When the Ties That Bind Break

Article excerpt

OUT WITH THE OLD PSYCHOLOGICAL CONTRACT. IN WITH THE NEW NONDEPENDENT TRUST. ACCORDING TO WILLIAM MORIN, IT'S TIME FOR EMPLOYERS AND EMPLOYEES TO BUILD A BOND BASED ON HONESTY AND RESPECT, INSTEAD OF FRAGILE PROMISES.

The employer/employee contract is broken. And according to William J. Morin, that's good news.

Actually, it's not so much that the contract is broken, explains Morin, the chair and CEO of consulting firm Drake Beam Morin. More accurately, the traditional bond between employers and employees rested upon a premise that has been revealed as unworkable. And that revelation clears the way for a new bond based on the kind of trust that emanates from honesty instead of piecrust promises--those easily made and easily broken.

Under the old bond--the so-called psychological contract--docile workers pledged allegiance to their employers in exchange for a promise of job security. Morin says that for many years, he himself lived the life that contract dictated, frequently uprooting his family for corporate relocations he never questioned.

"I grew up that way"--accepting the axiom that professional success meant "doing the boss's bidding, playing the game, and getting promoted every two years." But companies never were geared up to take care of people, says Morin, whose company is the world's largest outplacement firm.

"You cannot have companies become socialist entities," he says. "No one will ever take care of us forever."

That doesn't mean wise companies don't make substantial commitments to their employees. To illustrate, Morin quotes General Electric CEO Jack Welch, who asserts, "GE doesn't just exist for return on investment to shareholders, but it also exists for the fulfillment of employees."

"I think that is the major shift that management must make," says Morin--a shift that requires "not only a changing of the guard, but also changing the affinity, style, and posture of management in the United States."

Morin says that despite decades of management fads ("Who really believed in open-door management?"), U.S. businesses essentially have practiced military, chain-of-command management. But, he asserts, only through broad-scale changes in leadership can corporate America begin to repair the damage to employee morale inflicted by the widespread slashing of payrolls that began in the late 1980s--damage that stems as much from the way companies execute layoffs as from the layoffs themselves.

Usury management

Morin traces the economic downturn that precipitated the still-ongoing wave of cuts to the financial excesses of the 1980s. That's when, Morin asserts, "We stopped producing goods and services and started producing money."

Consider, for instance, how executive compensation climbed to dizzying heights with seemingly little relationship to company performance, he says.

"It's incredible to me that America allowed people--primarily men--because of egomania, to purchase companies they knew nothing about and had no plans to improve," Morin says. Simply allowing "whoever has the bucks to buy anything |he or she wants~ reduces any responsibility to society--in other words, the workers."

These wrenching changes have caused personal and professional upheaval for many trainers and HRD specialists, Morin notes. When budgets are slashed, trainers and HRD specialists often are among the first casualties, he observes. And those who keep their jobs in pared-down human resource departments must shoulder extra responsibilities, often becoming less effective. Morin contends that the aftermath of what he terms the "usury management" of the eighties is reflected not only in the painful contraction of the business sector, but also in all facets of society, including the spread of poverty among children, the degraded condition and effectiveness of public schools, and the gaping holes in the social safety net.

Forging an honest agreement

"What really happened is the value system eroded," Morin asserts. …