Deal or No Deal?

Personality and Psychological Contracts

By In Weekly Email 5 Minute Read Time

Deal or No Deal? Personality and Psychological Contracts

Psychological testing doesn’t happen so much in hospitals, doctors’ offices, or mental health facilities. No, businesses are the biggest consumer of personality research. For those of you subjected to intrusive brain scans, such as the Myers-Briggs Type Indicator (MBTI), know that you’re not alone. If this stat doesn’t scare you, we don’t know what will. Forbes reports an astonishing 89 out of the Fortune 100 firms, use the MBTI!

The Research

Scholars, the world over, are getting in on the game and are putting their noses in the books to answer the ‘Who Cares?’ question. A cool study by Usman Raja and some of his colleagues unpacks how personality can influence the psychological contracts that we all have with the organizations we work for.

What’s a Psychological Contract? 

On to some definitions. A psychological contract is nothing more than an unspoken promise between an employee and his or her organization. In other words, if you treat me right, I’ll treat you right. They’re unwritten obligations and mutual expectations between an employee and employer. And, remember, promises are meant to be broken. The authors of this study go a bit further and say that they’re two types of psychological contracts. The first are transactional or short-term contracts. These types of contracts are purely economic and materialistic in nature. Then, there’s relational contracts that go beyond informal expectations of money and effort changing hands. Psychological contracts that are relational are longer in duration and, besides dollars and cents, involve employee loyalty in exchange for growth and security offered by the organization.

Who is Likely to Prefer Shorter-Term Psychological Contracts?

This brain trust of professors tossed out many a hypothesis. At the Kimono, we like to cut to the chase so we’re only going to focus on a couple of their major findings. Two personality types preferred shorter-term/economic-type psychological contracts. These people were: crazy people and nosy people—or what describes the authors here at the Kimono. To be a bit more to the point, these scholars found that neurotic individuals, or people with greater anxiety and an inclination to mis-trust, couldn’t quite grasp the longer term nature of relational contracts. Also, employees with higher equity sensitivity, or individuals who are more outcome oriented and want more than others for the same amount of effort, felt the same way. These are the kids back in school who would ask everyone else what they got on their exam. The tables were turned when we look at conscientious employees and those with higher self-esteem; these subsets of employees valued longer term or relational contracts. Conscientious employees, by the way, are more methodical and dependable than most.

What’s It All Mean? 

And, why does this all matter? Because employees that embrace a relational psychological contract are more satisfied with their jobs, are less likely to quit, and are more committed to their organizations. With transactional psychological contracts you see just the opposite—grumpy workers, who don’t give a damn about the organization, and who are constantly looking for the first opportunity to run for the hills.

And speaking about contracts, remember to get your friends to sign their own contract with the Kimono where laughing and learning is just how we roll.

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