Driving Organizational Effectiveness Through Employee Training And Development: Examining The Mediating Role Of Employee Performance And Productivity In The Indian Energy Sector

Abstract

Purpose: Although the development of human capital is gaining strategic importance in the energy-intensive industries, the empirical evidence which outlines and investigates the impact of Employee Training and Development (ETD) on Organizational Effectiveness (OE) systematically through employee level mediating variables is insufficient in the Indian energy sector. This study examines direct and mediated pathways from ETD to OE as well as the theoretically motivated mediating construct of Employee Performance and Productivity (EPP).
Design/Methodology/Approach: This study adopts the cross-sectional, quantitative, and survey approaches based on Human Capital Theory (Becker, 1964) and Resource-Based View (Barney, 1991). A structured questionnaire using validated scales was used to gather primary data from 452 employees of energy sector organizations in public and private sectors in India. The validity of the measurements was determined by Confirmatory Factor Analysis (CFA) and the relations between the structures were explored by Structural Equation Modelling (SEM). Construct reliability was measured using Cronbach's Alpha, Average Variance Extracted (AVE) was used for convergent validity.
Findings: Results confirm that ETD exerts a significant positive direct effect on OE (β = 0.784, p < .001) and on EPP (β = 0.779, p < .01). EPP, in turn, is an important predictor of OE (β = 0.793, p < .001) and thus partially explains the relationship between ETD–OE.Managerial non-support (77.88%) and employee attitudinal resistance (77.21%) are found to be the most important hindrances that hinder the implementation of ETD.The reliability of all measurement constructs is of high level (α > 0.84; CR > 0.96) and the convergent validity is strong (AVE > 0.84).
Originality/Value: This study makes three contributions: theoretical, extending and testing an integrated mediation model that is grounded in Human Capital Theory and Resource-Based View in the energy sector; contextual, first systematic empirical testing of ETD–OE dynamics in the Indian energy sector, which is a critical context that has not been empirically examined; and methodological, applying SEM as a test for establishing construct validity and to examine mediated pathways where conventional regression-based approaches fail to conclusively identify mediations. HR implications and energy sector policy implications are discussed.