PROCEDURAL JUSTICE, STRATEGIC DECISION-MAKING, AND THE KNOWLEDGE ECONOMY

Collective knowledge building is a key strategic task for firms' succe ss today. But creating and sharing knowledge are intangible activities that can neither be supervised nor forced out of people. They happen only when individuals cooperate voluntarily. A key challenge facing st rategic management is obtaining the voluntary cooperation of individua ls as firms formulate and implement their strategic decisions. This es say draws on the rich body of procedural justice research to address t his critical issue. We argue that when people feel their strategic dec ision-making processes are fair, they display a high level of voluntar y cooperation based on their attitudes of trust and commitment. Conver sely, when people feel that the processes are unfair, they refuse to c ooperate by hoarding ideas and dragging their feet in conceiving and e xecuting strategic decisions. We further develop this argument into te am performance wherein the attitudinal and behavioral effects of proce dural justice are corroborated with theory and Initial evidence of the ir bottom-line performance consequences. We then build a theory, which we call intellectual and emotional recognition theory, that can expla in why procedural justice invokes the side of human behavior that goes beyond outcome-driven self-interests and that is so critical in the k nowledge economy. (C) 1998 John Wiley & Sons, Ltd.