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Senior and Fleming (2006) consider change as essential for an organisation. Change can be defined as the event that occurs when passing from one state or phase to another, in essence becoming different (Choudhry et al 2009, Anon, A 2010). Mullins (2005) affirms that change is an unavoidable element of organisational life. The most common forms of change across industries are cost reduction, redundancies, culture change, and performance management. Organisational change is a vast subject, within change there is understood to be resistance (***) and this shall be the focus of this report.
Barile (1999) asserts that people are core to a successful change implementation within an organisation. This is further iterated by Yemm (2007) who states that people are one of the two key elements of successful change, the other being the fit with the organisation. Organisational change is a vast subject but as people are core to successful change and often within change there is understood to be resistance (***) this shall be the focus of this report.
Discuss how resistance is associated with urgent change rather than organic??
Resistance to change can be defined as an individual or group engaging in acts to obstruct or disrupt an attempt to initiate change. Resistance itself can take different forms, from subtle undermining of change initiatives to withholding information or, active resistance (CIPD 2009).
The concept of resistance to change has benefited from research and through this it has become clear that resistance is far more complex than once thought. Rather than being driven by the self-interest of employees, it stems from a variety of social factors, including rational and non-rational factors, political factors and management factors; for instance inappropriate or poor management styles (Waddell & Sohal 1998).
Resistance is portrayed as an unwarranted and detrimental response and arising spontaneously as a reaction to change, independent of the interactions and relationships within the organisation (Dent & Goldberg, 1999a; Ford, Ford, & McNamara, 2002; King & Anderson, 1995 cited in Ford et al 2008)
By assuming that resistance is necessarily bad the potential contributions of increasing the likelihood of successful implementation, helping build awareness and momentum for change, and eliminating unnecessary, impractical, or counterproductive elements in the design or conduct of the change process are lost (ford et al 2008). Change recipients' reactions to change are not necessarily liabilities to successful change. On the contrary, employees reactions can have value for the existence, engagement, and strength of a change, serving as an asset and a resource in its implementation and successful accomplishment (Knowles & Linn, 2004b cited in Ford et al 2008).This is beyond the confines of this report but the researcher feels it is important to note that some theorists feel there are benefits for resistance to change; this would question the considerable research into reducing and overcoming resistance.
Link this to reasons resistance due to expectations not being met
Behaviours associated with resistance to change
Resistance may be disorganised or organised, individual or collective, conscious or unconscious, active or passive, continuous or stand alone incidences. Accordingly it can also take many forms; strikes, sabotage, restriction of output, go-slow, insubordination, ritualistic compliance, jokes, sarcasm, whistle-blowing and cynicism (Ackroyd and Thompson 1999, Ezzamel et al 2001, Gabriel 1995, 1999a, Jermier et al 1994, Marx 1995, Sturdy & Fineman 2001 cited in Fineman et al 2005).
An example of active resistance is strikes, like those amongst Royal Mail staff in order to halt changes they were not consulted about (The Guardian 2009).
Tactics to reduce resistance to change
McKoy and Elwood (2009) state that during times of change there are clear inferences for leadership, this if further evidenced by Kotter (***) and the need for education and communication to enable readiness for change rather than resistance to change. The leader's principal role in times of change is sense making, it is their responsibility to anticipate, interpret and articulate the change and its implications (McKoy &Elwood 2009).
The ADKAR framework describes knowledge as the knowledge to know how to change. Having training and education, access to information, examples, and role models will all increase the knowledge of the organisational change on an individual level (Hiatt 2006).
McKinsey's Lawson and Price (***) suggests that four basic conditions are necessary before employees will change their behaviour: a) a compelling story; employees must see the point of the change and agree with it; b) role modelling; they must see the CEO and colleagues they admire behaving in the new way; c) reinforcing mechanisms; systems, processes, and incentives must be in line with the new behaviour; and d) capability building; employees need the skills required to make the desired changes (Aiken & Keller 2009). Ability, in the context of ADKAR, is the capability to implement required skills and behaviours: practice applying new skills or using new processes and tools, coaching, mentoring, and the removal of barriers in the context of the organisational change taking place (Hiatt 2006).
Hiatt (2006) discusses reinforcement in the context of incentives and rewards, compensation changes, celebrations, and personal recognition. - for both resistance and PC
The expression 'Psychological contract' will be used as a collective term as it will be used in this context throughout the discussion. Burnes (2004) asserts that 'the concept is based on the assertion that there is an unwritten set of expectations operating at all times between every member of an organisation and the various managers and others in that organisation.' Psychological contracts serve two key functions; to define the employment relationship, and managing mutual expectations (Hiltrop 1995). Choudhry et al. (2009) goes on to signify that employees "fill in the blanks" regarding what one can expect to receive (for example benefits, promotion, or career opportunities) on the basis of environmental cues such as peer comparison.
Rousseau (1989, 1990) argues the psychological contract consists of the beliefs employees hold regarding the terms of the informal exchange agreement between themselves and their organisation. McShane and Von Glinow (2005, p129) take this a step further explaining types of psychological contracts, highlighting that they vary, yet the most fundamental differences between psychological contracts are the extent to which they are transactional or relational. Transactional contracts are short term, defined by a short set of obligations that do not change over the course of the contract. Temporary positions, consultants and, to an extent, new employees (until they develop a sense of continuity with the organisation) experience transactional psychological contracts. Relational contracts, however, are long-term, encompass a range of subjective mutual obligations and employees are more willing to contribute their time and effort without expecting the organisation to pay this debt back in the short term. This type of contact us associated with permanent employees (McShane & Von Glinow, 2005, p129-130).
The psychological contract develops through the formation of expectations from two sources: interactions with organisational representatives and perceptions of the organisation's culture. Organisational agents (recruiters, direct supervisors, human resource managers) make specific promises to employees about what they can expect from the organisation (Feldman, 1976; Van Maanen, 1976 cited in Turnley & Feldman, 1999). For example, Salancik and Pfeffer (1978 cited in Turnley & Feldman, 1999) suggest that social cues from peers may make certain aspects of the job environment particularly prominent to employees; these specific job aspects are likely to be incorporated into employees' psychological contracts (Turnley & Feldman, 1999). In saying this, psychological contracts can also be influenced by the social context i.e. culture and generation (E.g. in US employees expect to be involved in decisions, where as in Taiwan and Mexico they are more willing to accept arbitrary orders) (McShane & Von Glinow, 2005, p129-130).
As the organisation undergoes change, managing these mutual expectations becomes very challenging; employees strive to make sense of what is being provided and how it is different from what used to be provided before the change (Choudhry et al. 2009). The author feels that this may be the point at which a breach of the psychological contract can occur.
Breach of the psychological contract
An integral aspect of psychological contract theory is the concept of breach, defined as "the cognition that one's organisation has failed to meet one or more obligations within one's psychological contract in a manner commensurate with one's contributions" (Morrison & Robinson 1997: 230). Conway and Briner (2005) argue that contract breach is possibly the most important concept in psychological contract theory as it provides a primary explanation for why the psychological contract may negatively impact employees' attitudes, feelings, and behaviours (Dulac et al 2008).
Breach of the psychological contract is a form of injustice (Morrison & Robinson 1997; Rousseau 1995 cited Restubog 2009).
Contract breach erodes trust in the organization, which reduces members' identification with their organization (Restubog 2008).
Psychological contract breach takes place when employees perceive that their organisation has failed to deliver satisfactorily on its promises (Rousseau 1995).
Breach, which is a cognitive assessment involving the discrepancy between what has been promised and what has been delivered, is empirically and theoretically distinct from contract violation which refers to an emotional response arising from perceived contractual transgression (Bordia et al., in press; Robinson & Morrison 2000). A contention of psychological contract theory is that cognitions of breach strengthen feelings of violation in relational exchange relationships (Morrison & Robinson 1997).
Behaviours associated with psychological breaches
As addressed earlier a breach occurs when an employee is treated unfairly. When this happens they lose trust in the organisation and lessen the extent to which they identify with the group or team they are working with. This, in turn, results in reduced willingness engage in organisational citizenship behaviours (Restubog et al 2008). These behaviours include helpful behaviours such as volunteering to do extra tasks and helping co-workers get their tasks (Borman & Motowidlo, 1997 cited in Spector & Fox 2010).
The group value model is explains responses to contract breach when symbolic concerns are heightened; for example, when the nature of the contract breach is relational rather than transactional, or when the employees have a collectivist rather than an individualist orientation (Restubog 2008).
Breach has consequences on a wide range of employee behaviours such as job performance, citizenship behaviour (Turnley et al. 2003; Restubog and Bordia 2006; Restubog et al. 2006; Robinson and Morrison 1995) and attitudes towards commitment, satisfaction, and turn-over intentions (Kickul and Lester 2001; Restubog and Bordia 2006; Restubog et al. 2006; Turnley and Feldman 1999). These studies suggest that employees are likely to demonstrate negative attitudes as a way of responding to contract breach and withdraw from performing optional behaviours (Restubog 2009).
When employees feel that their organisation has failed to provide what is due to them, they will reciprocate by performing only their required responsibilities and reduce any behaviour that is above and beyond this (Restubog 2009).
The researcher feels that as a violation of one's psychological contract is emotional rather than ...... the visible behaviours will be more apparent.
Violation of the psychological contract
Psychological contract violations occur when an employee perceives that the organisation has failed to fulfil one or more of its obligations involved in the psychological contract (Rousseau & Parks 1993, Zhao et al. 2007).
Psychological contract violations are likely to act as the events that cause employees to re-evaluate their fundamental attachment to the company (Lee & Mitchell, 1994). Downsizing and restructuring are times when high levels of psychological contract violations are experienced. These violations are in the context of compensation though organisational change, for instance differences between promised and actual pay raises, salaries, and bonuses (Turnley & Feldman 1999). Conversely Beaumont and Harris (2002) found no support for the assumption that downsizing has a direct correlation with changes in the psychological contract.
Previous researchers have concluded that there are two basic causes of psychological contract violations: reneging and incongruence (Morrison & Robinson 1997). Reneging occurs either on purpose or due to unforeseen circumstances. In contrast, incongruence occurs when the employee and the organisation have a different understanding of what has been promised; the organisation believes that it has lived up to its commitments, but the individual perceives that it has failed to keep one or more promises (Turnley &Feldman 1999).
Robinson and Morrison (2000) found that perceived contract breach was more likely when organisational performance and self-reported employee performance was low, the employee had not experienced a formal induction process, had a history of psychological contract violations, and the employee had many employment alternatives at the time of hire. As the study was only on 147 managers this gives the research low reliability and validity, the research believes this should be taken into consideration in conjunction with these findings.
Behaviours associated with psychological contract violations
If there is no desire for the change, and the individual feels the change violates their psychological contract, Hirschman (1970) asserts that four outcomes are likely; exit (leaving the firm), voice (taking initiative with superiors to improve conditions), loyalty (decreasing the number of extra-role or organisational citizenship behaviours they take part in), and neglect (putting in half-hearted effort, more absenteeism and lateness, less attention to quality), this is known as the ELVN model. (Hirschman 1970; Choudhry et al. 2009)
Tactics to reduce the breakdown of the psychological contract
Although breach and violation have been distinguished conceptually and empirically (Morrison & Robinson, 1997; Robinson & Morrison, 2000), and evidence suggests that emotional responses to cognitions of breach influence resulting attitudes and behaviors (e.g., Zhao et al. 2007), research examining the relationship between the two constructs has been rare (Dulac et al 2008).
The researcher feels that if the breakdown of the psychological contract is prevented or reduced then there is less likelihood of a breach, if a breach does arise due to reduction methods there may be the potential to prevent a violation occurring.
If mutual expectations are made clear, then there is less room for perceptions of psychological contract breach. It is, therefore, important that there is clear and unambiguous communication between organisational authorities and employees concerning their mutual obligations regarding training, feedback, and career opportunities, for example (Restubog 2008). If however, contract breach is perceived, it is important that managers move to counteract the negative consequences of breach of trust and identification. Managers can promote trust with their constituents by expressing recognition, displaying sensitivity to their needs and concerns, and establishing effective communication channels (Handley et al. 2006). In line with the group value model, a sense of trust and justice can also be restored by offering employees voice with regard to decision making processes (Lind & Tyler 1988 cited in Restubog 2008).
Choudhry et al. (2009) states that often during change programs employees believe that the organisation is not sharing all the facts. Absence of relevant information may result in ambiguity and perceptions that key information is being withheld. According to Morrison and Robinson (1997), uncertainty is likely to cause employees to monitor fulfilment of their psychological contracts more closely for obligations that were promised yet not fulfilled. Thus, uncertainty related to an event involving change will serve as a trigger for identifying a breach or violation by the organisation (Choudhry et al. 2009). These findings indicate that clear communication and involvement can reduce the breakdown of the psychological contract in a change situation. Dulac et al. (2008) reinforces this notion, asserting that cognitions of breach may be less prevalent in high-quality social exchange relationships, yet it is important to understand how employees make sense of and react to these cognitions when they do indeed emerge.
Procedural and interactional justice reduces the negative impact of psychological contract breach on employee behaviours (Kickul et al. 2002 cited in Restubog 2009).
Perceptions of justice may be influenced by individual dispositions or personality traits. Thus, in order to gain a better understanding of the psychological contract dynamics, researchers are also encouraged to consider what individuals bring into the situation (Restubog 2009). This will need to be through the relationship of the employee and their manager...
Dulac et al (2008) proposes that high-quality social exchange relationships provoke biased "sensemaking" and interpretation processes ensuing from breach, resulting in less intense negative emotional responses. Furthermore they assert that social support from leaders that is available, or perceived to be available, may buffer negative affective responses to the stress resulting from psychological contract breach, preventing a violation from occurring.
Summary and short conclusions
When the psychological contract is fulfilled increased commitment to the organisation and organisational citizenship behaviours are present (Coyle-Shapiro & Kessler 2000) "All contracts are subject to change" (Rousseau 1995, p142).
Research could be done to investigate if tactics to reduce resistance to change, such as the ones outlines by kotter, also help reduce breakdown of the psychological contract, and vice versa.
Individuals will place different values on each need (Martin, 2005), whether it is their reaction to stimuli or knowledge and desire. These differences will be reflected in their consideration of alterations needed in their psychological contract; when an organisation undergoes change, it gives rise to employee perceptions that the employment relationship is also changing (Parks & Kidder 1994).
Although there are similarities in the behaviours tactics to reduce are vastly different.
The correlation between the extent of resistance and the extent of the breakdown of the psychological contract can be seen through the model created below
This demonstrates that violation is at the core, as this is the worst for of psychological contract and presents extreme resistance to change characteristics; potentially disbanding. By a company being aware of this they can ensure that they minimise the extent change will affect the individual, if only on the outer layers then this implies that the employees are able are not too dissatisfied and nor will there be disruption to the organisation presenting a better environment for the employees and management as a whole enabling cohesive work processes.
Findings/Analysis - 1000 words
- Keep academic tone and underpinning
- Measure findings against experiences on placement
- Short summary of findings
The key findings from the literature review are the extent to which the psychological contract can breakdown and the correlation that this has with resistance to change characteristics. Furthermore the understanding that no two people are the same presents issues for organisations for how they can best approach these inherent outcomes of change, but through understanding the psychology behind the actions solutions have been presented.
When the psychological contract is fulfilled increased commitment to the organisation and organisational citizenship behaviours are present (Coyle-Shapiro & Kessler 2000)
Whilst the researcher worked through restructuring (***) due to the amalgamation of Lloyds TSB and HBOS it was clear that each individual reacted slightly differently. Colleagues presented signs of contract violations as they started to look for other jobs (indicating wanting to exit the company), others put themselves forward for voluntary redundancy. Resistance to change was apparent throughout the business as the union began to take an active role with weekly desk drops of newsletters and actions that could be done, this was directed at those with relational contracts (***) as those with transactional contracts were less affected by the change as their psychological contract was short-term (***).
Discuss how is associated with urgent change rather than organic??
Change is essential for an organisation (Senior & Fleming 2006)
Note the tactics, those that were and weren't used through the LTSB change.
Conclusions - 250 words
Research suggests change is essential but would be more successful without resistance and psychological contract breakdown for both the employees and the organisations, there are tactics that have already been associated with each, seeing them as a whole and tackling them together will reduce time and money associated with mitigating against this risk but also give long term gains.
For these reasons through the findings and conclusions the researcher feels that understanding can be taken from this and has for this reason put forward some proposals for future organisational change that may prove useful in the reduction of resistance and psychological contract breakdown.
Discuss options for further research here? Limited research into the common behaviours of an employee whose contract is fulfilled, this will give a benchmark to work towards.
Recommendations - 250 words
Specific - how to minimise Resistance, which may in turn reduce PC breakdown, only needs to be 1 or 2 and do not need to explain them.
Through the findings the recommendations to future initiators of change are:
Use a mixture of the tactics outline (>>>>Kotter and those for psycho contract) which may reduce resistance to change and in turn minimise, psychological contract breakdown throughout change initiatives in order to maintain (the assumption that employees are happy and feel that their psychological contracts are presently being fulfilled) a motivated and loyal workforce. This will contribute to successful change rather than the workforce potentially being detrimental. As organic change allows the company more time to allow the employees to adjust the second recommendation may also help to mitigate in this situation of urgent change;
To create a culture of change meaning that this would be inbuilt into the employees psychological contract, therefore when change occurs it would not be less likely to breach the psychological contract and therefore reduce resistance to change. This would be a long term strategy as it can be difficult to change culture but would give the benefits of a more cohesive organisation working towards the same goals and there would be a reduction in the likelihood of losing significant talent (as a result of contract violation).
The recommendations can be used in isolation or recommendation 2 can be used in implementing recommendation 1 meaning that the process would become inbuilt and change could flow in the organisation in the future. A more flexible organisation is more likely to survive (***).
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