Leaders responsibility in shaping employee relations

One dimension of a leader’s responsibility which seldom receives the attention it deserves is around employee relations.

Every leader is confronted with two possible ways in which to shape that relationship. One is to shape it around what is called reciprocity and the other is to shape it around a marketplace orientation.

Reciprocity really means that there will be a certain amount of give and take, mutual exchange of support, care, trust and a long-term orientation. A certain emotional investment.

Employees are told, albeit tacitly that you give your best and we will do our best to take care of you. That we will invest in your development. That it is possible to pursue employment with a long-term orientation. That we will take a fair view about performance ups and downs, that we will try as far as possible not to pass on all the risks of doing business to you, especially if you are not at a senior level and so on.

In return employees give their best, their commitment, do everything that they can to serve the organization. This is really the whole principle of reciprocity which shapes the employee relations narrative of many organizations.

Then comes the marketplace-oriented relationship. Here the risk of doing business is passed on entirely to employees, which means that in a difficult phase, we will not necessarily protect the interests of employees. We may downsize, we may restructure, we may ask employees to leave. Relationship is seen as a market transaction where both are clear about the formal terms of engagement. There are no emotions, and where trust is replaced by a contract, goals, KRAs and so on.

Every new leader in some ways ends up shaping these choices. Often times the Board that hired the leader may mandate that the existing reciprocity orientation be replaced with some level of market place orientation.

On a rare occasion, we find leaders taking the decision to replace market orientation with reciprocity.

Therefore, here are my questions to leaders across levels:

What stance would you like the Board or investors and executive leadership to take with you the leader? Reciprocity or market place? Would you value emotional investment, give and take, trust, care and support?

Can we have a little bit of this and a little bit of that?

Can we provide the much-needed psychological safety in a marketplace-oriented culture?

What is our understanding of the motivational drivers of our employees? Can we engage employees without a relationship?

My position is that the best organisations are built on the principle of reciprocity. An organisation’s relationship with its employees cannot be a commercial transaction. This is also the Indian way too.

After all reciprocity is interdependence.

Youtube Video: https://youtu.be/xl8_xd3p0kM
Video Link: https://www.dropbox.com/scl/fi/aod9o048779fiygi5f5wr/Leaders-responsibility-on-employee-relationships.mp4?rlkey=idfrklyinmndqdtx04kyir5fs&st=lvhqhmhc&dl=0