Journal of Operations Management 31 (2013) 567–578 Contents lists available at ScienceDirect Journal of Operations Management j o ur na l ho mepage: www.elsevier.com/locate /jom The relative impact of attribute, severity, and timing of psychological contract breach on behavioral and attitudinal outcomes Stephanie Eckerd a,∗ , James Hill b , Kenneth K. Boyer b , Karen Donohue c , Peter T. Ward b a University of Maryland, Robert H. Smith School of Business, 3411 Van Munching Hall, College Park, MD 20742, United States b The Ohio State University, Fisher College of Business, 600 Fisher Hall, 2100 Neil Avenue, Columbus, OH 43210, United States c University of Minnesota, Carlson School of Management, Suite 3-150, 321 Nineteenth Avenue South, Minneapolis, MN 55455-9940, United States a r t i c l e i n f o Article history: Received 14 August 2012 Received in revised form 21 June 2013 Accepted 26 June 2013 Available online 10 July 2013 Keywords: Buyer–supplier relationships Behavioral supply chain management Psychological contracts Fairness Psychological experiment a b s t r a c t A psychological contract defines the perceived reciprocal obligations that characterize a relationship between an individual and organizational entity. Breach of a psychological contract can negatively affect work behaviors and attitudinal perceptions, and may also elicit an emotional response (violation) which can help to explain these negative consequences. This research focuses on the role of psychological contracts in a supply chain setting. We explore when and how three conditions of psychological contract breach – attribute, severity, and timing – negatively impact outcomes, and assess the mediating role of psychological contract violation in this relationship. To evaluate our hypotheses, we employ a laboratory experiment in which participants assume the role of a purchasing manager. We impose various breach factors and observe their relative impact on the decision-making behavior and fairness perceptions of the participant. We show that while the breach factors significantly impact task behavior, these relationships are not explained by psychological contract violation. However, violation is useful in explaining, in part, the results pertaining to fairness perceptions. © 2013 Elsevier B.V. All rights reserved. 1. Introduction Much of the business conducted in supply chain exchanges is governed by written contracts. However, previous research has shown that the proclivity of organizational decision-makers to reference the written or formal contract when differences arise is rather low, effectively increasing the relevance of social, rela- tional, and psychological contracts in supply chain governance (Handley and Benton, 2009; Kaufmann and Stern, 1988; Lumineau and Henderson, 2012; Ryall and Sampson, 2006). Recent research investigating such behavioral factors in supply chain contexts adds further credence to their importance. Factors such as trust (Byoung- Chun et al., 2011; Johnston et al., 2004), cooperation (Jiang, 2009; Tangpong et al., 2010), and communication (Eckerd and Hill, 2012; Prahinski and Benton, 2004) are all found to influence decision- making behavior. Other research has shown that relational factors, such as fairness and justice, can impact supply chain relationships in meaningful ways (Griffith et al., 2006; Katok and Pavlov, 2013; Liu et al., 2012). Our work contributes to this important stream of research by investigating the role that psychological contracts play ∗ Corresponding author. Tel.: +1 614 439 8951. E-mail addresses: seckerd@rhsmith.umd.edu, seckerd@umd.edu (S. Eckerd). in decision-making behavior, and overall fairness perception, in a purchasing context. Specific decision-making tasks within inter-firm exchanges are typically carried out by individuals, such as purchasing managers (PMs), who independently form their own interpretation of the exchange agreement. This introduces a distinctly psychological element into contractual relations, written and unwritten alike, wherein the terms are understood in the eye of the beholder (Macneil, 1985; Rousseau and McLean Parks, 1992). This purely idiosyncratic view of exchange obligations is known as the psy- chological contract. When an individual perceives a failure in fulfillment of the psychological contract, this is known as psy- chological contract breach. These failures may also generate an emotional response, and this component is referred to as psycho- logical contract violation. Since psychological contract breaches may occur in supply chain relationships, it is important to understand the impact of different types of breaches to better predict their consequences. The con- ditions of psychological contract breach that we focus on in this research include the attribution, severity, and timing of the breach. We examine the relative impact of each of these breach factors on an individual PM’s behavioral and attitudinal outcomes, and assess the extent that these outcomes may be explained by the emotions associated with violation of the psychological contract. We demon- strate that all three of the breach factors under evaluation have an impact on task behavior, but surprisingly these effects are not 0272-6963/$ – see front matter © 2013 Elsevier B.V. All rights reserved. http://dx.doi.org/10.1016/j.jom.2013.06.003