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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, manager-
employee relationships and trust and, finally, the characteristics associated with trust and
situational, dispositional and affectual factors.

Keywords Workplace trust: manager-employee relations: HRM.

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
4 Thf Intenititioniil Journal ot Huimiii Rvsoiini' Mtimifienieiii

(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 organiza-
tional 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 interdepend-
ent 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 main-
tenance 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 psycho-
logical 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 trustworthi-
ness 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 iv-
evaluate their current battery of HR practices in an attempt to iinprtue trust-
performance 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 manage-
ment 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 co-
onlinated 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, Kiffin-
Petersen 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 computer-
aided 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.
S 77K- Imematiomil Jounuil of Hiiniaii Rcstiiuvr

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 sub-
ordinates, they can increase oiganizational effectiveness through agreed common princi-
ples 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 diffi-
culty 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.

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