Article2002

Beaten Before Begun: The Role of Procedural Justice in Planning Change

M. Audrey Korsgaard · Harry J. Sapienza · David M. Schweiger

127 citations0/0 files storedJournal of Management

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Organizational Downsizing and Restructuring Job Satisfaction and Organizational Behavior Organizational Change and Leadership

Abstract

This investigation examines the potential adverse effects of planning strategic change on the employment relationship. We proposed that planning change can alter the psychological contract such that employees believe that organization obligations to the employee will diminish. We also argue that planning change may adversely affect employees’ perceived obligations to the organization, their trust in management, and their intention to remain with the organization but that such effects depend upon whether employees perceive the planning process to be procedurally just. We tested these hypotheses in a longitudinal study of a utility company undergoing reengineering planning. The findings supported the proposition that reactions to planning change depend upon perceptions of procedural justice in that employee obligations and intention to remain were only adversely affected by planning when employees perceived the process as unjust. Surprisingly, planning change did not significantly affect trust for employees who perceived the process as unjust and actually resulted in an increase in trust for employees who perceived the process as just. We discuss implications for practice and research.

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2017Exchange and Power in Social Life 1977Handbook of Industrial and Organizational Psychology.1970Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations, and States.1988The Social Psychology of Procedural Justice 1989MAKING FAST STRATEGIC DECISIONS IN HIGH-VELOCITY ENVIRONMENTS.1989Psychological and implied contracts in organizations 1981Threat Rigidity Effects in Organizational Behavior: A Multilevel Analysis 1980What Should Be Done with Equity Theory?

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