Over the years, I’ve realised the centrality of employee empowerment as a driver of business performance. It’s the passion, commitment and sense of ownership employees have for their role and responsibilities that makes all the difference to an organisation’s balance sheet.

But how do you empower employees so they have passion and a sense of ownership of the organisation?

One approach is for the leader of the organisation to ask employees their opinions, because if you ask them - what they think the organisation does well or doesn’t do well and if the organisation was the best in the world, what would it look like - then most employees would apply their own knowledge and experience to identify aspects of the business that could improve. Everyone in the organisation knows the answers to those questions. The fact that they’ve been asked is enormously empowering and motivating. If you incorporate what employees say in the way forward, then they get a real sense of ownership. It’s just treating them with dignity and respect. And it’s something the CEO needs to do personally. It’s not something that you can delegate within the organisation, but it makes a huge difference. Not just to morale and the culture but to financial performance of the organisation.

You may ask: “How does employee empowerment impact the balance sheet?” I’ve seen significant financial impacts of employee empowerment and can attest to its immense impact. What creates out-performance over decades is each individual turning up every day thinking: “If this was my business, I would do this task or project differently. I would do this a bit better.” They know what works best and if you ask their opinion and respect their response they will tell you what makes a warehouse operate more efficiently or what makes a piece of equipment work better. They know where waste occurs in processes and systems and they can identify and implement solutions to reduce it. They will do it day after day, year after year and that’s where you get out-performance in any team or organisation. This is because people take ownership and want the organisation to be successful and they are an integral part of the team that achieves success.

In the same way that employees in large organisations can be empowered to drive business success, I’ve seen women in India become empowered to break the cycle of poverty themselves by receiving small loans to build businesses. During a business trip to India several years ago I caught up with a couple of the Opportunity International Australia managers in Bengaluru. They invited me to meet some of the families they serve, so I did. I met a woman who had set up a bike hire business using a small loan. She purchased some second-hand bicycles with the loan and gradually built the business up to 25 bicycles. She made enough money to set her husband up with a roadside stall and put one of her children through school. I thought that for a $100 loan: "This is amazing!" And what was also amazing was just meeting this woman. Her self-esteem; she radiated optimism and self-confidence. She was empowered!

What I have witnessed in my visits to India with Opportunity is that a small loan can make a huge difference. It’s a hand up not a hand-out and people repay the loan, with a better repayment rate at 98 per cent than here in Australia. The funds then go back into the community. So, once you have given the loan, you’ve established one person in a new enterprise and the funds can go back to either help that same person take their enterprise to the next level or it goes to another person in the community as a small loan so they too can build a business. It’s forever doing work, it’s forever bringing people out of poverty. It’s not just a sunk cost. Moving people out of poverty, you need the money continuing in the system and microfinance is based on self-reliance and self-responsibility. Microfinance is fair, honest and it gives families hope more than anything else and a way out. Most people are happy to get their family established and to see their children through school and possibly college or university because then the whole family is self-reliant. They become empowered to break the inter-generational cycle of poverty themselves!