Creating Agile Institutions with Organizational Trust in the Finance Sector of Turkey: The Mediating Role of Psychological Empowerment in Times of COVID-19

Abstract

The study aims to evaluate the way for creating agile institutions with organizational trust. Besides that, the understanding of the mediating role played by psychological empowerment during COVID-19 pandemic is one of the major objectives of this study. The way psychological empowerment affects the creation of agile organizations is another major aspect that the study investigated. The philosophical stance that the research has adopted is the positivism philosophy. The study was done by collecting and analyzing quantitative data. The approach for the study is deductive whereas the design of the research is descriptive. The study used a survey method for collecting information. Structural equation model was used for analyzing quantitative information. The study was done on 325 samples who are working at the finance sector of Turkey. All the samples have a residence in Turkey. It was identified that the leadership approach of a company has a huge impact on the psychological construction of the samples. Descriptive statistics and t-test for inferential statistics were done by the researchers. There is a strong positive relationship between the centricity of the organization towards the workforce or customer and employee performance. It was identified that the leadership approach helps employees to address and adopt the change in the marketplace. It was also found that an agile organizational structure has more possibilities to modify the processing based on the change in the marketplace. The structural equation model was used to represent the relationship between the variables.

1. Introduction

The financial impact of COVID-19 at the finance sector of Turkey accounted for 17% of the country’s GDP in 2020 [1,2]. Due to the pandemic the risk and challenges associated with the non-performing loans increased in Turkey. The exchange rate depreciated by 10% before August 2020 because of the COVID-19 pandemic. Most of the companies at the finance sector of Turkey are going through huge challenges after COVID-19. The shortage of workforce, changes in supply-chain, reduction of profit, and poor economic condition of the country are causing finance organizations to change their business strategies and structure.

Due to COVID-19 the change in multiple operational sectors requires specific revival policies, the study is focusing on organizational agility to cope up with the crisis. The objective of the research is to understand the way to psychological empowerment of employees for business revival and proper delivery of products. As mentioned by Gerster et al. [3], the most beneficial approach that enhances organizational agility is the “Plan-Build-Run” approach. The study tends to develop a relationship between “psychological empowerment” and institutional agility. As stated by Muduli & Pandya [4] employee tendencies to adopt the change in organizational structure and change in behavior are required to understand for crisis management.

According to Sońta-Drączkowska [5], managing a project based on an agile method is easier to accomplish than creating an agile organization. The author further mentioned that the dynamic environment of today’s business world demands business agility. The agility does not only refer to adaptation of business changes but also focuses on sustainable customer orientation [6]. The creation of organizational ambidexterity also falls under the development of agile organization. The creation of an agile organization from a legacy company is considered a paradigm shift. Trust between the workforces to deal with the shift is highly necessary for creating an agile organization.

It was identified in many sectors that the change in organizational sectors affects the employees in numerous ways. As mentioned by Chen et al. [7], employees’ psychological orientation is one of the major things that get a huge impact due to the change in organizational structure. The change can reduce work motivation and employee efficiency. This is the reason behind selecting psychological empowerment as a key factor for creating an agile organization. The percentage of women working at the Turkey’s finance sector is 31.5% [1,2]. After the market recovery at the end of 2020, it was seen that around 12.2% of the people in Turkey fall under the poverty line. Most of the people who fall under the poverty line are women and low-skilled workers. Empowering this workforce psychologically can result in better product outcomes and fast market recovery.

The aim of the study is to create an agile institution with organizational trust during the COVID-19 pandemic. Based on the aim of this study four objectives were identified in this section:

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to understand the requirement of creating an agile organization;

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to evaluate the role of psychological empowerment in organizational agility;

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to understand the mediating role of psychological empowerment in managing issues generated due to the COVID-19 pandemic;

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to examine the organizational trust in the creation of an agile organization.

The study will contribute to the creation of an agile institution with organizational trust for dealing with COVID-19 impact at the finance sector. The study mostly focuses on the mediating role of psychological empowerment during COVID-19. The study will be beneficial to make decisions regarding leadership and work motivation for the employees at the finance sector of Turkey and other countries.

2. Literature Review

Every business sector around the world has its specific approach to dealing with any kind of change ranging from financial to operational to environmental. As mentioned by Tyszkiewicz & Pawlak-Wolanin [8], the concept of the agile organization came from developing a human-centric organization that holds the ability to adapt to any changes based on the surrounding environment or marketplace. The authors mentioned that an agile organization tends to deliver valuable products to its customer in a continuous process. Tyszkiewicz & Pawlak-Wolanin [8] referred to organizational agility or flexibility for managing any situation. The authors address that in an agile organization the business operation is surrounded by the development of relationships between customers, partners, and suppliers.

Kuusinen et al. [9,10] addressed the challenges a company faces in changing its structure towards the agile organization. The authors mainly focused on the large agile companies to identify the challenges they faced at the very initial phase. In an agile company at the initial phase faces difficulties in understanding the usage of new business equipment. It was noticed that most of the companies don’t focus on continuous development which is a result of their products that don’t require continuous development continuously.

The agile method is time-consuming and takes a lot of effort behind the production of a single good. The change from the legacy system to the agile system requires the adoption of both the employee capability and supply chain. As mentioned by Brosseau et al. [11], an agile organization is segmented into four different components that are structure, people or workforce, process, and technology. The creation of an agile organization is highly dependent on the leadership approach that the company follows. As an adaptation of agile approaches changes the working procedures it is necessary to identify the perception of the workforce for the change taking place in the company. The authors [11] focused on the use of a blueprint for the creation of an agile organization. According to them, the first component of the blueprint is value which refers to the market position and value creation of an organization. The development of an agile organization should start with the creation of an agile team. All the team members in an agile team need to deliver the contribution in the value stream. It is required to have a workforce, technology, and core processes that bring agility to the organization.

As mentioned by Muduli & Pandya [4] interactive motivation to perform a certain task while reflecting proper self-control and active involvement with the process is considered as psychological empowerment. The term psychological empowerment consists of multiple micro terms such as leadership, task performance, motivation, decision-making, organizational design, and group process. Authors [4] mentioned that empowering an employee enhances work performance and positive attitudes toward other employees, and processes. Muduli [12] addressed four components of psychological empowerment that are self-determination, impact, competence, and meaning. According to [12], self-determination refers to the sense of autonomy of an individual and concern regarding others’ actions. Employee competence is highly associated with the proper completion of a task.

Chen et al. [7] mostly addressed the managers’ ability and contribution to the enhancement of employee competencies. The authors focus on the leader’s behavior for the psychological empowerment of employees. As stated by Muduli [12], a leader needs to manage his workforce with further agility and flexibility for dealing with a crisis. Chen et al. [7] refer to the organizational implication of psychological empowerment to increase workforce agility and crisis management. Psychological empowerment is necessary to predict the complexity and risk in the global marketplace. The study [7] has focused on the impact of a leader’s behavior on the psychological empowerment and proactive behavior of employees in a workplace. Here the identification of a proper leadership approach became necessary to address employees’ behaviour towards the leaders.

Llorente-Alonso et al. [13] studied the use of psychological empowerment for preventing emotional disorders in the workforce during the COVID-19 pandemic. The proactive behavior of employees during the pandemic has changed drastically. The authors [13] focus on job crafting to deal with employees’ emotional disorders. Here job crafting refers to the relational, task limits, and cognitive change in a job. During COVID-19 job-crafting has been seen as an effective tool to enhance employee motivation.

The effect of COVID-19 in different business sectors can be seen in terms of increased competition, the unpredictability of the market change regarding technology and operations. As mentioned by Siswanti & Muafi [14], during COVID-19 the business sustainability depends on workforce creativity. The authors further mentioned that innovation, organizational survival, and process effectiveness are enhanced by workforce creativity. Siswanti & Muafi [14] focused on psychological empowerment as a variable for understanding employee motivation and consistency in the business process. Psychological empowerment is highly dependent on the leadership approach. Empowering the workforce psychologically enhances the organizational ability to cope up with the change in the marketplace. As COVID-19 made the business sector more competitive, the psychological empowerment of employees provided a wider space to adopt new methods for dealing with the challenges.

As mentioned by Rafique et al. [15], innovation and organizational agility are highly dependent on employee ability to cope up with changing market dimensions. Authors [15] did a study on 346 employees of the private sector to understand the mediating role of psychological empowerment between motivation and innovation. The authors found that sectoral policies play a major role to empower the workforce psychologically. As the challenges rose by COVID-19, it becomes important to deal with the changes in a new way.

Coun et al. [16] considered employees’ proactive behavior because of psychological empowerment. The study found that making employees motivated by providing autonomy makes an organization flexible to address any diverse situation. As mentioned in [16], organizational agility is not an aspect that changes overnight. A company needs to address all the micro-operational factors for achieving agility in business processes. Authors [16] paid attention to the intrinsic task motivation of employees because of psychological empowerment. Addressing the concept of competence stated by Muduli [12], Coun et al. [16] mentioned that the effect of psychological empowerment on an employee can be seen in terms of accomplishing goals set by the organization. The accomplishment of goals and milestones has a dependency on self-determination. Muduli [12] stated that self-determination is associated with the sense of autonomy whereas Coun et al. [16] refers to self-determination in terms of employee’s perception to perform tasks in an individual way.

Akkaya & Tabak [17] develop the link between self-determination and organizational agility. Authors [17] mentioned that every individual holds a different perception of different things. The way of working and performing a task is different for each employee. It can be said that all the individuals in a workforce do not have the similar ability and cognition to deal with a situation. The autonomy of the employees for performing a task in their individualistic way enhances organizational flexibility while dealing with multiple situations. Akkaya & Tabak [17] compared different leadership approaches to select the suitable one for a company’s agility. A company needs to design its production and capacity to innovate based on the current economical purpose. During the COVID-19 when it became difficult to communicate with international business sectors it was important to design the business processing focusing on the local marketplace.

Udenio, Hoberg & Fransoo [18] stated that companies on the finance sector need to focus more on inventory agility rather than organizational agility. As mentioned by Öztürk et al. [19], the effect of COVID-19 on the finance sector is much bigger compared to the financial crisis that took place from 2007 to 2009. Authors [19,20,21,22] found that the virus outbreak in many parts of the European continent has had a huge impact on Turkey’s stock market. Despite having close relationships with some of the EU countries, Turkey’s stock market faces a heavy downfall due to the economic recession in those countries during the COVID-19 pandemic.

The way to make an organization agile is highly associated with strategic agility. Kohtamäki et al. [23] stated that strategic agility is the key to enable innovative work culture in an organization. Company’s growth in sales and profitability highly depends on innovation and strategic initiatives. The theory of strategic agility refers that the higher performance of a company can be achieved by making a strategic posture with appropriate capabilities. Authors [23] focus on the absorptive capacity of a company to bring agility in the organizational structure. Absorptive capacity helps to improve business performance.

3. Methodology

The study aims to create an agile organization with the involvement of organizational trust during the situation of the COVID-19 pandemic. The study put a major focus on the mediating role played by psychological empowerment to build the agile organization. The consideration type of information for the specific study is quantitative and numerical. The researchers adopted the structural equation model for analyzing the quantitative data.

As mentioned in [24,25,26], the structural equation model requires a visual representation of the link between variables and sturdy phenomena. The descriptive research design allows the researcher to highlight the variables and describe their dependency and relationship with the research factors. The design of the research is beneficial for representing the perception of the study population by numerical data. It helps meet the research aim and find out the answers to research questions. The variables selected for the research are organizational centricity, team development, decision-making time, change adaptation, and organizational trust. The dependency between the variables was measured and interpreted by descriptive research design.

The approach based on which the study developed is the deductive research approach. The reason for selecting the deductive research approach in this study is to examine the differences between the findings from previous research. According to [27], deductive research approach is effective for proceeding research in an experimental setting. This approach helped to establish the validity as well as the reliability of the study in the research area. The study is trying to look for a new thing which is creating an agile organization at the finance sector of Turkey to deal with the impact of the COVID-19 pandemic.

As mentioned by Guest, Namey & Chen [28], the selection of the study respondents should be done properly so that it reflects the true character of the overall sector or area of the study. Random sampling method was used in this study to provide equal opportunities to all the employees of Turkey’s finance sector as a potential sample for the research. A random sampling method was used to select 325 samples from 1000 employees of multiple finance companies of Turkey. The authors [28,29,30] mentioned the validity of a study from both the external as well as internal factors get reduces in lower sample sizes.

As mentioned by Shi, Zhang, & Khan [31] the collection of quantitative data should be done by considering close-ended questions. A survey questionnaire was used for collecting information from 325 selected samples of the study. As the physical norms of the pandemic are concerned the entire questionnaire was handed over via electronic mail and social media messaging options. Before collecting the information all the participants were informed about the purpose and way of the study. 12 questions are in the survey questionnaire and all the questions are based on the variables selected for quantitative analysis (Appendix A). The platform used for the survey is Google Form. Due to the pandemic, it was advised that an online survey is the most practical data collection way in this situation.

According to Haardörfer [32], there are multiple benefits of conducting an online survey. The first benefit that an online survey provides is cost-effectivity. The online survey platform Google Form charges no money for using it. As it says in the online survey, the way to share the questionnaire is using online platforms like social media and emails. No physical transportation and the requirement of face-to-face interaction make it easier to reach an ample amount of population in a short period of time. Online survey questionnaire is easy to use and user-friendly that makes samples to complete the survey quickly and easily.

After the collection of all the relevant data the major thing that is required to do is to analyze the information. Quantitative data was collected from primary sources for the study. All the data was represented in Microsoft Excel Software 365. Two major tools were used in Microsoft Excel Software for analyzing the data. The first thing that was done is using inferential statistics to find out the Pearson correlation and t-Stat value between two variables. The researchers have done a t-Test by pairing two variables for mean from a set of inferential statistics. The two sample t-test is one of the most used statistical procedures that’s why we used it in our research. Its purpose is to test the hypothesis that the means of two groups are the same.

The study has used descriptive statistics for analyzing the data. The major use of descriptive statistics can be seen in terms of representing the data characteristics in a visual way. Bergin [30] mentioned that the interpretation of the data collected from survey questions can be done in a simplified way by doing descriptive statistics. The variability present in the samples can be measured and identified by this specific statistical method. The summarization of the collected information based on the research variables was done by descriptive statistics.

The study has used the Structural Equation Model (SEM) for analyzing the collected data. According to Sharma et al. [33], the use of the SEM is applicable to represent the relationships between variables. It helps to design and confirm the relationship of a phenomenon with the research variables or factors. The study has focused on statistical analysis to analyze and measure the relationship between latent and observed variables that makes SEM an essential component of the data analysis. The design of the study in an experimental setup enhances the requirement of using SEM.

4. Results

As mentioned by Carter & Varney [34], the agility of an organization is highly dependent on the centricity of a company. Here centricity refers to the organizational tendency either towards the workforce or customer. This first t-test was done between the centrality of the organization and the decision-making duration of a company. The Pearson correlation calculated between these two variables by doing a t-test is 0.16, which is higher than 0 (

Table 1. t-Test between Question 1 and Question 3.

	Q1	Q3
Mean	1.461538462	1.741538462
Variance	0.249287749	0.649040836
Observations	325	325
Pearson correlation	−0.162904935
Hypothesized mean difference	0
df	324
t Stat	−4.975208386
P(T ≤ t) one-tail	5.29939 × 10−7
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	1.05988 × 10−6
t Critical two-tail	1.967312704

). The Pearson correlation refers to the decision-making time of an organization that has a positive relationship with organizational centricity. Besides that, the value of t-stat came out negative which is referring to the low dependency of decision-making time on the organizational centricity.

The second t-test took place by considering the flexibility of an organization and the impact of organizational flexibility. The impact of organizational flexibility was measured on the employees. The Pearson correlation came out in case 0.008 which is positive but very close to zero (

Table 2. t-Test between Question 4 and Question 5.

	Q4	Q5
Mean	1.612307692	1.495384615
Variance	0.534415954	0.559392213
Observations	325	325
Pearson correlation	−0.008927643
Hypothesized mean difference	0
df	324
t Stat	2.006512296
P(T ≤ t) one-tail	0.022816117
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.045632233
t Critical two-tail	1.967312704

). It can be said that these two variables have a positive relationship, but the relationship is not strong enough.

The study tries to understand the dependency between an agile organization’s ability to handle COVID-19 impact and employee capability to adopt the change due to the shift towards an agile organization. The Pearson correlation between these two variables came out to be 0.12 which is positive (

Table 3. t-Test between Question 6 and Question 7.

	Q6	Q7
Mean	1.501538462	1.603076923
Variance	0.553238367	0.591965812
Observations	325	325
Pearson correlation	0.122418472
Hypothesized mean difference	0
df	324
t Stat	−1.825869509
P(T ≤ t) one-tail	0.034395094
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.068790188
t Critical two-tail	1.967312704

). Considering the Pearson correlation, it can be said that the employees’ ability to adapt the change towards organizational agility has an influence on dealing with COVID-19 impact by a company. The t-Stat value of these variables is −1.8 which refers to agile organizations’ ability to deal with the COVID-19 impact is not dependent on the employees’ ability for adopting the structural change in the organization.

According to [35,36], employees’ self-determination as well as competency has a major impact on the organization’s ability to deal with diverse situations and market crises. t-Test was done between employees’ self-determination and the organization’s ability to deal with the changes due to COVID-19. The Pearson correlation measured in this case was 0.37 which shows the organization’s ability to deal with COVID-19 impact has a strong positive relationship with self-deterministic character and competency of employees (

Table 4. t-Test between Question 6 and Question 8.

	Q6	Q8
Mean	1.501538462	1.470769231
Variance	0.553238367	0.49682811
Observations	325	325
Pearson correlation	0.372440273
Hypothesized mean difference	0
df	324
t Stat	0.683024654
P(T ≤ t) one-tail	0.24753968
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.495079361
t Critical two-tail	1.967312704

). The t-Stat value calculated between these two variables is 0.68 which refers to the dependency between two variables.

A relationship between organizational flexibility to adapt to marketplace change and organizational trust was also examined. According to Bhatta & Thite [37], organizational trust plays a crucial role in better processing in a company. The Pearson correlation between organizational trust and the company’s flexibility is 0.27 (

Table 5. t-Test between Question 4 and Question 9.

	Q4	Q9
Mean	1.612307692	1.550769231
Variance	0.534415954	0.587692308
Observations	325	325
Pearson correlation	0.272044642
Hypothesized mean difference	0
df	324
t Stat	1.227233109
P(T ≤ t) one-tail	0.110312971
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.220625941
t Critical two-tail	1.967312704

). It is suggested that organizational trust has a strong positive relationship with the company’s flexibility to adapt to challenges of COVID-19. The t-Stat value between these variables is measured at 1.22 which is a positive result. Considering the t-Stat value it can be said that a company’s flexibility is highly dependent on organizational trust.

Change in company structure to enhance the flexibility of the organization influences the employee competency and process of working [37]. It was identified that employees in the organization need to have the ability to adapt structural change. The value of the Pearson correlation between employee competency and ability to adapt to structural change in an organization is 0.13 which shows both these variables have a positive relationship (

Table 6. t-Test between Question 7 and Question 8.

	Q7	Q8
Mean	1.603076923	1.470769231
Variance	0.591965812	0.49682811
Observations	325	325
Pearson correlation	0.13504772
Hypothesized mean difference	0
df	324
t Stat	2.457130476
P(T ≤ t) one-tail	0.007264437
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.014528875
t Critical two-tail	1.967312704

). The t-Stat value in this case came out to be 2.45. Based on the t-Stat value it can be said that employees’ ability to adopt structural change towards agile organization is dependent on competency and self-deterministic character.

Most of the participants of the research said that one of the major activities to deal with the crises in the finance sector due to COVID-19 can be managed by continuous learning. The Pearson correlation that suggests the relationship between two variables measures 0.12 in this case (

Table 7. t-Test between Question 10 and Question 11.

	Q10	Q11
Mean	1.446153846	2.153846154
Variance	0.525641026	1.291073124
Observations	325	325
Pearson correlation	0.122484327
Hypothesized mean difference	0
df	324
t Stat	−10.03949859
P(T ≤ t) one-tail	3.9564 × 10−21
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	7.91279 × 10−21
t Critical two-tail	1.967312704

). Considering the value of the Pearson correlation it can be stated that continuous learning for dealing with the impact of COVID-19 pandemic has a strong positive relationship with the leadership approach of an organization. As mentioned by Almulhim [38], innovative behavior and the creation of an agile organization is dependent on the leadership approach that an organization used to follow.

As mentioned by Flores, Xu & Lu [39], a competent workforce holds the ability to adapt to the changes. The process of change adoption consists of multiple factors ranging from innovation ability to examination of market construction. The study tried to find out the relationship between employees’ ability to cope up with structural change for shifting the organization towards agility and the importance of continuous learning during COVID-19. The Pearson correlation here is calculated as 0.35 which is very close to 0.5 (

Table 8. t-Test between Question 7 and Question 10.

	Q7	Q10
Mean	1.603076923	1.446153846
Variance	0.591965812	0.525641026
Observations	325	325
Pearson correlation	0.357177566
Hypothesized mean difference	0
df	324
t Stat	3.335998969
P(T ≤ t) one-tail	0.000474325
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	0.000948649
t Critical two-tail	1.967312704

). It is evident that continuous learning is effective to enhance the employee’s ability for coping with structural change in an organization. The t-Stat value measured between these two variables is 3.33 that is also referring to the strong dependency of change adoption ability of employees on continuous learning.

It was identified that organizational centricity has a strong relationship with the decision-making of an organization. The relationship between organizational flexibility and the human-centric approach of organizational leaders is developed in this study. It was found that the leader’s approach towards human-centricity has no dependency on organizational flexibility (

Table 9. t-Test between Question 4 and Question 12.

	Q4	Q12
Mean	1.612307692	2.175384615
Variance	0.534415954	1.114207028
Observations	325	325
Pearson correlation	0.18838185
Hypothesized mean difference	0
df	324
t Stat	−8.711176963
P(T ≤ t) one-tail	7.86234 × 10−17
t Critical one-tail	1.649570176
P(T ≤ t) two-tail	1.57247 × 10−16
t Critical two-tail	1.967312704

). However, it was identified that the human-centric approach of a leader has a positive relationship with organizational flexibility to adapt to change in the marketplace. As mentioned by Ambad et al. [40], the human-centric approach, employee competency and work-efficiency of an employee can be addressed by psychological empowerment.

Descriptive statistics were done to understand the variance in the samples. The standard error for question one which is about organizational centricity is 0.02 (

Table 10. Descriptive statistics between Questions 1, 2, 3, 4, 5, 6, 7.

	Q1	Q2	Q3	Q4	Q5	Q6	Q7
Mean	1.461538462	1.56615385	1.741538	1.612307692	1.495384615	1.501538462	1.603076923
Standard error	0.027695473	0.03846876	0.044688	0.040550669	0.04148743	0.041258598	0.042678253
Median	1	1	2	1	1	1	1
Mode	1	1	1	1	1	1	1
Standard deviation	0.499287241	0.69350535	0.805631	0.731037588	0.747925272	0.743799951	0.769393145
Sample variance	0.249287749	0.48094967	0.649041	0.534415954	0.559392213	0.553238367	0.591965812
Kurtosis	−1.988242437	−0.5428081	−1.28301	−0.773571991	−0.283984881	−0.311850763	−0.841500992
Skewness	0.155019745	0.82265555	0.502851	0.749805713	1.129247304	1.104091015	0.816243461
Range	1	2	2	2	2	2	2
Minimum	1	1	1	1	1	1	1
Maximum	2	3	3	3	3	3	3
Sum	475	509	566	524	486	488	521
Count	325	325	325	325	325	325	325

). The low standard error in this case is referring to the fact that the amount variation is less in the sample. The mean value for question one is 1.4 which is referring to the fact that the finance sector in Turkey has almost a similar number of customer-centric and workforce-centric companies. The lower standard error between the data set is referring to the higher dependency.

The amount of variation in the data set is low in the case of both organizational flexibility and its effect on employee’s work motivation. The lower standard error is referring to the fact that the data set is reliable, and two variables have a significant amount of dependency on each other.

As mentioned by Malik, Sarwar & Orr [41], one of the components of psychological empowerment is employees’ ability to cope with any kind of organizational change. Here the change also refers to the shift towards a different organizational structure that is more agile and brings flexibility to the organization. According to Hosking [42], an agile organization maintains stability between decision making and quick resolving issues. As COVID-19 brought different constraints in the business sector, work motivation was highly affected by this. Employees are required psychological empowerment to deal with the change in the organization. The creation of an agile organization should be driven by a leadership approach and changing business processes towards a more workforce-centric approach. The size of an organization is one of the key factors that influence the difficulties of changing the organizational structure towards an agile organization [10].

According to Civelek [43], the structural equation model is a statistical method for representing the relationship between the variables in a study visually. The variables considered in this study represent the role of psychological empowerment for creating an agile organization. The relationship between the factors of agile organization and the components of psychological empowerment was established in this case. The unit for representing the relationship is the Pearson correlation, which is represented as r in Figure 1. The reason behind denoting the Pearson Correlation as r is the statistical analysis of the samples. The study has found that employee motivation (r = 0.008) has a positive relationship with organizational flexibility. Organization trust (r = 0.27) and the human-centric approach of an organization are showing a strong positive relationship with organizational flexibility.

Sahin et al. [44] stated that the handling of pandemic impact should be done by considering the perspective of employees. The study is showing the self-determination and competency of employees (r = 0.37) have a strong positive relationship with the creation of an agile organization. Elali [45] focused on the strategic agility of an organization. The study shows continuous learning for dealing with the severe impact of COVID-19 provides strategic agility which is highly influenced by the leadership approach (r = 0.12).

Ali et al. [46] mentioned that the psychological empowerment of employees can be enhanced by adopting a suitable and efficient leadership approach that provides employees autonomy to deal with situations creatively. Organizational trust as well as self-determination and competency as components of psychological empowerment are showing the most influence on the creation of an agile organization. It was found that agile organizations hold the capability to change the business processing based on market orientation. It is effective to deal with the change in the marketplace due to the COVID-19 pandemic.

According to Seetharaman [47], there is a requirement of shifting business models for better handling of COVID-19 impact. As mentioned in [48], the shift in the business model should move towards rapid development and agile capabilities. The study has found that the creation of an agile organization is dependent on one of the components of psychological empowerment which is organizational trust.

5. Discussion

It was found from the statistical analysis that an organization’s centricity towards workforce or customer does not make its decision-making time dependent. However, it was established that the decision-making duration of a company is positively related to the organization’s centricity. Most of the samples responded that an agile organization has a better ability to cope with the impact of COVID-19. There is a relationship between organizational agility or flexibility and employee’s ability to adopt structural change. An agile organization holds the capability to address the change in the market and maintain the equilibrium between market outcome and stock return in the finance sector.

Strategic communication is one of the key factors of psychological empowerment. According to Bushman [49], a bonus plan based on cash is highly beneficial for strategic communication within an organization. Cash-based bonus plans make employees work by considering the organizational objectives. Here an organization’s commitment to the market and its workforce is also a key factor that needs to be measured. Most of the cash-based bonus plan is effective to measure the performance of companies operating in fiancé sectors. Authors [12,13,14,15,16,17,50,51,52,53,54] addressed employee ability for organizational innovation and degree of coping up with marketplace change. They mentioned self-determination as a component of team autonomy whereas the study measured self-determination as a component to bring organizational agility.

The result of research can be more effective or applicable for its generalizability. It is important for researchers to consider the validity of research from both the external and internal aspects so that it can be accepted by all the readers. It is highly essential to maintain the applicability of a phenomenon from the functional aspects. It can be said that the study focused on an aspect that is comparatively new in the present situation. It will help organizations in the finance sector of Turkey to deal with the impact of COVID-19 in an effective way.

The limitations of the article concern the sample of respondents, which we will expand to include other countries (for example, Poland and Ukraine) in our subsequent studies. Future plans, therefore, will concern the deepening of this research in the context of attracting respondents not only from Turkey, but also from EU countries and Ukraine, which will allow to look at the problem of agile institutions more panoramically.

6. Conclusions

The study found that psychological empowerment of employees is highly influential for creating an agile organization. It can be said from a theoretical perspective that the components of psychological empowerment such as self-determination, competency, and work efficiency provide a space for increasing organizational flexibility. Due to COVID-19 the change in Turkey’s finance sector is new and most of the companies find it difficult to manage. The study found that the approach of an organization is important to make decisions during difficult situations. It was found that a human-centric approach of a company is more efficient to deal with the COVID-19 impact and make the time for decision-making less.

It was identified that the components of psychological empowerment such as employee motivation, work efficiency, employee perception regarding the change in the marketplace have a huge influence on the creation of agile organization. It was found that an organizational approach towards human-centricity has a huge impact on the creation of an agile organization. Agile organizations are highly effective to manage crisis arose due to COVID-19.

The practical contribution of the study is a change in leadership approach to empower employees psychologically. Leadership provides a team required autonomy for dealing with a situation in an innovative and effective way. The way to bring agility in an organization during COVID-19 a company in Turkey’s finance sector should implement continuous learning through experiment. The study found that one of the pillars of agile organization is leadership and employees’ capability to deal with the marketplace change. The consideration of these two pillars helps in management, innovation, and production at the same time.