With the growing numbers of competitors and high technologies in the market, where company will be an increased need for skilled employees at every level and department of the organization. (Neilson, 2000) Have a better understanding of what individual desire and how to attract talent people is important. This paper aim to look at the connection between psychological contract and motivation theory by analyzing commitment and trust model The Herzberg theory, Vroom’s expectancy theory, and McGregor motivation theory will be discussed to see how psychological contract align with employee motivations.
Psychological contracts has been defined as a ‘motivator’ that employees will give in the way of contribution when employees are confident that employer will reciprocate fulfill commitment, such as rewarding work, promotion or other forms of career advancement. (Rousseau, 2004). Research conducted by Robinson & Morrison demonstrated that employees holding different types of psychological contract (relational, transactional) treat perceived violations differently. (Crossman, 2004) In the dynamic global environment, downsizing, organization restructuring, corporate mergers and acquisition, then these trends make it difficult for organization to fulfill anticipated results in psychology contract. Rousseau.(2004)Robinson (1996) showed that the effects of psychological contract violations could reduce employee contributions. That is why organization will need to reduce violations and learn how to manage if it is unavoidable. (Eau, 2001) Psychological contract was rooted in three main principle constructs; the relationship, trust and commitment, these not only contribute to the construction or reconstruction of the psychological contract, but also identified an inter action between each; (Shore L.M & Tetrick E.L, 1994) ‘motives change may alter trust, which will in turn change the commitment form, meanwhile, changes in trust and commitment may also alter the relationship’. (Crossman, 2004) It is important to analysis the trust, since it is an initial entry to establish relationship. The expectation and predictability constitute the principle of trust that indicates the employees and employer will behave in an acceptable manner. (Atkinson C, 2006) Zand (1972) found that high trust groups perform better than low trust groups. (Crossman, 2004) Employees who trust their organization will more likely engage in their career, since they know what they can get from Company. But trust as a construct may be loss because downsizing, cutting the benefit. (Rousseau, 2004) Deutsch (1958) suggests, ‘with trust comes the risk that behavioral expectation will not be met, with uncertainty leading to swings in behavior between engaging in and avoiding trust’. (Aggarwal U & Bhargava S, 2009)
Motivation theory & Psychological contract
Consolidating the various motivation theories, it can be concluded that employee need a range of motivators in order to contribute more on their work. To meet these demands, employers are trying to identify the ways to satisfy their employees on both an extrinsic in financial level and an intrinsic psychological level.
Herzberg’s (1968) theory of motivation stated motivator factors which is able to cause high job satisfaction associated with positive attitude by recognizing for achievement, enjoying work itself, taking more responsibility. (Wilson F.M. 2010)Hygiene factors are important to remove job dissatisfaction; examples are working condition, personal relationship, and company policy. (Herzberg, 1968) For instance, ARM Holdings PLC is the world’s leading semiconductor intellectual property supplier. ARM uses employee engagement as a key tool in motivation. A variety of other satisfiers are used as well, such as undertaking more responsibility, employees receiving shares in company. The aim is for employees to act and feel like a part of business owner, and help...
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