Psychological contract and knowledge management mediated by cultural dynamics

Contact centres represents critical component in the value chain through their differentiating role in service delivery. The vitality is assessed in terms of performance and global service quality that is brought into sharp focus if the centre is outsourced because of the impact of the strategic behaviour of the principal and its relation with its agents. The association of employees with the brand in outsourced operation is not as effective as in captive operations partly because communications from principal to agent are attenuated. Emotional connectivity, diagnostic skill set, requirement gathering, and knowledge are some of the most sensitive qualities required in agents working in the contact centres. These characteristics differ in an in-house and outsourced operation which further reflects the psychological contract between service providers and employees. In addition, the employees are unlikely to achieve any rewards and are unable to offer any commitments to the customer in an outsourced operation because of cost obvious reasons and hence, the “psychological contract” is breached. One of the consequences of this breach is on knowledge management. The knowledge of an employee regarding the products and services attrite with that employee’s attrition. Employees’ then have little interest towards customer service and organizational welfare, which impacts on the customer centric goals of the principal. We argue that the psychological contract between the employer and an employee has positive influence on Knowledge Diffusion, which further contributes to the overall organizational effectiveness. This paper aims to investigate, as a pilot study, the elements of organisational culture and secondly its role in the diffusion of knowledge in contact centres, in-house and outsourced. We demonstrate how by deploying a blend of qualitative methods, it is possible to perceive the effect of each element of the cultural web on diffusion. Finally we propose a hypothesis of the role that Power Distance can play, as a proxy for the Psychological Contract to leverage knowledge diffusion.