The role of employees' psychological contract in the successful implementation of management tactics and achieving optimum performance at Engen Refinery, Durban, South Africa.
Padayachee, Althea Michele.
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The purpose of this research is to determine the role of employees' psychological contract in the successful implementation of management tactics and achieving optimum work performance. The concept of the psychological contract was first introduced by Argyris in 1960, in reference to the employer and employee expectations of the employment relationship (Smithson and Lewis, 2003). Recent research in the United Kingdom has revived the concept, with particular focus on how the psychological contract affects employee attitude or how it may be affected by employer actions. The perceived breach of psychological contracts, for example, may be linked to job satisfaction or staff retention. Research on the topic in a South African context is limited. The purpose of this research is to apply the concept to the South African context and to specifically determine how it impacts on strategy implementation through management tactics, as well as work performance. Furthermore the influence of factors such as gender, ethnicity and relative age will be investigated. Research will be conducted amongst employees of Engen Refinery, located in Durban, South Africa. It is expected that this study will add value to the body of knowledge in this field as well as benefit the company by identifying how an understanding of employees' psychological contracts is relevant to the implementation of tactics and achieving optimum work performance. Questionnaires will be administered to employees. A focus group discussion will be held with 5 employees. Two psychologists and one psychometrist will be interviewed. Two employees, who are also middle managers will be interviewed. Research findings indicate that the psychological contract of employees has a direct influence on the successful implementation of management tactics and optimising work performance at the Engen Refinery. Employees favour a relational psychological contract. It follows that meeting the relational needs of employees would result in an improvement in the successful implementation of tactics and work performance. Positive interpersonal relationships based on trust, respect and open communication minimise gaps in psychological contracts and reduce the degree of assumption with regard to mutual expectations. This has the effect of reducing feelings of inequity, which, based on equity theory, improves commitment and work performance and reduces perceptions of psychological contract violation. Recognition, and the application of behaviour modification theory, may be practically applied where a relational psychological contract is favoured, in order to influence the transactional aspects of the contract. While gender and age do not appear to influence how the psychological contract affects the implementation of tactics and work performance optimisation, ethnicity does, in the particular context of Employment Equity which is peculiar to South Africa. Research findings indicate that the concept of the psychological contract is relevant to improving the work environment, and can be used to effect change in order to enhance the successful execution of strategy and optimise employee work performance.