; Sundaray, 2011; Welch, 2011;
Cameron et al., 2011). As observed, organizations constantly seek ways to augment
employee engagement at work, and thereby enhance organizational effectiveness
(Macey and Schneider, 2008; Macey et al., 2009; Vinarski-Peretz et al., 2011). Despite
the increasing conceptual evidences and supports to establish employee engagement
as a driver of organizational success and performance, empirical evidence explicitly
signifying the association between employee engagement and organizational
effectiveness has not been forthcoming from any side. In fact, recent researches have
been focusing more on individual level analysis of employee engagement and research
concerning employee engagement and its organizational outcomes in terms of
organizational effectiveness has rarely been studied in engagement literature. Most
studies that have examined the consequences of engagement have focused on
engagement from an internal perspective by studying how engagement affects employee
attitudes and performance (for e.g., Rich et al., 2010; and Menguc et al., 2012). Against
this backdrop, it has also been reported recently that the relationship between individual
positive behaviors like engagement and organizational effectiveness is yet to be
confirmed (Cameron et al., 2011).
Keeping the preceding discussion in mind, the present paper undertakes this novel
opportunity to complement the existing literature by examining the relationship between
employee engagement and perceived organizational effectiveness. The study considers
employees’ perceptions of the effectiveness in their organizations. Cain (2006) affirmed
that employees are in the best position to evaluate the effectiveness of their organizations
in meeting its often conflicting goals and mission. Many previous studies have used the
stakeholder approach in the assessment of effectiveness while measuring the impact of
psychological climate, employee attitudes, and behaviors on the organizational
effectiveness (e.g., Biswas et al., 2006). Further, the paper synthesizes positive organizational
consequences of engagement into a more comprehensive phenomenon known as
organizational effectiveness and attempts to explore the functionalist perspective of
employee engagement as a potential antecedent of organizational effectiveness.

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INSIGHTS FROM LITERATURE AND HYPOTHESES

EMPLOYEE ENGAGEMENT
Employee engagement is a complex and dynamic process that reflects each individual’s
unique, personal relationship with work (Litten et al., 2011). The term employee
engagement was originated in 1990’s by the Gallup Research Group (Endres and
Mancheno-Smoak, 2008; and Little and Little, 2006). Touted positive outcomes of
employee engagement in Gallup’s popular release “First, Break All the Rules (Buckingham
and Coffman, 1999) have incorporated subsequent desires in organizations to maintain
a highly engaged workforce. Noteworthy implications of employee engagement are
attributed to high involvement, passion and zeal in employees’ efforts to perform up to
their potential, while creating high performing organizations.
Historical roots of the term employee engagement in academic research can be found
in the works of Kahn (1990), who has often been regarded as the academic parent of
employee engagement movement (Welch, 2011). Using the framework of personal
engagement, Kahn (1990) defined engagement as “the harnessing of organizational
members’ selves to their work roles; in engagement, people employ and express themselves
physically, cognitively and emotionally during work role performance.”
Numerous definitions have been made on engagement thereafter, but little consensus
has been yet reached. Of them all, the conceptualization that shapes engagement as “a
positive fulfilling, work related state of mind characterized by vigor, dedication, and
absorption” (Schaufeli et al., 2002), has been more popular in engagement literature
due to its vast validation in majority of countries. Vigor (positive affect) is characterized
by employees’ high levels of positive energy and mental resilience while performing the
job tasks. Engaged employees experience their work as stimulating and to which they
devote their time and effort willingly (Bakker et al., 2011). Dedication (motivation aspect)
takes into account the perception of engaged employees in terms of significance and
meaningfulness of work. It explicates the emotional framework of engagement as the
extent of employees’ willingness to invest considerable time, stronger involvement, energy
and effort in doing something meaningful with greater enthusiasm. Absorption
(cognitive aspect) is characterized by full involvement and engrossment of employees
in their work to the extent that one has difficulties in detaching oneself from work.
Engaged employees are happily involved and experience their work as engrossing and
something to which they can devote their full concentration (Bakker et al., 2011).
Therefore, engaged employees not only contribute more but are also more loyal and
therefore less likely to voluntarily leave the organization (Macey and Schneider, 2008).
It has also been reported that engaged employees perform better in their jobs (Bakker
and Bal, 2010; Halbesleben and Wheeler, 2008), and high levels of engagement lead
to positive organizational-level outcomes (Kahn, 1992; and Bakker et al., 2008).

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In organizational context, the term employee engagement has been described as “a

desirable condition, has an organizational purpose, and connotes involvement,
commitment, passion, enthusiasm, focused effort, and positive energy”, (Erickson, 2005;
Macey and Schneider, 2008). This posits, engaged employees being enthusiastic,
dedicated, and psychologically involved are more able to invest their active physical
strength and emotional energy towards the fulfilment of organizational goals. Employee
engagement has often been pronounced as the key to an organization’s success and
competitiveness (Grumen and Saks, 2011). Research has also revealed that engaged
employees will be more likely to create a social context that is conducive to the team
work, helping, voice and other significant discretionary behaviors that can lead to
organizational effectiveness (Podsakoff et al., 2009; Christian et al., 2011). Though
researches concerning employee engagement have suggested its positive linkages to
profitability, business growth, financial performance, customer satisfaction and
competitive advantage (The Gallup Organization, 2004; Saks, 2006; Harter et al.,
2002; Salanova et al., 2005; Schaufeli and Bakker, 2004; and Macey et al., 2009), yet
there exists a wide scope for further scholarly exploration, growth and dialogue around
the construct of employee engagement (Shuck and Reio, 2011).

ORGANIZATIONAL EFFECTIVENESS
Researchers in organizational sciences acknowledge that the central theme of
organizational theory pertained to organizational effectiveness (Goodman and Pennings,
1977; Biswas, 2010) and the underlying goal of most research on organizations is to
improve their effectiveness (Noruzi and Rahimi, 2010). Organizational effectiveness
is a broader term encompassing multiple constituents for measuring organizational
performance. Therefore, organizational effectiveness has been connoted as one aspect
of organizational performance (Lee and Choi, 2003). Organizational effectiveness is
“a company’s long term ability to achieve consistently its strategic and operational
goals” (Fallon and Brinkerhoff, 1996). Though, it has been hard to describe what
exactly constitutes organizational effectiveness (Cameron and Whetton, 1981; and
Rahimi and Noruzi, 2011), it has been widely accepted that organizational effectiveness
is “the extent to which an organization achieves its goals” (Steers, 1977). Due to its
multidimensional and paradoxical character (Cameron, 1986), an organization can be
simultaneously judged effective by one criterion and ineffective by another. Mott (1972)
defined organizational effectiveness as “the ability of an organization to mobilize itscentres
of power, for action, production and adaptation”. In fact, effective organizations tend to
produce better quality products and are resilient in the face of adversities. Further,
organizational theory has also produced a variety of models (rational goal, system resource,
internal process, and participant satisfaction) pertaining to organizational effectiveness,
the measures of organizational effectiveness as (a) productivity; (b) adaptability; and
(c) efficiency developed by Mott, (1972) have been found to be the most frequently and
most widely used in various models of perceived organizational effectiveness (Steers,
1977; Sharma and Samantara, 1995; Luthans et al., 1988).

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Employee engagement in practice, an active psychological state of employees at

work has frequently been considered pertinent in elevating organizational outcomes.
For instance, employees’ active psychological state at work is of greater significance
when it comes to innovation, organizational performance, and competitive advantage
(Bakker and Schaufeli, 2008). Based on the previous researches concerning
organizational context of employee engagement, it is argued that employee engagement
will be related to perceived organizational effectiveness in general and as a whole as
follows (See Figure 1 and 2):

Figure 1: The Hypothesized Model (M1)

Vigor Productivity

Employee H1 Perceived
Dedication Organizational Adaptability
Engagement
Effectiveness

Absorption Flexibility

H1: Employee engagement is significantly related to perceived organizational

effectiveness. Also, employee engagement will significantly predict perceived
organizational effectiveness.
H1a: Employee engagement is significantly related to perceived organizational
productivity. Also, employee engagement will significantly predict perceived
organizational productivity.
H1b: Employee engagement is significantly related to perceived organizational
adaptability. Also, employee engagement will significantly predict perceived
organizational adaptability.
H1c: Employee engagement is significantly related to perceived organizational
flexibility. Also, employee engagement will significantly predict perceived
organizational flexibility.

Figure 2: The Hypothesized Model (M2)

Productivity
Vigor
H1a

Employee H1b
Dedication Adaptability
Engagement
H1c

Absorption Flexibility

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METHOD
PARTICIPANTS
The respondents were 304 middle level managers from IT organizations. A covering
letter delineating the reason for the study was attached with each questionnaire stating
about the voluntary and anonymous nature of this study. Participants were also assured
for maintaining the confidentiality of responses. Completed questionnaires were
returned to the researcher via mail or in-person. Of the 304 participants’, a large
proportion (81%) were males, while 19% were females. The average age of the
participants was 36.16 (SD = 6.02). The work experience profile of the participants
varied from the minimum 5 year of experience from maximum of 28 years and the
average work experience was 10.29 (SD = 5.72). A large portion (63%) of the
participants was having 5 to 10 years of work experience, 23% were having 11 to 15
years of work experience, 6% were having work experience between 16 to 20 years,
and rest 8% were having the highest (above 20) years of work experience. 24% were
unmarried of all the participants and the rest were married. The sample was comprised
of management graduates (55%) and engineering graduates (45%) and average tenure
of subjects in their present organization was 5.63 (SD = 2.33), with a range from 3 to
14 years.
MEASURES
EMPLOYEE ENGAGEMENT
Employee engagement was measured with the extensively validated 9-item Utrecht
Work Engagement Scale (UWES-9) reported by Schaufeli et al. (2006). The scale
consists of 9-items and measures three sub-dimensions of employee engagement as
vigor, dedication, and absorption which have three items each.
i. Vigor is characterized by willingness to invest efforts while experiencing
high levels of positive energy and mental resiliency at work (e.g., “At my
work, I feel bursting with energy).
ii. Dedication refers to the strong involvement in one’s work, a feeling of
meaningfulness, significance, pride and challenge (e.g., “My job inspires
me”).
iii. Absorption explains one’s state of being fully engrossed and concentrated in
the work (e.g., “I get carried away when I am working”).
All items relating to these three sub dimensions were measured on a seven- point scale
ranging from 0 = “Never” to 6 = “Always”. Cronbach alpha () for this scale was 0.92.
ORGANIZATIONAL EFFECTIVENESS
An 8-item scale developed by Mott (1972) was used to measure various aspects of
organizational effectiveness. The scale has three sub-scales: (a) productivity;
(b) adaptability; and (c) flexibility.
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i. Productivity deals with the quantity and quality of the product or service,
and the efficiency with which it is delivered.
ii. Adaptability has two constituents: symbolic adaptability and behavioral
adaptability. Symbolic adaptability refers to both anticipating problems in
advance and developing satisfactory and timely solutions to them in addition
to staying abreast of new technologies and methods applicable to the activities
of the organization. Behavioral adaptability explicates prompt and prevalent
acceptance of solutions (Mott, 1972; and Luthans et al., 1988).
iii. Flexibility has been considered as a separate and independent index of
organizational effectiveness. It is conceptually different from adaptability as
organizational changes that result from meeting emergencies are usually
temporary, usually the organization returns to its pre-emergency structure,
whereas adaptive changes are more likely to be permanent (Mott, 1972;
and Samantara, 2004).
The scale consists of 8 items, e.g., “Thinking now of the various things produced by
the people you know in your division, how much are they producing? Their production
is, measured on a five-point scale ranging from 1 to 5. Each item needed a different
adjective as its response, so the scaling of the items was different. The Cronbach’s
alpha () was 0.88.

DATA ANALYSIS
The Analysis of Moments Structure (AMOS 18.0) was used to examine the structural
models. The statistical analysis included structural equation modeling approach, a
two-stage methodology: the measurement model and the structure model
recommended by Anderson and Gerbing (1988). The overall model fit was examined
using the chi-square goodness-of-fit statistic, Goodness of Fit Index (GFI), Root Mean
Squared Error of Approximation (RMSEA), Normed Fit Index (NFI) and Comparative
Fit Index (CFI). RMSEA values less than 0.06 are considered acceptable, whereas values
less than or equal to 0.05 indicate good model fit (Kline, 2005; and Wijhe et al., 2011),
GFI, NFI, and CFI values greater than 0.90 indicate acceptable fit model fit and values
close to 0.95 indicate good model fit (Hu and Bentler, 1999; Kline, 2005; and Wijhe et
al., 2011).

RESULTS
Table 1 presents the means, standard deviations, correlations of the study variables.
The correlation matrix suggests that the relationships among variables are in expected
direction. A moderate albeit significant relationship has been observed between
employee engagement and organizational effectiveness on an over-all basis with the
calculated r = 0.44 (significant at 0.01 level). This clearly outlines that higher
engagement level of employees in organization is associated with increased

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organizational effectiveness. In addition, there are positive and significant correlations

between productivity, adaptability and the three dimensions of employee engagement
as vigor, dedication, and absorption. Remarkably, no correlation has been found between
one constituent of organizational effectiveness, i.e., flexibility and dedication component
of employee engagement.

Table 1: Descriptive Statistics and Correlations of Key Variables (N-304)

Mean S.D 1 2 3 4 5 6 7 8

1. Vigor 5.16 1.07 –

2. Dedication 5.84 0.81 0.46** –

3. Absorption 5.39 0.98 0.39** 0.37** –

4. Employee 16.39 2.23 0.82** 0.75** 0.76** –

Engagement

5. Productivity 3.63 0.64 0.35** 0.20** 0.27** 0.36** –

6. Adaptability 3.63 0.66 0.40** 0.28** 0.26** 0.41** 0.36** –

7. Flexibility 3.86 0.76 0.13* 0.10 0.17** 0.17** 0.15* 0.20** –

8. Organizational 11.14 1.45 0.40** 0.27** 0.33** 0.44** 0.68** 0.73** 0.69** –
Effectiveness

Note: *p < 0.05; ** p < 0.01.

MEASUREMENT MODEL
The data was first analyzed for the six measurement elements (vigor, dedication,
absorption, productivity, adaptability, and flexibility) with AMOS confirmatory factor
analysis. All the factors were entered into the measurement model and allowed to
correlate. A good fit of the model to the data was established leading to a non significant
(² (99), n = 304) 118.14, p = 0.092, as well as other fit indexes indicated a satisfactory
degree of goodness-of-fit C/min 1.19, GFI 0.958, RMSEA 0.025, p < 0.05, CFI 0.984.

STRUCTURAL MODEL (M1)

The results from SEM indicate that hypothesized model (M1) fit the data well with
² (8), n = 304 = 14.22, p = 0.076 and C/min 1.77 had a value less than 2. An
inspection of the other fit indices also met the recommended criteria: GFI 0.984, TLI
0.971, RMSEA 0.051, p < 0.06, CFI 0.984. In combination, these fit indices suggest a
satisfactory fit to the data (see Table 2). Examination of the path coefficients for the
model explicates that the proposed paths are significant, with standardized values ranging
from 0.32 to 0.77. The results of the structural analysis provide support for H1. The
path from employee engagement to perceived organizational effectiveness was 0.70 which
indicates a positive association and significant contribution of employee engagement
to the organizational effectiveness. This finding supports H1.
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STRUCTURAL MODEL (M2)

Further, the results indicate that our structural model (M2) also provides a reasonable
fit to the data (see Table 2). It was expected that employee engagement as a whole
would be positively related to and significantly predict all the three constituents
(productivity, adaptability, and flexibility) of organizational effectiveness. The structural
analysis reveals that employee engagement is positively related to every component of
organizational effectiveness. Also, employee engagement contributes significantly to
productivity ( = 0.53, p < 0.001), to adaptability with  = 0.48, p < 0.001, and
contributes to flexibility with a lowest albeit significant  = 0.15, p < 0.001. As a
whole, results of the analysis shows that employee engagement is a stronger predictor
of productivity and adaptability, and significantly contributes to the prediction of all
the three components of organizational effectiveness. Hence, evidence was found to
support H1a, H1b, and H1c.

Table 2: Fit Indices of the Structural Path Model (M1), (M2)

Model ² df p GFI RMSEA NFI CFI
M1 14.22 8 0.76 0.984 0.051 0.965 0.984
M2 8.76 6 0.19 0.990 0.039 0.979 0.993

DISCUSSION
The central aim of the present study was to test the direct pathways between employee
engagement and perceived organizational effectiveness, our results suggest that engaged
employees perceive their organizations to be effective. We tested two hypothesized
models to examine whether employee engagement in terms of vigor, dedication, and
absorption qualifies a positive relationship with and contribute significantly to the
perceived organizational effectiveness in general and as a whole. Results of the study
put forthan argument that the criterion variable employee engagement in terms of
vigor, dedication and absorption may have a significant impact on the organizational
effectiveness. The findings of the study are broadly consistent with the conceptual
evidences in previous studies (Erickson, 2005; Saks, 2008; Maceyand Schneider, 2008;
Babcock-Roberson and Strickland, 2010; Sundaray, 2011; and Welch, 2011) that is
when employees are engaged they are more likely to do things that substantiate
organizational effectiveness (Saks, 2008). One possible explanation for this contribution
may be the fact that engaged employees often experience positive emotions (Bindland
Parker, 2010; Bakker et al., 2011). Positive emotions for instance compassion, joy etc.
lead to the positive activities in organizations like helping behavior, and create an
upward spiral of positive feelings (Cameron et al., 2003). Furthermore, when organization
members observe and experience love, compassion and other positive emotions, they
increase their pride in organization, enjoyment of the work, and satisfaction with the
job which are indispensable ingredients to the managerial success and the
‘organizational excellence’ (Cameron et al., 2003; and Fineman, 1996).

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Further, engaged employees perform their job tasks with a sense of deep involvement,
and full concentration which is a precondition to achieve proficiency in one’s work.
Individuals’ task proficiency may lead to the outstanding rewards for the firm’s success
and that organizational effectiveness may be achieved with a collaborative effort of engaged
and committed employees. To add even more, it has been found that engaged employees’
heightened emotional and intellectual connection with the work increase their tendency
to exhibit discretionary efforts at workplace (Gibbons, 2006; and Richman et al., 2008),
which in turn, has been suggested a significant predictor of organizational effectiveness
(Organ, 1988). Additionally, effort has been linked to productivity and profit generation
(Shuck et al., 2011). Engaged employees are more likely to exert extra efforts and display
citizenship behaviors such as altruism, civic-virtue, sportsmanship, etc. (Christian et al.,
2011; Schaufeli et al., 2006; and Shimazu and Schaufeli, 2009), through which they
tend to facilitate efficient functioning and smooth running of the organization and
thereby enabling organizations to sustain high performance and effectiveness. Hence,
our results exemplify that engaged employees enhance organizational effectiveness in
many ways and a number of potential mediating mechanisms such as job performance,
organizational commitment, and OCBs may play significant role in the relationship
between engagement and organizational effectiveness. Collectively, in our view, these
activities, initiatives, positive attitudes and behaviors as a consequence of engagement
may elevate organizational effectiveness.
In order to seek possible accurate explanation in extant literature for the positive
associations between engagement and organizational adaptability and flexibility, it is
found that engaged employees have a sense of energetic and affective connection with
their work activities, and due to the positive emotional, cognitive, and behavioral
framework, they see themselves as able to deal with the changing demands of their jobs
(Schaufeli, et al., 2006). As discussed earlier, engaged employees have a sense of vigorous
attitude in terms of high levels of positive energy, mental resilience at work, and willingness
to invest their efforts in work and persistence even in the face of difficulties (Schaufeli
et al., 2002). It follows, engaged employees’ show positive behaviors in the face of
emergency situations which may consequently enhance the organizational flexibility
and adaptability.
Furthermore, is has been suggested that engaged employees stay with their
organizations longer due to the high levels of investment in and dedication to work
(Halbesleben and Wheeler, 2008) and tend to contribute to organizational success and
profitability more effectively. As lower turnover is significantly and directly related to
the output and efficiency of the firm as it saves the cost of separation, vacancy, replacement
and training (Harter et al., 2010), this could be one of the reasons, disengaged employee
costs organizations in revenues and profitability due their higher turnover intentions
and absenteeism (Wollard, 2011) and that engaged employees serve the organization
more effectively.
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Thus, the investigation of variables in present study provides a plinth for the words
that employee engagement can be a deciding factor for organizational effectiveness
(Sundaray, 2011).

IMPLICATIONS
From a practical point-of-view, promoting organizational effectiveness can be achieved-
amongst others- by designing an HR system that incorporates positive workplace practices.
The relationship found between engagement and organizational effectiveness is insightful,
because based on that knowledge; attempts should be made through selection to hire
employees predisposed to engagement. In addition, our study signifies a call for
organizations to provide a congenial human resource development climate in order to
create conditions for high engagement level of employees. HR managers can play a
significant role in understanding the psychological aspects of workplace that may
intrinsically motivate employees to invest their inclusive self in performing job duties.
For instance, incorporating the elements of trust, integrity, and spirituality in providing
organizational support and justice may encourage high engagement level of employees
at work. Organizations that wish to improve employee engagement should focus on
employees’ perceptions of the support they receive from their organization (May et al.,
2004). More importantly, managers need to provide employees’ clarity of their work
roles that is recognized as having a direct affect on the engagement level. Further, work
roles represent opportunities for individuals to apply themselves behaviorally,
energetically, and expressively, in a holistic and simultaneous fashion (Kahn, 1992;
Rich et al., 2010; and Christian et al., 2011). In addition, employees should be
psychologically empowered to perform their work in organizations that takes in to
account organizational efforts to provide meaning in their work, opportunities to develop,
and increased occupational self-efficacy. Recent studies posit a great incremental value
on employee engagement and that enforce HR managers to design the HR system keeping
in mind employees’ psychological needs and concerns at workplace that may include a
greater emphasis on job design, support from management, development opportunities,
fair and equity at workplace, and a resourceful working environment to motivate
employees reciprocate with high engagement level with their and organization.

LIMITATIONS
Certain limitations should be taken into consideration while interpreting the results of
the current research. First, the cross-sectional design of the study inhibits to draw causal
inferences about the direction of the relationships between study variables. The cross-
sectional nature of the data may limit the consistency of findings over time. It would be
useful to conduct experimental and longitudinal studies in order to establish more
certain causality of the relationship and to make more objective and independent
assessments. Further, the use of self-report measures in the study posit the chances of
common-method bias and that would be a hindrance to generalize the findings in the
present study.

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In future, this study could be extended to examine association between employee

engagement and organizational effectiveness with more objective data, particularly,
on organizational effectiveness. The self-report measure of organizational effectiveness
that captures employees’ perceptions of effectiveness does not provide a concrete and
objective assessment. Additionally, future studies may include other indicators of
organizational effectiveness such as profitability, output, and managerial effectiveness
to maximize the scope of measurement of the variable.

FUTURE RESEARCH DIRECTIONS

The implications of this research could provide interest to both practitioners and
researchers. If the results of this study hold across other samples, managers could be
encouraged to know that an employees’ engagement with their work may influence
organizational effectiveness. Researchers should be encouraged at the possibility of
exploring individual and organizational peculiarities that might explain the mechanism
through which work engagement influence organizational effectiveness. The relationship
between work engagement and organizational effectiveness may not be straightforward
that is though employees’ engagement level at work influence firm’s performance and
efficiency, this does not necessarily imply that engaged employees will uniformly perform
in ways to benefit the organization; contextual factors are likely to function as regulative
aspect of engagement and influence the extent to which they augment organizational
effectiveness. To add even more, the mediating, moderating variables that could affect
the impact of employee engagement on organizational effectiveness can be explored
using the findings from current study.

CONCLUSION
The study was undertaken to examine the associations between employee engagement
and perceived organizational effectiveness. Results have suggested a positive and significant
contribution of employee engagement towards organizational effectiveness. The
investigation adds to the theoretical development of the nascent construct ‘employee
engagement’ with a novel contribution to establishing its association with organizational
effectiveness. It is concluded that engaged employees being enthusiastic about their
work, dedicated completely to find meaning in their work and are profoundly engrossed
to put forth their positive energy and mental efforts towards the attainment of
organizational goals.

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