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At the core, Psychological Contract is a philosophy and not a method, tool or formula. This reflects its significant and ever-changing dynamic nature. The method in which we define, understand and manage Psychological Contract, and apply the underpinning philosophy in our dealings - inside or outside the work - in essence defines our civilized outlook. Fairness,
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Early phase As the psychological contracts deals with the employees beliefs about mutual obligations amid themselves and employers, it can be viewed as the grounding of employee-employer relationships . Basically, individuals generally shape their outlook from two major sources which includes their communications with their organisational representatives and perceptions of organisations culture. In the anticipatory socialisation, at the time of recruitment, organisational recruiters and human resource professionals make detailed promises to workforce about what could be expected from a organisation Secondly, employees perceptions of organisations culture and the standard functional procedures shape the employees viewpoint as regards to psychological contracts. Recruitment and early years at the organizations shape the psychological contract of the employees. (DelCampo, 2007) Development In first four to six months after becoming the part of organisation, the simple psychological contract is brought to reality. According to a study, newcomers generally have an exceedingly positive view about the labour- employee relationship. Their preliminary perceptions could be characterised by tall expectations towards their employer and lesser expectations from themselves. As new employees gain more and more experience with the organisation, they try get used to the environment and they settle their expectations close to reality. Dimensions Specific promises which are made by both the parties on commonly accepted promises based on the common obligations of employees and employers formed the basis psychological contract. Though, even if the organization has not made definite promises, every member of staff will welcome fairness, clarity, and good communication. On the other
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In all cases this psychological contract must be respected and if it gets broken then it could impact: job satisfaction commitment of an employee Employee engagement.
Hence the manger should understand that employment relationships between employer and employee may deteriorate in spite of the managements best efforts. Hence it is better to prevent the breach than to repair the damage afterwards. In cases in which, breach cant be avoided it is better to negotiate. 4. How the psychological contract came into existence?
Changes in workplace are majorly responsible for it. These include: More employees doing part-time work. Organisations downsizing coupled with delivering Technology, markets and products changing constantly. Finance and technology becoming less worth-while than human resources More fluid organizational structures
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A psychological contract could be measured by one of the following methods: 1. Psychological Contract Inventory these are the scales for the measurement of Short term psychological contract. (This is basically a type of the transactional contract), Security (type of the Balanced contract), performance requirements contract (this is a type of balanced contract), Loyalty contract (this is a type of relational contract), Career Development (internal and external) (This also is a part of the balanced contract), (Rousseau, 2000; vers.3). 2. M_DOQ 10 i.e. MAJER_D'AMATO ORGANIZATIONALQUESTIONNAIRE 10 This is a test which takes into account 10 factors to get an idea about the employees perception of the organization. These 10 factors include satisfaction. Development, Team, Autonomy, Job description, Communication, Job involvement, Reward, Fairness, Leadership, Innovation; 3. Quality System (ISO9000:2001) provides a scale to quantify the satisfaction of the employees in a particular organization. The satisfaction level is calculated by a scale which has 6 dimensions that includes relation with others, general satisfaction, organisational and environmental features, training satisfaction, equipments available, professional role). After
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Every organization has some responsibilities towards its employees. If the organization fulfil these promises then it could lead to huge amount of employee satisfaction .Below are the some of the promises made by the contemporary organization to its employees: 1) Development of Career - Organizations should give all the possible opportunities to the employees for their development within the organizations. Their efforts should be recognized and there should be ample opportunities for the promotion. 2) Good Job Profile - The job offered by the organization should be challenging and interesting. Job should not be monotonous and employee should be given continuous challenges to preserve their interest in the job. 3) Good work Culture The organization should offer an environment with the good working environment. There should be good communication and cooperation within a group 4) Good Compensation employees of the organization should be offered an appropriate compensation achievements. 5) Work and private life Balance- there should be proper understanding of the personal situation of an employee and in some situations flexibility in working hours could be provided. (Lars, 1996) Psychological contract in contemporary organization is a two way role. Following are the kind of commitments which could help in bridging the employee- employer psychological contract: according the jobs they do. Incentives should be given for high
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According to a research while organizations have de-layered and reduced the number of the middle management posts many still continue to offer good careers and therefore most employees have adjusted the expectations o downwards. Many of them will be increasingly satisfied if they believe and know that their organizations are handling issues about their promotion fairly. The recession had increasingly negative impact on the employee attitudes, especially with regard to job satisfaction and security. This suggests, managers will have to face great challenge to restore and maintain employees commitment as corporate emerge from the recession. A positive psychological contract can greatly help as it supports a high level of employee involvement. However this concept of involvement goes beyond the employees attitudes and assets the need for managers to draw out the employees' behaviour. Managers should manage which expectations, through for regular the fair systems of performance
management
accounts
communicate important messages about what the organisation seeks to offer .Employee attitude surveys are effective tool for exploring what employees think and feel about the organization on a range of issues affecting them at the workplace. In times of rapid changes senior executives and employees hold different opinions. Two-way communication, formal or informal, is important to form a reality check and act as a basis for building the mutual trust. (Guerrero, 2005)
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The psychological contract may have the following implications Fairness of Process: employees want to identify and understand that their welfare will be taken care when vital decisions are made. They would like respect and consequently they are more contented with their jobs. Communications: an efficient two-way conversation between employer and employees is a compulsory means of giving importance to employees voice. Management style: organisations managers can no longer manage business 'top down' - they actually have to take up bottom up' approach. Critical information is known by employees from their communications with customers and suppliers. Expectations managing: organizations need to make apparent to what the employees can expect from their job. Managing expectations is particularly necessary when bad news is probable. Measuring attitudes: organizations should monitor employee attitudes on regular basis as it is a means to identifying where action is needed to improve the performance. Therefore, Breach of this psychological contract can critically spoil the employee-employer relationship. It is not always possible to avoid a breach but damage is contained if managers and senior executives are open with the employees about the issues which need to be addressed.(Mao, 2008) 8. Conclusion
Public attention to psychological contract has been infused by uncertainties about job security. Organization should make certain that trust and faith remains with the workforce i.e. clarifying what is on the offer, honouring commitments, or if required explaining what has gone wrong, and monitoring the employee attitudes on a habitual basis. Employee engagement strategy can make available a useful structure for this point. (Feldman, 1999)
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here? Human Resource Management Review. Vol 17, No 2, June. pp166-179. 2. Cullinane, N. (2006). The psychological contract: a critical review. International
Journal of Management Reviews. Vol 8, No 2, June. pp113-129. 3. Ven, C. (2009). The Psychological Contract; a big deal? Accessed on 14th August
2010 from: http://www.internationalmta.org/Documents/2004/2004024P.pdf 4. DelCampo, R. (2007) "Understanding the psychological contract: a direction for the
future", Management Research News, Vol. 30 Iss: 6, pp.432 440. 5. Anon, (2010). The psychological contract. Accessed on 12th August 2010 from:
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Context. Accessed on 14th August 2010 from: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1635325 8. Mao, H. (2008). Evading Tactics of Psychological Contract Violations. Accessed on
12th August 2010 from: http://www.ccsenet.org/journal/index.php/ass/article/viewFile/784/758 9. Feldman, D. (1999). The impact of psychological contract violations on exit, voice,
loyalty, and neglect. Accessed on 11th August 2010 from: http://www.accessmylibrary.com/article-1G1-55438376/impact-psychological-contractviolations.html 10. Thomas, B. (2001). An Investigation Of The Relational Component Of The
Psychological Contract Across Time, Generation, And Employment Status. Accessed on 11th August 2010 from : http://www.accessmylibrary.com/article-1G1-74942455/investigationrelational-component-psychological.html
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