psychological contract, in very layman terms, is something which is an unsaid, unwritten contract between an employee and the employer. It says that the employee, when he has been hired for a said service, for a said remuneration, agreed by both sides, is obliged to give his one hundred percent in providing the services that he has been hired for and the employer is obliged to pay complete remuneration without any delay to the employee.

Seems fair. Although this is just a part of the complete definition and basically the concept revolves around fulfillment of fair and valid expectations of both the employee and the employer at the workplace.

Now, when the contract is in place, the employee, if he is getting his remuneration in full and in time should give his hundred percent at his job. If he was dissatisfied with his salary, he shouldn’t have joined but a perceived low salary cannot be the premise for inefficiency.

But many employees do not give their hundred percent at work, and we all know that. Unfortunately, then the organisation has to lure them into work by giving incentives – and that’s where ethics come into play.

According to me, this casual approach of the employee is completely unfair and unethical to the employer.

The irony is that with incentives, numbers soar up. The question is, when hundred percent was supposedly given in lieu of the remuneration received (as per the psychological contract), then how come was there a scope for improvement. I mean there is no ‘hundred and ten percent’ and ‘two hundred’ percent stuff in reality after all.

But this amount spent in doling out incentives (or any variable income based on a hope for increasing performance) hits the bottom line. Yet managements think this to be a necessary evil and allow the balance sheets to bleed.

Incentives also becomes a source of dissatisfaction for those who are not able to earn it adding to the intangible cost for the organisation. Add to it untrained and immature leadership who fail utterly in motivating their team forcing the management to loosen their strings.

There has to be some other, simpler and organic way out.

Management will have to spend their money instead, on making their leaders better manpower managers and not better task managers. No one is a slave to their bosses or the organisation but under the top management’s nose, managers down the line follow this inhuman approach to drive numbers.

It is an individual’s goals towards self development that can be the strongest motivator for him. If that can happen, no extra money will have to be spent to drive numbers. This is the basic ‘being human’ premise anywhere, including at the workplace.

Leaders will have to come out of their comfort zones and help their people love their work. Yes, they will have to do it, for their and organisational benefit. They will have to be good at their interpersonal skills.As a trained leader, can you make an employee discover that goal for himself, align that goal with organisational goals and create that unbeatable synergy that makes the organisation and the individual growth graph hit the roof???

In short, can you see the human in your employee and use his human potential as a win win instead of (I am sorry) seeing him as a donkey and keep luring him with a carrot?

Trained leadership is the only solution to effective performance. After all, people leave bosses, don’t they 🙂

Categories: Workplace


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