Organizational Behavior

Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Name of Student Roll No Institute Subject Date

Mr. Barhate Mangesh Tukaram PG/509/MBA(I)/2009J Silver Bright Institute of Management (SBIM), Pune Organizational Behavior 10 Jan 2010

ORGANIZATIONAL BEHAVIOR

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

INDEX

- Preamble - Functions of Managers - Roles performed by managers Organization The Challenges of today’s organization The Changing Organization Organizational Behavior Organizations and human behavior Organizational structure Organizational culture Individual vs Group Behavior Motivation Leadership Money and other financial rewards Stress Conflict Communication Wrapping Up

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Preamble
Organizational behavior is a relatively young field of inquiry that studies what people think, feel, and do in and around organizations. Organizations are groups of people who work interdependently toward some purpose. OB concepts help us to predict and understand organizational events, adopt more accurate theories of reality, and influence organizational events. This field of knowledge also improves the organizations financial health. There are several trends in organizational behavior. Globalization requires corporate decision makers to be more sensitive to cultural differences, and seems to be associated with the recent rise in job insecurity, work intensification, and other sources of work-related stress. Information technology blurs the temporal and spatial boundaries between individuals and the organizations that employ them. It has contributed to the growth of telecommute -- an alternative work arrangement where employees work at home or a remote site, usually with a computer connection to the office. Information technology is also a vital ingredient in virtual teams -- cross-functional groups that operate across space, time, and organizational boundaries. Another trend in organizations is the increasingly diverse workforce. Diversity potentially improves decision making, team performance, and customer service, but it also presents new challenges. A fourth trend is the employment relationships that have emerged from the changing work force, information technology, and globalization forces. Employment relationship trends include employability and contingent work. Values and ethics represent the fifth trend. In particular, companies are learning to apply values in a global environment, and are under pressure to abide by ethical values and higher standards of corporate social responsibility.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Functions of Managers
A Manager is the person responsible for planning and directing the work of a group of individuals, monitoring their work, and taking corrective action when necessary. For many people, this is their first step into a management career. Managers may direct workers directly or they may direct several supervisors who direct the workers. The manager must be familiar with the work of all the groups he/she supervises, but does not need to be the best in any or all of the areas. It is more important for the manager to know how to manage the workers than to know how to do their work well. A manager may have the power to hire or fire employees or to promote them. In larger companies, a manager may only recommend such action to the next level of management. The manager has the authority to change the work assignments of team members. A manager's title reflects what he/she is responsible for. An Accounting Manager supervises the Accounting function. An Operations Manager is responsible for the operations of the company. The Manager of Design Engineering supervises engineers and support staff engaged in design of a product or service. A Night Manager is responsible for the activities that take place at night. There are many management functions in business and, therefore, many manager titles. Regardless of title, the manager is responsible for planning, directing, monitoring and controlling the people and their work.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Managers just don't go out and haphazardly perform their responsibilities. Good managers discover how to master five basic functions: planning, organizing, staffing, leading, and controlling. Planning: This step involves mapping out exactly how to achieve a particular goal. Say, for example, that the organization's goal is to improve company sales. The manager first needs to decide which steps are necessary to accomplish that goal. These steps may include increasing advertising, inventory, and sales staff. These necessary steps are developed into a plan. When the plan is in place, the manager can follow it to accomplish the goal of improving company sales.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Organizing: After a plan is in place, a manager needs to organize her team and materials according to her plan. Assigning work and granting authority are two important elements of organizing. Staffing: After a manager discerns his area's needs, he may decide to beef up his staffing by recruiting, selecting, training, and developing employees. A manager in a large organization often works with the company's human resources department to accomplish this goal. Leading: A manager needs to do more than just plan, organize, and staff her team to achieve a goal. She must also lead. Leading involves motivating, communicating, guiding, and encouraging. It requires the manager to coach, assist, and problem solve with employees. Controlling: After the other elements are in place, a manager's job is not finished. He needs to continuously check results against goals and take any corrective actions necessary to make sure that his area's plans remain on track. All managers at all levels of every organization perform these functions, but the amount of time a manager spends on each one depends on both the level of management and the specific organization.

Roles performed by managers
A manager wears many hats. Not only is a manager a team leader, but he or she is also a planner, organizer, cheerleader, coach, problem solver, and decision maker — all rolled into one. And these are just a few of a manager's roles. In addition, managers' schedules are usually jam-packed. Whether they're busy with employee meetings, unexpected problems, or strategy sessions, managers often find little spare time on their calendars. (And that doesn't even include responding to e-mail!) In his classic book, The Nature of Managerial Work, Henry Mintzberg describes a set of ten roles that a manager fills. These roles fall into three categories:
• • •

Interpersonal: This role involves human interaction. Informational: This role involves the sharing and analyzing of information. Decisional: This role involves decision making.

Business and management educators are increasingly interested in helping people acquire technical, human, and conceptual skills, and develop specific competencies, or specialized skills that contribute to high performance in a management job. Following are some of the

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

skills and personal characteristics that the American Assembly of Collegiate Schools of Business (AACSB) is urging business schools to help their students develop.

Leadership — ability to influence others to perform tasks Self-objectivity — ability to evaluate yourself realistically Analytic thinking — ability to interpret and explain patterns in information Behavioral flexibility — ability to modify personal behavior to react objectively rather than subjectively to accomplish organizational goals Oral communication — ability to express ideas clearly in words Written communication — ability to express ideas clearly in writing Personal impact — ability to create a good impression and instill confidence Resistance to stress — ability to perform under stressful conditions Tolerance for uncertainty — ability to perform in ambiguous situations Role Activity Seek and receive information; scan periodicals and reports; maintain personal contact with stakeholders. Forward information to organization members via memos, reports, and phone calls. Transmit information to outsiders via reports, memos, and speeches. Perform ceremonial and symbolic duties, such as greeting visitors and signing legal documents. Direct and motivate subordinates; counsel and communicate with subordinates. Maintain information links both inside and organization via mail, phone calls, and meetings. outside

• •

Category

Informational Monitor Disseminator Spokesperson Interpersonal Figurehead Leader Liaison Decisional Entrepreneur

Initiate improvement projects; identify new ideas and

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

delegate idea responsibility to others. Disturbance handler Resource allocator Negotiator Take corrective action during disputes or crises; resolve conflicts among subordinates; adapt to environments. Decide who gets resources; prepare budgets; set schedules and determine priorities. Represent department during negotiations of union contracts, sales, purchases, and budgets.

Although all three categories contain skills essential for managers, their relative importance tends to vary by level of managerial responsibility. The Essentials of control activities are: Setting performance standards. Determining the yard-stick for measuring performance. Measuring the actual performance. Comparing actuals with the standard. Taking corrective actions, if actual do not match with standards.

Top Managers Middle Managers Lower-level Managers

Conceptual Skills Human Skills Technical Skills Importance

The Levels of Management Management can be classified into three levels. They are top management, middle management and supervisory or first-level management. The number of managerial jobs in an organization varies with the level of management.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Top management sets the goals of the organization, evaluates the overall performance of various departments involved in selection of key personnel and consults subordinate managers on subjects or problems of general scope. Middle level management is responsible for developing departmental goals and initiate actions that are required to achieve organizational objectives. Supervisory management takes charge of day-to-day operations at the floor level and is involved in preparing detailed short-range plans. THREE FACES OF A MANAGER The manger of a small team has three major roles to play: Planner A Manager has to take a long-term view; indeed, the higher you rise, the further you will have to look. While a team member will be working towards known and established goals, the manager must look further ahead so that these goals are selected wisely. By thinking about the eventual consequences of different plans, the manager selects the optimal plan for the team and implements it. By taking account of the needs not only of the next project but the project after that, the manager ensures that work is not repeated nor problems tackled too late, and that the necessary resources are allocated and arranged.

Provider The Manager has access to information and materials which the team needs. Often he/she has the authority or influence to acquire things which no one else in the team could. This role for the manager is important simply because no one else can do the job; there is some authority which the manager holds uniquely within the team, and the manager must exercise this to help the team to work. Protector The team needs security from the vagaries of less enlightened managers. In any company, there are short-term excitements which can deflect the work-force from the important issues. The manager should be there to guard against these and to protect the team. If a new project emerges which is to be given to your team, you are responsible for costing it (especially in terms of time) so that your team is not given an impossible deadline. If someone in your team brings forward a good plan, you must ensure that it receives a fair hearing and that your team knows and understands the outcome. If someone is in your team has a problem at work, you have to deal

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

with it. I believe anyone can be a good manager. It is as much trainable skill as it is inherent ability; as much science as art. Here are some things that make you a better manager: As a person:
• •

• • •

You have confidence in yourself and your abilities. You are happy with whom you are, but you are still learning and getting better. You are something of an extrovert. You don’t have to be the life of the party, but you can’t be a wallflower. Management is a people skill - it’s not the job for someone who doesn’t enjoy people. You are honest and straight forward. Your success depends heavily on the trust of others. You are an include not an excluder. You bring others into what you do. You don’t exclude other because they lack certain attributes. You have a ‘presence’. Managers must lead. Effective leaders have a quality about them that makes people notice when they enter a room.

On the job:
• • • • •

You are consistent, but not rigid; dependable, but can change your mind. You make decisions, but easily accept input from others. You are a little bit crazy. You think out-of-the box. You try new things and if they fail, you admit the mistake, but don’t apologize for having tried. You are not afraid to “do the math”. You make plans and schedules and work toward them. You are nimble and can change plans quickly, but you are not flighty. You see information as a tool to be used, not as power to be hoarded.

Organization
An organization is not a random group of people who come together by chance. They consciously and formally establish it to accomplish certain goals that its members would be unable to reach individually. A Manager’s job is to achieve high performance relative to the organization's objectives. For example, a business organization has objectives to (1) make a profit (2) furnish its customers with goods and services; (3) provide an income for its employees; and (4) increase the level of satisfaction for everyone involved. An organization is a social entity, which is goal orients and deliberately structured. Organizations are not functioning in isolated but are linked to external dynamic environment. Virtually all organization combines (1) Raw material, (2) Capital and (3) labor & knowledge to produce Goods and Services.

Components of Organization

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

1. Task 2. People 3. Structure 4. Technology 1. Task: This component can be defined as a mission or purpose of the existence of organization. Every organization is having a purpose of existence that is accomplished by producing certain goods and services as an output, which is termed as task. 2. People: The workforce or human part of organization that performs different operations in the organization. 3. Structure: Structure is the basic arrangement of people in the organization. 4. Technology: The intellectual and mechanical processes used by an organization to transform inputs into products or services.

The Challenges of today’s organization
Organizations are facing different challenges in today’s environment like: Technology Only 20 years ago, few workers used fax machines or e-mail, and computers occupied entire rooms, not desktops. Advances in information and communication technology have permanently altered the workplace by changing the way information is created, stored, used, and shared. Diverse Workforce

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

A diverse workforce refers to two or more groups, each of whose members are identifiable and distinguishable based on demographic or other characteristics like gender, age group, education etc. Several barriers in dealing with diversity include stereotyping, prejudice, ethnocentrism, discrimination, tokenism, and genderrole stereotypes. Multiple Stakeholders Stakeholders are those who have interests in the organization. Multiple stakeholders for an organization include the customers, suppliers, consumers, investors, lenders, etc. Responsiveness An organization has to be responsive to the challenges and threats that it faces from within the internal or external environment. It requires quick responsiveness to meet the challenges and opportunities arising out of these changes. Rapid Changes Due to changing internal and external environment, rapid changes in the organization occur. Organization has to be flexible to adjust to those changes. Globalization Managers are faced with a myriad of challenges due to an array of environmental factors when doing business abroad. These managers must effectively plan, organize, lead, control, and manage cultural differences to be successful globally.

The Changing Organization

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Organizational Behavior

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

OB is concerned specifically with the actions of people at work. Managers need to develop their interpersonal or people skills if they are going to be effective in their jobs. Organizational behavior (OB) is a field of study that investigates the impact that individuals, groups, and structure have on behavior within an organization, and then applies that knowledge to make organizations work more effectively. Specifically, OB focuses on how to improve productivity, reduce absenteeism and turnover, and increase employee citizenship and job satisfaction. We all hold generalizations about the behavior of people. Some of our generalizations may provide valid insights into human behavior, but many are erroneous. Organizational behavior uses systematic study to improve predictions of behavior that would be made from intuition alone. Yet, because people are different, we need to look at OB in a contingency framework, using situational variables to moderate cause-effect relationships. OB addresses some issues that are not obvious, such as informal elements. It offers both challenges and opportunities for managers. It recognizes differences and helps managers to see the value of workforce diversity and practices that may need to change when managing in different situation and countries. It can help improve quality and employee productivity by showing managers how to empower their people as well as how to design and implement change programs. It offers specific insights to improve a manager’s people skills. In times of rapid and ongoing change, faced by most managers today, OB can help managers cope in a world of “temporariness” and learn ways to stimulate innovation. Finally, OB can offer managers guidance in creating an ethically healthy work environment. Contribution of OB to effectiveness of Organization: Wouldn’t a Manager’s job be easier if he or she could explain and predict behavior? This is the focus of organizational behavior (OB), the study of the actions of people at work. The goal of OB is to explain and predict behavior of employees at work. OB focuses on both individual behavior and group behavior. Managers must understand behavior in both the formal and informal components of an organization. Managers are particularly concerned with three types of employee behaviors: productivity, absenteeism, and turnover. A fourth type of behavior, organizational citizenship, is emerging as a vital concern. Managers must also be attentive to employee attitudes. Attitudes are value statements, either favorable or unfavorable, concerning people, events, or objects. Attitudes of special interest to managers pertain to those related to job satisfaction, job involvement, and organizational commitment. Can you think of ways in which your personal attitudes (values) have impact on your behavior at work? Sometimes an individual experiences an inconsistency between two or more attitudes or between behavior and attitudes. Are happy workers productive workers? The answer to this question is not as simple as it might appear. Review the relationship between employee happiness and productivity and see what you think. Many researchers now believe that managers should direct their attention primarily to what might help employees become more productive. Five specific personality traits have proven most powerful in explaining individual behavior in organizations. These are locus of control, Machiavellians, self-esteem, self-monitoring, and risk propensity. Review these traits

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Organizational Behavior
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so you can be prepared to predict practical work-related behaviors. Sometimes different people will hear or witnesses the same situations yet interpret them differently. This happens because of differences in perception. Perception is the process of organizing and interpreting sensory impressions in order to give meaning to the environment. Managers need to recognize that employees react to perceptions, not to reality (if there is such a thing as “reality”). Thus, managers must pay close attention to how employees perceive both their jobs and management practices.

Organizations and human behavior

Variables Influencing the Individual Human Behaviors: In simple word behavior is the function of Person and Environment in which he/she is working. The following two factors mainly influence the individual behaviors… 1. The Persons 2. The Environment of the Organization The Persons No single measure of individual differences can provide a complete understanding of an individual or predict all the behaviors of an individual. It is therefore more useful to consider a variety of differences that explain aspects of employee behavior. These can be

• Skills & Abilities • Personality • Perceptions
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Organizational Behavior
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• Attitudes • Values • Ethics Skills & Abilities: Mental and physical capacities to perform various tasks. This comes from knowledge, learning, and experiences.

Research has shown five major dimensions to be consistent components of personality. The Big Five personality dimensions are conscientiousness, extroversion/introversion, and openness to experience, emotional stability, and agreeableness. Conscientiousness - defined as being reliable and dependable, being careful and organized, and being a person who plans - is the dimension most strongly correlated to job performance. Extroversion/introversion refers to the degree to which a person is sociable, talkative, assertive, active, and ambitious. Openness to experience is the degree to which someone is imaginative, broad-minded, curious, and seeks new experiences. Emotional stability is the degree to which someone is anxious, depressed, angry, and insecure. Agreeableness refers to the degree to which a person is courteous, likable, good-natured, and flexible. Managers must remember that the relevance of any personality dimension depends on the situation, the type of job, and the level at which a person is working.

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Four personality traits that have been consistently related to work-related behavior are locus of control, Type-A behavior, self-monitoring, and Machiavellianism. Locus of control indicates an individual's sense of control over his/her life, the environment, and external events. Those with an internal locus of control believe that their actions affect what happens to them, while those with an external locus of control believe that outside factors affect what happens to them. People who exhibit Type-A behavior try to do more in less and less time in an apparently tireless pursuit of everything. Type-A people feel great time urgency, are very competitive, try to do many things at once, and are hostile. Self-monitoring, the fourth personality trait is the degree to which people are capable of reading and using cues from the environment to determine their own behavior. Strong self-monitoring skills can help managers and employees read environmental and individual cues quickly and accurately and adjust behavior accordingly. People with elements of a Machiavellian personality put self-interest above the group's interests and manipulate others for personal gain. Perceptions: We use the mental process of perception to pay attention selectively to some stimuli and cues in our environment. There are two types of perception. Social perception process is the process of gathering, selecting, and interpreting information about how we view themselves and others. In contrast, physical perception focuses on gathering and interpreting information about physical objects rather than people. Closure permits us to interpret a stimulus by filling in missing information based on our experiences and assumption. Attitudes: Attitudes are comprised of feelings, beliefs, and behaviors. One important work-related attitude is job satisfaction, the general attitude that people have toward their jobs. Main five factors contribute to job satisfaction: pay; the job itself; promotion opportunities; the supervisor; and relations with co-workers. The relationship between job satisfaction and work performance is complex and influenced by multiple organizational and personal factors. Managers have more influence over job satisfaction than any other individual.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Values: Values are long-lasting beliefs about what is important, worthwhile, and desirable. A person's value system is the way he/she organizes and prioritizes values. Terminal values are goals for behavior or for a certain result that someone wants to achieve. Instrumental values are the means—the instruments—that people believe they should use to attain their goals. Cultural values can affect personal values ETHICS: A key work-related value is the employee's ethics. Those who hold a relativist's view of ethics believe that what is right or wrong depends on the situation or culture. Those with a Universalist’s view believe that ethical standards should be applied consistently in all situations and cultures. Value conflict occurs when there is disagreement among values that an individual holds or between individual and organizational values. To avoid value conflict, managers should work toward integrating and fitting the values of different employees with the values of the organization. The Environment Of Organization • Work group • Job • Personal life Inside the organization, the work group or the relationship between the group members can affect the individual behavior. Organizational culture can also have impact on the individual behavior. Cultural values indicate what a cultural group considers important, worthwhile, and desirable. People share the values of their culture, which form the basis for individual value systems composed of terminal values and instrumental values. A key work-related value is a person's ethics. Value systems affect ethical behavior in organizations. Managers must be most concerned with interpersonal and person-organization value conflicts. Interpersonal value conflicts occur when two or more people have opposing values, which can prevent coworkers from working together effectively. Person-organization value conflicts occur when someone's values conflict with the organization's culture, causing frustration and possibly disrupting personal performance. The factors that influence job satisfaction are pay; the job itself; promotion opportunities; supervisors; and coworkers. The link between job satisfaction and work performance is complex and influenced by multiple organizational and personal factors. The link appears to be stronger for professionals than for employees at higher organizational levels. The Basic OB Model The basic OB model suggests study of the organization at following three levels: 1. Organization 2. Group 3. Individual

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The purpose of understanding organizations from all three levels (individual, group, and organization) is to develop a well-rounded view that will prepare us for the challenges that managers face in today's business environment. Focusing on the individual level allows us to understand individual differences, perception, motivation, and learning. Focusing on the group level shows us how more than two people can work together in groups or teams within an organization. Focusing on the organization level allows us to see the effects of the organizational environment, technology, strategy, structure, and culture.

Organizational structure
Organizational structure refers to the division of labor as well as the patterns of coordination, communication, work flow, and formal power that direct organizational activities. All organizational structures divide labor into distinct tasks and coordinate that labor to accomplish common goals. The primary means of coordination are informal communication, formal hierarchy, and standardization. The four basic elements of organizational structure include span of control, centralization, formalization, and departmentalization. At one time, scholars suggested that firms should have a tall hierarchy with a narrow span of control. Today, most organizations have the opposite because they rely on informal communication and standardization, rather than direct supervision, to coordinate work processes. Centralization means that formal decision authority is held by a small group of people, typically senior executives. Many companies decentralize as they become larger and more

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complex because senior executives lack the necessary time and expertise to process all the decisions that significantly influence the business. Companies also tend to become more formalized over time because work activities become routinized. Formalization increases in larger firms because standardization works more efficiently than informal communications and direct supervision. A functional structure organizes employees around specific knowledge or other resources. This fosters greater specialization and improves direct supervision, but makes it more difficult for people to see the organization‟s larger picture or to coordinate across departments. A divisional structure groups employees around geographic areas, clients, or outputs. This structure accommodates growth and focuses employee attention on products or customers rather than tasks. However, this structure creates silos of knowledge and duplication of resources. The matrix structure combines two structures to leverage the benefits of both types of structure. However, this approach requires more coordination than functional or pure divisional structures, may dilute accountability, and increases conflict. Team-based structures are very flat with low formalization that organize self-directed teams around work processes rather than functional specialties. A network structure is an alliance of several organizations for the purpose of creating a product or serving a client. Virtual corporations are network structures that can quickly reorganize themselves to suit the client's requirements. The best organizational structure depends on the firm‟s size, technology, and environment. Generally, larger organizations are decentralized and more formalized, with greater job specialization and elaborate coordinating mechanisms. The work unit's technology--including variety of work and analyzability of problems---influences whether to adopt an organic or mechanistic structure. We need to consider whether the external environment is dynamic, complex, diverse, and hostile. Although size, technology, and environment influence the optimal organizational structure, these contingencies do not necessarily determine structure. Rather, organizational leaders formulate and implement strategies to define and manipulate their environments. These strategies, rather than the other contingencies, directly shape the organization's structure.

Organizational culture
Organizational culture is the basic pattern of shared assumptions, values, and beliefs that govern behavior within a particular organization. Assumptions are the shared mental models or theories-in-use that people rely on to guide their perceptions and behaviors. Beliefs represent the individuals perceptions of reality. Values are more stable, long-lasting beliefs about what is important. They help us define what is right or wrong, or good or bad, in the world. Culture content refers to the relative ordering of beliefs, values, and assumptions. Organizations have subcultures as well as the dominant culture. Some subcultures enhance the dominant culture, whereas countercultures have values that oppose the

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organization's core values. Subcultures maintain the organization's standards of performance and ethical behavior. They are also the source of emerging values that replace aging core values. Artifacts are the observable symbols and signs of an organization's culture. Four broad categories of artifacts include organizational stories and legends, rituals and ceremonies, language, physical structures and symbols. Understanding an organization‟s culture requires painstaking assessment of many artifacts because they are subtle and often ambiguous. Organizational culture has three main functions. It is a deeply embedded form of social control. It is also the “social glue” that bonds people together and makes them feel part of the organizational experience. Third, corporate culture helps employees make sense of the workplace. Companies with strong cultures are generally perform better than those with weak cultures, but only when the cultural content is appropriate for the organization's environment. Also, the culture should not be so strong that it drives out dissenting values which may form emerging values for the future. Organizations should have adaptive cultures so that employees focus on the need for change and support initiatives and leadership that keeps pace with these changes. Organizational culture relates to business ethics in two ways. First, corporate cultures can support ethical values of society, thereby reinforcing ethical conduct. Second, some cultures are so strong that they rob a person‟s individualism and discourage constructive controversy. Mergers should include a bicultural audit to diagnose the compatibility of the organizational cultures. The four main strategies for merging different corporate cultures are integration, deculturation, assimilation, and separation. Organizational culture is very difficult to change. However, this may be possible by creating an urgency for change and replacing artifacts that support the old culture with artifacts aligned more with the desired future culture. Organizational culture may be strengthened through the actions of founders and leaders, introducing culturally consistent rewards, maintaining a stable work force, managing the cultural network, and selecting and socializing employees. Organizational socialization is the process by which individuals learn the values, expected behaviors, and social knowledge necessary to assume their roles in the organization. It is a process of both learning about the work context and adjusting to new work roles, team norms, and behaviors. Employees typically pass through three socialization stages. Pre-employment socialization occurs before the first day and includes conflicts between the organization‟s and applicant‟s need to collect information and attract the other party. Encounter begins on the first day and typically involves adjusting to reality shock. Role management involves resolving worknonwork conflicts and settling in to the workplace. To manage the socialization process, organizations should introduce realistic job previews (RJPs) and recognize the value of socialization agents in the process. RJPs give job applicants a realistic balance of positive and

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negative information about the job and work context. Socialization agents provide information and social support during the socialization process.

Individual vs Group Behavior
After studying this chapter, you should be able to understand the concepts about… A. Individuals B. Groups C. Teams

A group is defined as two or more interacting and interdependent individuals who come together to achieve particular objectives. Types of Groups a. Formal groups are work groups established by the organization and have designated work assignments and established tasks. The behaviors in which one should engage are stipulated by and directed toward organizational goals. b. Informal groups are of a social nature and are natural formations. They tend to form around Friendships and common interests. Group Roles 1. The concept of roles applies to all employees in organizations and to their life outside the organization as well. 2. A role refers to a set of expected behavior patterns attributed to someone who occupies a given position in a social unit. 3. Individuals play multiple roles. 4. Employees attempt to determine what behaviors are expected of them. 5. An individual who is confronted by divergent role expectations experiences role conflict. 6. Employees in organizations often face such role conflicts. Characteristics of a well-functioning, effective group A group is considered effective if it is having following characteristics. 1. Relaxed, comfortable, informal atmosphere 2. Task to be performed are well understood & accepted 3. Members listen well & participate in given assignments 4. Clear assignments made & accepted 5. Group aware of its operation & function 6. People express feelings & ideas 7. Consensus decision making

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Motivation
Motivation refers to the forces within a person that affect his or her direction, intensity, and persistence of voluntary behavior in the workplace. As a new generation of employees enters the workplace and as globalization creates a more diverse workforce, companies need to rethink their motivational practices. Two motivation theories -- Maslow‟s needs hierarchy and Alderfer‟s ERG theory – propose how employee needs change over time through a needs hierarchy. Maslow‟s theory groups needs into a hierarchy of five levels and states that the lowest needs are initially most important, but higher needs become more important as the lower ones are satisfied. Alderfer‟s ERG theory groups needs into a hierarchy of three levels: existence, relatedness, and growth. It also suggests that those who are unable to satisfy a higher need become frustrated and regress back to the next lower need level. Both Maslow‟s and Alderfer‟s theories are popular, but many scholars are now doubtful that people have an inherent hierarchy of needs. Paul Lawrence and Nitkin Nohria proposed an evolutionary psychology theory involving four innate drives – the drive to acquire, bond, learn, and defend. These drives create emotional markers that indicate the relevance and strength of perceived information about our environments and thereby motivate us to act on those conditions. McClelland‟s learned needs theory argues that people have secondary needs or drives that are learned rather than instinctive, including need for achievement, need for power, and need for affiliation. The practical implications of needs-based motivation theories are that corporate leaders need to balance the demands and influences of the different innate drives. They must also recognize that different people have different needs at different times. These theories also warn us against relying too heavily on financial rewards as a source of employee motivation. Expectancy theory states that work effort is determined by the perception that effort will result in a particular level of performance (E-->P expectancy), the perception that a specific behavior or performance level will lead to specific outcomes (P-->O expectancy), and the valences that the person feels for those outcomes. The E-->P expectancy increases by improving the employee‟s ability and confidence to perform the job. The P-->O expectancy increases by measuring performance accurately, distributing higher rewards to better performers, and showing employees that rewards are performance-based. Outcome valences increase by finding out what employees want and using these resources as rewards. Goal setting is the process of motivating employees and clarifying their role perceptions by establishing performance objectives. Goals are more effective when they are specific, relevant, challenging, have employee commitment, and accompanied by meaningful feedback. Participative goal setting is important in some situations. Effective feedback is specific, relevant,

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

timely, credible, and sufficient frequent (which depends on the employee’s knowledge/experience with the task and the task cycle). Two increasingly popular forms of feedback are multisource (360-degree) assessment and executive coaching. Feedback from nonsocial sources is also beneficial. Organizational justice consists of distributive justice (perceived fairness in the outcomes we receive relative to our contributions and the outcomes and contributions of others) and procedural justice (fairness of the procedures used to decide the distribution of resources). Equity theory, which considers the most common principle applied in distributive justice, has four elements: outcome/input ratio, comparison other, equity evaluation, and consequences of inequity. The theory also explains what people are motivated to do when they feel inequitably treated. Equity sensitivity is a personal characteristic that explains why people react differently to varying degrees of inequity. Procedural justice is influenced by both structural rules and social rules. Structural rules represent the policies and practices that decision makers should follow; the most frequently identified is giving employees “voice” in the decision process. Social rules refer to standards of interpersonal conduct between employees and decision makers and are noted by showing respect and providing accountability for decisions. Procedural justice is as important as distributive justice, and influences organizational commitment, trust, and various withdrawal and aggression behaviors.

Leadership
Leadership is a complex concept that is defined as the ability to influence, motivates, and enables others to contribute toward the effectiveness and success of the organizations of which they are members. Leaders use influence to motivate followers, and arrange the work environment so that they do the job more effectively. Leaders exist throughout the organization, not just in the executive suite. The competency perspective tries to identify the characteristics of effective leaders. Recent writing suggests that leaders have emotional intelligence, integrity, drive, leadership motivation, self-confidence, above-average intelligence, and knowledge of the business. The behavioral perspective of leadership identified two clusters of leader behavior, people-oriented and task-oriented. People-oriented behaviors include showing mutual trust and respect for subordinates, demonstrating a genuine concern for their needs, and having a desire to look out for their welfare. Task-oriented behaviors include assigning employees to specific tasks, clarify their work duties and procedures, ensure that they follow company rules, and push them to reach their performance capacity.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

The contingency perspective of leadership takes the view that effective leaders diagnose the situation and adapt their style to fit that situation. The path-goal model is the prominent contingency theory that identifies four leadership styles – directive, supportive, participative, and achievement-oriented -- and several contingencies relating to the characteristics of the employee and of the situation. Two other contingency leadership theories include the situational leadership model and Fiedler‟s contingency theory. Research support is quite weak for both theories. However, a lasting element of Fiedler‟s theory is the idea that leaders have natural styles and, consequently, companies need to change the leader‟s environment to suit their style. Leadership substitutes identifies contingencies that either limit the leader‟s ability to influence subordinates or make that particular leadership style unnecessary. This idea will become more important as organizations remove supervisors and shift toward team-based structures. Transformational leaders create a strategic vision, communicate that vision through framing and use of metaphors, model the vision by „walking the talk‟ and acting consistently, and build commitment toward the vision. This contrasts with transactional leadership, which involves linking job performance to valued rewards and ensuring that employees have the resources needed to get the job done. The contingency and behavioral perspectives adopt the transactional view of leadership. According to the implicit leadership perspective, people inflate the importance of leadership through attribution, stereotyping, and fundamental needs for human control. Implicit leadership theory is evident across cultures because cultural values shape the behaviors that followers expect of their leaders. Cultural values also influence the leader‟s personal values which, in turn, influence his or her leadership practices. The GLOBE Project data reveal that there are similarities and differences in the concept and preferred practice of leadership across cultures. Women generally do not differ from men in the degree of people-oriented or taskoriented leadership. However, female leaders more often adopt a participative style. Research also suggests that people evaluate female leaders based on gender stereotypes, which may result in higher or lower ratings.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Money and other financial rewards
Money and other financial rewards are a fundamental part of the employment relationship. They potentially fulfill existence, relatedness, and growth needs. Money generates various emotions and attitudes, which vary across cultures. People (particularly men) also tend to identify themselves in terms of their wealth. Organizations reward employees for their membership and seniority, job status, competencies, and performance. Membership-based rewards may attract job applicants and seniority-based rewards reduce turnover, but these reward objectives tend to discourage turnover among those with the lowest performance. Rewards based on job status try to maintain internal equity and motivate employees to compete for promotions. However, job status-based rewards are inconsistent with market-responsiveness, encourage employees to compete with each other, and can lead to organizational politics. Competency-based rewards are becoming increasingly popular because they improve workforce flexibility and are consistent with the emerging idea of employability. But competency-based rewards tend to be subjectively measured and can result in higher costs as employees spend more time learning new skills. Awards/bonuses, commissions, and other individual performance-based rewards have existed for centuries and are widely used. Many companies are shifting to team-based rewards such as gainsharing plans, and to organizational rewards such as employee stock ownership plans (ESOPs), stock options, profit sharing, and balanced scorecards. ESOPs and stock options create a ownership culture, but employees often perceive a weak connection between individual performance and the organizational reward. Financial rewards have a number of limitations, but there are several ways to improve reward effectiveness. Organizational leaders should ensure that rewards are linked to work performance, rewards are aligned with performance within the employee‟s control, team rewards are used where jobs are interdependent, rewards are valued by employees, and rewards do not have unintended consequences. Job design refers to the process of assigning tasks to a job, including the interdependency of those tasks with other jobs. Job specialization subdivides work into separate jobs for different people. This increases work efficiency because employees master the tasks quickly, spend less time changing tasks, require less training, and can be matched more closely with the jobs best suited to their skills. However, job specialization may reduce work motivation, create mental health problems, lower product or service quality, and increase costs through discontentment pay, absenteeism, and turnover.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Stress
Stress is an adaptive response to a situation that is perceived as challenging or threatening to the person‟s well-being. Distress represents high stress levels that have negative consequences, whereas eustress represents the moderately low stress levels needed to activate people. The stress experience, called the general adaptation syndrome, involves moving through three stages: alarm, resistance, and exhaustion. The stress model shows that stress is caused by stressors. However, the effect of these stressors depends on individual characteristics. Stress affects a person‟s physiological and psychological well-being, and is associated with several work-related behaviors. Stressors are the causes of stress and include any environmental conditions that place a physical or emotional demand on the person. Stressors are found in the physical work environment, the employee’s various life roles, interpersonal relations, and organizational activities and conditions. Conflicts between work and network obligations represent a frequent source of employee stress. Two people exposed to the same stressor may experience different stress levels because they perceive the situation differently, they have different threshold stress levels, or they use different coping strategies. Workaholics and employees with Type A behavior patterns tend to experience more stress than do other employees. High levels or prolonged stress can cause physiological symptoms, such as high blood pressure, ulcers, sexual dysfunction, headaches, and coronary heart disease. Behavioral symptoms of stress include lower job performance, poorer decisions, more workplace accidents, higher absenteeism, and more workplace aggression. Psychologically, stress reduces job satisfaction and increases moodiness, depression, and job burnout. Job burnout refers to the process of emotional exhaustion, cynicism, and reduced efficacy resulting from prolonged exposure to stress. It is mainly due to interpersonal and role-related stressors and is most common in helping occupations. Many interventions are available to manage work-related stress. Some directly remove unnecessary stressors or remove employees from the stressful environment. Others help employees alter their interpretation of the environment so that it is not viewed as a serious stressor. Wellness programs encourage employees to build better physical defenses against stress experiences. Social support provides emotional, informational, and material resource support to buffer the stress experience.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Conflict
Conflict is the process in which one party perceives that its interests are being opposed or negatively affected by another party. The conflict process begins with the sources of conflict. These sources lead one or both sides to perceive a conflict and to experience conflict emotions. This, in turn, produces manifest conflict, such as behaviors toward the other side. When conflict is constructive, the parties view the conflict experience as something separate from them. Disputes are much more difficult to resolve when they produce socioemotional conflict, where the parties perceive each other as the problem. The conflict process often escalates through a series of episodes and shifts from constructive to socioemotional. Conflict management maximizes the benefits and minimizes the dysfunctional consequences of conflict. Conflict is beneficial in the form of constructive controversy because it makes people think more fully about issues. Positive conflict also increases team cohesiveness when conflict is with another group. The main problems with conflict are that it may lead to job stress, dissatisfaction, and turnover. Dysfunctional intergroup conflict may undermine decision making. Conflict tends to increase when people have incompatible goals, differentiation (different values and beliefs), interdependent tasks, scarce resources, ambiguous rules, and problems communicating with each other. Conflict is more common in a multicultural work force because of greater differentiation and communication problems among employees. People with a win-win orientation believe the parties will find a mutually beneficial solution to their disagreement. Those with a win-lose orientation adopt the belief that the parties are drawing from a fixed pie. The latter tends to escalate conflict. Among the five interpersonal conflict management styles, only problem solving represents a purely win-win orientation. The four other styles -- avoiding, forcing, yielding, and compromising -- adopt some variation of a win-lose orientation. Women and people with high collectivism tend to use a problem solving or avoidance style more than men and people with high individualism. Structural approaches to conflict management include emphasizing superordinate goals, reducing differentiation, improving communication and understanding, reducing task interdependence, increasing resources, and clarifying rules and procedures. These elements can also be altered to stimulate conflict.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Negotiation occurs whenever two or more conflicting parties attempt to resolve their divergent goals by redefining the terms of their interdependence. Negotiations are influenced by several situational factors, including location, physical setting, time passage and deadlines, and audience. Important negotiator behaviors include preparation and goal setting, gathering information, communicating effectively, and making concessions. Third-party conflict resolution is any attempt by a relatively neutral person to help the parties resolve their differences. The three main forms of third-party dispute resolution are mediation, arbitration, and inquisition. Managers tend to use an inquisition approach, although mediation and arbitration are more appropriate, depending on the situation. Alternative dispute resolution applies mediation, but may also involve negotiation and eventually arbitration.

Communication
Communication refers to the process by which information is transmitted and understood between two or more people. Communication supports work coordination, employee well-being, knowledge management, and decision making,. The communication process involves forming, encoding, and transmitting the intended message to a receiver, who then decodes the message and provides feedback to the sender. Effective communication occurs when the sender‟s thoughts are transmitted to and understood by the intended receiver. Electronic mail (e-mail) is an increasingly popular way to communicate, and it has changed communication patterns in organizational settings. However, e-mail also contributes to information overload, is an ineffective channel for communicating emotions, tends to reduce politeness and respect in the communication process, and lacks the warmth of human interaction. Instant messaging is gaining popularity in organizations because it speeds up the communication process. Nonverbal communication includes facial gestures, voice intonation, physical distance, and even silence. Employees make extensive use of nonverbal cues when engaging in emotional labor because these cues help to transmit prescribed feelings to customers, co-workers, and others. Emotional contagion refers to the automatic and unconscious tendency to mimic and synchronize our nonverbal behaviors with other people. The most appropriate communication medium depends on its data-carrying capacity (media richness) and its symbolic meaning to the receiver. Nonroutine and ambiguous situations require rich media. Several barriers create noise in the communication process. People misinterpret messages because of perceptual biases. Some information is filtered out as it gets passed up the hierarchy. Jargon and ambiguous language are barriers when the sender and receiver have different interpretations of the words and symbols used. People also screen out or misinterpret messages due to information overload.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Globalization and workforce diversity have brought new communication challenges. Words are easily misunderstood in verbal communication and employees are reluctant to communicate across cultures. Voice intonation, silence, and other nonverbal cues have different meaning and importance in other cultures. There are also some communication differences between men and women, such as the tendency for men to exert status and engage in report talk in conversations, whereas women use more rapport talk and are more sensitive than are men to nonverbal cues. To get a message across, the sender must learn to empathize with the receiver, repeat the message, choose an appropriate time for the conversation, and be descriptive rather than evaluative. Listening includes sensing, evaluating, and responding. Active listeners support these processes by postponing evaluation, avoiding interruptions, maintaining interest, empathizing, organizing information, showing interest, and clarifying the message. Some companies try to encourage informal communication through workspace design, although open offices run the risk of increasing stress and reducing the ability to concentrate on work. Many organizations also rely on a combination of print newsletters and intranet-based ezines to communicate corporate news. Employee surveys are widely used to measure employee attitudes or involve employees in corporate decisions. Some executives also meet directly with employees, either through management by walking around or other arrangements, to facilitate communication across the organization. In any organization, employees rely on the grapevine, particularly during times of uncertainty. The grapevine is an unstructured and informal network founded on social relationships rather than organizational charts or job descriptions. Although early research identified several unique features of the grapevine, some of these features may be changing as the Internet plays an increasing role in grapevine communication.

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Organizational Behavior
Barhate Mangesh Roll No- PG/509/MBA (I)/2009J

Wrapping Up
Organizational Behavior is an important concept for any organization, since it deals with the three determinants of behavior in organizations: Individuals, Groups and Structure. Organizational Behavior then applies the knowledge gained about individuals, groups and the effect of structure on behavior in order to make organizations work more effectively. In a nut shell, OB is concerned with the study of what people do in an organization and how their behavior affects the organizations performance. Seeing as OB is concerned with employee related situations, it tends to emphasize behavior related to jobs, work, absenteeism, employment turnover, human performance and management. The organization's base rests on management's philosophy, values, vision and goals. This in turn drives the organizational culture which is composed of the formal organization, informal organization, and the social environment. The culture determines the type of leadership, communication, and group dynamics within the organization. The workers perceive this as the quality of work life which directs their degree of motivation. The final outcomes are performance, individual satisfaction, and personal growth and development. All these elements combine to build the model or framework that the organization operates from.

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