Causes and consequences of psychological contracts among knowledge workers in the high technology and financial services industries

As organizations shift the central focus of their competitive strategy away from value appropriation towards value creation it is to knowledge workers that they will look to provide the innovation to fuel their continued development. The state of the relationship between the knowledge worker and the...

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Bibliographic Details
Published in:International journal of human resource management 2001-11, Vol.12 (7), p.1152-1165
Main Authors: Flood, Patrick C., Turner, Thomas, Ramamoorthy, Nagarajan, Pearson, Jill
Format: Article
Language:English
Subjects:
Competition
Contracts
Financial services
High technology
Human resources
Knowledge
Knowledge Workers
Labour relations
Personnel management
Psychology
Value
Value Creation
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Summary:As organizations shift the central focus of their competitive strategy away from value appropriation towards value creation it is to knowledge workers that they will look to provide the innovation to fuel their continued development. The state of the relationship between the knowledge worker and the employer - the psychological contract - will determine whether this source of innovation and creativity is released. In this study, we developed and tested a causal model of the causes and consequences of psychological contract. Over four hundred participants who were knowledge employees drawn from eleven leading edge companies in the high-technology software, manufacturing and financial services sector participated in the study. We found support for the hypothesis that the psychological contract and those organizational processes relating to procedural justice would have a direct effect on two critical organizational outcomes, namely, employee commitment and intention to remain with the organization. We also found support for the hypothesis that psychological contract variables mediated the relationship between organizational processes and employee commitment and intention to stay with the organization.
ISSN:0958-5192
1466-4399
DOI:10.1080/09585190110068368