Historical Review of Psychological Contract - Coursework Example

Psychological Contract Name Course Institution Historical Review of Psychological Contract The psychological contract entails the mutual beliefs, informal obligations and perceptions made between parties, and this includes an employer and employee. The dynamics concerning the relationship are well set since the practicalities of the tasks to be done are well defined. The concept has its traces in the 1960s since it had a strong correlation with the equilibrium theory. The art of balancing was important since the employers had to understand the informal cultures of the employees for maximum yields to be attained, and this was the case if the employees had minimum grievances. The idea was thus an important expectation on the part of the employees. The promises and beliefs that were perceived by a person made up the contract since they were influenced by the institution that h/she worked for hence forming an exchange agreement (Conway & Briner, 2005: 22). The psychological contract was adopted since it was believed that work had a major role in defining the psychological wellbeing of an individual since it created a sense of identity and order. The psychological contract hence provided a platform where both the employer and employee could provide expression and gratification of each other’s needs. The work environment hence became instrumental in bringing about the interpretative idea of perception and cognition. The employees’ satisfaction was an important virtue since it was crucial for the attainment of productivity and efficiency on their part. Part of the satisfaction entailed the presence of huge differences between the organization’s inducements and the personal contributions of each employee. The idea was that inducements would be generated if the employees’ contributions were sufficient and attractive (George, 2009:26). The contract was, therefore, made up of an implicit understanding between the two parties that entailed that the employees would provide higher productivity incorporated with lower grievances and in turn receive job security and acceptable wages. The idea was that the employees would provide high yields if there were minimal interference from the employer hence providing a mutual understanding. The mutual understanding was created since each party had an expectation that ought to have been implemented. The expectations, therefore, comprised of being highly specific as well as being general since some of them were individualized while others were widely shared(Conway & Briner, 2005:40). The concept was fundamental since expectations were viewed as being a result of the rising needs. Since the preferences and needs varied then, it was important to come up with strong bases that could define the expectations of both the employees and the organization, and this saw the rise of the contract. The exchange between the parties involved needed to have mutual satisfaction if the relationship was to prosper. The fulfillment of needs was the driving force since the two parties had to play their roles significantly hence the virtue of responsibility was important. Critical analysis of the psychological contract between employees and employer As noted the psychological contract shows, the perception made between an employee and employer concerning the mutual obligations that they have towards one another. Most often the obligations are imprecise and informal since mostly they are inferred from certain actions as well as what transpired in the past. The contract entails things such as job satisfaction, work quality and levels of employee commitment. The obligations made may be in terms of expectations and promises between them. Some of the obligations may be made by the employer by just stating them, and this may be during performance appraisals and recruitment processes. The psychological contract has evolved over time since the employees have the right to negotiate in order for them to be able to satisfy their bargain. It, therefore, shows there is flexibility involved in terms of both the employee and employer since both parties will be satisfied hence offering their best. The negotiations may be in terms of promotions and transfers, and this would result to commitment, and motivation being enhanced since a common ground will be created. The common ground may include promises about salary increase or promotions, and both parties are obliged in being committed to meeting their respective sides of the bargain (Makin,Cooper & Cox, 1996:28). The management of reasonable expectations is an ideology that the employers have to undertake since they should not give the employees perceptions that do not materialize. On the part of the employees, they should manage the expectations so that adverse personal issues and difficult situations do not affect their productivity hence the management doesn’t view them as being deviant. The aspect of fairness should be incorporated so that the psychological contract can be efficient since equity plays a pivotal role hence ensuring that biasness does not prevail. The psychological contract is different from the formal contract since it is, usually, implicit or tacit. The reason for this is because the contract tends to be invisible and informal. The perceptions and assumptions made are unofficial, and they are often untested of the work environment. The psychological contract has a significant impact since it motivates the employees hence increasing their productivity and performance (George, 2009:38). The psychological contract is important since it is centered at the reality of the situation as perceived and understood by both the employer and employee hence becoming more influential in how the employees perform their duties. It is effective since it clearly spells out what the employees are expected and required to do in order to accomplish their side of the bargain. The contract, therefore, brings about the idea of a partnership between the employer and employee hence showing that both parties are important if the set objectives have to be achieved(Wellin, 2007:27). For the partnership to be formidable then certain expectations are expected by both parties. For example, the employee may expect the employer not to fire him or her after he or she has worked for a given number of years. On the other hand, the employer expects the employee to have a good public image as well as being secretive so that secrets cannot be given away to the competitors. It is worth noting that such expectations are not in the form of written formal agreements yet they are a major force since they are powerful determinants of behavior (Makin,Cooper & Cox, 1996:38). The notion that is created is that of payback whereby if an employee feels that the management is respectful to his or her right to grow and develop own initiative. In turn, the employee will feel obliged to respect the virtues of the organization hence allowing its evolution and growth. The psychological contract may be inherently unstable since the working conditions and environment may be subjected to change over time. The contract may be complex since it can be viewed as a mental map that is used in the navigation of the different aspects. They should be incorporated in the work environment hence should be undertaken by both the employer and employee. The proposition of the contract is that it provides a robust and strong framework in the employment management in terms of research and relationship. High levels of trust should prevail so that the psychological contract can be effective and efficient. It should be undertaken by the parties involved since it is an important virtue. Specifically in order for the psychological contract to be adhered then the employer should oblige to providing advancements, training, high pay, development, job security, support, respect and fair practice to the employees. On the hand, the employees should oblige to being loyal and flexible. They should also ensure that the job is well-done with minimum supervision. It is, therefore, important to note that for these obligations to be achieved then good communication systems and skills should be put in place (Wellin, 2007:39). Since the world has become dynamic with the age of technological innovations then, this has been pivotal in the advancements of communication systems. The employers and employees can easily communicate through emails and in the process a consensus is made. In the case of a misunderstanding then the problem should be communicated at the right time, and this can be achieved using such systems. Consistency is also important in ensuring that the psychological contracts between the employees and employers since constant fluctuations have adverse effects. Fluctuations in performance can lead to poor returns hence reducing productivity since the main objective of most employers is to maximize profits hence consistency should be adopted. On the part of the employees, consistent pay is crucial since delayed payments can seriously affect their lives. The employers should thus adhere to such promises in order to ensure that the high morale levels of the employees are maintained. Since time is of the essence then, the value of time should be incorporated in the psychological contracts (George, 2009:45). The psychological contracts have, therefore, pressurized employers to change their mindsets concerning issues that affect the employees. The idea of dialogue has been created in solution making since employees can air their grievances and means of solving them are incorporated. An open minded network is created, and this allows for the incorporation of new ideas without the fear of victimization. Conclusion There exists differences and variability between different psychological contracts since they are based on the workplace environments as well as the workforce demographics. The differences are brought about since objectives; tastes and preferences do vary among employers. For the contract to be successful then, each party has to adopt certain measures such as an employer should provide compensations that are performance based. On the other hand, the employee should provide quality performance. For the aspect of the psychological contract to prevail then the virtue of responsibility should be adhered to since this will ensure that both the employee and employer will do the right thing. Responsibility also deters controversy since tasks will be well-spelt out. The contract is thus instrumental in ensuring that mutual beliefs and perceptions are not violated. It is, therefore, worth to note that the psychological contract’s aim is to maintain the interpersonal and emotional relationship between an employer and employee. References Conway, N., & Briner, R. B. (2005). Understanding psychological contracts at work a critical evaluation of theory and research. Oxford: Oxford University Press. George, C. (2009). The psychological contract managing and developing professional groups. Maidenhead, Berkshire: McGraw Hill Open University Press. Makin, P. J., Cooper, C. L., & Cox, C. (1996). Organizations and the psychological contract: managing people at work. Westport, Conn.: Quorum Books. Wellin, M. (2007). Managing the psychological contract using the personal deal to increase business performance. Aldershot, England: Gower. Read More