Relationship Competence as a Performance Factor: Why the Quality of Collaboration Matters Economically

Even the best process depends on people passing on information, taking responsibility, raising problems, and connecting their knowledge. Whether they do so does not depend on responsibilities and work instructions only. It also depends on how they experience working together.

Are contributions taken seriously? Is disagreement possible? Can uncertainties be named? And how do managers react to mistakes?

A relationship is an interaction. This applies to customer and business relationships just as much as to collaboration inside a company. If relationships are understood in purely transactional terms – performance for pay, task for result, communication for conversion – an essential part of organizational effectiveness is left out of account.

Relationship competence is not a scientific term with a single agreed definition. What is meant here is a bundle of social and emotional skills that support resilient collaboration. These include:

•    perceiving perspectives and communicating them clearly,
•    clarifying expectations and roles,
•    giving and receiving feedback,
•    addressing tensions early,
•    reflecting on one’s own reactions,
•    dealing constructively with mistakes and uncertainty.

Good relationship building means neither constant harmony nor giving up clear requirements. A resilient working relationship also withstands differing interests, critical feedback and necessary decisions.

Relationship competence also does not replace functioning structures, sufficient resources or professional expertise. Appreciative communication cannot compensate for a permanently excessive workload, unclear responsibilities or decisions perceived as unfair. In its fact sheet published in 2026, the German Federal Institute for Occupational Safety and Health (BAuA) likewise classifies not only recognition and social support but also clear roles, adequate resources and good work design as relevant conditions.

The relational level rarely affects economic results in a single direct step. Its influence runs through motivation, trust, information sharing, learning behavior, commitment and the willingness to take responsibility. Research supports these connections, without any single appreciative act promising immediate gains in productivity or profit.

The self-determination theory developed by Edward Deci and Richard Ryan distinguishes between controlled and autonomous motivation: people act either largely under external pressure or because they experience a task as meaningful and identify with a goal.

Alongside autonomy and the experience of competence, relatedness is one of the three basic psychological needs that, according to this theory, shape the quality of motivation. In their research overview Self-Determination Theory in Work Organizations, Deci, Olafsen and Ryan (2017) link support for these needs to more self-determined motivation, engagement, well-being and job performance.

Work therefore does not always have to be enjoyable. But those who experience belonging, agency and competence have different conditions for sustained engagement than someone who is mainly steered through pressure.

From day-to-day interactions, employees form an overall judgment of whether their work is seen and whether the company takes an interest in their well-being.

For their study Perceived Organizational Support, Kurtessis and colleagues (2017) pooled the findings of 558 studies. Perceived support from the organization was associated with job satisfaction, affective commitment, well-being and job performance. Fairness, support from managers and working conditions emerged as important influencing factors.

Appreciation therefore shows not only in praise, but also in comprehensible decisions, feedback that is taken seriously, the allocation of resources and everyday interaction.

A German reference point comes from the 2024 analysis of the employment survey run by the Federal Institute for Vocational Education and Training (BIBB) and the Federal Institute for Occupational Safety and Health (BAuA): 62 percent of employees report frequent support from their manager; 40 percent experience regular praise and recognition. Employees with frequent support and recognition rate their work and health situation more favorably. The analysis published by the BAuA in 2026 thus shows an association, but not a simple cause-and-effect relationship.

The concept of psychological safety is particularly well researched. It describes a team’s shared belief that interpersonal risks are possible: asking a question, voicing doubts, admitting a mistake or contradicting a widely held opinion without being exposed or personally devalued for it.

Psychological safety does not mean that every statement remains without consequences or that performance standards drop. Rather, it creates a precondition for relevant information to become visible at all.

For a research review published in the journal Personnel Psychology, Frazier and colleagues (2017) synthesized 136 independent samples covering more than 22,000 individuals and almost 5,000 groups.

Psychological safety was associated with engagement, job satisfaction, commitment, task performance, information sharing and learning behavior, among other outcomes. Many of these studies, however, show associations and do not automatically reveal which characteristic causes the other.

Amy Edmondson and Derrick Bransby (2023) review the state of research in Psychological Safety Comes of Age. Psychological safety becomes particularly relevant where work is complex, uncertain and interdependent: teams then have to detect problems early and bring different bodies of knowledge together.

Psychological safety is therefore not a comfort zone. It creates the conditions for open debate, shared learning and the early handling of mistakes and risks.

Managers shape relational experiences to a particular degree. Their behavior influences whether employees raise criticism, uncertainties and ideas.

Martin and colleagues (2016) examined the quality of the relationship between managers and employees in a meta-analysis. Higher relationship quality was positively associated with the fulfillment of core work tasks and with voluntary behavior that supports the organization. It was negatively associated with counterproductive behavior. Trust, motivation, empowerment and job satisfaction mediated part of these associations. A positive, if moderate, association also appeared for objectively measured performance data.

Emotional intelligence and empathy can help managers to notice reactions, interpret perspectives and regulate their own behavior. Gerhardt, Bauwens and van Woerkom (2026) analyzed 101 studies on this and found predominantly positive associations with constructive leadership behavior and leadership effectiveness. At the same time, they emphasize that no clear causal statements are possible and that emotional intelligence is measured in different ways.

It is therefore not a formula for success on its own, but part of a package of competences made up of self-reflection, emotion regulation, communication, decision-making and the ability to handle conflict.

A lack of trust or appreciation does not necessarily lead straight to open conflict. Often less visible protective moves come first:

•    Concerns are held back.
•    Mistakes are hedged or covered up.
•    Ideas and responsibility are withheld or passed on.
•    Communication is limited to what is formally necessary.
•    Conflicts shift elsewhere, knowledge stays within individual areas.
•    Employees reduce their engagement to the agreed minimum.

These reactions do not have a single trigger. The research overviews by Frazier and colleagues (2017), Kurtessis and colleagues (2017) and Martin and colleagues (2016) nevertheless point in the same direction: trust, support and relationship quality are connected to whether people speak up, share information and take responsibility.

The organization may keep working, but with greater friction. Decisions rest on incomplete information, risks are recognized later and existing knowledge is not used sufficiently.

The Gallup Engagement Index Germany 2025, published in 2026, shows that 10 percent of employees have a high emotional commitment to their company, 77 percent a low one and 13 percent none at all. The representative survey of 1,700 employees describes the situation but does not on its own explain its causes.

Gallup’s international Q12 analysis provides a broader data base for the connection between engagement and organizational outcomes. Harter and colleagues (2024) drew on 736 studies from 347 organizations, more than 183,000 work and business units and around 3.35 million employees. Engagement was associated with all eleven outcomes examined, among them productivity, profitability, turnover, absenteeism, safety and quality.

These findings should also be read in a differentiated way: Gallup is examining its own engagement instrument, and associations are not the same as simple causal proof. The size and breadth of the data base, however, argue clearly against treating commitment and collaboration as economically irrelevant side issues.

The economic effect of good relationship building usually arises indirectly: problems are raised earlier, knowledge is shared more effectively, conflicts are worked through and decisions are better informed. Relationship competence does not guarantee economic success. But it shapes the conditions under which professional expertise, creativity and available resources become effective.

Relationship competence does not come out of a single workshop. It develops through the interplay of individual behavior, recurring routines and organizational conditions. Several starting points can be derived from the findings on psychological safety, leadership, work design and organizational support:

Working relationships always have a transactional side. Companies need clear agreements, measurable results and reliable processes. In the long run, however, a purely task- and result-oriented approach is not enough.

The quality of relationships influences whether people disclose problems, share knowledge, take responsibility and remain able to work even under pressure. Relationship competence is therefore not a friendly extra for good times, but an important component of stable, high-performing and future-ready organizations.

Empowerment Team Berlin supports organizations in developing leadership, collaboration and culture so that people can work effectively together.

Bundesanstalt für Arbeitsschutz und Arbeitsmedizin. (2024). Unterstützung und Anerkennung durch die Führungskraft sind wichtige Ressourcen – aber viele Beschäftigte erleben sie nur eingeschränkt (BIBB/BAuA-Faktenblatt 62). https://www.baua.de/DE/Angebote/Publikationen/Fakten/BIBB-BAuA-62

Deci, E. L., Olafsen, A. H., & Ryan, R. M. (2017). Self-determination theory in work organizations: The state of a science. Annual Review of Organizational Psychology and Organizational Behavior, 4, 19–43. https://doi.org/10.1146/annurev-orgpsych-032516-113108

Edmondson, A. C., & Bransby, D. P. (2023). Psychological safety comes of age: Observed themes in an established literature. Annual Review of Organizational Psychology and Organizational Behavior, 10, 55–78. https://doi.org/10.1146/annurev-orgpsych-120920-055217

Frazier, M. L., Fainshmidt, S., Klinger, R. L., Pezeshkan, A., & Vracheva, V. (2017). Psychological safety: A meta-analytic review and extension. Personnel Psychology, 70(1), 113–165. https://doi.org/10.1111/peps.12183

Gallup. (2026). Gallup Engagement Index Deutschland 2025. https://www.gallup.com/de/472028/bericht-zum-engagement-index-deutschland.aspx

Gerhardt, K., Bauwens, R., & van Woerkom, M. (2026). Emotional intelligence and leader outcomes: A comprehensive review and roadmap for future inquiry. Human Resource Development Review, 25(1), 29–79. https://doi.org/10.1177/15344843251342689

Harter, J. K., Tatel, C. E., Agrawal, S., Blue, A., Plowman, S. K., Asplund, J., Yu, S., & Kemp, A. (2024). The relationship between engagement at work and organizational outcomes: Q12 meta-analysis (11th ed.). Gallup. https://www.gallup.com/workplace/321725/gallup-q12-meta-analysis-report.aspx

Kurtessis, J. N., Eisenberger, R., Ford, M. T., Buffardi, L. C., Stewart, K. A., & Adis, C. S. (2017). Perceived organizational support: A meta-analytic evaluation of organizational support theory. Journal of Management, 43(6), 1854–1884. https://doi.org/10.1177/0149206315575554

Martin, R., Guillaume, Y., Thomas, G., Lee, A., & Epitropaki, O. (2016). Leader–member exchange (LMX) and performance: A meta-analytic review. Personnel Psychology, 69(1), 67–121. https://doi.org/10.1111/peps.12100