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Training Development and psychological contract

Role of Training in building the psychological contract at the workplace between the employer and the employees

'The Psychological Contract' is increasingly becoming relevant for the workplace relationships and for the wider human behavior.

Descriptions of the Psychological Contract first emerged in the 1960s. The Psychological Contract is a profound and wide-ranging concept and is open to a wide variety of interpretations and theoretical studies.

Primarily, the Psychological Contract refers to the 
relationship between an employer and its employees, and specifically concerns mutual expectations of inputs and results.
The Psychological Contract is usually seen from the angle of feelings of employees, although a full appreciation requires it to be understood from both sides.
Simply, in an employment context, the Psychological Contract is the fairness or balance (typically as perceived by the employee) between:

  • How the employee is treated at the workplace by the employer, and
  •  What the employee puts into the job.
 At a greater level the concept becomes increasingly multifaceted and significant in work and management - especially in change management and in large sized organizations.
Training and development was a tool only under the employer control. Employees depended on their employer to advance their learning and skills, and thereby their value in the employment market. This is no longer the case. Employees are increasingly able to control their own learning and development, again through modern technology, and a new attitude of autonomy is evolving, which we was never seen before.
Organisations have historically focused on retaining customers. Increasingly they will have to focus just as much on retaining staff. A new generation of workers has grown up with no expectation of a job for life. They seek variety and change, where their parents sought routine and security. Moreover they have access to, and control over, substantial modern technologies which will continue to evolve in favour of the individual, rather than the organization.
Organisations must therefore deal in a different way, if they are to retain the best people, and to develop better relationships and reputation among staff, customers and opinion-formers.
Every organization can improve its relationship with its people, if its leadership has the will to do so, because so much of the relationship depends on simple trust, honesty and humanity, which by any normal reckoning cost absolutely nothing.

More progressive organizational structures, in which the responsibilities and rewards of ownership and leadership are shared with employees, potentially customers too, face much easier and simpler challenges in developing and keeping a healthy Psychological Contract.

We can apply the theory and thinking about the Psychological Contract in a potentially far-reaching way:

  • To guide the way processes are used for fact-finding, analysis and people-management (appraisals, staff surveys, job grading, pay plans, training and development, etc)
  • To increase the use fairness as a chief leadership driver, along with related qualities like honesty, objectivity, humanity, and integrity and, where possible, to question and seek to improve the fundamental structure and purpose of the organization
The Psychological Contract offers insight and inspiration to explore and improve the very structure of businesses and other employment organizations.