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Chapter 1: Introduction to Organizational Behaviour

Introduction to Organizational
Meaning and Definition
Significance of OB
Scope of OB

Meaning of Organisational Behaviour

Organisation: It is an official group of people.
Behave: The way that you behave is the way that you do and say things, and the things
that you do and say.
Behaviour: Peoples or animals behaviour is the way that they behave.
Organisational behaviour can be defined as the understanding, prediction, and
management of human behaviour.
Organizational behaviour represents the human side of management, not the whole
Organizational Behaviour is a field of study that investigates the impact that
individuals, groups, and structure have on behavior within organizations, for the
purpose of applying such knowledge toward improving an organizations effectiveness.
OB is a field of study : It is a distinct area of expertise with a common body of
What does it study?
It studies three determinants of behaviour in an organization: individual, group, and
OB applies the knowledge gained, about individuals, groups, and the effect of structure
on behaviour in order to make organizations work more effectively.
OB is concerned with what people do in an organization and how that behaviour
affects the performance of the organization.
Contributing Disciplines to the OB Field

OB is an applied behavioural science that is built upon contributions from a number of

behavioural disciplines.

Psychology: The science that seeks to measure, explain, and sometimes change
behaviour of humans and other animals.



The study of people in relations to their fellow human beings.

Social Psychology: An area within psychology that blends concepts from

psychology and sociology and that focuses on the influence of
people on one another.

Anthropology: The study of societies to learn about human beings and their

Political Science : The study of the behaviour of individuals and groups within a
political environment

Significance of OB
People are truly the competitive advantage of an organization.
The basic premise and assumptions of the field of organizational behaviour in general are
that managing the people- the human resources of an organization- have been, are, and
will continue to be the major challenge and critical competitive advantage.
People are the key.
- Sam Walton ( founder of Wal Mart)
The inventory, the value of my company, walks out the door every evening.
- Bill Gates
The technology can be purchased and copied; it levels the playing field. The people, on
the other hand, cannot be copied. Although human bodies can be cloned in the future,
their ideas, personalities, motivation, and organizational cultural values cannot be copied.

The human resource of an organization and how they are managed represents the
competitive advantage of todays and tomorrows organization and are becoming widely
recognized as human capital.
Management is generally considered to have three major dimensions:
i. Technical (The ability to apply specialized knowledge or expertise.),
Conceptual (The mental ability to analyze and diagnose complex situations.),
iii. Human (The ability to work with, understand, and motivate other people, both
individually and in groups.)
Human behaviour at the workplace is very complicated and diverse. The new perspective
assumes that employees are extremely complex and that there is a need for theoretical
understanding backed by rigorous empirical research before applications can be made for
managing people effectively.
Scope of OB
OB is a field of study that investigates the impact that individuals, groups, and structure
have on behaviour 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 job satisfaction.
OB uses systematic study to improve predictions of behaviour that would be made from
institutions alone. But because people are different, one needs to look at OB in a
contingency framework, using situational variables to moderate cause-effect relations.
OB offers both challenges and opportunities for managers. It recognizes differences and
helps managers to see the workforce diversity and practices that may need to be changed
when managing in different countries.
OB 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.
OB offers specific insights to improve a managers people skills.
OB can help managers learn to cope in a world of temporariness and to manage a
workforce that has undergone the trauma of downsizing.
OB can offer managers guidance in creating an ethically healthy work climate.