Managerial Action to Build Control, Trust, and Fairness in Organizations: The Effect of Conflict

CHRIS P. LONG Olin School of Business

Washington University in St. Louis St. Louis, MO 63130

(314) 935-8114 long@olin.wustl.edu

SIM B. SITKIN

Fuqua School of Business Duke University

Durham, NC 27708 (919) 660-7946

sim.sitkin@duke.edu

LAURA B. CARDINAL A. B. Freeman School of Business

Tulane University New Orleans, LA 70118-5645

(504) 865-5541 cardinal@tulane.edu

Note: The authors wish to thank the participants of the Group of Management Education Researchers seminar group at Washington University in St. Louis for their helpful comments.

.

1

ABSTRACT

This paper refines and extends research on organizational control, justice, and trust by

examining the actions managers take regarding three critical managerial functions: control, trust-

building, fairness-building. Whereas past work has primarily evaluated responses to managerial

actions, this paper introduces and develops a theory of the determinants of three types of

managerial actions: task controls, trust-building activities, fairness-building activities.

Specifically, we focus on how the presence of various forms of superior-subordinate conflicts

(concerning goals, tasks, and interpersonal issues) stimulate managerial concerns around

subordinate task performance and their own managerial legitimacy. We argue that managers

attempt to address these concerns using particular combinations of task control, trust-building,

and fairness-building initiatives. The paper concludes with a discussion about how the theory we

pose here refines and extends research on organizational control, organizational trust, and

organizational fairness.

2

INTRODUCTION

Over more than a quarter century, researchers have argued that when managers promote

organizational trust and fairness, they can enhance the quality of their subordinates’

contributions and their capacity to achieve organizational objectives (Kim & Mauborgne, 1993,

1997). Research specifically suggests that managers who promote organizational trust and

fairness can increase levels of voluntary subordinate compliance with their directives and reduce

the time and effort necessary to measure and monitor employees (Frank, 1988; Jones, 1995;

Tyler & Lind, 1992). In addition, managers who successfully promote trust and fairness may

increase subordinate commitment to organizational goals, the tendency for employees to exhibit

extra-role behaviors, and the ability of their organizations to achieve competitive advantage

(Barney & Hansen, 1994; Colquitt, 2001).

Researchers have developed their understanding of the importance, antecedents, and

outcomes of trust and fairness primarily from subordinate evaluations of managerial initiatives

(Greenberg, 1987; Mayer, Davis, & Schoorman, 1995). While this focus has allowed researchers

to identify both the antecedents and outcomes of positive trust and fairness perceptions, “there is

a dearth of research, however, on the perspective adopted by managers” (Folger & Skarlicki,

2001: 98). As a result, scholars have not, as yet, developed a clear understanding of the factors

that influence managerial action to promote (or not promote) organizational trust and fairness.

Accounts of managerial actions, however, suggest that managers will promote

subordinate trust and fairness in an effort to respond to superior-subordinate conflicts. For

example, Kim and Mauborgne (1997) in their discussion of changes to Elco’s production

systems, observed that managers took actions that significantly enhanced subordinates’ trust and

fairness perceptions only after employees actively expressed dissatisfaction with the new

3

procedures and the overall implementation process. A similar account of conflict leading

managers to promote trust and fairness is provided by Rosenblatt, Rogers and Nord (1993).

They observe how actual and potential conflicts with members of the greater community, led

administrative leaders in one community’s school district to develop a carefully structured

participation process that promoted positive perceptions of trust and fairness.

Our theoretical argument builds from observations such as these about relationships

between conflicts and managerial actions. We use this conflict/action perspective to advance our

understanding of how and why managers promote trust and fairness in three ways. First, we

propose that superior-subordinate conflicts stimulate managerial concerns both about

subordinates’ willingness to reliably perform tasks and about their own managerial authority.

Second, we argue that managers will implement organizational controls and attempt to build

organizational trust and fairness in order to address these concerns. Third, we argue that,

because different forms of conflicts raise different concerns for managers, they lead managers to

differentially integrate the control (input, process, output), trust-building (calculative,

institutional, relational), and fairness-building (distributive, procedural, interactional) activities

they implement.

We present our ideas in several sections. We first discuss superior-subordinate conflicts

and describe how they raise concerns regarding subordinate task performance and managerial

authority. Next, we introduce task control, trust-building and fairness-building concepts and

explain how concerns raised by superior-subordinate conflicts lead managers to integrate their

efforts to apply task controls with their efforts to build organizational trust and fairness. We then

present a series of specific propositions addressing how managers combine specific types

organizational task control, trust-building, and fairness-building activities to respond to the

4

superior-subordinate goal, task and personal conflicts they encounter. We conclude by

proposing how the ideas we present here advance research in several domains.1

TRUST AND FAIRNESS PROMOTION IN ORGANIZATIONS

While research on subordinate reactions to organizational trust and fairness is extensive

(for recent reviews, see Colquitt, Conlon, Wesson, Porter, & Yee, 2001; Dirks & Ferrin, 2002),

our understanding of factors that lead managers to promote trust and fairness is significantly

more limited (Colquitt & Greenberg, 2003). It is important note, however, that a growing body

of research is beginning to move from viewpoints that managers’ attempts to build trust and

fairness are “epiphenomenal” (i.e., as the result of episodic, uncoordinated, and unrelated

actions) (Greenberg, 1990: 118) towards theoretical frameworks that outline how and why

managers take actions to promote trust and fairness.

Research on managers’ attempts to promote fairness has focused largely on examining

how various individual and organizational level variables influence managers tendencies to act

fairly. Regarding distributive fairness for example, several researchers (e.g., Meindl, 1989; Chen

and Church, 1995) have examined how individual philosophies and organizational contexts help

determine managers’ preferences regarding allocation procedures. In addition, a developing

body of research (e.g., Gilliland & Schepers, 2003; Masterson, Byrne, & Mao, 2004) is

examining how managers’ tendencies to promote interactional fairness is influence by a

managerial attributes and organizational contextual factors.

Perspectives on managers’ efforts to promote trust have developed in similar theoretical

directions. Whitener, Brodt, Korsgaard, and Werner (1998), for example, outline several key

organizational, relational, and individual factors that lead managers to act in trustworthy ways.

Work on strategic alliances, in addition, has begun to forge critical theoretical links between

5

efforts to build trust and organizational effectiveness. Specifically, both Das and Teng (1998;

2001) and Inkpen and Curral (2004), outline how the desire to manage risks in alliances lead

partners towards both trust and control-based actions.

Conflict (Potential and Actual) as Impetus for Promoting Trust and Fairness

A careful, reading of this work and of the trust and fairness literature in general reveals

an important motivation for promoting trust and fairness. Specifically, managers’ attempt to

promote trust and promote fairness represent important and often effective responses to potential

and actual superior-subordinate conflicts. For example, Thibaut and Walker (1975), describe the

importance of decisions to promote fairness (i.e., distributive and procedural) in potentially

contentious legal dispute contexts. Sitkin and Bies (1993) delineate how managers explain and

justify (i.e., promote interactional fairness) tough decisions in order to prevent conflicts with

their subordinates in organizational settings. Sitkin (1995) describes how trust between

managers and employees can alleviate persistent conflicts between managers and employees,

while Das and Teng (1998; 2001), outline how trust can be used to prevent and diffuse conflicts

with alliance partners.

Our observation is consistent with research that suggests strongly that attempts to address

actual conflicts and prevent potential conflicts command significant managerial attention

(Rahim, 1983). Sitkin and Bies (1993: 349), for example, point out that “each and every day,

managers face situations that could give rise to conflict”. By some accounts managers spend

almost 20% of their time actively managing conflicts and significant, additional amounts of time

preventing conflicts before they occur (Tjosvold & Chia, 1989; Sitkin & Bies, 1993). Edwards

(1979: 16) highlights the significance managerial concerns over superior-subordinate conflicts in

arguing that “work has been organized (i.e., by managers), then, to contain conflict (i.e, with

6

their subordinates)” (16).

When managers experience conflicts with subordinates, they encounter “incompatible

wishes, or desires” (Jehn, 1994: 224) that can arise from a variety of concerns (Bies, 1989; Sitkin

& Bies, 1993). For example, superior-subordinate goal conflicts exist when managers and

employees disagree about the outcomes they are attempting to achieve (Ouchi, 1980; Eisenhardt,

1989). Superior-subordinate task conflicts refer to disagreements regarding how organizational

work is performed and how policies are developed and implemented (Janssen, Van de Vliert, &

Veenstra, 1999). Lastly, superior-subordinate personal conflicts encompass “socio-emotional

disagreements not directly related to the task” (Jehn, 1995: 258) that arise from identity- or

value-based incongruencies or incompatibilities between individuals.

Managing Conflicts through Multiple Means

To “contain” conflicts with subordinates, conflict management researchers suggests that

managers use multiple conflict management strategies and tend to rely specifically on what

conflict researchers have classified as dominating and integrating behaviors (Van de Vliert,

Euwema, & Huismans, 1995; Munduate, Ganaza, Peiro & Euwema, 1999). Managers who

exhibit dominating behaviors tend to force their preferred positions on subordinates. Managers

who exhibit integrating behaviors attempt to facilitate superior-subordinate collaboration, the

exchange of information between themselves and their subordinates, and the reconciliation of

mutual, management-employee differences. Van de Vliert and colleagues (1995) suggest that

managers concurrently use dominating and integrating conflict management strategies to

improve the quality of their superior-subordinate relations while they promote “more creative

group decisions, more satisfaction, and more commitment to the implementation of those

decisions (i.e., managerial directives)” (272).

7

This observation that managers tend to combine multiple conflict management helps to

explain why managers initiate efforts to build trust and fairness. Below, we develop the

argument that because conflicts raise concerns for managers about their perceived legitimacy and

their authority, they stimulate managers to promote trust and fairness (i.e., exhibit integrating

behavior). Here managers promote trust and fairness attempt to facilitate examinations of

management-employee disagreements and superior-subordinate cooperation in order to preserve

and promote their managerial legitimacy.

We begin our discussion, however, by focusing on how conflicts lead managers to

implement organizational controls (i.e., exhibit dominating behavior). Because conflicts raise

managerial concerns about their subordinates’ task reliability we argue that they lead managers

to use organizational task controls in order to ensure that work gets done in a prescribed fashion.

Conflict and Control

Consistent with observations (Van de Vliert, et al., 1995; Munduate, et al., 1999) that

managers respond to conflicts by forcing their positions (i.e., exhibit dominating behavior),

control theorists (e.g., Ouchi, 1980; Barney & Hesterly, 1996) have demonstrated how managers

respond to conflicts by implementing organizational task controls. Organizational task controls

describe the formal (i.e., written contracts, monetary incentives, and surveillance) and informal

(i.e., values, norms, and beliefs) mechanisms that managers use to direct and promote the

efficient and effective completion of organizational tasks by their subordinates (e.g., Ouchi,

1977; Kirsch, 1996; Cardinal, Sitkin, & Long, 2004a).2

Scholars have classified various types of task controls based on the portion of the

production process to which they are applied (Merchant, 1985; Snell 1992; Long, Burton, and

Cardinal, 2002; Cardinal, et al., 2004). Managers select input controls to guide the selection and

8

preparation of human and material production resources. For example, managers apply training

and socialization to regulate employees’ skills and abilities or screening methods to obtain a

specific quality and quantity of material production inputs (Arvey, 1979; Van Maanen and

Schein, 1979; Wanous, 1980). Managers also use process controls while employees perform

tasks to ensure that employees use appropriate task production methods. Finally, managers use

output controls to ensure that employees achieve desired performance standards by measuring

the outputs they produce against standards such as desired production quantities or profit levels

(Ouchi, 1977, 1979; Mintzberg, 1979).

According to control theorists, superior-subordinate conflicts increase the salience of

potential opportunistic threats and, as a result, signal to managers that subordinates have reason

to misrepresent their abilities (i.e., information asymmetry) or work efforts (i.e., moral hazard)

(Williamson, 1975; Levinthal, 1988). When subordinates act in these ways, they may fail to

reliably perform organizational tasks or may impede both the efficient completion of those tasks

and the ultimate achievement of organizational goals (Levinthal, 1988: Barney & Hesterly,

1996).

In order to prevent this from happening or remedy it after it has occurred, control

theorists suggest that managers will respond to superior-subordinate conflicts with applications

of organizational task controls. Control theorists have outlined how various types of conflicts

lead managers to implement various types of organizational controls to help ensure that

subordinates engage their tasks in ways consistent with the achievement of organizational

objectives (Sutcliffe, Sitkin, and Browning, 2000). Ouchi (1980), for example argues that

managers use market, bureaucratic, or clan-based controls in response to various levels of goal

incongruence (i.e., goal conflict) they experience with subordinates. Sitkin and Roth (1993), in

9

addition, describe superior-subordinate task and personal conflicts lead managers to employ

highly formal (i.e., legalistic) control mechanisms in order to ensure that they effectively manage

task efforts.

Proposition 1 outlines the general argument we pose above that concerns about

subordinate reliability and opportunism highlighted by superior-subordinate conflicts lead

managers to implement organizational task controls.

Proposition 1: Reliability-based concerns about subordinate opportunism raised by superior-subordinate conflicts stimulate managers to implement organizational task controls.

Conflict and Authority

In addition to raising managerial concerns about a subordinate’s willingness to reliably

perform tasks, evidence suggests that superior-subordinate conflicts also may present managers

with significant, salient threats to their managerial authority. As Dornbusch and Scott (1975: 17)

point out, “the greater the discrepancy (i.e., conflict) between preferred and actual work

arrangements as perceived by performers, the greater would be the instability of their authority

systems.”

In response to these threats to their managerial authority, we theorize that managers will

take actions to promote organizational trust and fairness and generally act in ways consistent

with what conflict management researchers refer to as “integrative behavior” (e.g., Rahim,

1983). Specifically, we hypothesize that threats to managerial legitimacy and authority posed by

organizational conflicts lead managers to take actions that build organizational trust and fairness.

By acting in trust-worthy and fair ways, managers help ensure that their actions will be viewed

as “valid and proper” (Dornbusch & Scott, 1975) and therefore as a legitimate. By attempting to

ensure that their actions are legitimate, we argue that managers work to preserve, protect and

10

promote their own managerial authority.

The Importance of Managerial Authority

As social theorists have emphasized for some time (Weber, 1918; Barnard, 1938),

authority is an essential and extremely desirable quality for managers to possess. When

managers possess authority, they can reasonably assume that their subordinates will be both

compliant with their directives and committed to the achievement of organizational goals

(Dornbusch & Scott, 1975).

While a manager’s authority is often fairly stable (Pfeffer, 1981b), superior-subordinate

conflicts signal to managers ways (e.g., on subjects or in situations) in which their authority is

unstable (Dornbusch & Scott, 1975). In fact, the mere presence of employee dissent is evidence

to a manager that his/her authority in a certain area is in question and that he or she cannot

assume that his or her directives will be followed unquestioningly by subordinates (Walker &

Zelditch, 1985; Bell, Walker, & Willer, 2000).

According to Dornbusch and Scott (1975), Tyler and Lind (1992) and others, for a

manager to possess authority, they themselves and the actions they take must be viewed as

legitimate. For example, Tyler and Lind (1992: 118) observe that being viewed as legitimate

“nearly always facilitates and is often crucial for the effective exercise of authority [. . . and,],

once established, functions to enhance acceptance of decisions as long as the authority is viewed

as legitimate.” Building from this observation we theorize that, in order to preserve or enhance

their authority, managers will take actions that will be perceived as “desirable, proper, or

appropriate within some socially constructed system of norms, values, beliefs, and definitions”

(Suchman, 1995: 574).

Dornbusch and Scott’s (1975) theory of authority contends that managers are viewed as

11

legitimate when their actions are evaluated as both valid and proper. While both are important

building block of legitimacy, validity and propriety are the result of distinctly different

subordinate evaluations (Bell, et al., 2000; Walker & Zelditch, 1985).

A “valid” action is judged by subordinates to be consistent with the standards (i.e., rules,

norms, practices, etc…) of the established and accepted normative order (Bell, et al., 2000).

Subordinates conclude that a manager’s action is valid because, within a given organizational

system, compliance and non-compliance with managerial directives will credibly and predictably

result in the acquisition of rewards or the imposition of sanctions (Pfeffer, 1981c).

A “proper” action, on the other hand, is judged by subordinates to be consistent with their

own, internalized norms (Bell, et al., 2000). Specifically, in evaluating the propriety of an

action, individuals look “beyond the constraining effect of the organizational structure’s sheer

existence” (Bell, et al., 2000: 163) to see if an action (or set of actions) aligns with their

internalized norms of morality, of goodness, and of fairness (Dornbusch & Scott, 1975).

Validity and Propriety Lead to Trust and Fairness Promotion

Building from the discussion above, we argue that superior-subordinate conflicts present

salient threats to managerial legitimacy and authority. In response to these threats, we contend

that managers attempt to enhance the perceived validity and propriety of their actions by acting

to promote positive perceptions of organizational trust and fairness. In general, by promoting

trust and fairness managers attempt to enhance their perceived validity increasing the

predictability of their actions, reinforcing the accepted, normative order. Managers may also

promote trust and fairness in order to ensure that their actions are viewed as proper and in

alignment with what their subordinates will view as desirable and morally correct.

To deepen our discussion on this point, in the sections that follow we introduce the

12

concepts of trust-building and fairness-building. It is important to note that these concepts

describe categories of managerial actions that are distinct from each other and from

organizational task controls both in their primary focus and in the specific outcomes that

managers hope to achieve through their implementation.

Trust-Building

Trust-building activities are mechanisms that individuals use to assure others of their capabilities, their interest in accommodating others’ needs, and their willingness to fulfill promises made to others.

We argue that managers undertake trust-building activities in order to promote trust in

themselves or their organizations by developing positive perceptions of the elements of trust (i.e.,

ability, benevolence, integrity) as outlined by Mayer et.al. (1995) with individual subordinates

under their direction. Specifically, through trust-building activities managers promote

subordinates’ confidence in their (or their organization’s) ability to effectively direct the

organizational tasks subordinates perform, benevolence or interest in accommodating

subordinates’ specific needs, and integrity or willingness to fulfill promises and obligations to

subordinates (Mayer, et al., 1995).

According to situational demands, we argue managers will attempt to foster calculative,

institutional, or relational trust with their subordinates (Rousseau, Sitkin, Burt, & Camerer,

1998). For example, managers may attempt to build calculative trust with subordinates by

promoting positive perceptions of their managerial ability, benevolence, and integrity within

economic and social exchanges (Bromiley & Cummings, 1995). Managers may attempt to build

institutional trust (Zucker, 1986) through the careful development of organizational forms (i.e.,

structures, procedures, processes) that effectively promote their general ability to manage

organizational tasks, their concern for employees’ needs and interests (i.e., promote

13

benevolence), and their interest in protecting (or at least not violating) employee-management

agreements (i.e., promote integrity) (Sitkin & Stickel, 1996). In addition, managers may attempt

to build relational trust (Lewicki & Bunker, 1996) by utilizing their ability to forge relational

links with subordinates, benevolently paying attention to subordinates’ emotional needs, and

working hard to fulfill promises that they will maintain both high quality emotional relationships

and high levels of value congruence with subordinates (Sitkin & Roth, 1993; Sheppard &

Sherman, 1998).

Building from established trust research, we suggest that managers engage in trust-

building using a wide range of formal and informal mechanisms. In many cases, managers may

exhibit informal, trustworthy behaviors (e.g., behavioral integrity, demonstration of concern)

such as those proposed by Whitener, Brodt, Korsgaard, and Werner (1998). For example,

managers attempting to rebuild trust after relational trust violations (Stickel, 1999; Lewicki &

Bunker, 1996) may increase their use of informal communication channels to demsontrate their

concern for subordinates and improve the general quality of their superior-subordinate

relationships (Sitkin & Roth, 1993). Alternatively, when attempting to build calculative or

institutional trust, managers may redesign formal organizational policies to respond to the

specific, trust-based concerns of employees about organizational procedures (Zucker, 1986;

Sitkin, 1995).

Because “trust depends on people’s efforts to predict how the authorities will act in the

future,” managers use trust-building activities to communicate “underlying motivations of

authorities, motivations that allow the authority’s future behavior to be predicted” (Tyler & Lind,

1992: 155). In doing this, managers are able to enhance the perceived validity of their actions

and increase subordinates’ “acknowledgement that the objective order operates as a sanctioning

14

(i.e., or reward) system… “the violation of (i.e., or adherence to) which is punishable (i.e., or

rewarded)” (Bell, et al., 2000: 162). Similarly, managers may also use trust-building activities to

assure subordinates that they can achieve their personal goals within a particular organizational

system, thereby promoting the perceived propriety of the manager and his/her actions.

Fairness-Building

Fairness-building activities are mechanisms that individuals use to promote equity, representation, and civility within groups of multiple individuals.

We suggest that managers focus their fairness-building activities on fostering distributive

(Adams, 1965; Deutsch, 1975), procedural (Thibaut & Walker, 1975, 1978), and interactional

(Bies & Moag, 1986) fairness within the groups of multiple subordinates that they manage. When

engaged in distributive fairness-building, managers attempt to ensure that they equitably

distribute rewards and responsibilities to employees. When engaged in procedural fairness-

building, managers develop fair procedures and decision-making mechanisms that provide their

subordinates reasonable discretion over decision processes and outcomes. When engaged in

interactional fairness-building, managers attempt to communicate to subordinates that they

respect them.

Similar to trust-building activities, managers may use a wide range of formal and

informal mechanisms to build positive perceptions of organizational fairness. For example, Kim

and Mauborgne (1997) describe how Bethlehem Steel’s Sparrows Point plant used a variety of

formal and informal “processes and devices” to promote fairness (74). At that location,

management initiated the development of formal, structurally-based joint leadership teams

within which senior management and employee representatives came together, discussed, and

made decisions about important organizational issues. As employees did this, the organization

also actively encouraged managers and employees to spontaneously “share and debate their

15

ideas” (Kim and Mauborgne, 1997: 74), thereby using more informal means to promote

interactional fairness.

Similar to trust-building activities, we argue that managers also employ fairness-building

activities to enhance the perceived validity and propriety, and thereby the legitimacy of their

actions. Greenberg (1990), for example, shows how managers can use fairness-based impression

management tactics to assure subordinates of the propriety or the “goodness and fairness” (Bell,

et al., 2000: 163) of the manager and organizational system under which they operate. As a result

of these actions, managers also enhance the perceived validity of their actions by displaying to

subordinates how that manager’s efforts align with objective, and predictable norms of fairness

(Meindl, 1989; Chen & Church, 1995).

We use these concepts and the general discussion above to develop Proposition 2.

Proposition 2 outlines the general argument that concerns about managerial authority and

legitimacy and specifically about the perceived validity and propriety of their actions lead

managers to undertake efforts to promote trust and fairness.

Proposition 2: Authority-based concerns about the validity and propriety of their actions lead managers to implement trust-building and fairness-building initiatives.

Trust-Building and Fairness-Building as Valid and Proper Actions

Figure 1 outlines the relationships discussed thus far and helps us graphically depict how

superior-subordinate conflicts lead managers to promote trust-building initiatives, fairness-

building initiatives, and task controls. Specifically, we contend that when managers encounter

conflicts (i.e., actual and potential) with their subordinates, those conflicts prompt managers to

ensure that their actions decrease threats of subordinate opportunism (i.e., enhance subordinate

task reliability) and threats to the perceived validity and propriety and, thereby, the legitimacy of

16

their actions (i.e., enhance their managerial authority). Concerns about employee reliability

prompt managers to address issues related to organizational task controls. Authority-based

concerns about the perceived validity and propriety of their own actions prompt managers to

undertake trust-building and fairness-building initiatives.

These relationships are displayed in Figure 1.

Insert Figure 1 About Here

Indirect Effects on Control, Trust-Building and Fairness-Building

While we argue that primary relationships exist between reliability-based concerns and

task controls and authority-based concerns trust-building and fairness-building, Figure 1 also

depicts our contention that these concerns can lead to secondary effects on managerial actions.

Specifically, we propose that managers’ concerns about employee opportunism can affect their

efforts to promote trust and fairness. In addition, their concerns about validity and propriety can

affect manager’s applications of task controls.

Building on the recent work of several theorists (e.g., Whitener, et al., 1998; Folger and

Skarlicki, 2001), we contend that trust-building and fairness-building are key components of

social exchanges. As such, managers efforts to promote trust and fairness can also be affected by

manager’s assessments of employees’ levels of opportunism. For example, managers may

respond to employee opportunism with trust-building and fairness-building efforts in order to

demonstrate their willingness to facilitate management-employee cooperation and build more

positive interpersonal relations. Alternatively, managers may display a reduced willingness to

build organizational trust and fairness if they believe that their subordinates are highly

opportunistic and attempt to cheat them under any circumstance.

Managerial authority-based concerns can also affect their applications task controls. For

17

example, managerial concerns about the perceived validity of their actions may lead them to

more closely measure and monitor subordinate’s task efforts using various types of task controls

in order to make sure that the standing social order is properly reinforced. In addition, concerns

about the perceived propriety of their actions may lead managers to attempt to ensure that

organizational task controls such as certain incentives and rules incorporate subordinates’

interests and incorporate their preferences.

Propositions 3 and 4 outline the arguments described above and are depicted in Figure 1.

Proposition 3 outlines how managerial concerns about employee opportunism also stimulate

managers trust-building and fairness-building efforts. Proposition 4 describes how managerial

concerns about validity and propriety can affect managers’ applications of organizational task

controls.

Proposition 3: Manager’s reliability-based concerns about employee opportunism affect (to a lesser extent than authority-based concerns) managers’ trust-building and fairness-building efforts. Proposition 4: Manager’s authority-based concerns about the perceived validity and propriety of their actions affect (to a lesser extent than reliability-based concerns) managers’ task control efforts.

Multiple Concerns Elicit Multiple Responses

While task control, trust-building, and fairness-building represent distinct activities, a key

part of our argument is that, because they address related concerns, managers do not consider or

pursue the implementation of these activities in isolation. As Ouchi (1980: 130) outlines,

managers respond to organizational conflicts by concurrently addressing issues of control, trust,

and fairness. Specifically, he argues that, when implementing organizational controls managers

recognize that “it is this demand for equity (i.e., fairness) which brings on transactions

costs…Transactions costs arise principally when it is difficult to determine the value of the

18

goods or service. Such difficulties can arise from the underlying nature of the goods or service

or from a lack of trust between the parties.”

While Ouchi does not deal directly with trust-building and fairness-building efforts, we

concur with his general observation that issues of control, trust, and fairness are interrelated and,

argue that managers, as a result, will tend to integrate and balance their task control, trust-

building, and fairness-building efforts. We contend that managers do this because task control,

trust-building, and fairness-building represent complementary activities in the sense of

complementarity proposed by Bendersky (2003). Our conception of these three managerial

actions fits her model quite precisely in that “the interplay among the components (i.e.,

activities) enables each type of component to influence individual’s attitudes and behaviors more

significantly than it could without reinforcement from the others” (Bendersky, 2003: 644).

Specifically, we argue that managers build on complementarities between task control,

trust-building and fairness-building activities to craft integrated, balanced responses to the

problems created by superior-subordinate conflicts. By integrating control, trust, and fairness

activities, managers are able to both build on the strengths and compensate for the potential

weaknesses of each type of managerial activity. In Table 1, we outline the comparative strengths

and weaknesses of each of these three categories managerial activities. In addition we

summarize the primary mechanisms managers use and the intended outcomes they attempt to

achieve through the implementation of these activities.

Insert Table 1 About Here

Task controls, for example, present managers with efficient ways to communicate and

motivate task directives. However, task controls that are applied without attention to fairness

concerns, may stimulate conflicts by compromising subordinates’ perceptions that they are

19

equitably rewarded for their efforts (Deutsch, 1975), that they hold sufficient control over

organizational decisions and decision process (Thibaut & Walker, 1975; Lind & Tyler, 1988),

and that they are respected within their organization (Bies & Moag, 1986). In addition, if not

handled well, formal and informal task controls may be seen as inappropriately wresting control

over organizational tasks from subordinates, thereby signaling to those subordinates that their

manager may not be concerned with their individual needs and should not be trusted (Sitkin,

1995; Sitkin & Stickel, 1995; Ghoshal & Moran, 1996).

Alternatively, trust-building initiatives present managers with effective ways of building

and deepening relationships with subordinates by providing managerial mechanisms for

addressing individual subordinate’s concerns (Mayer, et al., 1995). However, as Leader-

Management Exchange (LMX) research describes, managers may develop trusting relationships

only with members of subordinate in-groups (Scandura, Graen & Novak, 1986; Schriesheim,

Neiter & Scandura, 1998). As a result, we argue that trust-building initiatives may compromise

subordinate fairness perceptions and stimulate conflicts by focusing managers too much on

deepening relationships with certain, individual subordinates and leading them to neglect the

respective needs of other subordinates under their discretion (Deutsch, 1975). In addition,

because they may make managers feel that they are spending too much time attending to

interpersonal relationships, if managers pursue trust-building initiatives in isolation they may

undermine that manager’s sense that they are applying a level of task control to efficiently and

effectively achieve organizational objectives (Spreitzer & Mishra, 1999).

Lastly, we argue that managers understand how fairness-building initiatives are useful for

promoting a sense among subordinates that everyone in the organization is equitably rewarded,

empowered and respected (Tyler & Lind, 1992). However, if managers focus only on promoting

20

fairness, they may spend an inordinate amount of time addressing the generalized concerns of

multiple subordinates and neglect developing appropriate levels of subordinate trust by attending

to the particular concerns of individuals under their direction. In addition, managers who focus

too much on fairness-building activities, may begin to feel they are not maintaining efficient,

direct control over their organization’s task completion efforts. This is because they may be

taking too much time attending to their subordinates’ desires for equity and respect or ceding too

much decision-making discretion and authority to their subordinates.

Proposition 5 builds from the discussion above and outlines our argument that task

control, trust-building, and fairness-building constitute complementary activities.

Proposition 5: Task control, trust-building, and fairness-building activities constitute complementary activities.

Striking a Balance between Control, Trust, and Fairness

While managers attempt to build integrative responses to superior-subordinate conflicts,

we argue that will attempt to balance the attention they pay to task control, trust-building, and

fairness-building activities. Drawing from a definition of balance proposed by Cardinal, et al.,

(2004), we specifically suggest that managers will attempt to achieve a state where they apply a

“harmonious” combination of task control, trust-building, and fairness-building activities. This

harmony “relies on specific situational requirements, but depends on achieving isomorphism

with internal and external requirements and sustaining or smoothly adapting to changes in those

requirements” (2-3).

Because organizations differ significantly on their evaluations of efficiency and

effectiveness, on one hand, and validity and propriety on the other, the particular balance a

manager achieves and the particular emphasis they place on task controls, trust-building

initiatives, and fairness-building initiatives will differ depending on the context within which a

21

particular manager operates. This may lead managers, for example, in highly formal

organizational contexts where managerial authority is rarely questioned to devote most of their

efforts towards developing and implementing elaborate formal control systems and devote

significantly less time to informally interacting with subordinates and promoting relational

elements of fairness (Tyler & Lind, 1992). Alternatively, in contexts where, interpersonal

interaction is highly valued and where subordinates routinely challenge managerial authority,

managers may focus primarily on facilitating high quality superior-subordinate interactions

through relational trust-building and interactional fairness-building activities and on using

informal task controls.

Proposition 6 encapsulates this discussion and our argument that, because they constitute

complementary activities, managers will attempt to integrate and balance their task control, trust-

building, and fairness-building efforts.

Proposition 6: Because task control, trust-building and fairness-building activities are complementary, managers will attempt to integrate and balance their task control, trust-building, and fairness-building efforts according to situational conditions.

Different Conflicts, Different Activities

While contextual (i.e., personal, relational, and organizational) factors will significantly

influence the relative emphasis managers place on task controls, trust-building, and on fairness-

building activities, we argue that the particular types of activities managers undertake will be

significantly influenced by the types of conflicts managers encounter. As conflict researchers

have shown, individuals do differentiate between forms of conflict (Pinkley, 1990; Pinkley &

Northcraft, 1994) and those interpretations differentially affect their subsequent actions (Jehn,

1995; Jehn, 1997). Studies on influence and impression management for example, suggest that

managers choose how they influence subordinates based, in large measure, on the forms of

22

resistance employees exhibit (Yukl, Falbe, & Youn, 1993; Yukl, Guinan, & Sottolano, 1995).

Sullivan, Albrecht, and Taylor (1990), concur with this assessment and argue “that the nature

and amount of resistance that a manager expects from a subordinate are the major determinants”

of how managers attempt to secure compliance with organizational directives (336).

Drawing upon these literatures to extend our theory, we reason that goal, task, and

personal conflicts focus managers on addressing different types of reliability-based and

authority-based concerns. These different concerns lead managers to combine different types of

task control, trust-building, and fairness-building activities. Managers do this in order to

efficiently and effectively address the key concerns raised by that particular conflict by

leveraging particular complementarities between specific types of activities.

While focusing on applications of task controls, control theorists have presented evidence

consistent with this perspective. Specifically, they have shown how managers choose to apply

various controls based on the forms of conflicts they encounter with their subordinates. Ouchi

(1980), for example, argued that the level of goal incongruence (i.e., goal conflict) managers

experience with subordinates should influence their choices between market, bureaucratic, or

clan-based controls. Some recent support for Ouchi’s ideas can be found in Sitkin and Roth

(1993), who explored how task and personal conflicts with subordinates lead managers to choose

highly formal (i.e., legalistic) control mechanisms, and Cardinal et al (2004), who found that the

adoption of specific mixes of organizational controls was stimulated by various types of conflicts

between managers and subordinates.

Our perspective is also consistent with Wicks et al.’s (1999) theory of “Optimal Trust”

and the general notion that managers promote levels of trust consistent with the goals they seek

to achieve and the situational constraints they face (Barney & Hansen, 1994). Building from the

23

work of Wicks et. al., (1999), we argue that managers understand how “trust is good-but a

conditional good” and that it is inadvisable from “a moral or strategic point of view” (99) to

produce levels of trust that are inconsistent with relational contingencies. From this idea we

argue that managers will respond to the concerns highlighted by specific superior-subordinate

conflicts with activities designed to build the levels of trust necessary to manage both those

conflicts and produce desirable organizational outcomes.

Lastly, our perspective refines and extends the work of fairness researchers who have

argued that managers will generally attempt to produce fairness in order to decrease feelings of

resentment and deprivation among their subordinates and establish an environment beneficial to

the pursuit of specific organizational goals (Lerner, 1977; Leventhal, Karuza & Fry 1980).

Extending the work of both conflict management and control researchers, that managers

maintain a goal of effectively managing conflict (Ouchi, 1980; Leventhal, 1988; Sitkin & Bies,

1993), we argue that the specific concerns raised by goal, task and personal conflicts lead

managers to engage in particular types of fairness-building activities in an effort to achieve the

goal of conflict reduction.

Proposition 7 summarizes this discussion and our argument that managers attempt

respond to the specific reliability-based and authority-based concerns raised by a particular form

of conflict with particular combinations of task control, trust-building, and fairness-building

activities.

Proposition 7: Managers respond to the particular reliability-based and authority-based concerns raised by particular types of conflict with specific combinations of task control, trust-building, and fairness-building activities

HYPOTHESES

In this section, we theorize about how managers respond to the specific forms of conflict

24

that they encounter with particular combinations of task control, trust-building, and fairness-

building activities. Figure 2 graphically depicts our hypotheses concerning the effects of goal,

task, and personal conflicts on managerial activities. Below, we develop these ideas in the form

of testable hypotheses.

Insert Figure 2 About Here

Figure 2 specifically outlines how different forms of conflict raise different reliability-

based and authority-based concerns for managers. Specifically, we argue that each type of

conflict raises three particular types of these concerns. The first (1. in the figure) describes a

motivation for employee opportunism (reliability-based concern) highlighted by a particular type

of conflict. The second (2. in the figure) describes a potential threat to the perceived validity of a

manager or their directives (authority-based-concern) highlighted by a particular conflict. The

third (3. in the figure) describes a potential threat to the perceived propriety of a manager or their

directives (authority-based concern) that a particular conflict highlights. The figure also presents

the specific combinations of task control, trust-building and fairness-building initiatives that, we

argue, managers use to address the reliability and authority-based concerns raised by each type

of conflict.

Goal Conflict

Superior-subordinate goal conflicts refer to disagreements over the outcomes actors are

attempting to achieve (Cosier & Rose, 1977; Ouchi, 1980). Research in a variety of domains

(e.g., Barnard, 1968; Fox, 1974: Levinthal, 1988) suggests that goal conflicts focus individuals

on issues related primarily to issues involving outcomes and distributions. For example,

according to Cosier & Rose (1977: 379), goal conflicts highlight situations where an employee

attempts to “attain his or her most preferred outcome while simultaneously blocking attainment

25

of the counterpart’s (i.e., the manager’s) most preferred outcome.” As Ouchi (1980: 130)

suggests, goal conflict raise concerns for manages that they and their employees may “pursue

incongruent objectives and [as a result] their efforts will be uncoordinated.”

Building from this research, we argue that goal conflicts raise authority-based and

reliability-based concerns that are specifically focused on issues of goal attainment and outcome

distribution and argue that, as a result, managers will initiate task control, trust-building and

fairness-building actions that are focused towards addressing specific types of concerns. We

argue below that superior-subordinate goal conflicts lead managers to implement output controls,

promote their integrity, and engage in distributive fairness-building.

Superior-subordinate goal conflicts raise reliability concerns by signaling to managers

that employees both desire different outcomes and may be motivated to pursue goals that are

contrary to management’s wishes. In response to these concerns we concur with control

theorists who argue that the potential motivational problems and information asymmetries

managers encounter in the context of superior-subordinate goal conflicts, lead managers to focus

on applying output controls (Leventhal, 1988; Barney & Hesterly, 1996). Ouchi (1980), for

example, claims that high levels of superior-subordinate goal conflicts lead managers to employ

market controls which rely primarily on output control mechanisms. By implementing output

controls, managers attempt to promote “selfless devotion to the same objectives” (Ouchi, 1980:

131) by more clearly and persuasively explicating management’s desired goals and aligning

employee incentives in ways that more effectively motivate subordinates to produce desired

organizational outcomes (Eisenhardt, 1989).

Disagreements between superiors and subordinates regarding goals also signal to

managers that their authority may be challenged in certain ways. In particular, we contend that

26

goal conflicts with subordinates suggest to managers that subordinates are unsure of the

instrumentality of pursuing management’s goals and may view management’s goals as invalid

either because they believe the pursuit of these goals will not result in the achievement of

predicted organizational outcomes or are generally inappropriate given situational constraints. In

addition, superior-subordinate goal conflicts may signal to managers that subordinates question

the propriety of management’s goals because the pursuit of those goals will not result in

outcomes that are desirable for employees.

In response to these concerns, to build a more general willingness for employees to go

along with their ideas, and to provide employees with a verifiable “proof source” (Doney,

Cannon, & Mullen, 1998: 606) that a manager’s (or organization’s) goals are valid and proper,

we argue that managers will respond to goal conflicts by promoting their own integrity. By

attempting to assure subordinates that their best chance of achieving their personal goals lies

with trusting management’s goals and then making extra efforts to ensure that employees receive

the rewards they are owed, managers attempt to increase employees’ confidence that the goals

they prescribe can be achieved and that subordinates will benefit by aligning their aspirations

with management’s desires.

We argue that concerns about employee perceptions of instrumentality and outcome

satisfaction also lead managers to engage in distributive fairness-building activities. Using

distributive fairness-building initiatives, managers attempt to ensure that the rewards employees

receive are commensurate with the inputs they provide to the production process. By focusing

on distributive fairness-building, managers help ensure that subordinates are satisfied with the

outcomes they receive in relative terms when they are compared with the outcomes received by

similar others in a particular social environment (Deutsch, 1975). When managers do this they

27

enhance subordinate perceptions that managerial goals are appropriate because the pursuit of

management’s goals will result in more predictable and equitable reward allocations. As Kim

and Mauborgne suggest, this increases employee outcome satisfaction and perceptions of

instrumentality because “when people get the compensation (or the resources, or the place in the

organizational hierarchy) they deserve, they feel satisfied with that outcome and will reciprocate

by fulfilling to the letter their obligation to the company” (71).

Proposition 8 summarizes the actions that managers take to respond to superior-

subordinate goal conflicts.

Proposition 8: In response to superior-subordinate goal conflicts managers will implement output controls, promote their own perceived integrity, and foster distributive fairness.

Task Conflict

Another form of conflict, superior-subordinate task conflict, refers to disagreements

between managers and their employees regarding the “content and issues of the task (s)” (Jehn,

1994:224). Research has shown that task conflicts focus individuals on issues different then

those raised by goal conflicts. Specifically, as Cosier and Rose (1977: 380) suggest, task

conflicts lead individuals to “become deeply involved in resolving the conflicting

interpretations” regarding how tasks are and should be performed. Consistent with this, Jehn

(1995: 275) observed in her research on groups that task conflicts can have positive effects and

often stimulate the development of “norms promoting open discussion of task issues” which

leads to a “critical evaluation of problems and decisions options.”

Building from this perspective, we argue that when managers encounter task conflicts

with subordinates, these disagreements highlight reliability-based and authority-based concerns

that are directly related to the resolution of task-based concerns. Regarding reliability-based

28

issues, task conflicts signal to managers that, because they hold conflicting views of how work

should be performed, subordinates may attempt to complete tasks using behaviors and processes

that are contrary to their manager’s wishes. As a result, superior-subordinate task conflicts

present a control dilemma for managers because when employees express disagreements about

task directives, managers become alerted that employees may ignore their manager’s task

directives in an effort to pursue their own, preferred task completion methods.

In response to these reliability-based concerns, Sitkin and Roth (1993) suggest that

managers often attempt to bring task actions into alignment by focusing on maintaining order.

Specifically, managers may attempt to partially alleviate the superior-subordinate task conflicts

they encounter by increasing the amount and intensity of the process controls they apply. For

example, managers may rely upon “legalistic” processes to correct misinterpretations of

directives and improve intra-organizational coordination by codifying and clarifying procedural

and performance specifications. In this instance, managers may create procedural manuals or

SOPs that specify the task performance procedures that managers prefer. To supplement these

efforts, managers will often develop elaborate information systems to help ensure that employees

provide their superiors with the information necessary to closely monitor subordinates’ work

activities (Ouchi, 1979).

Task conflicts also suggest that subordinates question the validity and propriety of

management’s task directives and, as a result, may view management’s task directives as

illegitimate. Specifically, we argue that subordinates who disagree with managers about how to

perform tasks signal that they may believe that production can be more efficiently and effectively

executed using alternative (i.e, more valid) means. In addition, these disagreements signal to

managers that the perceived propriety of production directives may be compromised because

29

current directives do not include subordinate’s preferred mechanisms for production.

By signaling that subordinates may view the task directives they are given as illegitimate

or ill-advised, task disagreements may prompt managers to promote their own perceived ability

to manage tasks so as to enhance the perceived validity of the task scheme they advocate. For

example, managers may take steps to communicate to employees that they themselves and the

organization from which they derive their authority possess knowledge appropriate to effectively

directing particular components of organizational task efforts. By using these techniques to build

trust in their ability to manage and their organizational task knowledge, managers may bolster

their own legitimacy (e.g., as a competent manager) and the symbolic legitimacy of the

procedures that they apply (Pfeffer, 1981a; Sitkin, 1995).

Task conflicts also communicate to managers that employees may possess valuable task

knowledge and, as a result, both desire and warrant some control over organizational decisions

(i.e., decision control) or the processes by which managers arrive at their decisions (i.e., process

control). In order to effectively facilitate participation, we argue that managers will promote a

“critical evaluation of problems and decision options” (Jehn, 1995: 275) in the form of “ask(ing)

more questions, to discover what that counterpart is doing” (Cosier & Rose, 1977: 380) and

soliciting decision input from subordinates. By encouraging employees to both provide

constructive criticisms about work processes and, thereby, exercising process or decision control,

managers attempt to simultaneously increase the perceived propriety of their directives and may,

as a result, identify production inefficiencies and productivity-enhancing solutions that

subordinate’s task-based disagreements highlight and that they, previously, may not have

considered.

Lastly we argue that the concerns raised by task conflicts stimulate managers to engage in

30

informational fairness-building activities. Informational fairness describes an element of

interactional fairness that refers specifically to the efforts that managers make to adequately

explain their actions (Sitkin & Bies, 1993). Building on this concept, we argue that, in order to

increase subordinate acceptance and satisfaction with decisions once they are made, managers

will also make efforts to explain their decisions they make to subordinates. Consistent with

Sitkin and Bies’ (1993) argument regarding managerial justifications, we argue that managers

attempt to prevent future conflicts and respond to existing conflicts by making extra efforts to

explain and justify their actions. Managers do this in order to reduce distrust in management and

increase the overall level of cooperation between managers and employees.

Proposition 9 summarizes our argument about the effects of task conflicts on managerial

actions.

Proposition 9: In response to superior-subordinate task conflicts, managers will implement process controls, enhance subordinate perceptions their own managerial ability, encourage subordinate decision control and process control, and promote informational fairness.

Personal Conflict

Superior-subordinate personal conflicts, encompass disagreements arising from identity-

or value-based incongruencies or incompatibilities between managers and employees (Jehn,

1994; Janssen et al., 1999). Building from research on personal conflicts, we argue that

managers encounter superior-subordinate personal conflicts when “tension, animosity, and

annoyance” (Jehn, 1995: 258) suggest that employees dislike them and are dissatisfied with their

superior-subordinate relationships.

Personal conflicts raise particular types of reliability-based and authority-based concerns

for managers. Regarding reliability-based issues, personal conflicts signal to managers that,

employees’ values differ from their manager’s and, as a result, they may act in ways that both

31

further their own values and may contradict managerial value-promotion efforts (Ouchi, 1980).

In addition, we argue that superior-subordinate personal conflicts raise authority-based concerns

by signaling to managers that employee’s may not believe that the values a manager espouses are

valid or appropriate within a particular organizational context. In addition, they may signal that

subordinates do not identify with the manager or the organization and do not feel that the values

the organization promotes align with their own values of goodness and fairness.

To respond to these concerns, we argue that managers will focus their task control

mechanisms and trust-and fairness-building initiatives towards helping their subordinates

understand and accept organizational values and assume an identity congruent with the

organization. In making this argument, we assume that mangers understand how individuals

with similar values and identities “tend to behave in a more trustworthy manner toward each

other” (Shapiro et al., 1992: 371) and toward management. As a result of this understanding, we

argue that managers will respond to superior-subordinate personal conflicts by applying input

controls, acting benevolently, and promoting interpersonal fairness.

In an effort to align subordinate preferences with organizational values, managers may

respond to personal conflicts using various forms of input controls. For example, Snell (1992)

refers to input control in human resource management as employee selection, and socialization-

based training. He suggests that managers can use these more formal forms of input control such

as these to “prevent performance problems” (297) and ex-ante ensure that employees understand,

accept and express a willingness to embrace organizational goals and values. Other authors have

described more informal forms of input control such as clan control (Ouchi, 1979) and

socialization control (Govindarajan and Fisher, 1990). We argue that managers also respond to

superior-subordinate personal conflicts using forms of input control such as stories, rituals,

32

legends to communicate organizational values and norms of social interaction through their

organization’s culture while limiting employee animosity towards their managers (Jermier,

1998).

In some cases, superior-subordinate personal conflicts may be so detrimental that

they lead managers to use input controls to “redesign their work area so that they no

longer would have to interact with the others involved in the conflict” (Jehn, 1995: 276).

As both Sitkin and Roth (1993) and Roth, Sitkin and House (1994) outline in their studies

of responses to employees with HIV/AIDS, a manager may respond to superior-

subordinate personal conflicts by barring aggrieved individuals from their unit and

organization, thereby shielding themselves “from the embarrassment of discussing the

issues directly associated with it (i.e., the personal conflict)” (Sitkin & Roth, 1993: 382).

Because personal conflicts also highlight value incongruencies that can compromise

cooperative efforts between employees and managers, we argue that these disagreements may

also focus managers’ attention on benevolently attending to employees’ needs. By doing this,

managers attempt to increase the perceived validity of the organization’s values by showing how

the promotion of the manager’s values can satisfy the subordinates’ desires. For example, by

demonstrating “a genuine care and concern for the welfare of partners” (McAllister, 1995: 26)

managers may increase the quality and quantity of their interpersonal interactions with

employees while attempting to instill subordinates with “a greater level of faith” (Rousseau, et

al., 1998: 400) in their intentions. Over time, this may result in a measurable decrease personal

animosity between managers and employees (Shapiro, et al., 1992) and, as Sitkin and Roth

(1993) have show, may lead to the development and deepening of value congruencies in ways

that produce dramatic, positive effects on organizational performance.

33

Lastly, we contend that personal conflicts will lead managers to attempt to enhance

employee-organization identity through interpersonal fairness-building activities. Interpersonal

fairness is achieved when managers treat subordinates in ways that demonstrate respect for them

and enhance their sense of dignity (Bies & Moag, 1986; Colquitt, 2001). Building on this

concept, we argue that managers respond to personal conflicts by ensuring that what they say and

do in the workplace treats employees with dignity and affords them respect. By doing so

managers attempt to demonstrate to subordinates the relational benefits that can be derived from

aligning themselves with the organization’s particular identity from which they derived positive

relational ends.

Proposition 10 summarizes our argument regarding the effects of personal conflicts on

managerial actions.

Proposition 10: In response to superior-subordinate personal conflicts managers will implement input controls, act benevolently, and promote interactional fairness.

THEORETICAL IMPLICATIONS OF TRUST-BUILDING

AND FAIRNESS-BUILDING

This paper presents a new theoretical direction for trust and fairness research. Our theory

argues that managers promote trust and fairness in their organizations in an ongoing effort to

protect, preserve, and enhance their authority. In addition, we contend that, because superior-

subordinate conflicts raise concerns about subordinates’ task reliability, managers will address

these superior-subordinate conflicts by combining the task controls they implement with trust-

building and fairness-building efforts. By combining activities, managers attempt to cultivate

positive, appropriate superior-subordinate relationships while they efficiently and effectively

direct subordinates’ organizational task efforts.

34

In general, we contend that our theory makes three contributions to organizational

research. First, our perspective highlights how the production of subordinate perceptions of trust

and fairness (i.e., of their managers) are the result of managers’ actions. Building from the

extensive research on organizational trust and fairness, we examine conditions where trust and

fairness issues are more salient for managers and, thus, explore situations where managers are

more likely to engage in various forms of trust-building and fairness-building activities.

Specifically, we argue that managers undertake efforts to promote trust and fairness in order to

preserve, protect, and enhance their managerial legitimacy and authority. In addition, because

we argue that superior-subordinate conflicts signal to managers that subordinates question their

legitimacy, these disagreements incite managers to engage in trust-building and fairness-building

activities.

Second, we propose that, because they constitute complementary actions, managers

concurrently pursue trust-building and fairness-building activities, and align those efforts with

their task control activities. Using complementarities theory (Milgrom & Roberts, 1992;

Bendersky, 2003) to refine and extend traditional control research (Ouchi, 1980; Bradach &

Eccles, 1989), we argue that managers combine their trust-building, fairness-building and task

control activities to craft effective, integrative solutions to critical organizational problems.

Third, we utilize the observations of conflict management theorists (Rahim, 1983; Jehn,

1994; 1995; Van de Vliert, 1995) and examine how particular types of superior-subordinate

conflicts comprise key antecedents of managerial task control, trust-building, and fairness-

building activities. Furthermore, we argue that managers use particular combinations of trust-

building, fairness-building, and task control activities in response to specific forms of superior-

subordinate conflicts in order to effectively address the specific reliability-based and authority-

35

based concerns these conflicts raise for managers.

Below we relate the theory we present in this paper to research on organizational trust

and fairness, managerial authority, organizational control, and organizational conflict.

Trust-Building and Fairness-Building – Distinct but Related Managerial Actions

This theory-building effort refines and extends the important but relatively small body of

work on managers’ attention to trust and fairness issues. In general, the scope of previous

research in this domain has been fairly limited, viewing managers’ attempts to build trust and

fairness largely as “epiphenomenal” (Greenberg, 1990: 118) (i.e., as the result of episodic,

uncoordinated, and unrelated actions). In addition, this work has generally (i.e., except

Whitener, et al., 1998) not drawn theoretical links between managers’ attempts to concurrently

build the positive perceptions of organizational trust and organizational fairness that theorists

argue are critical to organizational functioning (Lind & Tyler, 1988; Tyler, 1989; Tyler & Lind,

1992).

By explaining how managers promote trust and fairness in order to preserve and promote

their perceived legitimacy, we build from previous research examining relationships between

subordinates’ trust and fairness perceptions and managerial authority. Lind and Tyler (1992) for

example, argue that when subordinates believe that their managers are acting in procedurally fair

ways (i.e., acting in ways that promote trust, neutrality, and standing), they will view them as

legitimate and accede to their authority. In a similar vein, Walker and Zelditch (1985) outline

how positive subordinate perceptions of managerial legitimacy and authority are dependent on

equitable distributions of organizational outcomes and rewards (i.e., distributive fairness).

Consistent with these arguments, both Greenberg (1990) and Sitkin and Bies (1993), describe

how elements of interactional fairness can be used by managers to promote and enhance their

36

organizational legitimacy.

Trust, Fairness and Control

We build from this assumption that manager concerns themselves perceptions of their

legitimacy and authority to motivate our development of the concepts: trust-building and

fairness-building. By identifying theoretical differentiations between these concepts and task

control initiatives, we refine previous theoretical work that has identified trust and fairness

initiatives as a label for “a class of more general control mechanisms” (Bradach & Eccles, 1989:

104) or as a substitute for control (Das & Teng, 1998). Specifically, we argue that managers aim

to obtain different and distinct outcomes through their applications of trust-building, fairness-

building, and task control initiatives. In addition, we suggest that while the desired outcomes of

each category of action might differ, each type of activity comprises an important component of

an of complementary managerial actions.

By proposing that they represent complementary activities and can be combined

synergistically, we argue managers will integrate task control, trust-building and fairness-

building initiatives. We note here our understanding that this may lead managers, under some

circumstances, to use trust-building activities to bolster positive perceptions of fairness. Under

other circumstances, managers attempting to integrate activities may initiate fairness-building

activities to build specific types of trust. For example, managers may take explicit steps to

promote distributive and procedural fairness in the hopes of increasing subordinate trust in an

organization and its’ institutions. Under other circumstances, managers may focus on building

deeper levels of relational trust with subordinates in order to increase perceptions that they treat

employees with dignity and respect (i.e., they are interactionally fair).

In other situations, managers may attempt to build types of trust to bolster the controls

37

they seek to apply (Bradach & Eccles, 1989). For example, a sales manager may couple formal

incentive programs with efforts to promote their own integrity. In this way, that manager may

simultaneously increase the effectiveness of these incentive programs while encouraging

subordinates to positively assess that managers’ willingness to satisfy subordinates’ monetary

expectations and interests. Alternatively, managers apply certain types of controls in order to

enhance specific types of trust. Sitkin (1995), for example, explains how managers can use

legalistic control mechanisms to increase subordinate trust in authorities by decreasing the

perceived risk and uncertainty around exchanges while they foster increased cooperation around

complementary exchange domains.

In still other cases, managers coordinate their promotion of both organizational fairness

and control. For example, the same sales manager mentioned above may take explicit steps to

distribute rewards equitably to help employees gain confidence that their work efforts will be

appropriately compensated (Homans, 1961; Deutsch, 1975). Under different circumstances,

managers may apply controls to promote specific types of fairness. For example, to provide

employees a strong signal that s/he is acting in a distributively fair way, that sales manager may

rely on formal control mechanisms and circulate a written incentive plan to each of his/her

employees that explicitly outlines the rewards that can be achieved for specific sales targets.

While we tend to focus our discussion on how managers promote control, trust, and

fairness to accomplish organizational tasks, we also acknowledge that managers may attempt to

build trust and fairness apart from task management considerations. Whitener, et al. (1998), for

example, suggest that organizational, individual, and relational factors affect managers’ abilities

to behave in trustworthy ways. In addition, Folger et al. (1992) suggest that factors outside of

task considerations encourage managers to promote positive fairness perceptions among their

38

subordinates. For example, while managers’ attempts to deepen relationships with subordinates

by organizing social activities outside of work may have an indirect effect on their ability to

direct subordinates, managers may initiate these activities for reasons other than to enhance their

capacity to direct organizational tasks. Similarly, managers’ efforts to promote positive

subordinate perceptions of procedural justice need not be designed to solicit employee input on

task completion procedures. As Lerner (1977) suggest, these efforts could also be inspired

simply by a belief that fairness is a principle that should be promoted in organizations.

Lastly, managers undertake these task control, trust-building, and fairness-building

actions not only to promote short-term production efficiencies, but to limit the potential

development of “pathological spiraling relationships” where “ surveillants come to distrust their

targets (i.e., employees) as a result of their own surveillance and targets, in fact, become

unmotivated and untrustworthy” (Enzle & Anderson, 1993: 263). Specifically, we argue that

managers attempt to utilize situationally appropriate combinations of trust-building, fairness-

building and task controls to, over the long term, build positive working relationships with their

subordinates. If this happens, managers may, however, gain production efficiencies and enable

themselves to more easily obtain insightful and valuable employee insights that can be

incorporated into their future decision-making and planning activities (Eisenhardt and Bourgeois,

1988).

Contributions to Control Theory

Although it is not our primary goal, the focus we place in this paper on relationships

between trust-building, fairness-building, and task control activities also enable us to refine and

extend existing control theory. For example, using our framework we can explain how managers

simultaneously produce high levels of task control and trust (Wilkins and Ouchi, 1983). As a

39

result, our work refines the work of control scholars such as Ouchi (1980) who suggest that

managers who use high levels of informal or “clan” control also tend to promote high levels of

superior-subordinate trust. In these cases, we suggest that the potential threats to their authority

that arise in systems with more ambiguous goals and rules, lead managers to simultaneously

promote informal task control, positive perceptions of the benevolent intentions, and

interactional fairness.

Our perspective can also be used to explain how managers effectively combine their

applications formal controls (i.e., bureaucratic or legalistic) with appropriate levels of trust-

building and fairness-building. Managers who rely solely on formal controls often signal to

subordinates that they do not trust them and will actively seek to limit their personal autonomy

(Enzle and Anderson, 1993; Sitkin & Roth, 1993). This often produces employees who are

unwilling to commit themselves to an organization’s goals (Sitkin & Roth, 1993), voluntarily

comply with directives, or exhibit extra-role behaviors (Blau & Scott, 1962; Enzle & Anderson,

1993; Kim & Mauborgne, 1993; Ghoshal & Moran, 1996).

Using our perspective, we explain how managers respond to these real and potential

threats to their authority with combinations of formal task controls, trust-building (i.e., by

promoting integrity and ability), and fairness-building (i.e., by promoting distributive fairness,

decision and process control, and informational fairness) initiatives. By implementing these

initiatives, managers direct task efforts while simultaneously communicating that they recognize

subordinates’ "needs for achievement, responsibility, and recognition, as well as altruism, belief,

respect for authority and the intrinsic motivation of an inherently satisfying task” (Donaldson,

1990: 372).

Trust-Building and Fairness-Building as Conflict Leadership

40

The focus we place on multiple forms of superior-subordinate conflict also refines and

extends the arguments presented in traditional LMX research that disagreements between

managers and employees generally lower the quality of their exchange relationships and lead

managers to both less actively delegate responsibilities to subordinates and be less willing to

involve subordinates in their decision-making (Scandura, et al., 1986; Bauer & Green, 1986;

Schriesheim, et al., 1998). Because LMX researchers tend to focus primarily on the effects of

superior-subordinate goal conflicts within management-employee exchanges, we argue that this

research really has examined how conflicts affect managerial efforts regarding distributional

issues and outcome-based issues. Because, in contrast, we focus and utilize research on

superior-subordinate task and personal conflicts, we can predict instances where conflicts

stimulate managers to improve their exchange-based relationships with subordinates.

Lastly, because we investigate the effects of multiple forms of conflict, this theory also

presents the potential to contribute to conflict management research as well. Specifically,

managerial responses to conflict in the conflict management literature can be described primarily

as influence strategies (e.g., Van de Vliert & Kabanoff, 1990) or impression management tactics

(e.g., Yukl, Kim, and Falbe, 1996). While we contend that trust-building, fairness-building, and

task controls can be used in these ways to address the immediate effects of conflicts on superior-

subordinate relationships, we also suggest that conflicts may lead managers to craft more long-

term, institution-based solutions to organizational problems. For example, in organizational

environments where superior-subordinate task conflicts exist, managers may develop and

implement institutionalized dispute resolution systems which extensively utilize procedural

fairness principles. Alternatively, in organizations where superior-subordinate personal conflicts

persist, managers may institute elaborate input control mechanisms that allow them to effectively

41

screen organizational entrants before they attain organizational membership.

CONCLUSION

This paper introduces and examines a framework that outlines how superior-subordinate

conflicts raise particular types of managerial concerns about employee reliability and their own

legitimacy and authority. In response to these concerns, we argue that managers integrate and

balance the organizational task controls they apply with the efforts they undertake to promote

trust and fairness. Building from this premise, we outline how particular types of superior-

subordinate conflicts (goal task, personal) lead managers to apply specific combinations of

organizational task controls (output, process, input) and implement both trust-building

(promoting integrity, promoting ability, promoting benevolence) and fairness-building

(distributive, procedural, interactional) activities. As a result, this paper refines the work of

control theorists (Ouchi, 1980; Eisenhardt, 1989) and the work of justice and trust scholars

(Greenberg, 1987; Lind & Tyler, 1988; Tyler & Lind, 1992) by examining key factors that lead

managers to generally promote organizational trust and fairness in conjunction with the task

controls they apply and how they tailor the combinations of activities they implement to

situational conditions.

42

REFERENCES

Adams, J. S. 1965. Inequity of social exchange. In L. Berkowitz (Ed.), Advances in

Experimental Social Psychology: 276-299. New York: Academic Press.

Adler, P., & Borys, B. 1996. Two Types of Bureaucracy: Enabling and Coercive. Administrative Science Quarterly, 41: 61-89.

Arrow, K. J. 1974. The Limits of Organization. New York, N.Y.: W. W. Norton.

Barker, J. R. 1993. Tightening the iron cage: Concertive control in self-managing teams.

Administrative Science Quarterly, 38: 408-437. Barnard, C. I. 1938 The Functions of the Executive. Cambridge, MA: Harvard University Press. Barney, J. B., & Hansen, M. 1994. Trustworthiness as a source of competitive advantage.

Strategic Management Journal, 15: 175-190. Barney, J. B., & Hesterly, W. 1996. Organizational economics: Understanding the relationship

between organizations and economic analysis. In S. R. Clegg, C. Hardy, and W. R. Nord (Eds.), Handbook of Organization Studies: 115-147. Thousand Oaks, CA: Sage Publications.

Baron, R. A. 1991. Positive effects of conflict: A cognitive perspective. Employee

Responsibilities and Rights Journal, 4: 25-26. Baron, R. A. 1997. Positive effects of conflict: Insights from social cognition. In C. K. W. de

Dreu & E. Van de Vliert (Eds.), Using Conflicts in Organizations: 177-191. Thousand Oaks, CA: Sage Publications.

Bauer, T. N., & Green, S. G. 1996. The development of leader-member exchange: A longitudinal

test. Academy of Management Journal, 39: 1538-1567. Bell, R., Walker, H. A., & Willer, D. 2000. Power, influence, and legitimacy in organizations.

Research in the Sociology of Organizations, 17: 131-177. Bendersky, C. 2001. Conflict and Control: Control System Constraints on Conflict Behaviors

in Organizations. Washington, DC: Academy of Management Annual Meeting. Bendersky, C. 2002. Managing Organizational Conflict: A Theoretical Model of Dispute

Resolution System Effectiveness. Denver, CO: Academy of Management Meeting. Bendersky, C. 2003. Organizational dispute resolution systems: A complementarities

perspective. Academy of Management Journal, 28: 643-656.

43

Bies, R. 1989. Managing conflict before it happens: The role of accounts. In M. A. Rahim (Ed.)

Managing Conflict: An Interdisciplinary Approach: 83-92. New York, NY: Praeger Bies, R. J., & Moag, J. S. 1986. Interactional justice: Communication criteria of fairness. In R. J.

Lewicki, B. H. Sheppard, & M. H. Bazerman (Eds.), Research in Negotiation in Organizations: 43-55. Greenwich, CT: JAI Press.

Blau, P. 1964. Exchange and Power in Social Life. New York: John Wiley. Blau, P., & Scott, W. R. 1962. Formal Organizations: A Comparative Approach. San

Francisco, CA: Chandler Publishing Company.

Boyle, E. H., & Lawler, E. J. 1991. Resolving conflict through explicit bargaining. Social Forces, 69: 1183-1204.

Bradach, J. L., & Eccles, R. G. 1989. Price, Authority and Trust: From Ideal Types to Plural

Forms. In Annual Review of Sociology, 15: 97-118. Bromiley, P., & Cummings, L. L. 1995. Transactions costs in organizations with trust. In R.

Bies, B. Sheppard, & R. Lewicki (Eds.), Research on Negotiations in Organizations: 219-247. Greenwich, CT: JAI Press.

Cardinal, L. B. 2001. Technological innovation in the pharmaceutical industry: Managing

research and development using input, behavior, and output controls. Organization Science, 12: 19-36.

Cardinal, L. B., Sitkin, S. B., & Long, C.P. 2004a. Balancing and rebalancing in the creation and

evolution of organizational control. Organization Science, 15: 411-431. Cardinal, L. B., Sitkin, S. B. & Long, C. P. 2004b. Toward a Theory of the Creation and Development

of Organizational Control: A Configurational Approach. Academy of Management Journal: Revise and Resubmit.

Chen, Y-R., & Church, A, H. 1993. Reward allocation preferences in groups and organizations.

The International Journal of Conflict Management, 4: 25-59. Colquitt, J. A. 2001. On the dimensionality of organizational justice: A construct validation of a

measure. Journal of Applied Psychology, 86: 386-400. Colquitt, J. A., Conlon, D. E., Wesson, M. J., Porter, C. O., & Yee, N. K. 2001. Justice at the

millenium: A meta-analytic review of 25 years of organizational justice research. Journal of Applied Psychology, 86: 425-445.

Colquitt, J.A., & Greenberg, J. 2003. Organizational justice: A fair assessment of the state of the

literature. In J. Greenberg (Ed.), Organizational behavior: The state of the science. Mahwah, NJ: Erlbaum.

44

Cosier, R. A. & Rose, G. L. 1977. Cognitive performance and goal conflict effects on task

performance. Organizational Behavior and Human Performance, 19: 378-391. Covaleski, M. A., Dirsmith, M. W., Heian, J. B., & Samuel, S. 1998. The Calculated and the

Avowed: Techniques of Discipline and Struggles over Identity in Big Six Public Accounting Firms. Administrative Science Quarterly, 43: 293-327.

Crosby, F. 1976. A model of egoistical relative deprivation. Psychological Review, 83: 85-113. Das, T. K. & Teng, B. 1998. Between Trust and Control: Developing Confidence in

Partner Cooperation in Alliances. Academy of Management Review, 23: 491-512 Deutsch, M. 1975. Justice in the “crunch.” In M. J. Lerner & S. C. Lerner (Eds.), The Justice

Motive in Social Behavior: New York: Plenum Press. Dirks, K. & Ferrin, D. 2002. Trust in leadership: Meta-analytic findings and implications for

research and practice. Journal of Applied Psychology, 87: 611-628. Donaldson, L. 1990. The ethereal hand: Organizational economics and management theory.

Academy of Management Review, 15: 369-381.

Doney, P. M., Cannon, J. P., & Mullen, M. R. 1998. Understanding the influence of national culture on the development of trust. Academy of Management Review, 23: 601-620.

Eisenberger, R., Huntington, R. Hutchinson, S., & Sowa, D. 1986. Perceived organizational

support. Journal of Applied Psychology, 71: 500-507.

Eisenhardt, K. M. 1985. Control: Organizational and economic approaches. Management Science, 31: 134-149.

Eisenhardt, K. M. 1989. Agency theory: An assessment and review. Academy of Management

Review, 31: 57-74.

Eisenhardt, K. M., & Bourgeois, J. L. 1988. Politics of strategic decision-making in high velocity environments: Toward a mid-range theory. Academy of Management Journal, 31: 737-770.

Enzle, M. E., & Anderson, S. C. 1993. Surveillant intentions and intrinsic motivation. Journal of

Personality and Social Psychology, 64: 257-266. Folger, R., Konovsky, M. A. & Cropozano, R. A. 1992. A due process metaphor for performance

appraisal. Research in Organizational Behavior, 14: 129-177. Folger, R. & Skarlicki, D. 2001. Fairness as a dependent variable: Why tough times can lead to

bad management. In R. Cropanzano (Ed.). Justice in the Workplace: From Theory to Practice: 97-118. USA: Lawrence Erlbaum Associates.

45

Fox, A. 1974. Beyond Contract: Work power and trust relations. London: Faber, Ltd. Frank, R. H. 1988. Passions with Reason: The Strategic Role of Emotions. New York: Norton. Ghoshal, S., & Moran, P. 1996. Bad for practice: A critique of the transaction cost theory.

Academy of Management Review, 1: 13-47. Gilliland, S. W., & Schepers, D. H. 2003. Why we do the things we do: A discussion and

analysis of determinants of just treatment in layoff implementation decisions. Human Resource Management Review, 13: 59-83

Greenberg, J. 1987. A taxonomy of organizational justice theories. Academy of Management

Review, 12: 9-22. Greenberg, J. 1990. Look fair vs. being fair: Managing impressions of organizational justice. In

B. M. Staw and L. L. Cummings (Eds.). Research in Organizational Behavior, 12: 111-157. Greenwich CT: JAI Press.

Greenberg, J. & Cohen, R. L. 1982. Why justice? Normative and instrumental

interpretations. In J. Greenberg & R. L. Cohen (Eds.), Equity and Justice in Social Behavior: 437-469. New York, N.Y.: Academic PRess

Homans, G. C. 1961. Social Behavior: Its Elementary Forms. New York: Harcourt, Brace &

World. Hosmer, L. T. 1995. Trust: the connecting link between organizational theory and philosophical

ethics. Academy of Management Review, 20: 379-403. Inkpen, A. C. & Currall, S. C. 2004. The coevolution of trust, control, and learning in joint ventures. Organization Science (in press). Janssen, O., Van de Vliert, E. & Veenstra, C. 1999. An interdependence-conflict model of team

decision making. Journal of Management, 25: 117-142. Jaworski, B. 1988. Toward a Theory of Marketing Control: environmental Context, Control

Types, and Consequences. Journal of Marketing, 52: 23-39. Jehn, K. A. 1994. Enhancing effectiveness: An investigation of advantages and disadvantages of

value-based intragroup conflict. The International Journal of Conflict Management, 3: 223-228.

Jehn, K. A. 1995. A multi-method examination of the benefits and detriments of intragroup conflict. Administrative Science Quarterly, 40: 256-282.

46

Jehn, K. A. 1997. Affective and cognitive conflict in work groups: Increasing performance

through value-based intragroup conflict. In C. K. W. de Dreu, and E. Van de Vliert (Eds.). Using Conflicts in Organizations: 87-100. Thousand Oaks, CA: Sage.

Jehn, K. A., & Mannix, E. A. 2001. The dynamic nature of conflict: A longitudinal study of

intragroup conflict and group performance. Academy of Management Journal, 44: 238-251 Jermier, J. M. 1998. Introduction: Critical theory perspectives on control. Administrative

Science Quarterly, 43: 235-256.

Jones, T. M. 1995. Instrumental stakeholder theory: a synthesis of ethics and economics. Academy of Management Review, 20: 404-437.

Kerr, J., & Slocum J. W. 1987. Managing corporate culture through reward systems. Academy of

Management Executive, 1: 99-108.

Kim, W. C., & Mauborgne, R. A. 1993. Making global strategies work. Sloan Management Review, 34: 11-27.

Kim, W. C., & Mauborgne, R. A. 1997. Fair Process: Managing in the Knowledge Economy. Harvard Business Review, : 65-75.

Kirsch, L. J. 1996. The management of complex tasks in organizations: Controlling the systems development process. Organization Science, 7: 1-21.

Lawler, E. E., Ford, R., Large, M. D. 1999. Unilateral Initiatives as a conflict resolution strategy.

Social Psychology Quarterly, 62: 240-256. Lawrence, P. R., & Lorsch, J. W. 1967. Organization and Environment: Managing

Differentiation and Integration. Cambridge MA: Harvard University Press. Lerner, M. J. 1977. The justice motive: some hypotheses as to its origins and forms. Journal of

Personality, 45: 1-52. Leventhal, G. S. 1976. The distribution of rewards and resources in groups and organizations. In

L. Berkowitz, and E. Walster (Eds.), Advances in Experimental Social Psychology: 91-131. New York: Academic Press.

Leventhal, G. S. 1980. What should be done with equity theory?. In K. J. Gergen, M. S.

Greenberg, and R. H. Willis (Eds.), Social exchange: Advances in Theory and Research: 27-55. New York: Plenum.

Leventhal, G. S., Karuza, J., Fry, W. R. 1980. Beyond fairness: A theory of allocation

preferences. In G. Mikula (Ed.) Justice and Social Interaction: 167-218. New York: Springer-Verlag.

47

Levinthal, D. 1988. A survey of agency models of organizations. Journal of Economic

Behavior and Organizations, 9: 153-185. Lewicki, R. J. & Bunker, B. B. 1996. Developing and maintaining trust in work relationships. In

R. M. Kramer and T. R. Tyler (Eds.), Trust in Organizations: Frontiers of Theory and Research: 114-139. Thousand Oaks, CA: Sage Publications.

Lewin, A. Y., Long, C. P. & Carroll, T. N. 1999. The Co-evolution of New

Organizational Forms. Organization Science, 10: 535-550. Lewis, J. D., & Weigert, A. J. 1985. Trust as a social reality. Social Forces, 63: 967-985. Lind, E. A., & Tyler, T. R. 1988. The social psychology of procedural justice. New York:

Plenum. Lind, E. A. 1995. Social conflict and social justice. Leiden, The Netherlands: Inaugural oration

for the Leiden University Fund Chair in social conflict. Long, C. P. (2002). Balancing Organizational Controls with Trust-Building and

Fairness-Building Initiatives. Ph.D dissertation, Duke University. Long, C. P., Burton, R. M., & Cardinal, L. B. 2002. Three controls and better than one: A

simulation model of complex control systems. Computational and Mathematical Organization Theory, 8: 197-220.

Lowenstein, J., Thompson, L., & Gentner, G. 1999. Analogical encoding facilitates knowledge

transfer in negotiations. Psychonomic Bulletin & Review, 6: 586-597. Luhmann, N. 1979. Trust and Power. New York: Wiley. Masterson, S. S., Byrne, Z. S., & Mao, H. 2004. Interpersonal and informational justice:

Identifying the differential antecedents of interactional justice behaviors. Mayer, R. C., Davis, J. H., Schoorman, D. 1995. An integrative model of organizational trust.

Academy of Management Review, 20: 709-734. Mayo, E. 1945. The Social Problems of an Industrial Civilization. Boston Division of

Research, Graduate School of Business Administration, Harvard University. McAllister, D. J. 1995. Affect and cognition-based trust as foundations for interpersonal

cooperation in organization. Academy of Management Journal, 38: 24-59. Mendl, J. R. 1989. Managing to be fair: An exploration of values, motives and leadership.

Administrative Science Quarterly, 34: 252-276.

48

Molm, L. D. 1984. The disruption and recovery of dyadic social interaction. In E. E. Lawler

(Ed.), Advances in Group Processes: 183-227, Greenwich, CT: JAI Press. Molm, L. D. 1987. Linking power structure and power use. In K. S. Cook (Ed.), Social

exchange theory: 101-109. Newbury Park, CA: Sage Publications. Molm, L. D. 1990. Structure, action and outcomes: the dynamics of power in social exchange.

American Sociological Review, 55: 427-447. Molm, L. D. 1991. Affect and social exchange: satisfaction in power-dependence relations.

American Sociological Review, 56: 475-493. Munduate, L., Ganaza, J., Peiro’, J. & Euwema, M. 1999. Patterns and styles in conflict

management and effectiveness. The International Journal of Conflict Management, 10: 5-24.

Noorderhaven, N. G. 1992. The problem of contract enforcement in economic organization

theory. Organization Studies, 13: 292-243. Noreen, E. 1988. The economics of ethics: A new perspective on agency theory. Accounting,

Organizations, and Society, 13: 359-369.

Organ, D. A. 1990. The motivational basis of organizational citizenship behavior. In L. L. Cummings, & B. M. Staw (Ed.), Research in Organizational Behavior: 43-72. Greenwich, CT: JAI Press.

Ouchi, W. G. 1977. The relationship between organizational structure and organizational control. Administrative Science Quarterly, 22: 95-113.

Ouchi, W. G. 1979. A conceptual framework for the design of organizational control

mechanisms. Management Science, 25: 833-848.

Ouchi, W. G. 1980. Markets, bureaucracies, and clans. Administrative Science Quarterly, 25: 129-141.

Ouchi, W. G., & Maguire, M. A. 1975. Organizational control: two functions. Administrative

Science Quarterly, 20: 559-569. Pennings, J. & Woiceshyn, J. 1987. A typology of organizational control and its metaphors. In

N. Ditomaso and S. B. Bacharach (Eds.), Research in the Sociology of Organizations: 73-104. Greenwich, CT: JAI Press.

Perlow, L. A. 1998. Boundary control: The social ordering of work and family time in a high tech corporation. Administrative Science Quarterly, 43: 328-357.

49

Pfeffer, J. 1981a. Management as symbolic action: The creation and maintenance of

organizational paradigms. In L. L. Cummings & B. M. Staw (Eds.) Research in Organizational Behavior, 3: . Greenwich, CT: JAI Press.

Pfeffer, J. 1981b. Power in Organizations. Marshfield, MA: Pitman Publishing, Inc. Pfeffer, 1981c. Who governs? In Grusky, O. and Miller, G. A. (Eds.). The Sociology of

Organizations: Basic Studies (2nd ed.): 228-247. New York: The Free Press. Pinkley, R. L. 1990. Dimensions of conflict frame: Disputant interpretations of conflict.

Journal of Applied Psychology, 75: 117-126. Pinkley, R. L. & Northcraft, G. B. 1994. Conflict frames of reference: Implications for dispute

processes and outcomes. Academy of Management Journal, 37: 193-205. Rahim, M. A. 1983. A measure of styles of handling conflict. Academy of Management

Journal, 26: 368-376. Rosenblatt, Z., Rogers, K. S. & Nord, W. R. 1993. Toward a political framework for flexible

management of decline. Organization Science, 4: 76-91. Roth, N. L., S. B. Sitkin, A. House 1994. Stigma as a determinant of legalization. In S. B. Sitkin

& R. J. Bies (Eds.), The Legalistic Organization: 137-168. Thousand Oaks, CA: Sage Publications.

Rousseau, D. M., Sitkin, S. B., & Burt, R. S, & Camerer, C. 1998. Not so different after all: A

cross-discipline view of trust. Academy of Management Review, 23: 393-404.

Scandura, T. A., Graen, G. B, and Novak, M. A. 1986. When managers decide not to decide autocratically: An investigation of leader-member exchange and decision influence. Journal of Applied Psychology, 71: 579-584.

Schriesheim, C. A., Neider, L. L., & Scandura, T. A. 1998. A within-and between-groups analysis of leader-member exchange as a correlate of delegation and as a moderator of delegation relationships with performance and satisfaction. Academy of Management Journal, 41: 298-318.

Selznick, P. 1957. Leadership in Administration. New York, NY: Harper & Row.

Shapiro, S. P. 1987. The social control of impersonal trust. American Journal of Sociology, 93:

623-658.

Shapiro, D., Sheppard, B. H., & Cheraskin, L. 1992. Business in a handshake. Negotiation Journal, 8: 365-377.

50

Sheppard, B. H., & Lewicki, R. J. 1987. Toward general principles of managerial fairness. Social

Justice Research, 1: 161-176.

Sheppard, B. H., & Sherman, D. M. 1998. The grammars of trust: A model and general implications. Academy of Management Review, 23: 422-437.

Sitkin, S. B. 1995. On the positive effect of legalization on trust. In R. J. Bies, R. J. Lewicki, & B.H. Sheppard (Eds.), Research on Negotiations in Organizations: 185-217. Greenwich, CT: JAI Press.

Sitkin, S. B., & Bies, R. J. 1993. Social Accounts in conflict situations: Using explanations to manage conflict. Human Relations, 46: 349-370.

Sitkin, S. B., & Bies, R. J. 1994. The legalization of organizations: A multi-theoretical perspective. In S. B. Sitkin and R. J. Bies (Eds), The Legalistic Organization: 19-49. Thousand Oaks, CA: Sage Publications.

Sitkin, S. B., & Roth, N. L. 1993. Explaining the limited effectiveness of legalistic remedies for

trust/distrust. Organization Science, 4: 367-392. Sitkin, S. B. & Stickel, D. 1996. The road to hell: The dynamics of distrust in an era of quality.

In R. M. Kramer & T. R. Tyler (Eds.), Trust in Organizations. Frontiers in Theory and Research: 196-215. Thousand Oaks, CA: Sage Publications.

Snell, S. A. 1992. Control theory in strategic human resource management: The mediating effect

of administrative information. Academy of Management Journal, 35: 292-327. Spreitzer, G. M., & Mishra, A. K. 1999. Giving up control without losing control: Trust and its

substitutes’ effects on managers’ involving employees in decision making. Group & Organization Management, 24: 155-187.

Stickel, 1999, Building trust in the face of hostility. Unpublished doctoral dissertation, Duke

University. Suchman, M. A. 1995. Managing legitimacy: Strategic and institutional approaches. Academy

of Management Review, 20: 571-610. Sullivan, J. J., Albrecht, T. L., & Taylor, S. 1990. Process, organizational, relational, and

personal determinants of managerial compliance-gaining communication strategies. The Journal of Business Communication, 27: 331-355.

Sutcliffe, K. M., Sitkin, S. B. & Browning, L. D. 2000. Tailoring process management to

situational requirements: beyond the control and exploration dichotomy. In R. Cole, W. R. Scott (Eds.) The Quality Movement and Organizational Theory: 315-330. Thousand Oaks, CA: Sage Publications.

51

Thibaut, J., & Walker, L. 1975. Procedural justice: A psychological analysis. Hillsdale, NJ:

Erlbaum. Thibaut, J., & Walker, L. 1978. A theory of procedure. California Law Review, 66: 541-566. Thomas, K. W. 1976. Conflict and conflict management. In M. Dunnette (Ed.), Handbook of

Industrial and Organizational Psychology: 889—935. Chicago: Rand McNally Thompson, L., Gentner, D., & Lowenstein, J. 2000. Avoiding missed opportunities in managerial

life: Analogical training more powerful than individual case training. Organizational Behavior and Human Decision Processes, 82: 60-75.

Tjsvold, D. & Chia, L. C., 1989 Conflict between managers and workers: The role of

cooperation and competition. Journal of Social Psychology, 129: 235-247. Tyler, T. R. 1989. The psychology of procedural justice: A test of the group-value model.

Journal of Personality and Social Psychology, 57: 333-344. Tyler, T. R., & Bies, R. 1990. Interpersonal aspects of procedural justice. In J. S. Carroll (Ed.) Tyler, T.R., & Lind, E A. 1992. A relational model of authority in groups. In Advances in

Experimental Social Psychology: 151-191. New York: Academic. Van de Vliert, E. 1997. Complex Interpersonal Conflict Behavior: Theoretical Frontiers.

Hove, UK: Psychology Press. Van De Vliert, E. & Kabanoff, B. 1990. Toward theory-based measures of conflict management.

Academy of Management Journal, 33: 199-209. Van de Vliert, E. Euwema, M. & Huismans, S. E. 1995. Managing conflict with a subordinate

or a supervisor: Effectiveness of conglomerated behavior. Journal of Applied Psychology, 80: 271-281.

Van Maanen, J., & Schein, E. H. 1979. Toward a theory of organizational socialization. In B. W.

Staw, and L. L. Cummings (Eds), Research in Organizational Behavior: 209-264. Greenwich, CT: JAI Press.

Whitener, E. M., Brodt, S. E., Korsgaard, M. A., & Werner, J. M. 1998. Managers as initiators

of trust: An exchange relationship framework for understanding managerial trustworthy behavior. Academy of Management Review, 23: 513-530.

Wicks, A. C., Berman, S. L. & Jones, T. M. 1999. The structure of optimal trust: Moral and

strategic implications. Academy of Management Review, 24: 99-116. Wilkins, A. L., & Ouchi, W. G. . 1983. Efficient cultures: Exploring the relationship between

culture and organizational performance. Administrative Science Quarterly, 28: 468-481.

52

Williamson, O. E. 1975. Markets and Hierarchies. New York, NY: Free Press. Williamson, O. E. 1993. Calculativeness, trust and economic organization. Journal of Law and

Economics, 30: 131-145. Yukl, G., Falbe, C. M., & Youn, Y, J. 1993. Patterns of influence behavior for managers. Group

& Organization Management, 18: 5-28. Yukl, G., Guinan, P. J., & Sottolano, D. 1995. Influence tactics used for different objectives with

subordinates, peers, and superiors. Group & Organization Management, 20: 272-296. Zelditch, M, Jr. & Walker, H. A. 1984. Legitimacy and the stability of authority. Advances in Group Processes: Theory and Research, 1: 1-25. Zucker, L. 1986. Production of trust: institutional sources of economic structure, 1840-1920. In

B. M. Staw & L. L. Cummings (Eds.), Research in Organizational Behavior: 53-111. Greenwich, CT: JAI Press.

53

TABLE 1 Managerial Applications of Trust-Building and Fairness-Building, and Task Control

Activities

Trust-Building Initiatives

Fairness-Building Initiatives

Task Controls

Intended Outcomes

Develop appropriate levels of trust between a manager and their subordinates

Produce positive perceptions of fairness among employees.

Align subordinate inputs, behaviors, and outputs with demands of organizational tasks

Primary Mechanisms

Promote positive subordinate perceptions of a manager’s: 1. Ability 2. Benevolence 3. Integrity

Promote the perception that a manager or organization is 1. Distributively 2. Procedurally 3. Interactionally Fair.

Develop ways to 1. Select 2. Train 3. Monitor 4. Reward subordinates for task completion efforts

Strengths Provide managers with mechanisms to address employees’ trust-related concerns

Provide managers the mechanisms to address employees’ fairness-related (equity, respect, decision or process control) concerns

Provide managers the mechanisms to prepare, supervise and remunerate subordinates for completing task directives.

Weaknesses 1. May lead managers to compromise fairness by focusing too much on the concerns of particular, individual employees.

2. May lead managers to spend too little time implementing task directives.

1. Can lead managers to compromise employee trust by providing insufficient attention to the particularized concerns of individual employees.

2. May lead managers to spend too little time implementing task directives.

1. May wrest too much control out of employees’ hands, signaling to them that their manager cannot be trusted.

2. May lead managers to promote efficiency and effectiveness over fairness.

54

FIGURE 1 Process Model of How Conflicts Influence Managerial Task Control, Trust-Building and Fairness-

Building Actions

Superior-Subordinate Conflict

(Potential or Actual)

Reliability-Based Concerns

•Employee Opportunism

Authority-Based Concerns

•Validity•Propriety

Trust-Building Activities

Fairness-Building Activities

Organizational Task Controls

Conflict Recognition

Managerial Concerns

Managerial Responses

55

FIGURE 2 Relationships between Superior-Subordinate Conflicts, Key Managerial

Concerns and Manager’s Actions

Superior-Subordinate Manager’s ActionsKey Managerial Conflict Concerns Raised

Goal Conflict

2. Instrumentality of Goals 3. Outcome Satisfaction

Output Controls

Promote Integrity

Distributive Fairness-Building

1. Goal Incongruence

Task Conflict

2. Efficacy of Process Directives

3. Decision Satisfaction

Process Controls 1. Incongruent Task Preferences

Personal Conflict

2. Appropriateness of Values 3. Identification

Input Controls 1. Value Incongruence

Promote Ability

Procedural Fairness-Building: Decision and Process Control

Informational Fairness-Building

Promote Benevolence

Interpersonal Fairness-Building

56

1 It is important to note early in this paper that we acknowledge that some managers may engage in activities designed merely to give the impression that they are acting fairly or are trustworthy (Greenberg, 1990). However there are many reasons why we reasonably adopt the assumption that managers make good faith efforts to build trust and fairness. Most important of these is that we describe conditions where managers concurrently issue control directives, promote relatively robust fairness perceptions (Lind, 1995) and build more fragile trusting relationships with their subordinates (Lewicki & Bunker, 1996). Thus, we assume that managers act in good faith because subordinates will respond more effectively to genuine attempts to be fair and build trust (Lind & Tyler, 1988; Tyler & Lind, 1992). As a result, we generally assume that managers recognize that they must exhibit a desire to improve their relationships with employees and promote a positive work environment if, over time, they are to reap the benefits that positive trust and fairness perceptions will give them. 2 The concept of organizational control has traditionally (Ouchi, 1979) been defined broadly as the collection of processes by which “managers direct attention, motivate, and encourage organizational members to act in desired ways to meet an organization’s objectives” (Long, Burton, & Cardinal, 2002: 198). In contrast, we use the concept and term “task controls” because it captures the focus that researchers (e.g., Ouchi, 1977; Eisenhardt, 1985) have placed on the controls managers use to direct organizational tasks. Managers apply task controls in order to achieve the explicit goal of efficient and effective organizational task management. Individual task controls include formal and informal controls directed towards employee inputs, behaviors and outputs (Cardinal, et al., 2004).

57