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Journal of Economics and Management Sciences; Vol. 3, No.

3; 2020
ISSN 2576-3008 E-ISSN 2576-3016
https://doi.org/10.30560/jems.v3n3p14

The Determinants of Employee’s Performance: A Literature Review


Mohand Tuffaha1
1
Department of Business Organization, Universitat Politècnica de València, Spain
Correspondence: Mohand Tuffaha, Department of Business Organization, Universitat Politècnica de València,
Spain.

Received: August 12, 2020; Accepted: August 22, 2020; Published: August 23, 2020

Abstract
This piece of research highlights a contextual understanding of employee performance’s concept by identifying
factors affecting employee performance in the organization. This achieved through analyzing literature in ISI
(Web of Knowledge) from 2015 until 2019, after that determine factors influencing employee performance. The
definition of employee performance is given, furthermore, the description of each factor which has an influence
on employee performance. The result indicates that knowledge management, information and communication
technology, employee’s empowerment, innovation and creativity and organization culture have a significant
impact on employee performance. On the other hand, the correlation between these factors has a vital role in
maintaining employee’s performance and attitude.
Keywords: performance, knowledge management, information and communication technology, empowerment,
innovation and creativity, productivity
1. Introduction
Companies and organizations should focus on building employees positive performance, through providing
employees with a group of tools and skills to meet out new realities and challenges (Batarlienė, Čižiūnienė,
Vaičiūtė, Šapalaitė, & Jarašūnienė, 2017). Globalization, new market demands, innovation and smart economy
are considering a challenge, as well as, drivers for companies to maintain and improve employee performance
(Cooper & Ezzamel, 2013). Dealing with quick changes in technologies, stakeholders requirements and market
demands are depending on reducing the gap within employees attitude as underpinning factor on achieving smart
goals of the organization (Shah, Irani, & Sharif, 2017).
Researchers have defined employee performance as well as highlighted parameters affecting employee
performance as in the following. Anitha (2013) reports that the performance of an individual or an organization
depends strongly on all organizational activities, policies, practices, knowledge management practices and
employee engagement. These elements are vital determinants fostering high levels of employee performance.
While Islami, Mulolli and Mustafa (2018) recognize managing performance as a planned process of which the
key elements are agreement, measurement, support, feedback and positive reinforcement, which shaped
outcomes in terms of performance expectation. Also, Bataineh (2017) highlight Employee’s performance as a
combination of efficiency and effectiveness of the employee’s daily tasks to meet the expectations of the
stakeholders. Isaac, Abdullah, Ramayah and Mutahar (2017) show that employees highly agree that
implementing the internet in their job helped them in improving task process, education acquisition and the
quality of their communication which lead to improving individual performance as well as organization. On the
other hand, Pawirosumarto, Sarjana and Gunawan (2017) tide between employee performance and work
environment that contains physical and non- physical factors around employees which have a positive and
significant effect on improving employee performance. While Smith and Bititc (2017) emphasis on improving
performance measurement systems and performance management practices as factors of work’s environment
which enhance employee’s engagement levels. Also, Mensah (2018) support their ideas when considered talent
management as a critical success factor within companies which become the most core managerial value in our
highly dynamic and uncertain market environment of the twenty-first-century era.
Based on these observations, this paper aims to enhance the understood of employee performance and the factors
affecting it. Author proposing a conceptual model, consisting of five factors which are knowledge management,
information and communication technology, employee’s empowerment, innovation and creativity and
organization culture (de Menezes & Escrig, 2019) (see Figure 1). Furthermore, this model will identify the
correlation between these factors and their impacting on employee performance.

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Figure 1. Factors affecting employee performance

2. Methodology
A systematic literature review aims to present a fair evaluation of a research topic by using a reliable, efficient
and trustable approach (Kitchenham & Charters, 2007). The author analyzed journals in ISI (Web of
Knowledge) between 2015 and 2019. While selected articles are corralling with keywords of employee
performance, knowledge management, information and communication, empowerment, innovation, creativity
and organization culture. The correlation among the variables is based on a meta-analysis. Furthermore, the
Boolean logic (i.e. AND or OR) was used to express relations between search terms and extract relevant articles.
In our case, the author used the distinct stages proposed by Kitchenham & Charters(2007): (1) formulate the
research questions and the search strategy, (2) filtering and extracting data based on inclusion and exclusion
criteria, and (3) synthesizing the findings.
Research questions which are formulating literature review are: 1) what are factors affecting on employee
performance? 2) Are there is a correlation between these factors? The result of these questions as the following
2.1 Knowledge Management and Employee Performance
Knowledge management has gained a huge of attention during the past few decades, as researchers have
recognized the importance of managing knowledge in a knowledge-based economy (Ali, selvam, Paris, &
Gunasekaran, 2019).
Scholars defined knowledge Management as a concept that depends on collecting, auditing and sharing
information within the organization’s stakeholders (employees, customers and partners). While Susanty,
Yuningsih, & Anggadwita (2019) claim that knowledge management is a learning process that involves
exploration, exploitation and share of knowledge supported by optimum technology and cultural environment.
Gunjal (2019), emphases in his definition the importance of sharing information and data within the organization
to enhance the capability of running a business efficiently and effectively. Promoting integration and
collaboration approach in the overall organization department, lead to creating the enterprise's knowledge assets.
These assets could intend to develop knowledge management systems that working on providing enterprises with
machines and tools to restructure and manage knowledge. Depend on technological and social components
across overall departments of the organization which are well-known recently as “socio-technical systems”
(Hwang, Lin, & Shin, 2018). This system should identify components to enhance enterprises utilizes such as
organizational learning and total quality management, which lead to creating sustainable competitive advantages
(Gunjal, 2019).
The result of the investigation on the relationship between knowledge management and employee’s performance
has been positive in most literature. This positiveness appeared in how four phases of the knowledge
management process which are: 1) knowledge creation, 2) knowledge capture and storage, 3) knowledge sharing
and 4) knowledge applications. These four phases have vital correlation on three essential pillars of performance

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which

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are innovation, quality of service delivery and operational efficiency of services (Ahbabi, Singh,
Balasubramanian, & Gaur, 2019).
Organization performance can be explained in terms of organization performance elements, that consist of
market reputation, employee satisfaction, customers loyalty and market share (Imran, Ilyas, Aslam, & Fatima,
2018) The core of the previous combination depends on knowledge sharing that is considered an essential tool to
achieve the desired expectation of knowledge management. It’s strongly believed that organizations’ survival
and success depend on sharing skills, knowledge and experiences within employees and transform them into
ideas of innovations (Soto-Acosta, Popa, & Palacios-Marqués, 2016). In other words, helping employees in
creating new knowledge and motivate them with learning abilities will promote the culture of creativity and
innovation in the organization which influence on employees attitude, behavior, skills and performance (Jyoti &
Rani, 2017).
Knowledge management infrastructure is a critical element in the knowledge management process. This result
appeared when examining the positive relation of knowledge management infrastructure (Organizational
Culture, IT Infrastructure, and Organizational Structure) on knowledge Management Process, and how
knowledge management process significantly related to employees performance (Aalmajali & Al-lozi, 2019).
Abualoush, Masa’deh, Bataineh & Alrowwad( 2018) conclude that knowledge management infrastructure
contains two main factors: technical infrastructure factor and social infrastructure factor. Where technical
infrastructure includes information technology infrastructures (software), tools, and hardware, on another hand,
social infrastructure includes organizational culture, organization command structure and human resources.
Another critical element in the knowledge management process is a performance management system that
working on tracking the implementation of organizational strategic objectives by evaluating individual
performance (Sales, 2019). Asiaei & Bontis(2019) assumed that the effectiveness of the performance
management system appears in identifying the position of the organization in the current market and forecast the
strategies of future market demands. Furthermore, the performance management system working on finical
indicators such as profits, revenue and cost, and non-financial indicators by using Balance scored card which
secures competitive advantages in the knowledge-based economy.
2.2 Information and Communication Technology and Employee Performance
The wide diffusion of information and communication technology (ICT) has been strongly impacting on the
organization dynamism. ICT facilitates abroad range of organization’s activities related to production, marketing,
customer loyalty and employee performance (Reichstein, 2019). Shehata & Montash (2019) claim that ICT
transformed the nature of products, markets, companies and the competition itself. ICT restructures many
industries, enhance managing cost and created entirely new business models. In details, Giotopoulos,
Kontolaimou, Korra, & Tsakanikas (2017) report that integration between ICT and organization operations
reflected directly on organization performance and employee’s productivity, cost-saving, organization
effectiveness and open new markets.
The influence of ICT showed during 1990 when comparing the productivity growth between Europe and USA
and how American’s companies gained competitive advantages by using ICT widely in various economic sectors
(Melián-González & Bulchand-Gidumal, 2017). These sectors are recently affected with the Internet of things
(IoT), cloud computing (CC) and predictive analytics (PA) (Ardolino, et al., 2018) which are a new trend in ICT
(Dahiya & Mathew, 2018). Caputo, Cillo, Candelo & Liu (2019) report that the spread out of social networks,
virtual realities, electronic devices, 3D printers and artificial intelligence (AI) among organization departments
could enhance the impact of ICT. For instance, Big Data can support the processing of business intelligence (BI)
tools, while artificial intelligence can support productivity work achieving (Caputo, Cillo, Candelo, & Liu,
2019).
Human Resource department is one of the departments that is affected dramatically with information and
communication technology. it is widely recognized that HRM function is influenced by the improvement of IT
by transforming the way firms collect, store, analysis, evaluate employees performance (Turulja & Bajgoric,
2018) The strategic approach of integration between HR and information technology lead to developing E-HRM
(Rahman, Mordi, & Nwagbara, 2018). Ayesha & Yadav(2019) explain E-HRM as a combination of computer
programs, software tools, databases, and hardware to record, store and analyze data necessary for the Human
Resource (HR) applications. Organization portal considered an interface of E-HRM, which consist of Employee
Portals, Enterprise Intranet Portals, Corporate Portals and Business-to-Employee Portals. These portals are
serving different purposes like knowledge access, e-learning, LMS, online employees communities, (Ali, selvam,
Paris, & Gunasekaran, 2019).

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Many scholars highlighted the advantages of E-HRM. For instance, Rahman, Mordi, & Nwagbara (2018) claim
that E-HRM works as an analytical tool to help the decision-makers in making the valuable and accurate decision
that leads to improv HR functions and employee’s performance. Obeidat (2016) mentioned three different ways
E-HRM supported the productivity of an organization through providing employees with required information
about performance improvement, rewards allocation and performance appraisal. Armstrong (2016) emphasis on
the value of E-HRM as a pathway to conduct E-training, which is the most efficient online intervention program
that enhances the knowledge and skills of employees without tiding them to fix physical place or ignoring their
busy schedule. Furthermore, E-training has a role in reducing the cost of the instructor, booking avenue,
hardcopy materials and employee’s time.
E-HRM’s achievement marks a significant milestone in the relationship between employee performance and
ICT. Tabatabaei, Omran, Hashemi, & Sedaghat (2017) emphasis on ICT as the main source for sustainable
employee performance by facilitating knowledge exposure, skills gaining and shrining experiences which
enhance the competitive advantages of the organization. Also, maintaining recruitment and selection,
performance appraisal and workforce planning (Glaister, Karacay, Demirbag & Tatoglu, 2018).
2.3 Empowerment Approach and Employee Performance
The literature explains the empowerment approach as a management concept that constructs on dimensions of
intrinsic motivation, job design, participative decision making, social learning theory, and self-management
(Alazzaz & Whyte, 2015). Potnuru, Sahoo, & Sharma (2019), associate these dimensions with the organization’s
knowledge sharing, rewards systems that could empower the employees to enhance organizational
competitiveness and performance.
García-Juan, Escrig-Tena & Roca-Puig(2019) identify two different perspectives to understand empowerment.
The first one is the structural perspective which contains a set of practices and structures that enable to transfer
power and authority from the top to the bottom of the organization. While the second one is the psychological
perspective that concerns an employee’s attitudes in reaction to managerial practices. Lewis, Brown & Sutton
(2019) have the same conclusion through categorized employee’s empowerment in structural and psychological.
Structural empowerment, empowered employees with both direction and boundaries for their decision making
which reflects the extent to which organizational decision rights are decentralized. Where psychological
empowerment reflects an individual employee’s subjective experience for competence and self-determination
within their organizational role.
Empowering employees is critical in today’s competitive environment where organizations are facing the
pressure of globalization, rapid market changes and new customers demand. These challenges required
innovative and creative solutions that rely on empowering employees to meet these challenges. (Shah, Khattak,
Zolin, & Shah, 2019).
To enhance the level of empowerment in the organizations, managements should expand communication with
employees to make sure that employees are aware of the organization’s mission, vision, value and desired targets
of each individual. Besides, management should emphasis on face to face communication and integration
activities across hierarchical levels as an approach to ensure a clear understanding of organizational strategies
(Baird, Su, & Munir, 2018). Empirical studies point out that management can promote empowerment by
engaging employee in decision-making and participation in organization objectives (Nayak, Sahoo, & Mohanty,
2018). Kundu, Kumar & Gahlawat (2019) add four managerial behaviours to maintain empowerment, namely,
enhancing the meaningfulness of work, fostering participation in decision making, expressing confidence in high
performance and providing autonomy from bureaucratic constraints.
This part of the literature investigates the theoretical relationship between employee performance and
employee’s empowerment as a central factor affecting organization surviving. The positive side of this relation
appeared when scholars highlighted empowerment as one of the modern mechanisms that can be used to develop
employees performance and make full use of their capabilities, which have a positive effect on employee’s
motivation and innovation to achieve the organization’s objectives (Aldaihani, 2019). Also, scholars associated
employee empowerment to organization outcomes by enhancing work satisfaction, reduce job-related strain and
minimize employee turnover (Lewis, Brown, & Sutton, 2019).
2.4 Innovation, Creativity and Employee Performance
Many organizations recently fighting to survive in rapid economic changes by developing and understanding the
factors that promote the culture of innovation and creativity within employees. Therefore, many scholars have
the conclusion that innovation and creativity are crucial in daily tasks and assignments. In this part of the study,
we

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particularly looking upon the relationship between employee performance and innovation and creativity and the
ways to implement strategies that support innovation and creativity in the organization.
Many scholars have been discussed innovation and creativity and highlighted the critical role of innovation and
creativity in future organization success. Most researches have the almost same framework of explanation these
terms. They identified creativity as a stage of process refers to idea generation, and innovation refers to the
subsequent stage of implementing ideas toward better procedures, practices, or products (Olsson, Paredes,
Johansson, Roese, & Ritzén, 2019). Creativity as the development of new and useful solutions for challenging
that is facing an organization, where innovation refers to the implementation or application of new and useful
thoughts in the workplace (Khalili, 2018). Creativity is the generation of novel and useful ideas or solution while
innovation is the actual implementation and execution of creative ideas (Kremer, Villamor, & Aguinis, 2019).
Creative workplace concerns the cognitive and behavioral processes applied when attempting to generate novel
ideas. Innovate workplace concerns the processes applied when attempting to implement new ideas. (Hughes,
Lee, Tian, Newman, & Legood, 2018).
The question appears which one is coming first, innovation or creativity. According to Khalili (2018), creativity
is a fundamental step in innovation. Kremer, Villamor, & Aguinis (2019) agree with Khalili when they
concerned the existing of innovation depending on creativity. The same scenario occurs with Wang, Cheng,
Chen, & Leung (2019) when they explained creativity and innovation as two closely related and overlapped
concepts starting with the creativity and ending with innovation.
Promoting innovation within the organization passing through several processes, starting with the decision to
innovate by budgeting investment. Then commercialization of original ideas, after that prepare an adequate work
environment that motivates staff to create unique idea depending on human, physical and intellectual resources.
Therefore, creativity develops through stages that involve preparation, generation and validation of ideas and
assessment of achieved outcome (Stojcic, Hashi, & Orlic, 2018). Flevy Lasrado (2019), discussed in her book
the milestone of innovation in the organization. Where leadership considered the first component that working
on creating the next level of leaders, not just followers. Promoting leadership culture is being the role models of
innovation, co-creation, foster innovation and enhance communication and sharing information. The second
pillar is people as a source of innovation and creativity by encouraging the maximum potential of employees
through involving them in decision-making as a clear internal motivation strategy. Capability building
considered the third pillar that depending on internal capability investment by aligning several interrelated
organization elements and asset. Last pillar depending on developing a model of innovation outcomes that
working on five dimensions, which are probability, employee experience, product quality, process improvement
of customer experience and innovation portfolio.
Fostering innovation and creativity in the organization has numerous benefits and positive consequences on
employee’s psychology, behavior and performance, through influence the competitive performance of the firms
and affects positively on financial performance (Nguyen & Le, 2019). Another benefit of innovation and
creativity appears in offering sustainability for the organization by enhancing internal capability depending on
employee performance, organization structure and learning strategies (Chaubey & Sahoo, 2019). Alzghoul,
Elrehail, Emeagwali, & AlShboul (2018) urge that workplace climate that emerging creativity and innovation
have a positive impact on employees through enhancing job satisfaction, job commitment and job performance.
Furthermore, Ismail, Iqbal, & Nasr(2019) also explained that Organizations can outperform their competitors by
providing a creative environment to their employees and opportunities to think and act differently.
2.5 Organization Culture and Employee Performance
The literature explains the importance of organization culture on overall organization’s performance through
referring to Hofstede theory (1965) as a reference point to explain four dimensions of culture which are power
distance, uncertainty avoidance, individualism and collectivism and masculinity and femininity (Mahadevan,
2017). But in this part, we will highlight the relationship between employee performance and organization,
furthermore, factors that working in enforcing positive culture within employees.
There are numerous definitions of organizational culture. Nikpour (2017) defined organizational culture as the
pattern of beliefs, values, and experiences that is reflecting on material arrangements and members behavior.
Where Shahzad, Xiu, & Shahbaz (2017) referred organizational culture to an employee's values, and beliefs
shared at all levels and displayed of organizational traits. Warrick (2017) also support those definitions by
adding an environment in which organizational member’s influence on how members think, act, and gain
experience work.
Researchers widely category organization’s culture into three types, innovative organizational culture (IOC),
bureaucratic organizational culture (BOC) and trust and supportive organizational culture (TOC) (Wu, Huang,

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Huang, & Du, 2019). An innovative culture is represented by a work environment that is creative, results-
oriented, and challenging. This dimension involves an enterprising and opportunity-seeking environment that
attracts employees seeking challenge and risk. Bureaucratic culture refers to an organized, systematic,
procedural, and regulated work environment. Organizations high on this dimension lack flexibility and
emphasize efficiency, predictability, and consistency. A supportive culture is manifested in a work environment
that is trusting, people- oriented, and encouraging. Such culture facilitates open relationships among employees
and provides a workplace with equitable, friendly, and helpful (Jogaratnam, 2017). In this review, we are
focusing on the influence of an innovative culture.
To build a creative culture, researchers have been described elements that figure out organizational culture.
Teamwork, communication, training and development and reward recognition are the main pattern of
organization culture (Ramdhani, Ramdhani, & Ainisyifa, 2017). While Rich, Rich, & Hair ( 2018) mentioned
innovation, outcome orientation, aggressiveness, stability, attention to detail, respect for people and team
orientation as main elements of organizational culture. Also, Wu, Huang, Huang & Du (2019) agreed with them
when he mentioned compliance, leadership, decision making, effectiveness and values as elements of
organizational culture. Larentis, Antonello, & Slongo (2019) expanded in their book to cover shared meanings
and symbols, openness to new ideas and perspectives, the role of boundary spanners, past experiences and
problems’ sharing between individuals.
Most scholars agreed in describing organization culture as a magic stick “ recipe” that has a positive influence on
organization attitude and business improvement process (Mahadevan, 2017). This positiveness expands to reach
not only employees and organization performance but also organizational commitment (Nikpour, 2017).
Shahzad, Xiu, & Shahbaz (2017) argue that organizational culture is highly significant, plays a vital role in
organizational success and is highly correlated with an employee's satisfaction and performance. Warrick (2017)
expand the influence of innovative culture to reach performance, morale, job satisfaction, employee engagement
and loyalty, employee attitudes and motivation and tool to attract and retain talented employees.
The correlation between organization culture, knowledge management, information and communication,
employee’s empowerment and innovation and technology from one side and their impact on employee’s
performance from other side are clear. Iqbal, Latif, Marimon, Sahibzada, & Hussain (2019) approve how the
correlation between knowledge management and organization culture facilitate organizations task and achieve
superior performance. While Al-Abdullat & Dababneh (2018) conclude that organization successes on applying
job satisfaction depending on the combination of clan and adhocracy types of organizational culture and
knowledge management through maintaining knowledge sharing environment and empowerment employee’s
innovative solutions. The four processes of knowledge management framework including sharing (S ), learning
(L), evaluation (E), and production (P ) with the combination of well organization culture fit can achieve
maximal payoff of employee performance (Zhang, 2018). The organization that building their strategy on
adopting correlation between ICT and innovation and creativity has a major influence on employee’s
performance. This assumption supported by several researchers starting from Ndou, Schiuma & Passiante (2019)
by arguing that creative economy progress measured in terms of human capital performance against
implementing clear strategies that maintain information communication technology and innovation and creativity.
The same result appeared with Laar, Deursen, Dijk & Haan (2019) when identified that creativity,
communication, collaboration, and analytical skills were presented as skills that are useful to the creative
professional.
Conclusion and Limitation
A broad literature explained employee’s performance and the factors influencing this performance. Therefore,
this conceptual study contributes to enhancing understanding of factors impacting on employee performance.
As shown in this research, several factors are affecting employee performance. First, organizational knowledge
management which has a significant role in improving employee performance through analyzing the current
skills, knowledge and ability of employees then design a proper strategy to reduce the gap between the current
and desired performance. Second, ICT which are considering the core assets of the organization that are working
in encouraging employees to improve their performance. The third factor is the empowerment, which has a
tremendous impact on an employee’s performance to reshape the attitude of organization in dealing with
numerous challenges and threaten in the market, especially if the organization is looking for their employees as a
competitive advantage for surviving. Fourth, creative and innovative which are playing as a change-agent in
promoting the manifestation of a new idea, which lead the organization to face uncertainty and complexity in a
highly changing environment. The fifth factor is an organizational culture, which is working as an umbrella that
drives employees performance to develop creative solutions, thinking innovatively and using flexible reasoning
in challenging organizational situations (Ismail, Iqbal, & Nasr, 2019).
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On other hand, the correlation between organization culture, knowledge management, information and
communication, employee’s empowerment and innovation and technology from one side and employee’s
performance from other side was clear while analyzing this literature. Where ERP is a functional arm that
facilitates the process of collaboration between these factors by empowering employees through aspects of
involving in managements concerns, strategic goals and targets, self-learning and developing and knowledge
management (Rouhani & Mehri, 2018).
Research Limitation
The main limitations of this piece of research are the fact of being conducted only in one database within a
limited period, between 2015 and 2019, which influence the accuracy of information. Future research should
increase the sample size to collect more data regarding the factors affecting an employee’s performance.
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