1003 — Psychological contract is key to successful change, report finds

Jan 6, 2004 | Conteúdos Em Ingles

The psychological contract between employer and employee is key to retaining staff in times of organisational change, according to new UK research. Researchers at Roffey Park have discovered that paying attention to this relationship during mergers and acquisitions is crucial, and if employers fail to get it right, staff will vote with their feet. If a company fails to live up to individuals’ perceptions of its obligations it damages employees trust and could subsequently jeopardise a merger.

“A breach of the psychological contract is a significant business risk. Acquirers should assess whether the predominant psychological contract is “relational” or “transactional” and plan their strategy accordingly. The ‘other party’ in the psychological contract and their future role has a key influence on employees’ perceptions of change. Good HR practices are influential when negotiating a new ‘deal’ with staff.”

The report also found out that early communication is fundamental for building a new psychological contract, therefore caution is warranted when making promises.


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