Liberty Construction Company

Risheenbhai. (1123997497)

Everest University

Professor: Dr Batie

Organizational Behavior. (MAN 5245)

4th Feb, 2012

Discuss this case in terms of the social system, equilibrium, the psychological contract, role,

status and Status symbols.

Liberty Construction Company, a small company in Colorado, can be considered as a social

system. Social system, as we all know, is a complex set of human relationships interacting in

many ways. Each small group (like the two camps formed in the incident) is a subsystem within

larger group (which is the Liberty Construction Company) that are subsystems of even larger

groups (the construction industry). One point that stands out in the complex interactions among

people in the social system is that the behavior of any one member can have an impact, directly

or indirectly, on the behavior of any other. Like in the incident, the job conflict that arose

between Federico and Alvarez affected other employees’ perception about the company and it

also created work problems.

The company is said to be in social disequilibrium because the employees are divided and are

working against one another instead of in harmony. They seemed to be enjoying in giving each
group work problems. This disequilibrium is caused by the change implemented by the owner

which highly affected the present operator of the backhoe. The dissatisfaction he felt led to his

resignation from work. This disequilibrium will reduce the company’s progress but it will

eventually regain its equilibrium.

A side from the economic contract employees make when they join an organization they also

make an unwritten psychological contract. It defines the conditions of each employee’s

psychological involvement with the social system. In the case of Michael Federico, his

expectations are properly met by the management. They gave him the new backhoe to operate

which means they trust him and his skills and it also means that he is respected by them. On the

other hand, Pedro Alvarez felt dissatisfied and not properly recognized; his self-esteem and self-

respect is seriously affected. He felt like he is insulted because he should have retained then ewer

machine instead of giving it to a temporary employee.

Role reflects a person’s position in the social system, with its accompanying rights and

obligations, power and responsibility. Taking the side of Alvarez, we can say that he is

experiencing role ambiguity wherein people are not sure how they should act in situations. Like

what happened to him, he doesn’t know how he should act about the situation.

Status is the social rank of a person in a group while status symbols are visible things that serve

as evidence of social rank. When it comes to seniority, Federico’s status level is higher having

nine months of work experience while Alvarez only has seven months. While when it comes to

job level Alvarez is superior because he is a regular employee. Status symbols are also important
in order to determine your social rank. The quality and newness of equipment used is one of the

typical symbols of status. Alvarez being reassigned to an older machine means that his status

level declines. Status and status symbols are often source of employee problems and conflicts,

like what happened in the incident. Sometimes they are also the cause of employee separation

because they don’t want low-status job. But they also have good effects; they definitely serve to

motivate employees to do their best in order to acquire higher status.