A balanced psychological contract is an employer relationship that includes an expectation of career advancement in exchange for high performance in work assignments. The main objective of this study was to create a broader theoretical framework for this type of hybrid contract and to quantitatively examine its nomological network. Specifically, the main objective was to conduct a multi-step study to examine the relationship between balanced contracts and executives using the five-factor model. A secondary objective was to examine whether the interaction of personality and balanced contracts predicts employee satisfaction with their work. Sample data were collected from 48 small business owners and 244 of their employees in Canada. The multi-step analysis showed that managers` awareness and openness to experience were the best predictors of balanced contracts. In addition, the interaction of openness to experience and balanced contracts was closely related to employee job satisfaction. Finally, we discuss possible limitations, possible future avenues of research, and practical implications. Equality between distributor and supplier is the hallmark of a strong distribution agreement.
Balanced agreements survive longer than those where one partner is preferred over another due to smart conditions. The longest lifetime agreements are simple, easy to understand and unbiased. Distribution partnerships that are based on unbalanced agreements and that are perhaps too cleverly formulated often expire prematurely. Strong chords don`t have to be smart, but to demonstrate balance and balance. An agreement that allows price adjustments only once a year is unbalanced. A manufacturer has to deal with changing costs throughout the year. It is not reasonable to expect the manufacturer to bear the increase in costs over a longer period of time without being able to pass on these additional costs in the short term. A balanced approach to cost developments would allow price changes to be made throughout the year, possibly with a period of 30 or 60 days.
Proponents of balanced trade argue that it is easy to measure and manage because it does not require complex calculations and assessments of an economy`s exports and imports. They argued for the protection of growth, employment and wages in a trade-deficit economy, assuming (implicitly or explicitly) that imports are synonymous with posting jobs abroad. A trade surplus has little incentive to balance because, conversely, it would experience fewer jobs and growth. Balanced trade is a state in which an economy has no trade surplus or trade deficit. A balanced trade model is an alternative to a free trade model, as a model that requires countries to coordinate imports and exports to ensure a zero trade balance would require various market interventions to achieve this outcome. Intelligently designed words and phrases in a distribution agreement rarely extend the life of a partnership between a distributor and a manufacturer. A partnership lives only as long as both partners believe that a lasting relationship is beneficial. Once the perceived value erodes, the partnership is terminated, followed closely by the expiration or termination of the agreement. Contract negotiations tend to balance organically.
If you send an unbalanced deal to one party, the opposing party will likely try to achieve balance. During the creation process, neither party accepts the terms of a contract if they are found to be abusive. And technology trends have led companies like IBM and other leading companies to offer a fair deal from the start. Relationships and agreements between distributors and manufacturers eventually expire. This process can be consensual, with both sides moving in different directions. After withdrawal, the distributor works with an established and enthusiastic supplier; The manufacturer establishes a relationship with a promising dealer. However, separating a former partner in a distribution agreement can become bitter and require the help of a lawyer. In many cases where a distribution relationship ends in litigation, the distribution agreement has been designed in such a way that the two parties are not treated equally. One-way agreements are created by a partner who may have relatively little experience in creating distribution agreements. Sometimes we try to stack the benefits on one side of the partnership to make it a better deal for one partner than the other. A partner becomes too smart trying to improve their life by taking advantage of the other partner`s inexperience. Such exploitation thwarts the longevity of a distribution partnership.
International trade organizations such as the World Trade Organization (WTO) generally limit tariffs and trade barriers, so trying to strike a balanced trade agreement would conflict with accession agreements. Distributors and manufacturers must ensure that a distribution agreement in which they enter into does not have unilateral language. A relationship based on a symmetrical agreement is much more likely to grow and develop over a long period of time. A relationship based on the relative inequality of power between two partners, on the other hand, is doomed to an early conclusion. Striving for a balanced agreement is just one step a partner can take to promote the longevity of a distribution agreement and partnership. If a party can terminate the agreement for convenience, the balance states that the other party can do the same. The authors of the agreement must remember that the perceived value of the continuation of the relationship by both parties; It is not the wisdom and intelligence of the author that determines the endurance of the distribution partnership. A balanced business model is different from a free trade model, where countries use their resources and comparative advantages to buy or sell as many goods and services as supply and demand allow.
A country would use tariffs or other trade barriers to achieve balanced trade that could be done either country by country (zero balance on a bilateral basis) or for the overall trade balance (where a surplus with one country could be offset by a deficit with another). In addition to tariffs, there were various proposals. Agreements that contain clever phrases and clauses that give one partner more power than another are asymmetrical. Agreements drafted in an unbalanced manner tend to expire faster than those drafted with the aim of balancing the relative power of both parties. The partners in an unbalanced distribution agreement can be satisfied at a time when the indicators are favorable: increased sales, increased market share and increased profit margins. However, all measures increase and decrease over time. A proven partnership can sometimes survive declining measures. However, if the measures are poor over a long period of time, one or both parties may request an exit from the agreement. Problems with an unbalanced agreement usually arise when the yield decreases or when one or both parties consider terminating the agreement. As with any other component of technology and law, your results may vary.
But when it comes to business strategy, it never hurts to treat others the way you want to be treated. For more information on accounting agreements, watch the OpenView Labs video with Jeremy Aber. An agreement that allows termination by a single party is unbalanced. An agreement that allows one party to terminate the agreement for a number of alternative reasons, while allowing the other party to terminate for a single draconian cause, is equally unbalanced. Be careful when drafting the agreement to ensure an appropriate balance in the ability of both parties to terminate the agreement. Executives who sign a distribution agreement are generally optimistic about the partnership that will be launched. No one who participated in the creation of an agreement is eagerly awaiting its demise. Premature termination of a dealer-supplier relationship can be disappointing. Litigation arising from the decoupling of partners should be avoided. However, breaking down a partnership is not necessarily the wrong course of action.
When a distribution partnership dissolves, both parties have the choice to focus on their respective business customers and companions or to devote management time and company resources to litigation that always results in the termination of the distribution agreement. Senior management time, management attention and financial resources allocated to a legal dispute represent a diversion of the company`s attention; away from customers. Since unbalanced agreements are more likely to lead to a legal fight, it is worth striving to create a balanced distribution agreement. .