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Ini. J.

of Human Resource Managemeta 14:1 February 2003 3-11

j J JjJi

and HRM in the new millennium
Rachid Zeffane and JuUa Connell
Abstract This paper introduces the topic of trust in the workplace. The rationale for the growth of interest in trust is explored, as are the inq>lications for HRM policy makers and researchers. Here, we also outline the main thrust of the eight papers incorporated in this special edition. First, we explore the topic of HRM and trust, before moving to issues relating to trust and workplace change. Next we discuss team dynamics, manageremployee relationships and trust and, finally, the characteristics associated with trust and situational, dispositional and affectual factors. Keywords Introduction Although there appears to be some consensus in the literature that trusting relationships are important and useful for a range of organizational activities, such as teamwork, leadership and human resource management, concurrently there is also growing concern in relation to the levels of distrust and violations of trust within oiganizational contexts (Giacalone and Greenberg, 1997; Lewicki and Bunker, 1996). Thus, a common thread of the papers in this volume seems to suggest that trust behaviours are those that build on individual confidence and eliminate fear as an operating principle. This process is achievable only when one understands the emotions associated with trust. For example, an active feeling of trust is confidence: in leadership, in veracity and in reliability. In contrast, a passive feeling of trust is the absence of worry or suspicion. The evidence gathered here suggests that the most productive work relationships are those based on trust, which may sometimes be unrecognized, and frequently taken for granted. In this sense, trust is synonymous with confidence and the absence of suspicion, confirmed by a track record of consistency, kept promises and an ability to correct negative behaviours. Overall, as it appears that some level of workplace trust is vital for effective leadership and human resource management, each party needs to believe that the other is trustworthy, in order for one to influence the ottier or to be influenced. Does trust matter? It has been said that tmst has something in common with the weather and motherhood: it is widely talked about and is widely assumed to be good for oiganizations (Parkhe and Miller, 2000). The topic of trust has long been of interest to scholars in organizational behaviour and human resource management. Hence, recent workplace trends have led to a renewed focus on the nature, antecedents and consequences of trust Rachid Zeffane and Julia Connell. Faculty of Business and Law. University of Newcastle, Callaghan, NSW 2038. Australia (tel: +61 2 4921301): e-mail: mgjac@alinga. newcastle.edu.au).
The Iniemalional Journal of Human Resource Management ISSN ()9S8-SI92 print/ISSN 1466-4399 online 6 2003 Taylor & Francis Ltd hnp://www.randf.co.uk/joumals

Workplace trust: manager-employee relations: HRM.

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(lor Lwuinpit:. Whitney. IW4: A'ffane. 1994. 1995: Mayer ci al.. I99S: Chirk and Payne, 1997: Krmner and Tyler. 1996: Harari. 1999: Mayer and Davis. 1999: Zeffane and Morgun. 2000). Trust is a muiti-componeni construct with multiple dimensiotis that .arv in nuiurc and importance according to the context, relationship, tasks, situatiotis and people concemed (Hardy and Magrath. 1989). As a result, the growth ofthe trust literature has generated much debate and divergent opinion revolving around what trust is. what il is not and how trusting relationships might be created. Although a commonly accepted definition of trust remains problematic, a frequently cited conceptualization emphasizes interpersonal relationships and a 'willingness to be vtilnerable' (Mayer et iiL. I99.'t). Thus, when trust declines, a reversal occurs and people become reluctant to take risks, demanding greater protections against the possibility of betrayal 'and increasingly insist on costly sanctioning mechanisms to defend their interests' (Tyler and Kratner. 1996: 4). Generally, however, trust is considered in the organizational literature to be ati imperative phenomenon since it is a tnore consistent mechanism to support organizational change and development in a volatile world than hierarchical power and direct surveillance (Lane and Bachmann, 1996). The results of .several recent surveys clearly indicate that the formation of tru.st within workplace relationships is complex and elusive. Consequently, while workplace trust is increasingly cited as necessary for the generation of competitive organizational advantage through suppon. co-operation and the improvement of co-ordination mechanisms (Rocha. 2001), research suggests that employees are becoming less trusting of their managers and employers (Davis and Landa. 1999). For example, trust had declined in three of the four workplaces surveyed by Manchester Consulting in 1996 and 1997 (McCune, 1998), while a 1998 survey of 2004 workers across Canada concluded that three out of four Canadian employees do not trust the people they work for (Davis and Landa. 1999). In Australia, the results of a large national survey of over 19.500 employees (Morehead et al.. 1997; also revealed a very low level of trust in managers, particularly within the public sector. Some attribute the trend of declining trust within workplace relationships to the stream of downsizing, restructuring and re-engineering programmes thai have severely threatened employees' job security (Shaw. 1997). Others attribute it tu Ihe intemal functioning of organizations, including the interplay of leadership styles, change management strategies and the degree of employee commitment (ZetTane. 1994: Kosgaard etal.. \995: Teny, 1997: Shapiro, 1998: Daley and Vasu. 1998). Shaw (1997) argues that this erosion In trust has led employees to become cynical and withdrawn, especially as they see their colleagues lose theirjobs while senior managenient benefits through higher salaries and the organization improves iis profit margins. It has been argued that efficiency iti organizations is possible only when interdependent actors work together effectively in a climate of positive trust (C'amevale and Wechsler. 1992: McAllister. 1995: Robinson, 1996). For example, a survey of 50.000 employees (representing both public and private organizations) revealed that employees who work for supportive managers, where trust and respect are the dominant characteristics of the relationship, reported less stress and greater productivity (Davis and Landa. 1999). Without the support of employees, managers are likely to experience lower productivity and weakened organizational performance (Camevale atid Wechsler. 1992: ZetTane. 1994: Terry, 1997). Therefore, although the development and maintenance of trust within workplace relationships is challenging, there is every indication that it is an important feature of organi/.ational life.

Zeffane and Connell: Trust and HRM 5 HRM and tmst Under pressure to make rapid and constant changes, organizations have had to alter employment relationships and the psychological contracts that underlie them. Argyris (1960) first developed the concept of such a contract referring to the sum of implicit mutual expectations between the employer and the employee. In the 1990s psychological contracts again became the focus of research for contemporary employnwnt relationships in the light of trends towards globalization, restructuring and downsizing (Robinson, 1996). The definition of a psychological contract was updated recently by Flood et al. (2001) who propose that such a contract emer;ges when one party believes that a promise of future retums has been made and, thus, an obligation has been created to provide future benefits. They cite several studies whereby met expectations afifiect employee behaviours, particularly increased commitment and intention to remain with the organisation, thus indicating an emergent psychological contract that is more relational than transactional. Robinson and Rousseau (1994) found that problems can arise when psychological contracts are perceived to be broken and that this can lead to low job satisfaction, poor performance and high staff tumover. Nevertheless, Robinson (1996) provided results that showed that, if high levels of trust are established and maintained, organizations might, in some ways, be immune to the negative consequences of psychological contract breach. Specifically, where employers eam the trust of employees, perceptions of contract breach are less likely to occur. Likewise, Whitener (2001) cites a number of sources suggesting that employees interpret organizational actions such as human resource practices and the trustworthiness of management as indicative of the organization's commitment to them. As a result, employees reciprocate through their own committnent to the organization. Whitener (2001) argues that few studies have explored the role of human resource practices in this way and that none has explored die role of trust. In their laper "Ilie effects of technical and social conditions on workplace trust', Blunsdon and Reed address the gap between HRM practices and trust. They used data from the 1995 Australian Workplace Industrial Relations Survey and attempted to find correlations between the conditions associated with organizational systems and levels of workplace trust. Their view is that organizations comprise both technical systems of production (where work gets done through the specification of tasks) and social systems of work (where issues of effort, compliance, conformity and motivation arc addressed through employment relations policies and practices - HRM practices). Their analysis purports that differences between industries, occupational composition and HRM practice all impact on levels of trust This led tiiem to argue that management interventions can, and do, make a difference, but not necessarily in ways that might be predicted. Hence, they conclude that the means by which trust is fostered and developed deserves serious consideration in the light of the specific technical and social conditions impinging on each workplace. The second paper in this edition outlines 'The importance of HR practices and workplace trust in achieving superior performance'. In that paper, Gould-Williams continues the theme of HR practices and trust, focusing on a study of public-sector organizations in the UK. The paper assesses the impact of 'bundles' of HR practices on workplace tmst, job satisfaction, commitment, effort and perceived organizational performance. In that endeavour, Gould-Williams explores a model based on theories of organizational behaviour, organizational psychology, social exchange and human economics. The model is then tested using data from UK local govemment employees.

(1 Thf Intenumonul Joiirmil of Human Rc.\i>iii\r The results suppi>rt the hypothesis that HR practices can he powertui predictors ol' trust and organizational performance, and suggest that public-sector organizations need tn ivevaluate their current battery of HR practices in an attempt to iinprtue trustperformance outcomes. Workplace change and trust In a review of the literature on managerial and organizational cognition. Walsh (1995) concludes that we know very little about the social and emotional bases of change, particularly, as Huy (1999) points out, because radical change often involves major uncertainty, where the consequences of different altematives are difficult to evaluate fully. These deficiencies in the change research literature are compounded by Dunphy (1996) who maintains that the major change theories in use today have been developed by change agents and practitioners seeking to develop frameworks for understanding and directing change based on their practical experiences within organizations. In the third paper in this volume 'Employee involvement, organizational change and trust in management', Morgan and Zeffane attempt to tinravel some ofthe complexities associated with change management The authors explore the effect that diffierent types of change .strategies may have on employees' trust in management, utilizing data from the tnost recent Australian Workplace Industrial Relations Survey (Morehead et al.. 1997). Morgan and Zeffane argue that tew models of organizational change encompass the role of trust in the change proces.s and that little empirical research has focused on the potential effects of change strategies on employees' tmst in management. Statistical analysis revealed that there were significant negative effects of change on tmst. although the effects varied according to the type of change and the level of etnployee involvement. On final analysis, they resolve that, because change is imperative for organizational success, the key question for management is: how can it best be managed to minimize its corrosive effects? They contend that, where human re.source management is concemed. when major change processes take place, direct consultation between employees and management becomes a vital function of success. The fourth paper in this volume, 'Tmst in public-sector .senior management' by Albrecht and Travaglione, also focu.ses on workplace change and tmst. Based on surveys within two organizations, their results indicate that situational, rather than demographic or personality factors tend to be the most important determinants of tmst An open climate of communication, faimess and equity in organizational policies and procedures, perceived organizational support and satisfaction with job and career security were found to be significant determinants of tmst in senior management. The authors advise that, at a practical level, these influential antecedent factors fall within the control of human resource policy makers and practitioners and they give examples of how these factors may be associated with improved levels of workplace tmst Team dynamics, manager-employee relationships and trust Tmst influences co-ordination and control at both the institutional and interpersonal levels of an organization. Because economic action is embedded within networks of social relationships, it may be argued that efficiency within complex systems of coonlinated action is possible only when interdependent actors work together effectively (Costa, 2000). While extant empirical research demonstrates the important impact of tmst on team and organizational periormance, littie empirical work has examined the nature of tmst relationships in the team context (Gillespie and Mann, 2000). Through personal interactions, people can develop trusting relationships. Tmst is important for

Zeffane and Connell: Trust and HRM 7 any group working together, but even more important for 'dispersed' teams, as trust has to substitute for hierarchical and bureaucratic control. As Gillespie and Mann contend, the level to which team leaders and their team members share common perceptions about the quality of trust in their relationships remains to be explored, and can ultimately affect the performance of the team. Kifiin-Petersen and Cordery's paper 'Trust, individualism and job characteristics as predictors of employee preference for teamwork' is the fifth paper in this special edition. Using data from 218 employees in forty self-managing work teams, KiffinPetersen and Cordery examine the relationship between trust, individualism, job characteristics and team members' attitudes towards teamwork. Results indicated that the two situational forms of trust (trust in co-workers and trust in management) were stronger predictors of an employee's preference for teamwork than propensity to trust. Trust in co-woikers was found to partially mediate the relationship between a person's propensity to trust strangers and their (neference for working in a team. This paper highlights the importance of considering the dispositional variables of propensity to trust and individualism as factors that influence an employee's preference for teamwork, in addition to their trust in management, trust in co-woricers and their opportunity for skill utilization. Gothey and Jones (1996) maintain that effective organizations are those where the culture is based on the amount of sociability and solidarity that people experience within their work life. Therefore, increasing sociability among heterogeneous groups and creating a sense of solidarity becomes a clear role for managers. Processes such as those discussed in paper number six of this volume, 'Trust me. I'm your boss: trust and power in supervisor-supervisee communication' by Willemyns, Gallois and Callan are critical for the improvement of workplacerelationships.Willemyns et al. use computeraided content analysis to examine employees' perceptions of trust, power and mentoring in manager-employee relationships. Data were drawn from a variety of sectors, including health care, education, hospitality and retail, providing insight into the main communication skills that managers should focus upon to improve trust in the workplace trust. Sitoational, dispositional and afTectuai ciianicteristics oT trust Affective orrelational-basedtrust is also referred to as identity or identification-based trust, the latter being reinforced at the organizational level through corporate culture (Coleman, 1990; Maguire et al., 2001). The basis for this type of trust is a mutual understanding and agreement concerning needs, desires, choices and preferences between the trustor and trustee. Trust is, however, subject to all of the challenges we associate with relationships in general, such as the dispositional and situational determinants analysed in the seventh paper presented in this volume, 'Dispositional and situational determinants of trust in two types of managers' by Payne. This paper reports on a study of 398 people employed in two UK service organizations. The main purpose of the study was to determine the degree to which dispositional factors (predisposition to trust and trait anxiety) and situational factors (seven aspects of the job environment) predicted a person's reported trust in their immediate line managers and senior managers within their industry. It was hypothesized that the dispositional factors would have a greater influence on trust in managers in the industry and that situational factors would have a greater influence on trust in one's immediate line manager. The results reflect the complexity involved in predicting trust at woik and the managerial challenge of creating a trusting culture.

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The culculutive image of trusl suggests thai people tru.st others cither because they have acted in favourable wuys in the past, or because they can he expected to act favourably in the future. By tru.sting others we pluce them under obligation to us (Dasguptu. I9K8). Trust is. therefore, seen as a subjective probability calculation of the potential costs and benefits of future interaction (Dasgupta. 1988). This caiculative model corresponds, in large part, to what Kramer (1999) refers to as the 'rational choice' model. Kramer argues that it 'remains, arguably, the most influential image of trust within organisational science' (ibid.: 572). With respect to Must in senior management, the model is built on employees exercising 'mental arithmetic' about the motives, actions and intentions of senior management. The final paper in this issue. 'Affectual trust in the workplace' by Young and Daniel, argues that the concept of trust as a rational calculus of cost and benefit ignores the emotional content of trust that is central to its understanding. Their paper presents an alternative approach of an affect-based framework consisting of both cognitive and emotional elements of trust. A conceptual structure, such as this, may have value as a comparative framework in cross-cultural HRM research and cross-national HRM relations. This framework is used to analyse data from interviews with service providers talking about their jobs and their employer. Young and Daniel's analysis illustrates a distancing between employers and employees. Suggestions for improving this situation are proposed. Concinsion The evidence presented by many of the papers featured in this special issue points to employees lacking trust in their managers and employers. On that basis, one is more inclined to admit that so-called 'flexible capitalism', with its focus on expediency over trust and loyalty in woiicplace relations, tends to erode character. Character is expressed by loyalty and mutual (rather than one-way) commitment, or by the practice of delayed gratification for the sake of a future end. In other words, the prevalence of restructtiring and contingent labour creates an environment of .superficiality, in which workers and businesses are indifferent towards one another and in which trust, respect and mutual goals have no time to develop. This trend is a cause for concern for both academics and practitioners, as support is mounting for the argument that the development of trust within workplace relationships is critical to the success of any company. Trust is an inherent element of an organization whereby the corporate culture reflects the sense of corporate community and becomes the essence of an organization's spirit and being. For example, for many non-profit organizations fiscal success is not the only work of the corporation. Where there is single-minded attention to the bottom line, bum-out and alienation can occur, resulting in a workforce that is unable to respond with the creativity needed in today's environment. Yet it does not have to be this way. The concept of a coiporate community can allow positive bonds to develop within workplace relationships and managers can play a role as facilitators in creating communities, rather than just corporations, and trust can be developed. The degree to which trust exists determines much of an organization's character, impacting on such things as an organization's structure and control mechanisms, job design, effectiveness and the extent of communication, relationships with other organizations, innovation, job satisfaction, commitntient. organizational citizenship behaviour, goal sharing and coping with crises.

Zeffane and Connell: Trust and HRM 9 If, and when, managers learn to build a high-trust relationship with their subordinates, they can increase oiganizational effectiveness through agreed common principles and the keeping of promises. For all its value in day-to-day exchanges, consistency is at best a starting point for the development of trust between managers and their subordinates. Unsurprisingly, relationships where employees and managers have difficulty trusting each other can be troublesome. Once trust is violated, a 'vicious cycle' can ensue whereby trust becomes doubly difficult to establish. Such a cycle is not hopeless to rectify, but, for distressed employees who may be experiencing uncertainty and job insecurity, the potential for rebuilding a solid relationship can slip away very quickly. Hence, the challenge for human resource managers and practitioners lies in the creation of trusting workplace relationships, especially where existing levels of trust are low. Roy Payne concludes in his paper (this volume) that trust is a complex concept and its operationalization and conceptualization must be kept clear when assessing empirical work concemed with its understanding. As such, the current growth in trust literature provides a challenge to researchers and, particularly, to the development of measures relevant to the many levels of analysis and types of trust. It is the intention of the editors of this special edition that the papers presented within this volume will go some way towards assisting with these chidlenges for both humanresourceresearchers and practitioners. References
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Zeffane, R.M. (1995) 'Downsizing: Problems in the Quest for Leaner Organisations', Human Resottrce Management Intemationat Digest, 3(6): 23-7. Zeffane, R.M. and Morgan, D. (2000) 'Organisational Tmst: Can Management be Tmsted to (Thange?', refereed paper presented at the British Academy of Management Conference, Aberdeen, Scotland, September.