European Journal of Training and Development

Team building, employee empowerment and employee competencies: Moderating

role of organizational learning culture
Rama Krishna Gupta Potnuru, Chandan Kumar Sahoo, Rohini Sharma,
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Rama Krishna Gupta Potnuru, Chandan Kumar Sahoo, Rohini Sharma, (2018) "Team building,
employee empowerment and employee competencies: Moderating role of organizational learning
culture", European Journal of Training and Development, https://doi.org/10.1108/EJTD-08-2018-0086
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Team building
Team building, employee
empowerment and
employee competencies
Moderating role of organizational
learning culture Received 28 August 2018
Revised 16 October 2018
Rama Krishna Gupta Potnuru Accepted 17 October 2018
Institute of Computers and Business Management – School of Business Excellence,
Hyderabad, India
Chandan Kumar Sahoo
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School of Management, National Institute of Technology, Rourkela, India, and

Rohini Sharma
Foundation for Technology and Business Incubation,
National Institute of Technology, Rourkela, India

Abstract
Purpose – The purpose of this paper is to examine the impact of team building and employee empowerment
on employee competencies and examine the moderating role of organizational learning culture in between
these relationships.
Design/methodology/approach – An integrated research model is developed by combining resource-
based view, signalling theory and experiential learning theory. The validity of the model is tested by applying
moderated structural equation modelling (MSEM) approach to the data collected from 653 employees working
in cement manufacturing companies. The reliability and validity of the dimensions are established through
confirmatory factor analysis and the related hypotheses are tested by using MSEM.
Findings – The findings suggest that organizational learning culture significantly strengthens the
relationships of team building and employee empowerment on employee competencies.
Research limitations/implications – The research is undertaken in Indian cement manufacturing
companies which cannot be generalized across a broader range of sectors and international environment.
Practical implications – The findings of the study have potential to help decision makers of
manufacturing companies to develop strategies which will enable them to improve employee competency, to
formulate effective human resource development interventions and to enhance the capability of the employees
to achieve desired goals and objectives of the organization.
Originality/value – The research is unique in its attempt to combine three frameworks to build a new
theoretical model explaining the importance organizational learning culture along with team building and
employee empowerment.
Keywords Confirmatory factor analysis, Organizational learning culture, Employee empowerment,
Employee competencies, Moderated structural equation modelling, Team building
Paper type Research paper

Introduction European Journal of Training and

Development
As per resource-based view (Wernerfelt, 1984), in the competitive market environment, an © Emerald Publishing Limited
2046-9012
organization should be effective and require an important intangible core competence that is DOI 10.1108/EJTD-08-2018-0086
 EJTD employee competencies. An employee competency refers to those traits, skills or attributes
that employees need to perform their jobs more effectively (Soderquist et al., 2010; Campion
et al., 2011). A competent workforce is believed to produce higher quality products (Ahuja
and Khamba, 2008), support innovation (Siguaw et al., 2006) and reduce turnover costs (Joo
and Shim, 2010). To develop and maintain employee competencies for future requirement
and in the present environment, an organization must emphasize on human resource
development (HRD). Werner and DeSimone (2006) defined HRD as a set of systematic and
planned activities designed by an organization to provide its members with the
opportunities to learn necessary skills to meet current and future job demands. According to
Werner and DeSimone (2006), “HRD practices are the programs, which are designed to be
strategically oriented to the organizational process for managing the development of human
resources to contribute to the overall success of the organization” (p. 26). The rationale for
using HRD practices to support business objectives is quite straightforward: enhancing or
unleashing needed employee expertise (Chermack and Kasshanna, 2007). HRD practices
continuously improve employee’s expertise and performance through the existing practices
of training, performance appraisal and organizational development initiatives (Garavan,
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2007).
HRD alone is not sufficient to enhance employee competencies to a greater level because
not all knowledge and skills obtained from HRD practices is properly transferred (Froehlich
et al., 2014). Thus, an organization should create a learning culture in the organization, so
that employee can share, acquire and create knowledge and skills, which can modify the
behaviour of the employees. Organizational learning culture refers to a set of norms and
values about the functioning of an organization that supports systematic organizational
learning so that individual learning, teamwork, collaboration, creativity and knowledge
distribution have collective meaning and value (Torres-Coronas and Arias-Oliva, 2008,
p. 177). Thus, organizational learning culture could directly or indirectly influence employee
competencies.
The present study integrates the resource-based view (Wernerfelt, 1984) and
organizational perspective of learning to create a strong theoretical foundation by exploring
the effects of team building, employee empowerment and organizational learning culture on
employee competencies. The study provides empirical evidences to bridge the knowledge
gaps with regard to the relationship between HRD practices, organizational learning culture
and employee competencies. Even though HRD practices and organizational learning
culture are considered critical concepts and practices, most of the existing literature focuses
on the conceptual level and consider commitment, productivity, and profitability as primary
outcome variables. Few studies have attempted to examine the moderating role of
organizational learning culture on individual outcomes such as commitment, engagement
and satisfaction. Thus, the significance of the study lies in providing empirical validation of
the moderating role of organizational learning culture towards the relationship of HRD
practices and employee competencies. This research attempts to answer the following
structured questions:

RQ1. Is there any relationship between HRD practices and employee competencies?

RQ2. Does organizational learning culture will moderate the relationship between HRD
practices and employee competencies?
From the above research questions, following research objectives were derived. To study the
impact of HRD practices on enhancement of competencies of employees of the cement
 industry. To assess the moderating role of organizational learning culture in between the Team building
relationship of HRD practices and employee competencies.

Literature review and hypotheses

Team building
Klein et al. (2009) define team building as “the formal and informal team-level practices that
focus on improving social relations and clarifying roles as well as solving task and
interpersonal problems that affect team functioning”. In this intervention, team members
experimentally learn, by examining their structures, norms, values and interpersonal
dynamics, to increase their skills for effective performance (Senécal et al., 2008). In the
literature, there is consensus that there are four approaches/components to team building:
(1) goal setting;
(2) role-clarification;
(3) interpersonal relations; and
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(4) problem solving.

A brief explanation is presented below:

Goal setting: This component is designed specifically to strengthen a team member’s
motivation to achieve team goals and objectives (Salas et al., 2004). Team members
are expected to become involved in action planning to identify ways to achieve
those goals (Aga et al., 2016).

Role clarification: It entails clarifying individual role expectations, group norms and
shared responsibilities of team member (Klein et al., 2009). Role clarification can be
used to improve team and individual characteristics (i.e. by reducing role ambiguity)
and work structure by negotiating, defining and adjusting team member roles
(Mathieu and Schulze, 2006).

Interpersonal relations: It assumes that teams with fewer interpersonal conflicts
function more effectively than teams with greater number of interpersonal conflicts.
It involves an increase in teamwork skills, such as mutual supportiveness,
communication and sharing of feelings (Aga et al., 2016).

Problem solving: The fourth component emphasizes on the identification of major
problems in the team’s tasks to enhance task-related skills. It is an intervention, in
which team members identify major problems, generate relevant information,
engage in problem solving, action planning, implement and evaluate action plans
(Aga et al., 2016; Beebe and Masterson, 2014).

Effective team building intervention in an organization enhances an individual’s cognitive

outcome like teamwork competencies and affective outcomes like trust and team potency,
whereas at team level, the outcomes are coordination and effective communication
(Tannenbaum et al., 2012). At the organization level, team effort helps to solve various
problems of the organization, such as conflict among organizational members, unclear roles
and assignments, lack of innovation in solving problems, etc., that upsurge the performance
of the organization (Stone, 2010).

Employee empowerment
An employee empowerment approach is composed of practices aimed at sharing information,
job related knowledge and authority with employees (Fernandez and Moldogaziev, 2013).
 EJTD Baird and Wang (2010) stated, “The basic objective of empowerment is redistribution of
power between management and employees – most commonly in the form of increasing
employee authority, responsibility, and influencing commitment”. In the literature,
empowerment defined in two perspectives: psychological perspective and managerial
perspective. From a psychological perspective, empowerment is a motivational akin to a state
of mind or set of cognitions (Fernandez and Moldogaziev, 2013). Dust et al. (2014) described
employee empowerment as a four-dimensional motivational construct composed of four
cognitions those are meaning, competence, self-determination and impact, that reflect an
active rather than a passive orientation towards a work role. From a managerial perspective,
employee empowerment is a relational construct that describes how those with power in
organizations share power, information, resources and rewards with those lacking them
(Gomez and Rosen, 2001; Fernandez and Moldogaziev, 2013). Bowen and Lawler (1995) define
empowerment as sharing with front-line employees on four organizational ingredients:
(1) information about the organization’s performance;
(2) knowledge that enables employees to understand and contribute to organizational
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performance;
(3) rewards based on the organization’s performance; and
(4) power to make decisions that influence organizational direction and performance.

Organizational learning culture

Torres-Coronas and Arias-Oliva (2008, p. 177) defines organizational learning culture as:
A set of norms and values about the functioning of an organization that support systematic
organizational learning so that individual learning, teamwork, collaboration, creativity, and
knowledge distribution have collective meaning and value.
Organizational learning culture is a complex process that refers to the development of new
knowledge and has the potential to change behaviour (Škerlavaj et al., 2010). According to
Kandemir and Hult (2005), organizational learning culture has been viewed as a process by
which organizations as collectives learn through interaction with their environments and
propose that learning might result in new and significant insights and awareness. The
objective of building an organizational learning culture in an organization is to expand
people’s capacity to create the results they truly desire, the employee’s new and expansive
patterns of thinking to be encouraged, collective aspiration to be set free, and employees
should be continually learning how to learn together (Senge, 2009). According to Marsick
and Watkins (2003), organizational learning culture consists of seven interlinked constructs:
(1) create continuous learning opportunities;
(2) promote inquiry and dialogue;
(3) encourage collaboration and team learning;
(4) create systems to capture and share learning;
(5) empower people toward a collective vision;
(6) connect the organization to its environment; and
(7) provide strategic leadership for learning, which helps in building the
organization’s strategic learning culture.

Table I summarizes the seven dimensions of organizational learning culture.

 Employee competencies Team building
The word competency was first explained in the book “The Competent Manager” (Boyatzis,
1982, p. 21) which defines the term as, “an underlying characteristic of a person that could be
a motive, trait, and skill aspect of one’s self-image or social role, or a body of knowledge
which he or she uses”. A competency is a reliably measurable, relatively enduring (stable)
characteristic of a person, team or organization that causes and statistically predicts a
measurable level of performance (Berger and Berger, 2010). Some definitions of the term
competency are shown in the Table II given. The term “reliably measurable” means two or
more independent observers or methods (tests, surveys) agree statistically that a person
demonstrates a competency (Spencer et al., 2008) while “relatively enduring” means a
competency measured at one point of time is statistically likely to be demonstrated at a later

Dimension Definition

Continuous “Learning is designed into work so that people can learn on the job; opportunities are
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learning provided for ongoing education and growth”

Inquiry and “People gain productive reasoning skills to express their views and the capacity to listen
dialogue and inquire into the views of others; the culture is changed to support questioning,
feedback, and experimentation”
Team learning “Work is designed to use groups to access different modes of thinking; groups are
expected to learn together and work together; collaboration is valued by the culture and
rewarded”
Embedded “Both high- and low-technology systems to share learning are created and integrated with
system work; access is provided; systems are maintained”
Empowerment “People are involved in setting, owning, and implementing a joint vision; responsibility is
distributed close to decision-making so that people are motivated to learn toward what
they are held accountable to do”
System “People are helped to see the effect of their work on the entire enterprise; people scan the
connection environment and use information to adjust work practices; the organization is linked to its
communities”
Strategic “Leaders model, champion, and support learning; leadership uses learning strategically
Table I.
leadership for business results” Dimensions of
organizational
Source: Marsick and Watkins (2003) learning culture

Author and year Definition

Bartram (2004) “Sets of behaviours those are instrumental in the delivery of desired results or
outcomes. Also, repertoires of capabilities, activities, processes, and responses
available that enable a range of work demands to be met more effectively by some
people than by others”
Campion et al. (2011) “Collections of knowledge, skills, abilities and other characteristics that are needed for
effective performance in the jobs in question”
Eric Soderquist et al. “The knowledge, skills, and abilities that underlie effective or successful job
(2010) performance, which are observable, measurable, and distinguish superior from
average performance”
Chen and Naquin “The underlying individual work-related characteristics (e.g., skills, knowledge,
(2006) attitudes, beliefs, motives, and traits) that enable successful job performance, where Table II.
“successful” is understood to be in keeping with the organization’s strategic Definition of the term
functions” competency
 EJTD point of time (Catano et al., 2007). Competency characteristics are content knowledge,
behaviour skills, cognitive processing (IQ), personality traits, values, motives and
occasionally other perceptual or sensor motor capabilities that accurately predict some level
of performance. Cardy and Selvarajan (2006) has classified competencies into two categories:
employee (personal) and organization (corporate). Employee competencies are those
characteristics or traits that are acquired by employees, such as knowledge, skills, ability
and personality that differentiate them from average performers (Cardy and Selvarajan,
2006). Organizational competencies are those, which are embedded in the organizational
system and structures that tend to exist within the organization, even when an employee
leaves (Semeijn et al., 2014). Human capital attributes have been argued to be an important
resource of organizational performance because organizations that are able to generate
organization specific, valuable and unique competencies are thought to be in a superior
position that enables them to outperform their rivals and succeed in a dynamic business
environment (van Esch et al., 2018).
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Formulation of hypotheses
This study selected a set of independent constructs: HRD practices (team building and
employee empowerment) and organizational learning culture; and dependent constructs:
employee competencies. The independent constructs are considered necessary for
influencing employee competencies and its influence on organizational effectiveness.
Figure 1 illustrates the research model of this study. In the following sections, the
relationship between the constructs is discussed.

Human resource development practices and employee competencies

Researchers (Sung and Choi, 2014) have suggested that organizations should design and
implement HRD practices so that the individual can perform effectively and meet the
performance expectations through improving individual competencies. Kehoe and Wright
(2013) deliberates that HRD was the basic component for employees to acquire competencies
that in turn significantly improve organizational performance. In fact, the general purpose of
HRD practices is to produce a competent and qualified employees to perform an assigned
job and contribute to the organization’s business outcomes (Nolan and Garavan, 2016).
Scholars have investigated the outcome of HRD practices and reported that these
practices improve employees’ capabilities on the job, productivity and efficiency (Haslinda,
2009; Alagaraja et al., 2015). Yuvaraj and Mulugeta (2013) also provided a similar result that
explains HRD practices continuously improve employees’ capability and performance
through the existing practices of training, career development, performance appraisal and
organizational development components of HRD. The study examined two practices: team
building and employee empowerment that were being widely implemented in the selected

Organization
Learning Culture

H2 (a)
Team Building H2 (b)
H1 (a)
Employee
Figure 1. Employee
Competencies
Conceptual model Empowerment H1 (b)
 organizations (Cement manufacturing units). The association between selected HRD Team building
practices and employee competencies are revealed in subsequent reviews.

Team building and employee competencies

According to LePine et al. (2008), “The practices of team-building components (goal-setting,
interpersonal processes, role-clarification, and problem-solving) can lead to improved
performance through modification of attitudes, values, problem-solving techniques, and
group processes”. In the goal-setting component, team members are introduced to a goal-
setting framework and are expected to involve in action planning to identify ways to achieve
those goals, which strengthen team member’s problem-solving skills and motivation (Aga
et al., 2016). Team members exposed to role-clarification activities are expected to achieve
better understanding of their and others’ respective roles and duties within the team (Salas
et al., 1999). Interpersonal process component involves an enhancement in team member’s
interpersonal skills, such as mutual supportiveness, communication and sharing of
information (Klein et al., 2009). The fourth component emphasizes the identification of major
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problems in the team’s tasks to enhance task-related skills (Lacerenza et al., 2018). Team
building is an intervention, in which team members identify major problems, generate
relevant information, engage in problem solving and action planning, implement and
evaluate action plans (Aga et al., 2016; Beebe and Masterson, 2014). Team building
intervention enhances individual’s cognitive outcome like teamwork competencies and
affective outcomes like trust and team potency, whereas at team level, the outcomes are
coordination and effective communication (Tannenbaum et al., 2012). Shuffler et al. (2011) in
their meta-analysis found that an effective team building improves affective outcomes (trust,
attitude and confidence) and cognitive outcomes (shared knowledge among team members)
in employees. The above discussions provide ample facts to suggest that:

H1a. Team building is positively related to the enhancement of employee competencies.

Employee empowerment and employee competencies

Fernandez and Moldogaziev (2013) have stated that, “employee empowerment is a relational
construct that describes how those with power in organizations share power and formal
authority with those lacking it”. Organizations have implemented empowerment initiatives
based on the premise that when individual employees can participate in decision-making
and share responsibility, for how work is conducted, outcomes such as performance and
employee’s knowledge will be enhanced (Maynard et al., 2012). Organizations that
encourage harmonious relationships between superiors and subordinates provide
employees with the liberty to express their creative suggestions, which help in enriching
their self-motivation (Fernandez and Moldogaziev, 2012). When employees are empowered
and given the autonomy and flexibility, they are likely to be more motivated and take full
responsibility to find new ways and develop new skills to respond to challenges (Luoh et al.,
2014). Kanter (1993) and Laschinger (1996) define structural empowerment as workplace
structures that enable employees to carry out work in meaningful ways. These structures
empower employees by providing access to information required to perform the job
effectively, support from peer and supervisor feedback, resources like time and supply to
carry out job and opportunity for learning and growth within the organization (Dainty et al.,
2002). Liden et al. (2000) found that empowering working conditions have been positively
linked to employee’s positive job attitude and tolerant to work pressure and ambiguity.
When employees are involved in their work with the spirits of vigour and commitment, it
 EJTD makes a significant difference to their self-motivation and positive job attitude (Manojlovich,
2005). Empowerment can enrich individual’s ability to perform their duties successfully,
where they have control over their workload, get support from the peers, feel more rewarded
for their accomplishments and are treated fairly (Janssen, 2004). Fernandez and Moldogaziev
(2013), in their empirical study found that there is a positive relationship between employee
empowerment and employee’s attitude and behaviour. Leach et al. (2003) further indicated
that, employee empowerment has a positive impact on job knowledge through an empirical
validation. Hence, the following premise is expected:

H1b. Employee empowerment is having a significant and positive relationship with the
enhancement of employee competencies.

Moderating role of organizational learning culture

Organizational learning culture as a moderator is grounded on the signaling theory (Spence,
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2002) and experiential learning theory (Kolb 1984). Based on the viewpoint of signaling
theory, organizations that cultivate learning culture would give indications to the employees
that the management values and supports the exchange of knowledge and skills learnt by
them from the HRD programmes provided by their organizations (Bloor and Dawson, 1994;
Spence, 2002). Such culture that facilitates knowledge-transfer and idea sharing would
positively influence employee competencies. According to the experiential learning theory
(Kolb 1984), the process of learning is highly affected by two elements: individual’s
interaction with different stakeholders and feedback of one’s knowledge from their superiors
and peers. Referring to this, employee perceptions’ that the organization promotes sound
learning culture through regular feedbacks and mentorship would motivate them to acquire
and exchange their skills and knowledge (Clark et al., 1993). Therefore, the learning culture
process has been identified as one of the vital and appropriate contextual factors to enhance
employee competencies (Jeong et al., 2017). Based on above discussion, it can infer that
organizational learning culture plays an important moderating role in between HRD
practices and employee competencies. Thus, in the present study associations between
selected HRD practices, organizational learning culture and employee competencies are
revealed in subsequent reviews.

The moderating effect of organizational learning culture between team building and
employee competencies
Team building practices are based upon an action research model of data collection,
feedback, and action planning (Whitehead, 2001). Team building activities operate within a
particular environmental context. Although groups are often viewed as the context variable
for individual behaviours, the organizational environment should also be considered as
the context variable for group behaviour (Shuffler et al., 2011). According to Van den
Bossche et al. (2006), “The organizational variable that could influence a team member’s
knowledge and problem-solving skill is the organization’s learning culture”. The
enhancement of team member’s competencies based on organizational learning culture can
influence the level of cooperation or performance between team members, which in turn may
affect team effectiveness (Hollenbeck et al., 2004). The above discussions provide ample
facts to suggest that:
 H2a. Organizational learning culture will moderate the relationship between team Team building
building and employee competencies, where the relationship will be stronger when
the organizational learning culture is high.

The moderating effect of organizational learning culture between employee empowerment

and employee competencies
Employee empowerment involves the employees being provided with a greater degree of
flexibility and more freedom to make decisions relating to work (Greasley et al., 2005).
Empowerment is closely related to people’s perceptions about themselves in relation to their
work environments (Kuo et al., 2010). Jones et al. (2013) stated that:
The environment surrounding individuals is important for increasing employee empowerment
because empowerment is not a consistent or enduring personality trait, but rather a set of
cognitions shaped by work environments.
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In a recent study, Joo and Shim (2010) has found a positive moderating role of organizational
learning culture between empowerment and employee positive behaviour, where their
results indicated if an organization has high learning culture in the presence of
empowerment would influence highly on employee behaviour. Thus, the following
hypothesis is proposed:

H2b. Organizational learning culture will moderate the positive relationship between
employee empowerment and employee competencies, where the relationship will
be stronger when the organizational learning culture is high.

Methodology
Research design, sampling and data collection
A structured questionnaire was developed for collection of primary data on the basis of
seven-point Likert scale. It consists of two sections; first section collects general information
of the respondents like, age, gender, designation and experience. The second section
includes the items that measure the constructs team building, employee empowerment,
organizational learning culture and employee competencies. The study took place in four
medium-sized cement-manufacturing units in India. We communicated personally (through
appointments, phone calls and email) to senior executives of the four units and explained the
methodology of the study. We gave instructions to executives and supervisors about how to
answer specific questions and to distribute the questionnaire to their subordinates and
colleagues, who had participated in HRD practices in the past two years. The schedule was
distributed to around 952 employees, out of which 653 complete responses were obtained,
corresponding to a response rate of 68.53 per cent of the respondents.

Measures
Team building
A six-item scale representing four broad areas of team building practices was developed for
this study: goal setting, interpersonal relations, role clarification and problem solving. These
items were adapted from Aga et al. (2016), Klein et al. (2009) and Salas et al. (1999) and its
reliability is 0.81.
 EJTD Employee empowerment
A five-item scale to measure the effectiveness of employee empowerment implemented in
the organization is developed by adopting Menon (2001) and Men and Stacks (2013) scales of
employee empowerment. We modified the items according to the current study, and its
reliability is 0.87.
Employee competencies. The competencies analysed in the study were technical
expertise, adaptability, innovation, teamwork and cooperation, conceptual thinking and self-
confidence. For this, we have adopted Díaz-Fernández et al. (2014) measures of employee
competencies and adapted it to the current scenario of the study. The construct consists of
six items and its reliability (Cronbach’s alpha) is 0.71.
Organizational learning culture. Dimensions of learning organization questionnaire
(DLOQ) were developed by Watkins and Marsick (1997) with 21 items, measuring seven
dimensions, but later it was shortened to seven items and measures all seven dimensions of
DLOQ by Yang et al. (2004). We have used Yang et al. (2004) scale of organizational learning
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culture which measures continuous learning, team learning, dialogue and inquiry,
empowerment, system connection, embedded system and strategic leadership. The seven-
item scale shows reliability of 0.88.

Results
The results are described in the order in which the analyses were conducted. First, the
confirmatory factor analysis (CFA) in AMOS to establish a factor structure and find out any
kind of presence of common method bias. Second, construct validity of the full measurement
model to assess the convergent and discriminant validity. Third, we carried out descriptive
statistics, correlation and reliability analysis in SPSS of the full measurement model. Fourth,
we performed moderated structural equation modelling (MSEM) in AMOS to test the
hypotheses.

Comparison of measurement models and Harman’s single factor test

A full measurement model was tested initially. Team building, employee empowerment,
organizational learning culture and employee competencies items were loaded onto their
respective factors. All factors were allowed to correlate. The four-factor model showed a
good model fit x 2 = 799.845, df =337, p < 0.05, CMIN/df = 2.373, Goodness of fit index
[GFI] = 0.901, comparative fit index [CFI] = 0.950, root mean square error of approximation
[RMSEA] = 0.052. Emphasis was given to carry out sequential x 2 difference test that
compared the full measurement model to five alternative nested models as shown in
Table III. The result of the full measurement model is significantly better as compared to the
alternative models that suggest the variables in the study are distinct.
Cross-sectional and self-reported data are susceptible to common method biases.
Following the procedure adopted by several scholars (Ketkar and Sett, 2010; Conway et al.,
2015) all items of both independent and dependent variables are included in a single factor
and fit indices were examined. The single factor model showed poor fit with the data.
Comparison of the single factor model with the full measurement model had shown that the
full measurement model had significantly better fit with the data as compared to the single-
factor model. While this test does not eliminate the possibility of method bias, it provides
evidence that inter-item correlations are not driven purely by method bias (Podsakoff et al.,
2003).
 Models x 2(df) CFI NFI GFI RMSEA x 2diff dfdiff
Team building
Full measurement model 799.845 (337) 0.955 0.922 0.906 0.049
Model A1 3454.934 (344) 0.664 0.641 0.576 0.133 2655.089 7***
Model B2 2863.703 (342) 0.728 0.703 0.644 0.120 2063.858 5***
Model C3 2593.368 (342) 0.757 0.731 0.665 0.113 1793.523 5***
Model D4 3212.137 (344) 0.690 0.667 0.614 0.127 2412.292 7***
Model E5 (Harman’s single factor test) 4193.741 (346) 0.584 0.565 0.544 0.147 3393.896 9***

Notes: ***p < 0.001; x 2 = chi-square discrepancy; df = degrees of freedom; CFI = comparative fit index;
NFI = normative fit index; RMSEA = root mean square error of approximation; x 2diff = difference in chi-
square; dfdiff = differences in degrees of freedom. 1Team building, employee empowerment and
organizational learning culture combined to one factor; employee competencies into a second factor. 2Team
building and employee empowerment combined to one factor; employee competencies and organizational
learning culture combined into a second factor. 3Team building, employee empowerment and employee Table III.
competencies combined to one factor; organizational learning culture into second factor; 4Team building
and organizational learning culture combined to one factor; employee competencies and employee Fit statistics from
empowerment into second factor. 5All factors combined into a single factor. All models are compared to the measurement model
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full measurement model comparison

Construct validity of the full measurement model

Construct validity was established in the study by assessing convergent validity and
discriminant validity. To estimate convergent validity, discriminant validity and goodness
of fit statistics, we performed a CFA. Convergent validity is established by estimating factor
loadings (completely standardized loading), composite reliability and average variance
extracted (AVE) from the CFA. In Table IV, the results of convergent validity are provided,
which shows that the values are in acceptable region, confirming convergent validity.
Discriminant analysis is assessed by comparing the AVE with corresponding inter-
dimension squared correlation estimates (Fornell and Larcker, 1981). Table V shows the
square root of AVE values of all study factors are greater than inter-dimension correlations,
supporting discriminant validity. The goodness of fit statistics of the measurement model
specified good model fit with the data ( x 2 = 799.845, df =337, p < 0.05, CMIN/df = 2.373,
GFI = 0.901, CFI = 0.950, RMSEA = 0.052). Thus, the instrument used in the study has good
construct validity and psychometric properties.

Descriptive statistics, correlations and reliabilities

Table VI presents mean, standard deviation and correlations among the four variables. The
reliabilities of each individual variable vary from 0.77 to 0.93. The correlations among the
four variables are significant, supporting all of the hypotheses.

Moderated structural equation modelling results

We used AMOS 20.0 to test the study’s hypotheses through SEM, such that we could
explicitly account for measurement error when examining the hypothesized relationships
among the study’s focal constructs. This approach also allowed us to assess how well our
conceptual model as a whole fit the data, as recommended by previous studies that seek to
test complex models having web of hypotheses with both mediating and moderating affects.
Several procedures for testing the interaction (moderating) effects in SEM have been
forwarded (Jaccard et al., 1996; Joreskog and Yang, 1996; Ping, 1995). Cortina et al. (2001)
found that all procedures produced very similar results. Present study adopted Ping’s (1995)
approach to Moderated SEM using the three steps described by Cortina et al. (2001). These
 EJTD Completely Average
standardized Composite variance
Construct and items loading reliability extracted

Team building
TB1: Team members have the complementary skill sets to 0.850
accomplish their roles within the team
TB2: The team uses an effective short and long-term strategic 0.843
plan
TB3: Team members are familiar with each other’s roles and job 0.792 0.913 0.637
responsibilities
TB4: The team members communicate well with one another 0.779
TB5: Everyone on a team has a significant amount of influence 0.762
on decisions that affect team performance
TB6: The team uses an effective short and long-term strategic 0.756
plan
Employee empowerment
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EE1: Employees feel a healthy atmosphere to extend their 0.902

creative suggestions
EE2: Employees are involved in the decision-making process of 0.832
different forums
EE3: Accessibility to the information and resources need to 0.820 0.917 0.691
perform in a better way
EE4: There is freedom to express views even if it is contrary to 0.878
the resolutions to be taken
EE5: Individuals can participate in planning and scheduling of 0.711
daily activities
Organizational learning culture
OLC1: Employees are encouraged for continuous learning 0.848
OLC2: Trust and confidence as a way of organizational life 0.841
OLC3: Organization provides the required resources as desired 0.839 0.924 0.671
by the employees relating to the assigned jobs
OLC4: Employees openly discuss mistakes with superiors and 0.833
colleagues’ in order to learn from them
OLC5: Organization enables people to get needed information at 0.788
any time quickly and easily
OLC6: Employees continually look for opportunities to learn 0.763
OLC7: Leaders continually look for opportunities to learn 0.758
Employee competencies
EC1: Employees are always committed to assigned work and 0.815
the organization
EC2: People demonstrate team spirit while working in teams 0.759
EC3: Individuals are tolerant to work pressure and ambiguity 0.727 0.875 0.541
Table IV. EC4: Employees are self –motivated in the organization 0.759
Confirmatory factor EC5: Employees are exhibiting positive job attitude at work 0.672
analysis (Convergent EC6: Individuals are applying their acquired specialized 0.669
validity) knowledge at workplace

steps are detailed in the Appendix I. Recent few studies (Anning-Dorson, 2017; Harney et al.,
2018) also followed the same approach. The goodness-of-fit statistics of MSEM results ( x 2 =
483.728; df = 174; NFI = 0.935; CFI = 0.957; RMSEA = 0.059; SRMR = 0.077) indicate that it
has a good model fit.
 Figure 2 shows the results of MSEM analysis in which results of beta coefficients and Team building
adjusted R2 are given. In total, 59 per cent of variance of HRD practices, organizational
learning culture and interactions variables on employee competencies is explained. It shows
that there is positive relationship between HRD practices and employee competencies, which
infer team building and employee empowerment positively influences the employee
competencies, confirming ( b = 0.408, Standard Error (SE) = 0.031, critical ratio (CR) =
13.161, p < 0.001) H1a and ( b = 0.035, S.E = 0.004, CR = 8.75 p < 0.05) H1b. H2a proposed
that organizational learning culture would moderate positive relationship between team
building and employee competencies, where the relationship may be stronger when
organizational learning culture is higher. The results of the MSEM (Figure 2) show that there
is significant interaction between team building and employee competencies ( b = 0.109, SE
= 0.021, CR= 5.190, p < 0.05), supports H2a. The moderated relationship also supported by a
simple slope test based on one standard deviation above and one standard deviation below.

Team Organizational learning Employee Employee

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Variables building culture empowerment competencies

Team building 0.79

Organizational learning
culture 0.403** 0.83
Employee empowerment 0.352** 0.441** 0.81
Employee competencies 0.393** 0.250** 0.429** 0.73
Table V.
Note: Values in diagonal represent the squared root estimate of AVE Discriminant validity

Variables Mean SD 1 2 3 4

Team building 4.19 0.88 (0.77)

Organizational learning culture 3.68 0.98 0.403** (0.82)
Employee empowerment 3.58 0.99 0.352** 0.441** (0.83)
Table VI.
Employee competencies 4.16 0.64 0.393** 0.250** 0.429** (0.89) Descriptive statistics
and bivariate
Notes: N = 653; **p < 0.01, (two railed tests). Reliabilities are reported in parentheses correlations

Team building

Interaction 0.408***
(TB*OCL) 0.109**

Organization 0.265** Employee

Learning Culture Competencies
R 2 = 0.59
0.130**
Interaction
(EE*OCL) 0.035**

Employee
Figure 2.
Empowerment MSEM results
 EJTD From Figure 3, it clarifies that organizations with higher organizational learning culture ( b =
0.515, t = 8.837, p < 0.001) will influence more on employee competencies than with lower
organizational learning culture ( b = 0.401, t = 5.049, p < 0.001).
The analysis has found similar results for H2b also, which indicates that there is
moderated positive relationship between employee empowerment and employee
competencies, where the relationship may be stronger when higher organizational learning
culture is present ( b = 0.130, SE= 0.020, CR = 6.50 p < 0.05), confirming H2b. From simple
slope test (Figure 4), it further elucidates that organizations with higher organizational
learning culture ( b = 0.162, t = 2.788, p < 0.05) will influence more on employee
competencies than with lower organizational learning culture ( b = 0.142, t = 1.499).

Discussions
The study has found that team building, employee empowerment and organizational
learning culture have a significant and positive influence on employee competencies. In
addition, the findings confirm that the moderating effect of organizational learning culture
on the above relationship is significant. Detail findings are discussed below.
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HRD practices (team building and employee empowerment) of cement manufacturing units
have shown a significant and positive relationship with employee competencies. In this respect,
the finding of significant and positive influence of team building on employee competencies are
congruent with the studies of Aga et al. (2016), Beebe and Masterson (2014) and Braun et al.
(2013) that established that effective implementation team building programmes will enhance
knowledge, skill and capabilities of the employees. It was also found that employee
empowerment shows positive impact on employee competencies which confirms the
assumption of eminent researchers such as Fernandez and Moldogaziev (2013) state that
effective implementation of employee empowerment enhances employee competency.

5
Moderator
Employee Competencies

4.5

4 Low OLC

Figure 3. 3.5 High OLC

Interaction between 3
team building and 2.5
organizational 2
learning culture on
1.5
employee
competencies 1
Low Team Building High Team Building

5
Employee Competencies

4.5 Moderator
Figure 4. 4 Low OLC
Interaction between 3.5
High OLC
employee 3
empowerment and 2.5
organizational
2
learning culture on
1.5
employee
competencies 1
Low Employee Empowerment High Employee Empowerment
 Further, the perception of organizational learning culture moderated the relationship Team building
between team building and employee empowerment with employee competencies.
Employees perceived that organization having effective implementation of team building
practices along with high organizational learning culture results in higher employee
competencies. In this respect, the findings of the study empirically validate the hypothesized
relation that has been theoretically stated in many studies (Sung and Choi, 2014; Banerjee
et al., 2017). A similar result also found that organizational learning culture moderated the
relationship between employee empowerment and employee competencies. This empirical
finding validates the theoretical assumptions of renowned researchers (Kim and McLean,
2008; Park, 2010; Moon and Choi, 2017) that employee empowerment facilitated by learning
environment may show a positive effect on the development of employee competencies.
Similarly, H2b proposed that organizational learning culture strengthens the positive
relationship between employee empowerment and employee competencies. The findings of
the present research corroborate with the previous studies by Jones et al. (2013) and Kuo
et al. (2010) and establishes that in the presence of organizational learning culture
strengthens the relationship between employee empowerment and employee competencies.
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Theoretical contribution
The findings of this study have several important theoretical contributions. The study
provides a deeper understanding of how HRD practices influences enhancement of
employee competencies in the presence of contextual variable organizational learning
culture. The results confirm that the relationship between HRD practices and employee
competencies can be strengthened by positive organizational learning culture. A work
context that is supportive for encouraging employees for continuous learning through the
acquisition of new knowledge and skills would foster the relationship between HRD
practices and employee competencies. This study therefore provides support for a
contingency perspective in HRD research that with a positive organizational learning
culture; the effect of HRD practices on the development of employee’s competencies can be
enhanced. By demonstrating that organizational learning culture moderates the HRD
practices and employee competencies relationship, this study builds on a recent stream of
research examining the resource-based view (Wernerfelt, 1984) from a contingency
perspective. This study also extends the application of HRD practices and organizational
learning culture to a new context (i.e. the emerging economy of India). It demonstrates that
in emerging economies, characterized by environmental turbulence and uncertainties. The
implementation of HRD practices will help the organization to perform better by increasing
the competency level of their employees.

Practical implications
Bates and Khasawneh (2005) state that, “There is considerable consensus today that a key
competitive advantage for organizations lies in their ability to learn and be responsive to
challenges from both internal and external environments”. Evidently, focus has to be paid, in
developing an organizational learning culture to enhance employee competencies to build
competitive advantage and enhance organizational effectiveness. The outcomes of the paper
also recommend some suggestions to managers striving for success. First, from moderated
SEM results, managers should recognize that, just by providing team building and employee
empowerment initiatives are not enough, it is the organization’s responsibility to create an
environment of learning to enhance employee competencies. Second, organizations have to
take advantage of organizational learning capability by signifying the importance of
managers and their attitudes in effective implementation of learning conditions within the
 EJTD organization. This indicates that managers are the facilitators of learning culture within the
organization, and it can be achieved by applying the attributes of a learning organization in
such a way that learning orientation becomes the main trigger for learning (Real et al., 2014).
Third, the direct inference of study results is that employees with enhanced competencies are
the most vital stakeholder group in any business process that is endeavouring for improved
organizational effectiveness. Hence, managers striving for effectiveness and efficiency in
their process should put employees first, which supports the opinion of Skerlavaj et al. (2010).

Limitations and directions for future research

The study has a few limitations; however, these pave the way for a new line of future
research. Even though, we collected responses from employees who participated in team
building and employee empowerment initiatives in the past two years, but we have collected
data at a single point of time (cross-sectional study). This might raise issues relating to the
direction of causality, we recommend the future researchers to conduct a longitudinal study
that minimizes the issues on the direction of causality. The data used in the study are largely
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subjective opinions of the employees responding to the survey. As per Real et al. (2014),
subjective assessment obtained through multi-item scales are in the general consistent with
an objective measure, the difference between perceptions and objective data may exist.
Future studies might emphasis on this area, using objective measures. Finally, we cannot
generalize the results through wider range of sectors and global environment, as the study
was conducted in Indian cement industries.

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Appendix. Moderation/interactions procedure

The three-step procedure outlined by Cortina et al. (2001) to carry out Ping’s (1995) MSEM approach.
This approach is also carried out by Conway et al. (2015).
Step 1: Standardize all indicators for the independent variable X (team building, Sxn, n = [1,
6]), Y (employee empowerment, Sym, m = [1, 5]), and moderator Z (organizational learning Culture,
Szl, l = [1, 7])
Step 2: Create interaction term

X
6 X
7
XZ ¼ Sxn * Szl
1 1
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X
5 X
7
YZ ¼ Szm * Szl
1 1

Step 3: Fix the measurement properties for interaction terms XZ and YZ.
KXZ: Path from latent interaction XZ to indicator xz: KXZ = l xz =

X
6 X
7
XZ ¼ l xn * l zl
1 1

where l xn are the path coefficients from latent independent variable X (team building) to its
indicators Sxn, n = [1, 6]
l zl are the path coefficients from latent moderator Z (Organizational Learning Culture) to its
indicators Szl, l = [1, 7]
KYZ: Path from latent interaction YZ to indicator yz: KYZ = l yz =

X
5 X
7
YZ ¼ l yn * l zl
1 1

where l yn are the path coefficients from latent independent variable Y (employee empowerment) to
its indicators Syn, n = [1, 5]

Corresponding author
Rama Krishna Gupta Potnuru can be contacted at: mr.prkgupta@gmail.com

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