| Monitoring Versus Meddling: Revisiting Agency Theory from an OB Perspective |
| | Thompson, Jeffery A. | U. of Minnesota | jthompson@csom.umn.edu | (612) 626-1812 |
| | Agency theory is one of the most popular and controversial theories to describe intra-organizational relationships. Much of the controversy surrounds agency theory's assumption that shirking is a universal tendency, thus suggesting the need for constant monitoring of agents by principals. This paper, by drawing upon psychological research and theory, proposes a richer conception of the monitoring relationship within organizations than provided by current agency theory. I will argue that the assumptions underlying the need for monitoring are often inaccurate when applied to real firms, and that in some cases monitoring can incur subtle, often non-financial costs and unintended effects.
First, I offer a brief explanation of agency theory and the role of monitoring within the theory. Next, I more clearly define the boundary conditions of agency theory in the organizational realm by identifying contexts in which monitoring in the classic sense is counterproductive. Specifically, I argue that monitoring may become meddlesome when a) agents are intrinsically motivated, possess critical and unique information, or are innately trustworthy, b) principals are focused only on short term gain or are themselves opportunistic or immoral, or c) the organization emphasizes individual reputations and relies upon organizational slack. Research propositions are provided.
Finally, I investigate ways in which the agency theoretic concept of bonding can be expanded to incorporate psychological aspects of the principal/agent relationship. Based upon this augmentation of agency theory, I discuss avenues and strategies for future research on the agency relationship within the organizational behavior domain.
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| | Keywords: agency theory; supervision; monitoring |
| Breach of Psychological Contracts in Work Groups |
| | Tinsley, Catherine Honor | Georgetown U. | tinsleyc@gunet.georgetown.edu | (202) 687-2524 |
| | Lee, Cynthia | Northeastern U. | cynthia@neu.edu | (617) 373-5146 |
| | The antecedents and consequences of contract breach are examined in the context of self-managed work groups.
Contract breach leads to lower group performance, lower member satisfaction, and weaker future contracts between
members and their work group. Group cohesion, strong group norms, and group ability decreased the likelihood of
contract breach, whereas divergent perspectives (concerning the promised obligations to the group) increased
contract breach. We conclude with theoretical and managerial implications. |
| | Keywords: Breach; Psychological Contracts; Workgroups |
| Psychological Contract Breach: A Study of Multiple Bases of Comparison |
| | Ho, Violet Tzu-Wei | Carnegie Mellon U. | vho+@andrew.cmu.edu | (412)-268-4225 |
| | The objective of this study is to explore and empirically test for the existence of various bases of comparison that are used by employees in forming judgments regarding psychological contract breach. Psychological contract breach has been defined as the degree to which the employer had not fulfilled its obligations. Previous research has assumed that employees, when evaluating breach, use the employer's promises as their basis of comparison against which employer's contributions are measured. The present study examines alternative bases of comparison including psychological and social bases: employer's promises, employee's normative expectations; coworkers within the organization; and employees outside the organization with a similar job.
Data were collected using self-administered questionnaires from approximately two hundred business graduate students. Results showed that the bases of comparison differ depending on the specific psychological contract terms evaluated. Employees' psychological contracts factored into three dimensions, namely those involving job characteristics, the relational component, as well as the transactional component of employment. It was found that for the dimension involving job characteristics, the employees' own normative expectations were most often used as a referent. Employer's promises were most often relied upon when evaluating the relational component of the psychological contract, and employees in other organizations were used when evaluating the transactional component. |
| | Keywords: Multiple Bases of Comparison; Psychological Contract Breach; Dimensions of Psych. Contract |
| An Examination of the Development and Consequences of Psychological Contracts |
| | O'Leary-Kelly, Anne M. | U. of Arkansas, Fayetteville | aokelly@comp.uark.edu | (501)-575-4566 |
| | Schenk, Joseph A. | U. of Dayton | schenk@quark.sba.udayton.edu | (937)-229-3116 |
| | This study explored the development and consequences of two types of
psychological contracts, transactional and relational, in a longitudinal
study of sales associates in a direct marketing organization. Associates
were surveyed upon entry to the organization and several months later to
determine the impact of entry motives, information seeking, and social
information on the development of psychological contracts. Our results
suggested that entry motives and information seeking predict some
dimensions of psychological contracts. Further, we found that
psychological contract type predicted sales associates' performance and
intentions to leave. |
| | Keywords: contracts; psychological; socialization |