The

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Chapter 1 The Psychological Contract and Commitme
nt
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Objectives

• Define the psychological contract and discuss the
  obligations of the contract currently in place
• Explain the importance of the psychological
  contract and what happens when it is violated
• Explain the benefits of committed employees and
  what employers can do to foster commitment

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Organizational Behavior An Experiential Approach
8/E Joyce S. Osland, David A. Kolb, Irwin M.
Rubin and Marlene E. Turner
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Objectives

• Describe external influences that affect
  workplace expectations
• Explain the self-fulfilling prophecy and how
  managers can apply this concept
• Explain the pinch model
• Make a psychological contract with your professor

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Organizational Behavior An Experiential Approach
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Rubin and Marlene E. Turner
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Mental Maps - Defined

• Our images, assumptions, and stories about
  every aspect of the world, which determine what
  we see and how we act.

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Rubin and Marlene E. Turner
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Psychological Contract - Defined

• An individuals beliefs, shaped
• by the organization, regarding
• the terms and conditions of a
• reciprocal exchange
• agreement between individuals
• and their organization

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Organizational Behavior An Experiential Approach
8/E Joyce S. Osland, David A. Kolb, Irwin M.
Rubin and Marlene E. Turner
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Social Exchange Theory - Defined

• People enter into relationships in which not only
  economic, but also social obligations play a role
  
• People are most comfortable when the exchange is
  balanced
• Psychological Contract

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Rubin and Marlene E. Turner
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Importance of Psychological Contracts

• Link individuals to organizations
• Reflect the trust that is a fundamental feature
  of the employment relationship
• Motivate individuals to fulfill their obligations
  (if they believe the other party will do the
  same)

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Organizational Behavior An Experiential Approach
8/E Joyce S. Osland, David A. Kolb, Irwin M.
Rubin and Marlene E. Turner
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Psychological Vs. Employee Contract

• Psychological Contracts
• Dynamic relationship
• defining employees
• psychological
• involvement with
• employer
• Reflects perceptions of
• expectations
• Interpretations may not
• be similar

• Employee Contracts
• Formal contract that specifies agreements such as
  hours and type of work in return for compensation
  and benefits

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Rubin and Marlene E. Turner
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Sources of Experienced Violation

• Inadvertent
• Disruption
• Breach of
• contract

• Able and willing (divergent
• interpretations made in good
• faith)
• Willing but unable (inability
• to fulfill contract)
• Able but unwilling (reneging)

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Rubin and Marlene E. Turner
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Consequences of Broken Contracts
Causes

• Outrage, shock, resentment, anger
• Decreased trust and good faith
• Decreased job satisfaction
• Decreased productivity
• Decreased attendance
• Turnover

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Realistic Job Previews - Defined
RJPs are a recruitment technique that give
accurate information about job duties, and
especially about the major sources of job
satisfaction and dissatisfaction prior to
organizational entry
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Employee Commitment - Defined

• Emotional attachment to, involvement in, and
  identification with organization
• Strong belief in and acceptance of organizations
  goals and values
• Willingness to exert considerable effort on
  behalf of organization
• Strong desire to remain in organization

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Advantages of Committed Employees

• Higher performance
• Higher job satisfaction
• Adapt better to unforeseen circumstances
• Better attendance records
• Stay with the company longer
• More organizational citizenship behavior

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Organizational Citizenship - Defined

• OCB refers to discretionary contributions that
  are organizationally related, but are neither
  explicitly required nor contractually rewarded by
  the organization, yet contribute to its effective
  functioning

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Workplace Incivility - Defined

• Low intensity deviant behavior that violates
• workplace norms for mutual respect it may
• or may not be intended to harm the target

• Work effort
• Productivity
• Motivation
• Creativity
• Helping behaviors
• OCB

Causes decreased
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Business-Related Changes Impacting Psychological
Contracts

• Technological change
• Rate of change in the business environment
• Global economy
• Changing economic conditions
• Uncertainty for workers

• Demands for performance, flexibility and
  innovation
• Reengineering
• Downsizing
• Mergers acquisitions

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Job-Related Changes Impacting Psychological
Contracts

• Outsourcing, off-shoring, subcontracting of work
• Contingent and temporary employment for
  peripheral employees
• Fewer full-time jobs and core employees
• Relatively low union representation
• Less job security

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External Factors that Impact Psychological
Contracts

• Demographics
• Swings in employment
• Nomadic nature of the workforce
• Changing complexion of the workforce
• Changing value trends

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Projected Year 2012 Workforce

• 47 Women
• 65 White non-Hispanics
• 15 Hispanics
• 12 African Americans
• 6 Asians

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A Nomadic Work Force

• 13 different jobs in the career of the average
  high school or college graduate
• 10.2 different jobs from ages 18-38
• Only a third (31) of workers
• 25 and up have worked 10 years
• with the same employer

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Value Changes Affecting the Workplace

• Shifting breadwinner and parenting roles
• What else?

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Generations at Work

• Baby Boomers (1946-1964) - self-fulfillment at
  work fought against hierarchical authority
  demand a voice in work decisions work is central
  to lives significant loyalty to corporate
  employers
• Gen X (1965-1976) - Work less central and
  family nonwork activities more important
  identity less tied to work less expectations of
  organizations and career stability
• Gen Y (1976-2001) prefer fun environment and
  teamwork flexible work hours looking for work
  with significance idealistic

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Cultural Differences in Psychological Contracts

• Promises
• Intention can equal follow through
• Uncertainty/fate can reduce binding aspect
• Zone of negotiability
• Variation in type of employee conditions open for
  negotiation
• Group identity
• How we and they are defined influences
  trust/promise making

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Self-Fulfilling Prophecy - Defined

• People perform in accordance with a raters
  expectations of them

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The Pinch Model
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Whats Your Decision?

• Which decision have you made about your
  workplace? About this course?
• Join
• Participate
• How do you get employees to participate?

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Responses to Violation
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